U.S. markets closed

Should the New York Stock Exchange try to slow climate change?

John Detrixhe

BlackRock, the world’s biggest asset manager, is under pressure from activists to block funding for companies that contribute to climate change. Protestors have also taken aim at the New York Stock Exchange, the world’s largest by market capitalization of the firms listed there. Should these financial titans that serve as conduits between investors and companies be the ones to decide who gets funding?

NYSE president Stacey Cunningham says it’s up to investors.

“Investors should have the right to choose,” Cunningham said during a panel discussion today at the World Economic Forum in Davos, Switzerland. “It’s a really slippery slope if we start to decide for them what opportunities they should have access to.”

In some ways, BlackRock and NYSE are in similar positions. They don’t necessarily decide whether money flows into companies that extract oil or coal, or into firms that don’t recruit a diverse suite of executives and board members. But they do enable money to pour into all sorts of companies, and that is an increasingly controversial proposition.

BlackRock doesn’t own the $7.4 trillion in assets (pdf) it manages; the money is allocated and directed by individuals and outside professional investors. The asset manager creates index and exchange-traded funds, as well as actively managed funds, and investors decide which ones to put their money in. NYSE, meanwhile, lists stocks on its exchange, and investors decide which of them to buy or sell.

That said, it’s not like anything goes. NYSE has thresholds for a company to qualify for stock listing (pdf): among other things, a firm must have certain number of shareholders and a minimum market capitalization. Environmental and social criteria aren’t among the requirements. Cunningham says NYSE, owned by Atlanta-based Intercontinental Exchange, has made it easier for investors to make decisions about the environmental, social, and corporate governance credentials of listed companies. “We provide data, we calculate a lot of metrics around ESG issues,” she said.

Last week, BlackRock chief Larry Fink wrote letters to CEOs and clients that focused on sustainability. He said climate change is a crucial for determining companies’ prospects in the long term, and that BlackRock is improving sustainability disclosures for shareholders, while making sustainability a standard offering for investors. Ultimately, though, the choice is the clients’ to make, according to the company’s website: “The investments we make on their behalf will always represent their preferences, timelines and objectives.”

Goldman Sachs CEO David Solomon was asked a similar question during the Davos panel: would the investment bank turn down a client because of these issues? Solomon said the company, in its roles as an investor, advisor, and financier, thinks about “the reputational association of being involved with certain businesses.” But he sidestepped the bigger question about whether Goldman would work with certain energy companies, or with firms that that don’t make diversity a priority.

“You’re looking for a line? There’s not a line,” he said. “There’s a transition going on, where people are thinking differently about how they want to direct capital to try to promote sustainability.”

He added that it will be “a multi-decade transition” in the way investors allocate capital. The activists taking aim at his and other financial firms that facilitate fundraising won’t be willing to wait that long.

 

Sign up for the Quartz Daily Brief, our free daily newsletter with the world’s most important and interesting news.

More stories from Quartz:

  • Dow 15,000 very likely as coronavirus pandemic hits U.S. economy: strategist
    World
    Yahoo Finance

    Dow 15,000 very likely as coronavirus pandemic hits U.S. economy: strategist

    He thinks the economy could begin to show signs of life in the fourth quarter of this year — but until that starts to show up somewhere in the markets or economic data, he prefers putting on trades that profit from extreme volatility and downside. Yahoo Finance highlights a call such as this because, well, McDonald has been dead right so far. Moreover, April has lived up to its billing in the early going as potentially lethal to stocks because of dreadful economic data nobody on Wall Street has ever seen before.

  • Warren Buffett Dumps Delta Air Lines, Southwest Airlines As Coronavirus Pandemic Slams Industry
    Business
    Investor's Business Daily

    Warren Buffett Dumps Delta Air Lines, Southwest Airlines As Coronavirus Pandemic Slams Industry

    Warren Buffett's Berkshire Hathaway has sold off millions of shares of Delta Air Lines and Southwest Airlines over the past few days, regulatory filings showed on Friday. That sent Delta stock, Southwest stock and other airline stocks lower after hours. Delta stock was down 9% in the stock market Friday.

  • He nailed the March coronavirus selloff — now he says there’s another 30% to go before the stock market hits bottom
    Business
    MarketWatch

    He nailed the March coronavirus selloff — now he says there’s another 30% to go before the stock market hits bottom

    Hedge-fund manager Dan Niles, in a note cited by Yahoo Finance this week, warned his clients way back in February that he was getting “increasingly worried” investors weren't ready for the impact the spread of the coronavirus could have on the U.S. economy. While the Dow Jones Industrial Average (DJIA)posted its worst first quarter ever, his Satori Fund closed in positive territory.

