In his annual letter to BlackRock investment recipients, Fink stated that these companies need to do more than make profits. The message: “pay attention to their societal impact” or risk losing the support of the investment behemoth. With over six trillion dollars in investments, BlackRock has the weight to make this demand felt.
“Serve A Social Purpose”
“Society is demanding that companies, both public and private, serve a social purpose,” the New York money-manager wrote in a draft of the letter that Fink shared with the New York Times. (photo – Damen Winter, New York Times)
“To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society.” If a company does not engage with the needs of the community, “it will ultimately lose the license to operate from key stakeholders.”
A Watershed Moment for Business World Wide!
As Andrew Sorkin wrote in the Times: “It may be a watershed moment on Wall Street, one that raises all sorts of questions about the very nature of capitalism.”
Jeffrey Sonnenfeld of the Yale School of Management added, “It will be a lightning rod for sure for major institutions investing other people’s money… It is huge for an institutional investor to take this position across its portfolio…I’ve seen nothing like it.’’
See a full draft of Fink’s letter on the necessary connections between commerce and societal impact.
By Robert Frerck, Blue Ocean Network
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