Pension funds reconsider U.S. managers over climate commitments

Money managers are facing challenges as pension funds in northern Europe consider withdrawing American mandates due to concerns over U.S. asset managers' commitment to climate risk. In contrast, some hedge funds in London are dropping oil exclusions to retain state investor mandates. State Street Global Advisors has lost UK and Scandinavian mandates after stepping back from climate commitments. Meanwhile, Indiana's state pension plan replaced BlackRock with State Street, citing BlackRock's focus on environmental, social, and governance issues. U.S. money managers are navigating a complex political landscape, facing potential blacklisting from both sides of the environmental debate. Interest in ESG strategies is declining among hedge funds, leading to a rise in separate managed accounts for these investments.