“Perhaps he just doesn’t believe that the cultural change will happen in his life-time,” Horowitz told TriplePundit. When Fink writes that his Investment Stewardship team “has begun to speak to companies about corporate purpose” and how “we have been encouraged by the commitment of companies to engage with us on this issue,” Horowitz said he detects “a hint of complacency.” “Given the chaos in politics and the dire warnings about climate change, one cannot help wondering if it’s not too little, too late ,” he told TriplePundit. Yet, Horowitz says, he would have liked “more urgency, ambition and vision” in the latest letter. “What I found very forward thinking was the idea that corporate leaders should use their considerable financial, social, political and human capital to drive progressive social change on the issues of the day like climate change, inclusion and diversity, and technology issues.” Too little, too late?įink’s letter “is even more relevant this year,” according to Brook Horowitz, a consultant on business ethics and integrity and CEO of IBLF Global, an NGO promoting responsible business practices. Welsh said he welcomed the optimism of Fink’s letter. At DSM, he said, “our purpose instructs every aspect of the organization.” “The notion of purpose is not new and is widely held in evolved companies,” Hugh Welsh, CEO of science-based health and nutrition firm DSM North America, told TriplePundit. With 2018 the year where “purpose” was being widely embraced by companies as the new mantra, Fink’s words struck a resonant chord. “Rather, we seek to understand how a company’s purpose informs its strategy and culture to underpin sustainable financial performance.” “Purpose is not the sole pursuit of profits but the animating force for achieving them.”įink wrote that he had “no intention” of telling companies what their purpose should be. “Profits are in no way inconsistent with purpose,” he wrote. Purpose strikes a chordīut Fink is adamant about pushing against economist Milton Friedman’s notion that a company’s only social responsibility is its profit. Fink’s actual letter made no such pledge-in fact the term “climate change” never appears. The bogus letter, whose origin is unclear, took a stronger stance on climate change, including divesting from coal companies in BlackRock’s actively managed funds, something that environmental activists have long pressured the firm to do. “Stakeholders are pushing companies to wade into sensitive social and political issues - especially as they see governments failing to do so effectively,” he wrote in his new letter.įink’s missive is so influential that it even prompted a fake letter days before its release that was picked up by The Financial Times and other media before the hoax was revealed. His 2019 letter, Purpose and Profit, was even more provocative, urging corporate executives to step into a leadership vacuum in a divided world. The annual letter to CEOs from Larry Fink, the head of BlackRock, the world’s largest money manager which oversees nearly $6 trillion in assets, has become one of the most much-anticipated events in corporate America.įink’s 2018 letter, declaring companies should do more than make profits, set off a year of intense discussion in C-suites and board rooms and earned him the mantle of “the new conscience of Wall Street.”
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