BlackRock Asked to Divest of Chinese Companies in Response to Coronavirus, Human Rights Abuses

WASHINGTON, May 13, 2020 /PRNewswire/ -- In a letter to BlackRock Chairman and CEO Larry Fink, the National Legal and Policy Center (NLPC) asked the firm to divest its customer's money from the 137 Chinese companies currently listed on American stock exchanges.

Of the 137, eleven are at least 30% owned by the Chinese government and all are "under the influence and ultimate control of the Communist Party of China."

BlackRock, the world's largest investment manager, recently divested itself of certain companies producing thermal coal in response to demands by anti-fossil fuel activists. In the letter, NLPC Chairman Peter Flaherty cited this "precedent" and argued that Chinese companies "that manufacture equipment for Xi's surveillance state or that are dominated by the People's Liberation Army raise even bigger ethical questions."

"China is the world's worst human rights abuser and greatest threat to world peace through its military buildup and increasingly imperial ambitions," Flaherty writes.

"Some investment managers argue that factors like human rights should not be considered in investment decisions because they have a fiduciary duty to investors to obtain the best possible return. Of course, you have specifically rejected this argument by applying a host of ESG litmus tests to BlackRock's investments."

"In light of your self-appointment as moral arbiter for corporate America, you cannot now pick and choose which moral imperatives you will honor and which you will ignore. Unless BlackRock divests from Chinese companies, your 'leadership' will amount to empty virtue-signaling."

The letter specifies China's response to COVID-19 allowing for its worldwide spread, its attempts to blame the virus on the United States, the brutal suppression of dissent in Hong Kong, the confinement of more than one million Uyghurs to detention camps, the building of a "surveillance state," and its macabre organ harvesting program.

NLPC also cited the risks to American investors who entrust their savings and retirement funds to BlackRock, pointing out that "Chinese companies in which you invest your customer's money are opaque. They do not submit to Public Company Accounting Oversight Board audit standards. They are not compliant with Dodd-Frank."

"Moreover, American retail investors have been repeatedly burned when U.S.-listed Chinese firms have been taken private at lower valuations and relisted on foreign exchanges."

http://www.nlpc.org

SOURCE NLPC