British billionaire Chris Hohn's hedge fund holds billions of dollars in shares of two powerful credit-rating companies while seeking to push their climate priorities on the firms whose decisions can influence how much American
businesses, schools and local governments pay to borrow money.
Moody's and S&P Global wield enormous influence over borrowing costs across the American economy, with their credit assessments affecting everything from corporate investments to public infrastructure projects. Hohn's TCI Fund Management holds major stakes in both firms and previously pushed them to adopt climate policies, raising questions about the influence wealthy investors can exert over institutions whose financial judgments carry significant consequences for American communities.
Dr. OJ Oleka, chief executive officer of the State Financial Officers Foundation, told the Daily Caller News Foundation that credit-rating decisions can have consequences extending well beyond Wall Street, particularly for smaller communities that rely on borrowing to finance public infrastructure.
"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 said.
"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.
TCI Fund Management reported holding approximately 14.3 million shares of Moody's and 14.1 million shares of S&P Global as of June 30, positions valued at approximately $6.5 billion and $5.7 billion, respectively, according to a Securities and Exchange Commission (SEC) filing.
The Moody's position represented approximately 8.2% of the company's outstanding shares, according to a separate SEC filing. Together, the investments accounted for approximately 23% of TCI's publicly disclosed stock portfolio, making the credit-rating companies among the fund's largest reported holdings.
TCI declined to comment to the DCNF. Moody's and S&P Global did not respond to requests for comment.
Hohn, who founded TCI Fund Management and the Children's Investment Fund Foundation, has a documented history of using shareholder activism to advance climate-related initiatives, including at Moody's and S&P Global.
In November 2020, Hohn launched a campaign seeking to pressure hundreds of companies into adopting more aggressive climate policies through shareholder resolutions, according to Reuters.
TCI Fund Management's website confirms that the firm filed climate-related shareholder proposals at both Moody's and S&P Global as part of its Say on Climate campaign. The proposals sought annual disclosure of greenhouse gas emissions, plans for reducing those emissions and shareholder votes on the companies' climate strategies. The votes would not legally require the companies to act.
Moody's subsequently announced in December 2020 that it was joining the campaign, pledging to disclose its emissions, develop a comprehensive plan to manage them and allow shareholders to vote on its climate strategy.
Hohn said he expected both companies to support the proposals, telling investors he had been holding regular discussions with Moody's leadership and believed S&P Global would also embrace the initiative, according to IR Impact.
Both companies ultimately presented climate proposals introduced by their own management teams to shareholders in 2021 after TCI withdrew its original proposals. Moody's shareholders approved its climate plan with 93.3% support, while S&P Global's proposal received 99.5% support, according to a Harvard Law School corporate governance review.
Oleka warned that significant ownership positions in credit-rating companies become concerning when investors use their influence to advance political or ideological priorities.
"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.
Oleka said state financial officers have repeatedly warned that ESG-related investment policies could undermine the financial interests of public pension beneficiaries, including teachers and law enforcement officers.
"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," Oleka said. "They want to retire with dignity."
Moody's and S&P Global both incorporate climate-related risks into their credit ratings, with S&P Global previously taking negative rating actions against major oil and gas companies partly because of concerns about the industry's transition away from fossil fuels.
In January 2021, S&P Global announced that it had placed nine oil and gas companies and their subsidiaries under review for potential credit downgrades, including ExxonMobil, Chevron and Shell. The agency also lowered its outlooks for BP and Suncor Energy, citing growing competition from renewable energy, concerns over greenhouse gas emissions, volatile oil prices and weaker industry profitability. The actions demonstrated how climate-related considerations could directly affect the credit standing of major American energy companies.
Moody's also factors climate-related concerns into its assessments of borrowers' financial health. In a January 2025 framework, the agency outlined how environmental, social and governance (ESG), including the economic transition away from fossil fuels, could influence companies' future earnings, financial stability and ability to repay debt. That approach allows climate-related developments to affect credit assessments when Moody's determines they pose a financial risk.
Credit ratings can influence how much companies and local governments pay to borrow money. While the agencies argue that climate-related risks can affect borrowers' financial health, critics question whether incorporating such considerations could disadvantage certain industries or allow political priorities to influence decisions with significant economic consequences.
Oleka said investors and asset managers should face greater scrutiny when their investment decisions involve other people's money.
"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," he said.
He also questioned the distinction between passive investing and active shareholder engagement, arguing that asset managers should not use their positions to advance objectives that beneficiaries never authorized.
"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 also advocated for stronger measures to compel companies to adopt climate policies. In a 2022 interview reported by Bloomberg, he criticized voluntary ESG engagement strategies as ineffective and argued that investors needed stronger mechanisms to force companies to decarbonize.
"Talk doesn't work, voluntary doesn't work, there need to be forcing mechanisms," Hohn said.
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