- The European Commission didn't properly consider conflicts of interest when it hired a division of BlackRock (BLK +2.4%), the world's largest asset manager, to help develop green banking rules, a European watchdog said.
- European Ombudsman Emily O'Reilly started an inquiry after the EU executive branch in March appointed BlackRock to produce a study that would advise it on plans to integrate sustainability into banking rules.
- EU lawmakers and NGO Change Finance questioned the ability of BlackRock, which holds large stakes in fossil fuel industries and in banks affected by the regulations, to provide impartial advice.
- Though her decision stopped short of seeking to cancel the contract, O'Reilly said the EC should have used "significantly more critical scrutiny" over BlackRock's application.
- "Questions should have been asked about motivation, pricing strategy and whether internal measures taken by the company to prevent conflicts of interest were really adequate," she said in her decision.