Larry Fink is the CEO and chairperson of New York-based BlackRock, an investment management firm. BlackRock manages roughly $6 trillion in assets on a global basis. Because of its sheer size, The Economist once referred to BlackRock as the world’s largest “shadow bank.”
From my backseat driver vantage point, Fink long ago saw the light regarding what ails society and the leaders who are at the helm of for-profit organizations.
There is a blinding fixation on putting profits ahead of purpose. Indeed purpose seems to have been forgotten or worse ignored.
Senior leaders—and arguably a for-profit organization’s board of directors—continue to operate with their head in the sand. Fink’s annual letter to CEOs points this out admirably.
First, he sets the stage of today’s calamitous situation with the following lines. In summary, it’s not pretty.
- The global landscape is increasingly fragile and, as a result, susceptible to short-term behavior by corporations and governments alike.
- Around the world, frustration with years of stagnant wages, the effect of technology on jobs, and uncertainty about the future have fueled popular anger, nationalism, and xenophobia.
- Trust in multilateralism and official institutions is crumbling.
- Many see an increased risk of a cyclical downturn.
Once one digests Fink’s landscape setting, one gets the sense we sit on the cliff of a perilous future. From an ingrained short-term, myopic, shareholder-return-is-the-goal strategy to a yellow vest uprising, the world seems destined for moral bankruptcy. Fink sees this, too.
