BlackRock invested British pension funds in Putin’s war chest — The Bureau of Investigative Journalism (en-GB)

The drawdown of dividends

Even from a purely financial standpoint, BlackRock’s recent bets on Russia might now seem misjudged. The Moscow stock exchange almost tripled in value from April 2014 to the end of last year, but share prices fell as Russian tanks prepared to enter Ukraine this year, wiping out much of the previous gains . Global sanctions and closed markets prevented investors from selling. BlackRock has reduced the value of its Russian assets to zero, but these could rise again when markets reopen and sanctions are lifted.

BlackRock clients, however, have benefited from generous dividends from shareholders of Russian companies. These are a key factor in rewarding foreign investors for betting on Russian companies, according to Felix Boudreault, managing partner at research firm Sustainable Market Strategies.

In Boudreault’s opinion: “It’s like tobacco and the big oil companies. You pay for investors to forgive your sins […] They need to reward you, so you don’t think too much about what you invest in.

He added that the role of Western investors in Russian companies is likely to generate “a lot more questions from pensioners – not just about what [money is invested in]but where”.

Tony Burdon, CEO of campaign group Make My Money Matter, said: “Whether it’s vegans investing in factory farming or regular British savers enabling Putin’s war, the contradictions between incumbent values everyday pensions and their investments are blatant”.

He urged pension funds to disclose the impact of their investments and use their buying power “to put pressure on asset managers, especially those with enormous influence”.

Rudik, the Ukrainian MP, has questions for BlackRock: “What matters most, [a company’s] reputation or funds? I’m sure people who have been in business for so long know that funds are easy, money is easy, but reputation is hard. Invest [the dividends] to rebuild Ukraine and support Ukraine would be a right decision. It will equalize the money that is being used right now to destroy us.