State leaders taking on climate saw boost from fossil fuel

In October, Scott Fitzpatrick, then-treasurer of Missouri, announced his state would pull $500 million out of pension funds managed by BlackRock.

He said he would move Missouri’s money away from the asset manager because it was “prioritizing” environmental, social and governance investing over shareholder returns. Fitzpatrick, a Republican who won election as the state’s auditor in November, used his office as treasurer to target BlackRock after years of criticizing Wall Street for a perceived turn toward investing focused on climate and social issues.

As he homed in on BlackRock, Fitzpatrick quietly held a financial stake in a massive fossil fuel company that could suffer from the broader adoption of alternative energy. Fitzpatrick and his wife owned a more than $10,000 stake in Chevron during both of 2022 and 2021, according to his latest financial disclosures filed with the state.

Fitzpatrick is among a group of powerful Republican state leaders who have waged similar fights against environmentally conscious investing as they held personal investments in, or saw political support from, the fossil fuel industry.

A handful of state financial officers who have similarly attacked ESG practices owned stock or bonds in oil, gas or other fossil fuel companies in recent years, according to the latest state financial disclosure reports reviewed by CNBC. Some of the state officials have received campaign donations from fossil fuel companies or their executives.

State leaders face possible conflicts of interest when they have a chance to see financial gains from the fossil fuel industry as they use their offices to defend the sector — or in some cases move their state’s dollars away from clean-energy investments, government ethics experts told CNBC. As the officials ramp up their criticism of Wall Street investment practices, a lack of state laws requiring regular stock disclosures makes it difficult for the public to monitor what personal stake their representatives could have in the actions they take in office.

Brandon Alexander, the chief of staff to the Missouri auditor’s office, told CNBC in an emailed statement that Fitzpatrick’s publicly traded securities are either in a trust or qualified retirement accounts that are managed by a financial advisor.

“Other than employer sponsored retirement accounts (the entirety of which are invested in target date funds over which he has no control), all of Auditor Fitzpatrick’s publicly traded securities, are held in a trust or in qualified retirement accounts which are actively managed by a financial advisor to whom he gives no direction,” Alexander said. “He has never ‘had private briefings tied back to the fossil fuel industry’ nor does he…