  • Goldman Sachs: These 3 Stocks Are Poised to Surge by at Least 35%
    Business
    TipRanks

    Goldman Sachs: These 3 Stocks Are Poised to Surge by at Least 35%

    Investment bank Goldman Sachs has been analyzing the market performance, and has a mixed outlook for the year – not necessarily bad news for the long term, but an acknowledgement that we're not completely certain what the economic cycle has in store. David Kostin, Goldman Sachs' chief U.S. equity strategist, predicts that the market has not found its true bottom yet, and has to meet three conditions before it can. Kostin notes that the current peak-to-trough time, of just 23 trading days, is an order of magnitude faster than the median – which stands at 17 months.

  • Co-founder of George Soros’s legendary Quantum Fund warns of the ‘worst bear market of my lifetime’
    Business
    MarketWatch

    Co-founder of George Soros’s legendary Quantum Fund warns of the ‘worst bear market of my lifetime’

    Jim Rogers has been sounding the bear alarm for a while, and now that the market finally seems to be cooperating, the Rogers Holdings chairman is turning up the volume. I expect in the next couple of years we're going to have the worst bear market in my lifetime,” he told Bloomberg in the wake of the worst first-quarter loss in the Dow's history. Why so glum?

  • U.S. dairy farmers dump milk as pandemic upends food markets
    Business
    Reuters

    U.S. dairy farmers dump milk as pandemic upends food markets

    Despite strong demand for basic foods like dairy products amid the coronavirus pandemic, the milk supply chain has seen a host of disruptions that are preventing dairy farmers from getting their products to market. Mass closures of restaurants and schools have forced a sudden shift from those wholesale food-service markets to retail grocery stores, creating logistical and packaging nightmares for plants processing milk, butter and cheese. Trucking companies that haul dairy products are scrambling to get enough drivers as some who fear the virus have stopped working.

  • Business
    TheStreet.com

    Depression Ahead: Cramer's 'Mad Money' Recap (Friday 4/3/20)

    Newlands said that when times get tough, consumers turn to brands they trust, and Constellation has many of the brands that consumers prefer. He said there has been a sizable channel shift in recent weeks, as consumers switch from drinking at restaurants, which are now closed, to taking their beer and wine home. When asked about inventory levels, Newlands said they have about 70 days of inventory on hand, but in many parts of the country, alcohol is considered essential, so their factories continue to operate and distribution remains strong.

  • 20 technology stocks with low debt to consider owning in a down market
    Business
    MarketWatch

    20 technology stocks with low debt to consider owning in a down market

    a href="https://www.marketwatch.com/story/20-technology-stocks-with-low-debt-to-consider-owning-in-a-down-market-2020-04-02? siteid=yhoof2" (FTNT) 2.2% -16% -6% 52% 12/31/2019 Computer Communications IPG Photonics Corp.

  • MD Gov. confirms Kennedy family members missing
    U.S.
    Associated Press Videos

    MD Gov. confirms Kennedy family members missing

    Maryland Gov. Larry Hogan says that rescuers are searching for two missing boaters - the daughter and grandson of former Maryland Lt. Gov. Kathleen Kennedy Townsend - after their canoe was found in Chesapeake Bay. (April 3)

  • Market bottom or ‘very tough times ahead’? Here’s what one chart watcher is keeping his eye on
    Business
    MarketWatch

    Market bottom or ‘very tough times ahead’? Here’s what one chart watcher is keeping his eye on

    Investors say there's no one chart that will signal when the stock-market bottom is in. In a Friday blog post, the founder of Kimble Charting Solutions pointed to the chart above for the Thomson Reuters Equally Weighted Commodities Index, which he said “will go miles and miles towards telling us if we are headed towards very tough times or if the huge declines of late are actually in a bottoming process.” The index tracks a basket of 17 commodities, including cocoa, coffee, copper, corn, soybeans, cotton, crude oil, gold, heating oil, lean hogs, live cattle, natural gas, platinum, silver, soybean oil, sugar and wheat.

