Comptroller Lander & NYC Pension Trustees: Shareholders Should Reject Election of Out of Step Saudi Aramco CEO to...

Comptroller Lander & NYC Pension Trustees: Shareholders Should Reject Election of Out of Step Saudi Aramco CEO to BlackRock Board

New York, NY - New York City Comptroller Brad Lander, on behalf of the New York City Employees' Retirement System (NYCERS), filed an exempt solicitationurging BlackRock shareholders to 'VOTE NO'against the board election of Saudi Aramco CEO Amin H. Nasser. As shareholders, Comptroller Lander and fellow NYCERS trustees believe that Nasser's role with Saudi Aramco poses conflicts of interest that compromise his ability to fulfill board responsibilities. Nasser has been an advocate for the expansion of fossil fuels and moving away from decarbonization efforts.

The solicitation to shareholders notes,"Nasser is not qualified to serve as an independent member of BlackRock's Board, which is responsible for '[o]versight of near- and long-term business strategy (including sustainability).' His nomination represents a step backward for the company, aligning BlackRock with outdated perspectives and practices that are incompatible with the pressing need for climate action and responsible business practices as reflected in BlackRock's own commitments."

At a time when the climate crisis has never been more urgent, the public comments of Nasser are in direct conflict with BlackRock's stated climate commitment of "supporting the goal of net zero greenhouse gas emissions by 2050 or sooner." The solicitation brings into question the progress BlackRock can truly make with the board election of Nasser and cites the company's withdrawal from Climate Action 100+.

Despite BlackRock's positioning of Nasser as an independent director, Aramco has conducted sizeable, related-party transactions with BlackRock within the past three years. One of the largest transactions was a 49% equity interest in Aramco Gas Pipelines Company for $15.5 billion by a consortium of investors co-led by BlackRock.

The close relationship between Saudi Aramco and BlackRock may compromise Nasser's independence as a director. According to the NYSE listing standards, a director cannot be independent if he is "a current executive officer of a company that has made payments to, or received payments from, the listed company for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million, or 2% of such other company's consolidated gross revenues." Even if a director passes this test, he still may not be independent. Ultimately, the board must make a final determination of independence based on all relevant facts and circumstances.

BlackRock has not disclosed its Aramco-related fees or tariff payments enabling investors to assess whether such payments may be material to their own proxy voting decision-making.

The solicitation also cites human rights concerns, and notes that"in his capacity as the CEO of Aramco, Nasser received a June 2023 letter from independent human rights experts appointed by the United Nations Human Rights Council, expressing concern and requesting clarification with respect to allegations that Aramco had engaged in one of the largest ever climate-related breaches of international human rights law by a business." BlackRock has committed to incorporating the UN Global Compact's Ten Principles in their "strategy, culture, and day-to-day operations," raising further questions about the alignment of Nasser with BlackRock's overall business strategy.

As of February 28, NYCERS has approximately $43 million invested in BlackRock. Additionally, BlackRock manages approximately $19 billion on behalf of NYCERS.

The full exempt solicitationhas been filed with the Securities Exchange Commission (SEC) as of May 1, 2024.

In addition to Comptroller Lander, trustees of the New York City Employees' Retirement System are as follows:

Mayor Eric Adams' Appointee Bryan Berge, Director, Mayor's Office of Pension and Investments; New York City Public Advocate Jumaane Williams; Borough Presidents: Mark Levine (Manhattan), Antonio Reynoso (Brooklyn), Donovan Richards Jr. (Queens), Vito Fossella (Staten Island), and Vanessa L. Gibson (Bronx); Henry Garrido, Executive Director, District Council 37, AFSCME; Richard Davis, President Transport Workers Union Local 100; and Gregory Floyd, President, International Brotherhood of Teamsters, Local 237.

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