A U.S. senator from Montana recently spoke out about the suspension of HSBC executive Stuart Kirk over his climate change comments, calling the move «woke» and a potential breach of law.
Montana Republican senator and Senate banking committee member Steve Daines recently spoke out against the decision to suspend HSBC Global Asset Management’s head of responsible investing Stuart Kirk.
«I am concerned that this episode may involve breaches of United States law, or indicate that you and the financial industry are falling prey to the same groupthink that led to the 2008 financial crisis,» Daines said in a letter to HSBC chief executive Noel Quinn.
Blackrock Influence
In the letter, Daines underlined suspicions of external influence on the decision to suspend Kirk as the bank had reportedly cleared the theme and content of his presentation last month.
«It appears to many that Mr. Kirk’s suspension was in response to pressure on HSBC from outside parties that may be legally prohibited from influencing the management of your company,» Daines said, underlining major shareholder and climate change supporter Blackrock.
«An entity such as Blackrock that holds securities consistent with Schedule 13G affirms that its ownership is 'not with the purpose nor with the effect of changing or influencing the control' of a company such as HSBC. To the extent Blackrock, or any similar firm, directly or indirectly through any group with which it is affiliated, influenced your decision with regard to Mr. Kirk, these laws may have been violated.»
Groupthink Risk
Daines called HSBC and Blackrock supporters of «extreme environmental ideology through their business», underlining the risk of excessive groupthink and lacking dissent.
«Your treatment of Mr. Kirk’s heterodox remarks raises serious questions about HSBC’s risk management practices and culture. As you know, a key principle of risk management is establishing a culture where dissenting views may be candidly expressed. It is well established that groupthink can lead to suboptimal, even disastrous outcomes for businesses,» he said.
«In the early 2000s, your industry assumed that the housing market could never slump nationwide, or that rigorous mortgage underwriting standards were an unnecessary impediment to mortgage volume. Now, your industry appears destined to ignore the dangers of the current path until the economy once again suffers the consequences.»
Demanding Answers
The letter concluded with Daine’s request for answers from Quinn with regards to two questions.
The first inquiry was about whether or not Blackrock or another U.S.-based HSBC investor contacted the bank about Kirk’s speech. And the second inquiry was about whether or not HSBC had any contact with U.S.-based groups about Kirk’s speech or suspension decision.
«As Mr. Kirk noted in his speech, many risks to the finance industry are more concerning than climate change. However, these risks do not have international movements behind them agitating for attention,» Daines added.
«To the extent that Mr. Kirk’s speech implicitly rebuked HSBC’s environmental commitments as ill-advised or contrary to the financial interests of your investors, this should prompt re-examination of your commitments, not silencing for pointing out that the emperor has no clothes.»