  • Coronavirus stimulus checks: When to expect up to $1,200, what you need to do, and more
    Business
    Yahoo Money

    Coronavirus stimulus checks: When to expect up to $1,200, what you need to do, and more

    Many Americans will get government checks up to $1,200 to help them financially weather job loss, reduced work hours, and other money challenges as the country tries to stem the spread of the coronavirus outbreak. When will the stimulus check arrive? Treasury Secretary Steven Mnuchin said at a White House briefing on Thursday, that those Americans who have signed up for direct deposit will receive their payment within two weeks.

  • Coronavirus update: 1.14 million cases, 60,887 deaths as Cuomo thanks Chinese businessmen for ventilators
    Business
    MarketWatch

    Coronavirus update: 1.14 million cases, 60,887 deaths as Cuomo thanks Chinese businessmen for ventilators

    Communities around the world reeled Saturday as the economic damage and human cost of the COVID-19 pandemic climbed. More than 1.1 million people worldwide have been infected with the disease, the Wall Street Journal reported. On Wall Street, stocks closed sharply lower for the week on Friday after a report from the Labor Department confirmed 701,000 jobs had been lost in March, far more than expected and a sign that the economy was taking a bruising from the pandemic much earlier than was assumed.

  • Tesla stocks surges due to strong vehicle delivery numbers in Q1
    Business
    Yahoo Finance Video

    Tesla stocks surges due to strong vehicle delivery numbers in Q1

    Tesla shares are up nearly 17% after the automotive company announced that it delivered roughly 88,000 cars in the first quarter of 2020. Yahoo Finance's On The Move panel discusses.

  • ‘Quiet’ Warren Buffett has three ways to win in this market
    Business
    MarketWatch

    ‘Quiet’ Warren Buffett has three ways to win in this market

    At times like this it must be a relief to have some of your retirement portfolio managed by Warren Buffett. Granted, Buffett and Berkshire Hathaway Vice Chairman Charlie Munger aren't the spring chickens they were during the dot-com crash or the global financial crisis, when they were spry youngsters in their 70s and early 80s. The company press office says Buffett is not planning to speak in public before May.

  • The Most Profitable Trade: ‘Oil All Over the Oceans Right Now’
    Business
    Bloomberg

    The Most Profitable Trade: ‘Oil All Over the Oceans Right Now’

    With oil demand in freefall, traders are resorting like never before to using the world's fleet of supertankers as temporary floating storage facilities, filling them with millions of unsold barrels until better times. It's an unusual trade, but one that's among the most lucrative around right now, just when everyone on Wall Street struggles to make money. From the coast of Singapore to the North Sea, the tankers are starting to slow down, ready to drop their anchors, holding crude the world economy doesn't need as fuel demand plummets due to the coronavirus outbreak.

  • Introducing Chesapeake Energy (NYSE:CHK), The Stock That Collapsed 99%
    Business
    Simply Wall St.

    Introducing Chesapeake Energy (NYSE:CHK), The Stock That Collapsed 99%

    For example, we sympathize with anyone who was caught holding Chesapeake Energy Corporation (NYSE:CHK) during the five years that saw its share price drop a whopping 99%. Shareholders have had an even rougher run lately, with the share price down 81% in the last 90 days. Given that Chesapeake Energy didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development.

  • He talked to Trump last week — now this billionaire investor is warning about taking ‘undue risk’ in the market
    Business
    MarketWatch

    He talked to Trump last week — now this billionaire investor is warning about taking ‘undue risk’ in the market

    Cohen also said his $16 billion firm has effectively managed risk so far this year with performance that is “essentially flat” despite the gutting market downturn. The note follows a conference call with President Trump last week that, according to Reuters, focused on the U.S. economy and the Federal Reserve. Dan Loeb of Third Point LLC, Stephen Schwarzman of Blackstone Group, Robert Smith of Vista Equity Partners, Paul Tudor Jones of Tudor Investment Corp and Ken Griffin of Citadel were also reportedly on the call.

  • Even retirees with resources find coronavirus is upending their financial plans
    Business
    LA Times

    Even retirees with resources find coronavirus is upending their financial plans

    With the U.S. economy staring at a recession and the stock market having plunged more than 25% from its peak in February, retirees have seen the value of their retirement funds badly eroded and are looking for ways to generate cash for their living expenses. Here are three retirees who explain how they're coping with the crisis: 'Never seen something this big' Randy Smythe, 60, retired last September after a career in e-commerce sales and soon took off to spend a year visiting the national parks while renting out his home in Lake Arrowhead.

