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Weekly Short
29 January, 2021
It’s notable – and in many ways brilliant – that CEO of BlackRock, Larry Fink’s annual open letter to CEOs has become a milestone in the sustainability calendar.
BlackRock manages $7.8 trillion, making it the world’s biggest asset manager. And the company has a strong reputation for strength and success – frequently outperforming its peers. This gives everyone powerful incentive to listen to what Fink has to say, including old school capitalists that other sustainability advocates might fail to reach.
Fink is an outspoken advocate of purpose, stakeholder capitalism and climate action, and this year he puts significant focus on urging CEOs to step up and play their part in addressing climate change, linking the need for transformative action to Covid-19.
“I believe that the pandemic has presented such an existential crisis—such a stark reminder of our fragility—that it has driven us to confront the global threat of climate change more forcefully and to consider how, like the pandemic, it will alter our lives.”
He calls for concerted action from everyone to make the transition to net zero economies happen.
Sceptics argue that Blackrock is not doing enough – and it is true that it still has many billions of dollars tied up in the coal industry, a less than stellar record on biodiversity, and a track record of voting more frequently against than in favour of pro-climate resolutions.
There’s certainly more that BlackRock could do. But we think it’s also worth appreciating the fact that his pronouncements have outsized influence, including on those who’s mantra is to ‘follow the money’.
By Marie Guérinet