Asset manager BlackRock agreed to new disclosure requirements about its use of sustainable-investment factors as part of a legal settlement with Tennessee Attorney General Jonathan Skrmetti, his office said on Friday.

The settlement ends a lawsuit that was originally filed in December 2023 by the state of Tennessee under the Tennessee Consumer Protection Act. The suit alleged that BlackRock overstated the financial benefits of ESG-related strategies and didn’t adequately disclose its integration of ESG factors.

(Reuters) -Republican-led Tennessee and asset manager BlackRock settled a dispute over the company's use of ESG factors in its investment decisions, according to a statement by the state's Attorney General Jonathan Skrmetti on Friday.

BlackRock and the state of Tennessee on Friday reached a settlement over a lawsuit claiming the asset management firm downplayed how large a role environmental, social and governance proposals made in its investment process.

Tennessee said it settled a lawsuit with BlackRock Inc. after accusing the world’s largest money manager of allegedly breaching consumer protection laws by making “misleading” statements about its ESG investment strategy.