Last month I posted a two-part piece on leadership and climate change. To remind or inform you, the links are below.
In the second of the two posts I mentioned the name of Larry Fink. He is the CEO of BlackRock, which is the world’s largest asset management company. (It controls some $10 trillion.) Because Fink had gone on record several times in recent years as an advocate of tackling the problem of climate change, and because he spoke not as a private person but in his capacity as the leader of one of the world’s most powerful companies, I thought it possible that he, perhaps more than any other prominent executive, might lead the charge against a climate crisis of growing proportions.
Silly me. The ink was, so to speak, hardly dry on my post when there was this headline in the Financial Times, “BlackRock cuts back support for climate and social proposals.” I almost screamed but did not, “Say it isn’t so, Larry!”
Fink, it turned out, had not only not led on climate change, he followed. BlackRock’s support for US shareholder proposals on environmental and social issues fell this year by nearly half!
Why? Because Fink had come under special criticism from Republicans who charged that BlackRock was pushing a “woke capitalism.” Because some states were threatening to boycott financial services groups that “discriminated” against fossil fuels. You get the picture. As Harvard Business School professor Lucien Bebchuk put it, big asset managers want to appear “responsible stewards.” But they also seek to “accommodate corporate managers and avoid adversarial relationships with them… and to reduce the odds of a political and public backlash against their power.”
On one level I get it. Someone like Fink considers that he has a responsibility to the public – but that he has a much greater responsibility to his stakeholders. Still, it’s damn disappointing to see a leader like him cave so quickly and completely on an issue of such great urgency.
————————————————————————–