(Bloomberg) -- Florida will pull $2 billion worth of state assets managed by BlackRock Inc., accelerating Republicans’ fight with the world’s largest money manager over its ESG investing practices. 

The state treasury will immediately have Florida’s custody bank freeze about $1.43 billion worth of long-term securities and remove BlackRock as the manager of approximately $600 million worth of short-term overnight investments, Florida Chief Financial Officer Jimmy Patronis said in a statement on Thursday. The pullback is the latest step in a broader fight led by Republican Governor Ron DeSantis against corporations that embrace environmental, social and corporate governance values.

“I need partners within the financial services industry who are as committed to the bottom line as we are – and I don’t trust BlackRock’s ability to deliver,” Patronis said in the statement. 

“Using our cash, however, to fund BlackRock’s social-engineering project isn’t something Florida ever signed up for,” he said. “It’s got nothing to do with maximizing returns and is the opposite of what an asset manager is paid to do. Florida’s Treasury Division is divesting from BlackRock because they have openly stated they’ve got other goals than producing returns.”

Reuters reported Florida’s planned divestiture earlier. The Florida Department of Financial Services manages approximately $60 billion in taxpayer money.

Ed Sweeney, a spokesperson for New York-based BlackRock, said the firm is “surprised” by the decision given the strong returns the company has delivered for Florida the last five years. 

ESG Trigger

Republicans are ratcheting up attacks on environmental, social and governance investing this year. BlackRock, which oversees $8 trillion globally, is a major proponent of the strategy and has been a prime target for the GOP. Louisiana and Missouri have pulled a combined $1.3 billion from BlackRock this year. And in August, Texas included the firm on a list of those it says boycott the energy industry. 

Read More: BlackRock, UBS Ask to Be Removed From Texas’ Energy Boycott List

“Neither the CFO nor his staff have raised any performance concerns,” BlackRock’s Sweeney said in a statement. “We are disturbed by the emerging trend of political initiatives like this that sacrifice access to high-quality investments and thereby jeopardize returns, which will ultimately hurt Florida’s citizens. Fiduciaries should always value performance over politics.” 

Read more: DeSantis Amps Up ESG Attack, Banning Strategy for State Pensions

Back in August, DeSantis and other state officials passed a resolution calling for state funds to be invested without considering the “ideological agenda” of the ESG movement. 

“The tax dollars and proxy votes of the people of Florida will no longer be commandeered by Wall Street financial firms and used to implement policies through the board room that Floridians reject at the ballot box,” DeSantis said at the time.

The move follows other similar clashes with corporate giants, such as PayPal Holdings Inc. and Walt Disney Co. DeSantis is seen as a key rival of Donald Trump for the 2024 Republican presidential nomination. The governor won a landslide re-election victory in November promising to battle what he called “woke ideology” being promoted by Wall Street banks, asset managers and big-tech companies in Florida.

On Wednesday, BlackRock’s Fink said he’s been working to counter criticism from across the political spectrum for BlackRock’s support of sustainable investing. Republicans have retaliated against his firm’s embrace of what they’ve described as “woke” capitalism, while Democrats and environmental activists have targeted BlackRock for investing in fossil-fuel producers.

Against that backdrop, BlackRock poured record amounts of money into US political campaigns this year. Fink said Wednesday that he has been spending a lot of time in Washington to “correct the narrative.”

--With assistance from Felipe Marques and Shelly Hagan.

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