When We are Led by Billionaires

No. This is not a political statement. Instead, it is a story about a billionaire who has established a corporate vision for our generation that could single handedly save us from ourselves. I am not speaking about Michael Bloomberg, although some may argue that this description fits him too.
 
Laurence Douglas Fink was born in 1952 in California, a son of an English professor and shoe store proprietor. A successful business student and eventual MBA, Fink started in the bond business in the 1970s when bond business was just starting to hit its stride. Laurence (or Larry for short) weaved in and out of the financial markets until the late 1980s when he founded BlackRock, an asset management firm that has since grown to be the world’s biggest, with $6.5 TRILLION under its auspices. One may think that Larry Fink, the billionaire who he is, and with the success he’s achieved, would be pleased amassing wealth and prestige, not thinking about much else. Perhaps in the older days of his asset management career that was the case. Nowadays Larry is most known for setting the high bar for corporate executives to lead with purpose and intent, and to make the world a better place.
 
Every year Larry sends out a letter to the companies in which BlackRock invests as part of the company’s Corporate Governance program. In 2017, Fink recalibrated on his 2016 letter where he suggested companies needed to start thinking longer term for greater value to shareholders, by suggesting that going forward, BlackRock will make determinants on investments based on the key ingredients that support long-term value, which include environmental, social and governance functions. Sustainability was mentioned several times in the 2017 letter as a key determinant of how companies are looking at growth. That growth isn’t just about shareholder returns and short-term gains, but about how a company can invest in global improvements.
By 2018, Fink’s letter took on a more urgent tone, requesting that recipients of investment dollars think strongly about the way the public is depending on companies to make a positive contribution to society given the pressing issues of our time. Fink says “without a sense of purpose, no company, either public or private, can achieve its full potential. It will ultimately lose license to operate from key stakeholders.” Fink’s letter goes on to question the role companies indeed play in society, and whether companies want to be known for being stewards of the environment and communities in which they operate.

When we live in a time when politics, business, philanthropy and technology seem to swarm with billionaires, and when society begins to doubt the audacity of said billionaires to give back in a way that is impactful and can effect change, it’s hard to give credence to these moves by Fink to inspire companies to do the right thing.  That said, the waves Fink made by writing his imploring letters, and subsequently the changes we’ve seen in big companies wanting to play a bigger hand in the space of sustainability, are monumental. Whether you take these actions at face value, or like some, see them as a pure money making ploy, that’s your choice. My perspective is that leading companies are figuring out how to represent their business interest in a way that has positive humanistic and societal implications. Stakeholders and shareholders are responding well, and that will only continue as investors, partners, governments and ultimately consumers support those companies doing the right thing, without question and without hesitation.
 

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