BlackRock Owns Stock In 90% Of American Public Companies, So Don’t Blame The Companies

To blame a company for being partially owned by BlackRock is to mistake how modern capital markets function. BlackRock’s business model is built on exchange-traded funds. An ETF is designed to replicate a stock index by owning small shares of nearly every company in that index. This is not a matter of choice in the ordinary sense. If BlackRock manages a fund tracking the S&P 500, it must purchase and hold shares of every company in that index. That means BlackRock owns stock in roughly 85–90% of all public companies in the US, with average stakes of less than 10%. The companies have no say in the matter. They cannot reject BlackRock as a shareholder, nor can they prevent their shares from being included in index-tracking funds. Ownership in this sense is automatic, structural, and unavoidable.
For this reason, when one learns that BlackRock owns shares of a given company, that fact alone says nothing about the virtue or vice of the company itself. The company is no more complicit in BlackRock’s ideology than a grocery store is responsible for the political beliefs of the shoppers who buy milk from its shelves. The company’s board and management do not invite BlackRock in. They simply exist in a marketplace where the largest asset manager in the world happens to be a nearly universal shareholder. Confusing this structural fact with moral culpability is a category mistake.
The real issue lies elsewhere. BlackRock’s influence does not stem from controlling boards or directly managing companies. BlackRock does not, as a rule, take board seats. Its power comes from how it votes its shares. Even a 9% block can swing outcomes in a shareholder vote, particularly in a climate where many proposals hinge on slim margins. When BlackRock aligns its votes across thousands of companies, it can impose a sweeping ideological agenda across the entire economy. This is precisely how ESG, environmental, social, and governance mandates, have been injected into corporate America.
The harm of ESG begins with the nature of the metrics themselves. ESG is not a neutral set of financial criteria. It reflects subjective judgments about environmental policies, social initiatives, and governance structures. A company might be penalized for producing affordable energy from fossil fuels, or for failing to meet arbitrary diversity quotas, regardless of whether those practices maximize shareholder value. This diverts resources from profitability into politically fashionable projects. Instead of focusing on innovation, efficiency, and customer service, companies are pressed to produce reports, hire consultants, and redesign operations to meet ESG targets.
This shift damages shareholders, who are the legal owners of corporations. The fiduciary duty of management is to maximize long-term shareholder value. ESG muddies that duty. By elevating political and social objectives above profit, ESG transforms corporations into vehicles for ideological conformity. Shareholders lose returns, while executives and asset managers gain prestige and influence. The market becomes less about allocating capital efficiently and more about signaling virtue to a class of unelected gatekeepers. That is why state attorneys general, led by Texas Attorney General Ken Paxton and joined by ten other states, filed suit in November 2024 against BlackRock, Vanguard, and State Street. The complaint charges that these asset managers formed an investment cartel, using their combined influence in coal companies to press producers to slash output by more than 50% by 2030 in line with ESG commitments through initiatives like Climate Action 100+ and the Net Zero Asset Managers Initiative. The lawsuit alleges that this collusion created artificial supply constraints, raised coal and electricity prices, and delivered windfall profits to the asset managers, violating federal antitrust statutes like the Sherman and Clayton Acts as well as Texas and other states’ consumer protection and deceptive-trade-practices laws. It also charges deceptive marketing, pointing out that BlackRock promoted some funds as non-ESG while pursuing ESG actions anyway. This legal push is part of a broader anti-ESG campaign, with Texas already pulling billions from BlackRock and placing the firm on and off investment blacklists depending on whether its ESG commitments were rolled back.
Moreover, ESG does not even succeed on its own terms. The metrics are vague and inconsistent. One rating agency may score a company highly for governance while another downgrades it for failing environmental tests. Companies learn to game the system, spending money on glossy sustainability reports rather than real improvements. The result is box-checking, not progress. And because BlackRock owns virtually every company, it has no incentive to consider whether ESG harms an individual firm. If all competitors are equally burdened, the relative market share of each remains unchanged. What is lost is efficiency, competition, and ultimately the prosperity of the US economy as a whole.
Some critics argue that companies could resist, that boards could defy BlackRock’s pressure. But here the mechanics of shareholder democracy matter. A single retail investor holding 0.01% of shares cannot compete with BlackRock’s 9%. Boards pay attention to blocs of that size. To pretend otherwise is to ignore how votes are counted. The tragedy is that companies may well prefer to ignore ESG distractions, but they face the reality that their largest shareholders demand compliance. In this way, BlackRock functions as an unelected regulator, imposing mandates that Congress never approved and voters never endorsed.
The breadth of this power cannot be overstated. As of 2024, BlackRock reported holdings in over 3,400 US-listed companies, out of roughly 3,950 total. This near-universal presence means its voting policies ripple across every sector. Oil and gas firms are pressured to decarbonize, even if doing so reduces profitability. Tech firms are prodded to adopt speech codes, even if doing so alienates customers. Banks are pushed to deny loans to politically disfavored industries, even if the loans would be profitable. In each case, the same story repeats: ESG dictates override market logic.
It is crucial, then, to keep the blame in the right place. The company itself is not evil because BlackRock is a shareholder. ExxonMobil did not invite BlackRock into its ownership structure, any more than Lockheed Martin or Apple did. BlackRock bought its shares because its funds require it to. The company may or may not pursue bad policies, but the mere fact of BlackRock’s ownership is morally inert. The culpability rests with BlackRock’s use of its voting power to advance ESG mandates, not with the companies compelled to live under them.
The lesson for investors, policymakers, and citizens is twofold. First, do not confuse structural ownership with ideological alignment. A company is not guilty by association simply because BlackRock owns a slice of its stock. Second, recognize the true danger of concentrated financial power. When one firm can vote 9% of shares in nearly every public company, it becomes a shadow government, shaping the private sector without the checks and balances of democratic accountability.











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