British billionaire Chris Hohn’s hedge fund holds major positions in Moody’s and S&P Global, drawing scrutiny over whether climate-focused shareholder activism could influence credit assessments affecting American businesses, schools and local governments.
By yourNEWS Media Newsroom
WASHINGTON — British billionaire Chris Hohn’s investment firm holds more than $12 billion in shares of two of the world’s most influential credit-rating companies, raising questions about the role climate-focused investors may play in financial assessments that determine borrowing costs for American businesses and communities.
TCI Fund Management, founded by Hohn, reported owning approximately 14.3 million shares of Moody’s and 14.1 million shares of S&P Global as of June 30, 2026, according to a Securities and Exchange Commission filing.
The holdings were valued at approximately $6.5 billion and $5.7 billion, respectively, representing nearly 23% of TCI’s publicly disclosed U.S. equity portfolio. A separate SEC disclosure placed the fund’s Moody’s ownership at approximately 8.2%.
The investments have attracted attention because Hohn previously used shareholder proposals to encourage both companies to adopt climate-related policies, while their credit ratings influence financing costs throughout the American economy.
Credit-rating agencies evaluate the financial condition of corporations, municipalities and other borrowers. Their assessments help lenders and investors determine the interest rates borrowers must pay when issuing bonds or obtaining financing.
A lower credit rating can make borrowing more expensive, potentially increasing costs for public infrastructure, business expansion and government services.
Dr. OJ Oleka, chief executive officer of the State Financial Officers Foundation, warned that decisions affecting creditworthiness can have consequences far beyond major corporations.
“You’ve got small communities all across the country who are trying to pay for new sewer districts, who are trying to build new schools, who are trying to purchase police cars and fire trucks to keep the people safe in their community and make life better,” Oleka told the Daily Caller News Foundation.
“If they can’t get good credit, despite the fact that they’re strong financially and fiscally, because they won’t bend the knee to leftist ideologues on climate, that is unconscionable,” he added.
Hohn has a documented history of advocating climate-related corporate policies through shareholder engagement.
In November 2020, he launched an initiative encouraging hundreds of publicly traded companies to disclose greenhouse gas emissions, develop plans to reduce them and submit those plans for shareholder review.
According to Reuters’ reporting on the campaign, Hohn sought to pressure corporate boards to establish measurable climate commitments through shareholder resolutions.
TCI’s published record of environmental, social and governance engagements confirms that the firm filed climate-related proposals at Moody’s and S&P Global under its Say on Climate initiative.
The proposed shareholder votes would have been advisory rather than legally binding.
Moody’s subsequently announced in December 2020 that it was joining the campaign, committing to disclose emissions, establish a climate strategy and give shareholders an opportunity to vote on its approach.
Hohn indicated that he expected both credit-rating companies to adopt the proposals.
As IR Impact reported, Hohn said he had conducted regular discussions with Moody’s leadership and believed S&P Global would also support the initiative.
Both companies eventually introduced management-sponsored climate proposals in 2021 after TCI withdrew its original resolutions.
Moody’s shareholders approved the company’s climate proposal with 93.3% support, while S&P Global’s proposal received 99.5%, according to a corporate governance review published by Harvard Law School.
Those votes demonstrated substantial shareholder support for corporate climate disclosure policies but did not establish that TCI influenced individual credit ratings.
Oleka nevertheless questioned whether major investors should be able to promote political or ideological objectives through companies whose financial judgments affect public institutions.
“If you’ve got investors who are buying up shares in an entity like Moody’s or S&P that are incredibly powerful and influential in how companies and states and municipalities get credit, if that interest is to push a political ideology, that is absolutely dangerous,” Oleka said.
Both rating agencies acknowledge that environmental factors can influence their assessments when those factors present material financial risks.
In January 2021, S&P Global announced rating actions involving major oil and gas companies, including ExxonMobil, Chevron and Shell.
The agency placed nine energy companies and subsidiaries under review for possible downgrades and revised its outlooks for BP and Suncor Energy.
Its stated concerns included competition from renewable energy, greenhouse gas emissions, volatile oil prices and weaker profitability across the industry.
Those actions illustrated how expectations about energy markets and the transition away from fossil fuels could influence credit assessments.
Moody’s has also incorporated climate-related considerations into its financial analysis.
The company introduced climate risk assessments into its credit lifecycle management tools, enabling financial institutions to evaluate potential exposure to environmental developments.
A January 2025 Moody’s ratings framework explained how environmental, social and governance factors may affect a borrower’s earnings, financial stability and ability to meet debt obligations.
Such considerations can include changing regulations, physical damage from extreme weather, energy market developments and the costs associated with shifting technologies.
Rating agencies maintain that these assessments are intended to identify financial risks rather than reward or penalize political positions.
Critics argue that subjective assumptions about future climate policy could nonetheless influence borrowing costs in ways that disadvantage certain industries or communities.
The distinction is particularly important for municipalities, which frequently issue bonds to finance schools, water systems, roads and emergency services.
A credit downgrade can increase interest expenses, leaving taxpayers responsible for higher financing costs or forcing local governments to reduce spending elsewhere.
Oleka said public pension beneficiaries could also be affected if investment managers prioritize objectives unrelated to financial performance.
“The last thing they would want is for politics and ideology to get in the way of what should be a good pension when they retire,” he said. “They want to retire with dignity.”
He argued that investors managing other people’s assets have a primary obligation to seek financial returns.
“There is a single responsibility for somebody who is an asset manager or somebody who’s an investor, especially if they’re investing other people’s money. And that is, they need to be focused on returns,” Oleka said.
He also questioned whether asset managers clearly communicate the extent of their shareholder activism to the people whose investments they oversee.
“When you are passive or you claim to be, but your behavior is active, that’s when you run into a lot of these problems,” Oleka said.
Hohn has openly advocated using stronger mechanisms to encourage companies to reduce emissions.
In a 2022 interview reported by Bloomberg, he criticized reliance on voluntary corporate commitments.
“Talk doesn’t work, voluntary doesn’t work, there need to be forcing mechanisms,” Hohn said.
The comments reflected his broader approach to shareholder activism, which seeks corporate policy changes through investment ownership and governance mechanisms.
However, holding a substantial minority ownership stake does not give an investor direct authority to determine the ratings assigned by Moody’s or S&P Global.
No evidence presented in the reporting establishes that Hohn directed either company to downgrade a particular business, municipality or government because it rejected climate policies.
The companies’ adoption of climate disclosures also does not, by itself, demonstrate improper influence over their credit-rating methodologies.
TCI declined to comment to the Daily Caller News Foundation, while Moody’s and S&P Global did not respond to its requests for comment.
The controversy reflects a wider debate over environmental, social and governance considerations in financial markets, particularly whether climate-related risks should be incorporated into decisions involving public funds and essential infrastructure.
Supporters of such assessments argue that overlooking material environmental risks could leave investors and borrowers exposed to future financial losses. Critics maintain that rating agencies must ensure their judgments are not shaped by investors’ political preferences.
With TCI holding billions of dollars in both credit-rating companies, the debate raises continuing questions about shareholder influence, transparency and the independence of financial assessments that affect borrowing costs across the United States.
Original article
Comments