Indiana Secretary of State Diego Morales is accusing BlackRock, the world’s largest financial asset manager, of violating state law by misleading Hoosiers about its investment strategy.

BlackRock calls the allegations “a politically motivated attack.”

A cease-and-desist order alleged that BlackRock publicly said it engaged in “ESG integration … across all our active portfolios.”

ESGs are policies that consider the environmental or social impacts of their investments.

The order goes on to allege that BlackRock’s own reports later said that some of its investments do “not seek to follow a sustainable, impact or ESG investment strategy.” And Morales said that contradiction is a violation of Indiana law.

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The order also accused BlackRock of misleading clients by saying that ESG strategies produce better long-term outcomes, while the state alleged that BlackRock’s own returns say otherwise.

In a statement, BlackRock said Morales “completely mischaracterizes BlackRock’s approach to investing.”

The company said its only focus is helping Hoosier clients achieve their investment goals and that it plans to defend itself against “this arbitrary use of state power.”

Brandon is our Statehouse bureau chief. Contact him at bsmith@ipbs.org or follow him on Twitter at @brandonjsmith5.