World's largest asset manager puts climate at the centre of investing

The world's largest asset manager, BlackRock, declared this January that climate change would fundamentally reshape finance and that sustainability would henceforth be central to how it invests the trillions of dollars in its care — a watershed moment that signalled the mainstreaming of climate concerns in global finance.

In an influential annual letter, the firm's chief executive argued that climate risk had become investment risk, and that the world was "on the edge of a fundamental reshaping of finance" as investors, companies and governments reckoned with the implications of a warming planet. He warned that a significant reallocation of capital was coming.

The firm announced a series of measures, including exiting some investments tied to thermal coal, expanding its range of sustainable funds, and pressing the companies it owns for better disclosure of climate risks, with a warning that it would be increasingly willing to vote against management that failed to act.

Because of BlackRock's enormous size and influence, its stance carried weight far beyond its own portfolios, pushing climate considerations higher on the agenda across the financial industry and in corporate boardrooms.

The move drew both praise and scepticism — welcomed by many as a sign that the financial establishment was finally taking climate seriously, and dismissed by some critics as insufficient given the firm's continued vast holdings in fossil fuels. Either way, it marked a notable shift, as the logic of climate risk moved from the margins to the heart of mainstream investing.