Blackrock appoints head of Saudi Arabian oil company to board amid investment dispute

Amin Nasser is the CEO of Saudi Aramco, a $2 trillion oil company that campaigners describe as «the world's largest corporate source of greenhouse gases» . : REUTERS/Hasnoor Hussain

Blackrock has appointed the head of a Saudi Arabian oil company to its board of directors in its latest explicit departure from the focus on «environmental, social and awakened criticism.

Amin Nasser, chief executive of Saudi Aramco, the world's largest oil company, became the director of the world's largest management company.

Blackrock said the decision reflects the importance of the Middle East to its business and, under Nasser's leadership, Aramco has become «a leader in the global energy transition.»

But the move came after Larry Fink, chief executive Blackrock has faced backlash for bringing so-called ESG issues to the fore. center of Blackrock's approach to the markets.

In his widely circulated 2020 letters to clients and executives, Mr. Fink stated that “climate risk is an investment risk” and that “sustainability must be our new investment standard.”

He has since backed down and yet recognized companies “cannot be the climate police.”

Mr. Fink also made no mention of ESG at all in his letters this year amid an ongoing dispute with Republican politicians in the US who have accused Blackrock of woke up the ideology before the investor returned.

Last year, Florida, the state run by Republican presidential candidate Ron DeSantis, said it was withdrawing $2 billion of state assets from BlackRock funds and turning them over to rival money managers in protest.

Blackrock CEO Larry Fink acknowledged that companies «can't be the climate police»; Photo: Thos Robinson/Getty Images

Against this backdrop, Mr. Nasser's appointment to BlackRock is likely to raise eyebrows in some circles.

Mr. Fink said: “Amin's distinguished career spanning over four decades at Aramco gives him a unique perspective on many of the key issues facing our firm and our clients.

“His leadership experience, understanding of the global energy the industry and drivers of the low-carbon transition, as well as his knowledge of the Middle East region, will make a meaningful contribution to the BlackRock Board dialogue.”

Supporters of the Friends of the Earth climate campaign call Aramco «the world's largest corporate emitter of greenhouse gases.» It has been responsible for more than 4% of the world's carbon emissions since 1965.

The company has annual sales of over $300 billion and is valued at about $2 trillion on the stock market.

It has been accused in the past of greenwashed by advertising campaigns in the UK that claimed the company was «providing a more sustainable future», despite being the world's largest oil producer, with a daily production of almost 13 million barrels of oil equivalent per day and reserves of about 200 billion barrels.

BlackRock said Mr. Nasser helped make Aramco a leader in global energy. transition by “investing in cutting-edge technologies to address the balance of energy security and sustainability” and setting the “ambition” to achieve net zero carbon emissions 1 and 2 by 2050.

This target excludes Scope 3 emissions – or emissions caused by the burning of Aramco products by third parties – which account for 90% of Aramco's emissions.