BlackRock and Tennessee Settle Lawsuit Over ESG Investment Practices

The settlement includes increased transparency, compliance measures, and investor protections but does not admit wrongdoing by BlackRock.

Tennessee filed the lawsuit in December 2023, alleging BlackRock misled consumers about the role of ESG factors in its investment strategies.
The settlement requires BlackRock to enhance transparency, undergo third-party audits, and align investor communications with established fiduciary duties.
BlackRock has committed to prioritizing financial interests in funds without explicit ESG objectives and improving disclosures on proxy voting.
The agreement does not impose penalties, fines, or admissions of wrongdoing on BlackRock’s part.
Tennessee retains the right to refile the lawsuit if BlackRock fails to comply with the settlement terms.