Blackrock / Fink

So how does Fink’s 2021 letter depart from previous years, and in what ways does it commit BlackRock to using its $8.7 trillion capital market influence to “confront the global threat of climate change”?

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Despite Mr. Fink’s insistence that companies benefit society, it’s worth noting he’s not playing down the importance of profits and, while it’s a subtle point, he believes that having social purpose is inextricably linked to a company’s ability to maintain its profits. On that score, Mr. Fink and Friedman aren’t that far apart. “It may well be in the long-run interest of a corporation that is a major employer in a small community to devote resources to providing amenities to that community or to improving its government,” Friedman wrote in 1970, adding that this approach may make it easier to attract desirable employees along with “other worthwhile effects.” But he also added a dollop of reality to the debate. Noting “widespread aversion” to things like capitalism, profits and the “soulless corporation,” he wrote that social responsibility is “one way for a corporation to generate goodwill as a byproduct of expenditures that are entirely justified in its own self-interest.”

In his 2018 annual letter to shareholders, Fink stated that other companies should be aware of their impact on society, however, anti-war organizations are discontent with Fink's statement,[41] because his company, BlackRock, is the largest investor in weapon manufacturers through its U.S. Aerospace and Defense ETF.[42] In September 2018, an activist with the U.S. non-profit organization Code Pink confronted Fink on stage at the Yahoo Finance All Markets Summit.[43]

The influential investment firm now counts environmental sustainability as a new standard for investing.

Aladdin Climate is a workshop for building on top of BlackRock’s Aladdin, bringing together the tools you need to quickly build scalable solutions.

BlackRock has trillions invested in stock-market trackers that include some of the worst polluting companies in the world. So will BlackRock dump shares in these companies? "No, we're not saying that," Mr Fink says. "First of all none of it's our money. The entire pool of money that we manage, which at the present time is approximately $8.7tn, every dollar is somebody else's money."

Larry Fink, boss of the world's biggest money manager, says the pandemic could help in fighting a bigger crisis.

Learn more about BlackRock’s sustainability survey where we sought to better understand clients’ drivers and challenges to sustainable investing.

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Sustainability will drive the way we manage risk, construct portfolios, design products, and engage with companies. Read our Global Executive Committee letter.

Sustainability will drive the way we manage risk, construct portfolios, design products, and engage with companies. Read our Global Executive Committee letter.

In his annual letter to CEOs, BlackRock’s Larry Fink discusses how the events of 2020 are helping to accelerate an economic transformation.