  • Analysts Share Stocks They Would Buy In This Environment: Exxon Mobil, P&G And More
    Business
    Benzinga

    Analysts Share Stocks They Would Buy In This Environment: Exxon Mobil, P&G And More

    On CNBC's "The Exchange," Jamie Cox of Harris Financial Group and Charles Bobrinskoy of Ariel Investment spoke about stocks they like in the current market environment. Cox said he keeps asking himself when is he going to buy an integrated oil company, if not when there is an oil price war going, combined with a 30% or more demand destruction. He thinks now might be the right time to start buying a little bit of Exxon Mobil Corporation (NYSE: XOM) or Royal Dutch Shell plc ADR Class A (NYSE: RDS-A) and initiate a position in companies that are well capitalized and have plenty of interest coverage.

  • “Starbucks of China” down almost 70% on Thursday on fraud claims
    Business
    Insider Monkey

    “Starbucks of China” down almost 70% on Thursday on fraud claims

    Luckin Coffee (NASDAQ:LK) stock tanked more than 80% (and is down 66% at the time of this writing) after the company revealed an investigation that essentially proved what Muddy Waters alleged months ago. Luckin Coffee admitted to inflating its sales numbers after an internal investigation. Luckin Coffee reveals investigation In a press release filed with the Securities and Exchange Commission, the China-based coffee chain said its board of directors formed a special committee to oversee an internal investigation.

  • After $50 Billion of Losses, No One Comes to Save the Mortgage Market
    Business
    Bloomberg

    After $50 Billion of Losses, No One Comes to Save the Mortgage Market

    In the week since, three top investors in the sector have engaged restructuring advisers, two others sold $7 billion of debt at a discount and publicly traded mortgage REITs in the U.S. lost more than $12 billion of market value, bringing total declines this year to at least $50 billion. Prominent asset managers including Blackstone Group Inc., TPG and Apollo Global Management Inc. have been sucked into the vortex wrought by the coronavirus pandemic, with their associated mortgage REITs losing more than two-thirds of their value on average so far in 2020.

  • Zoom stock: Privacy and China connection weigh on shares
    Business
    Insider Monkey

    Zoom stock: Privacy and China connection weigh on shares

    One of the few stocks that has benefited from the coronavirus pandemic is Zoom, although the stock is now under pressure due to privacy concerns. The shares climbed while most of the rest of the U.S. stock market plunged, but the news flow has shifted now. Zoom Video Communications Inc (NASDAQ: ZM) stock should not be confused with the stock for Zoom Technologies Inc., which trades under the ticker ZOOM on the over-the-counter market.

  • Business
    Barrons.com

    If Your 401(k) Balance Is Small or Non-Existent, Fret Not. A New Paper Justifies Low Retirement Savings.

    Low- and middle-income workers who haven't been able to save much for retirement might not be as ill prepared as the financial punditry would have you believe, a finding that could help ease seniors' anxiety surrounding the adequacy of their post-work income. According to a recent paper via the National Bureau of Economic Research—titled “Can Low Retirement Savings Be Rationalized?”—the current meager returns from safe investments like bonds and certificates of deposit don't justify delaying consumption as they had when interest rates were higher. What's more, the paper's authors contend, the conventional wisdom on adequate retirement savings fails to account for declining consumption, meaning that those who can't save a lot in the first place may be able to get by with less in retirement.

  • N.Y. Has Most Deaths in a Day; Italy Has Fewer: Virus Update
    U.S.
    Bloomberg

    N.Y. Has Most Deaths in a Day; Italy Has Fewer: Virus Update

    Read the full story here Dubai Extends Restrictions to 24 Hours (1:05 p.m. NY) Dubai imposed further restrictions on the movement of people and halted metro services as the Middle East's business hub seeks to limit the spread of the coronavirus. A program to clear the streets will be extended to 24 hours for two weeks from Saturday, Dubai's media office said by tweet.

  • 'Fast Money' Traders Weigh In On AT&T, Tesla And Twitter
    Business
    Benzinga

    'Fast Money' Traders Weigh In On AT&T, Tesla And Twitter

    On CNBC's "Fast Money," Guy Adami said he agrees with Goldman Sachs' upgrade on Twitter Inc (NYSE: TWTR) as the stock should benefit from increased traffic during the crisis. He is concerned about the ad spending, but he thinks that traders who want to play the market can buy some at the current price level. Dan Nathan sees Twitter as a valuable utility for the users, but the company is not growing sales at a rate one might expect for a growth company valued this way.