Two giant global asset managers, BlackRock Inc. and BNP Paribas, have reported that their stock ownership in West Sacramento-based Origin Materials Inc. has exceeded stakes of 5%.
Origin (Nasdaq ORGN) has developed technology and processes to turn wood waste materials into zero-carbon plastic that doesn’t use petroleum products.
The two asset managers reporting their holdings are among the many investors that are part of the environmental, social and governance, or ESG, movement. They consider climate change a material investment risk and technology to slow climate change a growth opportunity.
For Origin, the two global investors' interest signals that the company founded in 2008 is getting traction in its efforts. It has completed its first plant, it has another on the way and company executives were busy with investor roadshows last year. Origin became a public company in June 2021.
The reports of ownership come as some Republican elected officials are opposing the ESG movement by investors.
On Jan. 31, London-based BNP Paribas Asset Management UK Ltd. reported to the Securities and Exchange Commission that it owned 7.7 million shares of Origin stock, representing 5.4% of all of its shares outstanding.
On Feb. 3, New York-based BlackRock (NYSE: BLK) reported to the SEC that it owned 7.3 million shares of Origin stock, representing 5.1% of its outstanding shares.
Origin representatives didn't respond to calls from the Business Journal for comment.
The SEC requires investors to file beneficial ownership reporting disclosure documents when their interest in a company exceeds 5%.
Origin announced the completion of Origin 1, its first large-scale manufacturing plant, on Jan. 27. That plant is in Sarnia, Ontario.
Earlier in January, Origin announced that the Louisiana State Bond Commission unanimously granted its approval of the issuance of up to $1.5 billion of tax-exempt bonds for the financing of the construction of Origin 2, the company’s first world-scale manufacturing facility, to be located in Geismar, Louisiana.
The Sarnia plant is a $130 million investment. The Geismar manufacturing operation will be a $1.1 billion manufacturing plant.
BlackRock, which is the world's largest asset manager, has $10 trillion in assets under management. BNP has more than $610 billion in assets under management.
Both asset management companies reported the shares under the SEC's SC 13G beneficial ownership report. That is a short-form version of an ownership disclosure statement intended for "passive investors, exempt investors and qualified institutional investors."
If a person or company is not a passive, exempted or qualified institutional investor, they are required to file a more comprehensive 13D ownership report.
Meanwhile, opposition to the ESG movement is becoming a political wedge issue. House Financial Services Committee Chairman Patrick McHenry (R-North Carolina) said Friday that the committee will convene a task force to combat what he called the threat that ESG policies by investors and the Biden administration pose to capital markets. Louisiana's state treasurer has said he will pull money out of BlackRock for its environmental and social priorities, while other state treasurers have called on BlackRock CEO Larry Fink to change policies, The New York Times has reported.
In November, BNP described its road map to getting its portfolio investments to achieve net zero emissions by 2050. In a public release by the company at that time, it said it was in the short-term reducing the carbon footprint of its investments by 30% by 2025, and by 50% by 2030. Those figures are based on a 2019 baseline.
BlackRock's Fink has been telling public companies for at least three years that they need to consider climate change risks and benefits in all of their business planning considerations.
Origin's executives were busy in the fall attending investor roadshows. Origin co-CEO Rich Riley participated in the Goldman Sachs Global Sustainability Forum in New York on Sept. 29.
Co-CEO John Bissell participated in the 2022 Advanced Bioeconomy Leadership Conference in San Francisco on Oct. 27.
Both Bissell and Riley participated in the Credit Suisse Climate Tech Conference, held virtually on Dec. 6 and 7. They also met with institutional investors as part of that conference, according to Origin.
Origin's product is a drop-in replacement for petroleum in the manufacture of PET plastic, which is the most recycled plastic on the planet. Origin has long been backed by users of plastic materials, including The Mitsubishi Group, Nestle SA, Danone SA and PepsiCo Inc. (Nasdaq: PEP), all of which are potential customers for Origin’s zero-carbon PET for industrial goods and packaging.
As of the third quarter, Origin reported it already had more than $8 billion in manufacturing capacity reservations for its product over the next decade.
