BlackRock CEO Larry Fink says stakeholder capitalism hasn’t ‘woken’ – Archyde

Larry Fink, Chief Executive Officer of BlackRock Inc., in Zurich, Switzerland on Thursday, March 7, 2019.

Stefan Wermuth | Bloomberg via Getty Images

The manager of Black Rock has attempted to defend a shareholder movement focused on putting the interests of wider society ahead of profits, saying so-called “stakeholder capitalism” is neither political nor “awakened”.

In his widely acclaimed annual letter to corporate leaders titled “The Power of Capitalism” BlackRock CEO Larry Fink on Monday denied allegations that the wealth manager used its weight and influence to support a politically correct or progressive agenda.

“Stakeholder capitalism has nothing to do with politics. It’s not a social or ideological agenda. He didn’t ‘woke up,'” Fink said.

“It is capitalism, fueled by mutually beneficial relationships between you and the employees, customers, suppliers and communities, that your business depends on to thrive. That is the power of capitalism.”

Fink’s annual letter to CEOs outlines the priorities he sees as critical to helping BlackRock’s clients achieve “sustainable” long-term returns and achieve their goals. In recent years, the letter has focused on a range of issues, from diversity in boardrooms to the climate emergency.

His public support for investments according to environmental, social and governance standards has been criticized from all sides. For some conservative groups and US lawmakers, BlackRock, last week passed the $10 trillion mark for the first time for assets under management, was accused”woke up‘ to disguise his investment funds’ infusion of money into Chinese companies.

BlackRock became the first foreign-owned company to operate a wholly owned business in China’s mutual fund industry last year.

The asset manager previously has the US and China’s “complex“Economic Relations. It has also said that it believes that globally integrated financial markets “can provide people, businesses and governments across countries better and more efficient access to capital that supports economic growth around the world.”

Separately, environmental activists have attacked the company for not fully divesting itself of fossil fuel companies and many other big contributors to the climate crisis.

Fink’s letter reiterated the asset manager’s policy of reaching out to companies participating in the so-called “energy transition‘ instead of giving up completely. He added that companies cannot be the “climate police” alone and instead need to work with governments.

“Divesting entire sectors — or simply transferring high-carbon assets from public markets to private markets — will not bring the world to net zero. And BlackRock has no policy of divesting oil and gas companies,” said Fink.

BlackRock’s CEO said the money manager is also working on expanding an initiative for investors to use proxy voting technology.

“We are committed to a future in which every investor – including individual investors – can have the opportunity to participate in the proxy voting process if they choose to do so,” said Fink.

“We know there are significant regulatory and logistical hurdles to achieving this today, but we believe it could bring more democracy and more votes to capitalism. Every investor deserves the right to be heard. We will continue to innovate and work with other market participants and regulators to turn this vision into reality.”


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