April 15, 2020<\/p>\n
Mr. Lawrence Fink, Chief Executive Officer
\nBlackRock, Inc.
\nPark Avenue Plaza
\n55 East 52nd Street
\nNew York, NY 10055-0003<\/p>\n
Dear Mr. Fink,<\/p>\n
As the nation stands at the edge of an economic precipice and stares into it bleakly, you and your firm, the largest asset management company in the world, play an important role in calming fears, easing worries, and promising a return to normalcy. This role is exaggerated, in scope and magnitude, by the faith that the Federal Reserve has placed in you to help guide and manage its efforts to alleviate the current stress on the financial system.<\/p>\n
In light of all of this, we ask that you reconsider your controversial annual letter from January 14th to the world\u2019s largest investors that BlackRock will operate under a \u201cstakeholder\u201d model rather than the well-established \u201cshareholder\u201d primacy model. While we had concerns when this was first announced, the current pandemic has created a health crisis that is in turn creating an unexpected economic crisis.<\/p>\n
This economic crisis makes it more important than ever that companies like BlackRock focus on helping our nation\u2019s economy recover. BlackRock and others must not add additional hurdles to recovery by supporting unnecessary and harmful environmental, social, and governance (ESG) shareholder proposals.<\/p>\n
As an asset manager and a publicly traded company, your job is to act as a steward of investors\u2019 capital. By opting to enter into a public market, BlackRock received the benefit of outside investment funds with which to operate and grow. However, the bargain of that benefit is that you must act in good faith and with a fiduciary responsibility to maximize returns for those investors.<\/p>\n
Because of your experience and position, your actions influence not only the financial future of millions of Americans but also actions taken by other companies. In light of your influence, we are especially concerned that your support for some ESG shareholder proposals and investor initiatives brings political interests into decisions that should be guided by shareholder interests. Shareholders and society at large benefit when companies are guided by values such as producing quality products and services, having integrity in dealing with customers and vendors, and developing the talents and skills of employees. But when a company\u2019s values become politicized, the interests of the diverse group of shareholders and customers are overshadowed by the narrow interests of activist groups pushing a political agenda.<\/p>\n
Most ESG shareholder proposals are sponsored by activist groups that abuse the proxy process to achieve social and cultural changes that are entirely unmoored from the interests of corporate shareholders. Environmental nonprofits, labor unions, left-leaning pension funds, ESG-focused asset managers, and left-wing activists are unconcerned with corporate performance. Their goals are societal and political.<\/p>\n
Furthermore, these ESG proposals will add an extra-regulatory cost on these companies requiring them to spend their shareholder capital. This may harm everyday Americans who are invested in these companies through pension funds and retirement plans. While this won\u2019t affect folks in your income bracket, this may be the difference between affording medication, being able to retire, or supporting a family member\u2019s education for many Americans.<\/p>\n
There is a financial risk to this tack as well. The Wall Street Journal<\/em> recently reported that \u201c[p]erformance of BlackRock\u2019s own iShares range of ESG funds shows that ESG is no guarantee of gold-plated returns. Its two oldest in the U.S., set up in 2005 and 2006 and now tracking the MSCI USA ESG Select index and the MSCI KLD 400 Social index, have both lagged behind iShares\u2019 S&P 500 fund.\u201d<\/p>\n And while publicly traded companies operate under a legal fiduciary duty to their investors, this is also a moral imperative. Free market capitalism has lifted more people out of poverty than any economic system in world history. That\u2019s because, at its simplest level, capitalism operates under the basic rule that all exchanges are voluntary. Therefore, to achieve wealth and create growth in a capitalist system, one must appeal to the self-interest of others.<\/p>\n At this moment especially, all of us \u2014 including BlackRock \u2014 must be focused on the nation\u2019s economic recovery. Investors, many of whom are terrified that their retirement funds have been lost or are at risk, need to be assured that managers of their assets are focused on those facets of business performance that are likely to produce a sustained return on investment and a return to financial normalcy. Extraneous political considerations serve only to sow confusion and exacerbate instability, when instability can least be tolerated. In unsettled environments such as this, true \u201csustainability\u201d is demonstrated by robustness and resilience, not by highly politicized trends and fads.<\/p>\n It is a major concern that your statements run counter to this basic and well-established model. During the best of times, the purpose of any business is to return a profit for shareholders by providing goods and services that consumers want and need. But especially during times of grave threat to the economic health of the nation, that purpose \u2014 and not a political agenda \u2014 should be top of mind for businesses and for investors.<\/p>\n SIGNATURES (Affiliations for identification only<\/em>):<\/strong><\/p>\n Justin Danhof<\/strong>, General Counsel, National Center for Public Policy Research CC: The Honorable Jerome Powell, Chairman Download letter here<\/a><\/p>\n April 15, 2020 Mr. Lawrence Fink, Chief Executive Officer BlackRock, Inc. Park Avenue Plaza 55 East 52nd Street New York, NY 10055-0003 Dear Mr. Fink, As the nation stands at the edge of an economic precipice and stares into it bleakly, you and your firm,…<\/p>\n","protected":false},"author":2,"featured_media":35205,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[30],"tags":[],"yoast_head":"\nCLICK HERE TO SIGN THE LETTER<\/a><\/h2>\n
\nBill Meierling<\/strong>, Executive Director, Shareholder Equity Alliance
\nStephen R. Soukup<\/strong>, Publisher\/Vice President, The Political Forum
\nSteve Moore<\/strong>, Founder, Committee to Unleash Prosperity
\nEdwin Meese III<\/strong>, Former Attorney General of the United States
\nDavid Brat<\/strong>, Dean, School of Business, Liberty University
\nKen Eldred<\/strong>, Investor, Living Stones Foundation
\nFoster Friess<\/strong>, Founder, Foster’s Outriders
\nKevin D. Freeman<\/strong>, CFA, Founder, NSIC Institute
\nPatrick Moore<\/strong>, PhD, President, Ecosense Environmental Inc.
\nKeith E. Sirois<\/strong>, President and Chief Executive Officer, Capital Management HPP, Inc.
\nRebecca Hagelin<\/strong>, CEO, United in Purpose
\nDavid A. Ridenour<\/strong>, President, National Center for Public Policy Research
\nCharlie Kirk<\/strong>, Founder and Executive Director, Turning Point USA
\nDavid L. Black<\/strong>, Ph.D., Founder and CEO, 2ndVote
\nMorton Blackwell<\/strong>, President, The Leadership Institute
\nJenny Beth Martin<\/strong>, Honorary Chairman, Tea Party Patriots Action
\nDavid McIntosh<\/strong>, President, Club for Growth
\nSeth Dillon<\/strong>, CEO, The Babylon Bee
\nBrian Glicklich<\/strong>, CEO, Digital Strategies
\nLTC Allen B. West (USA Ret.)<\/strong>, Fmr. Member, U.S. House of Representatives
\nKent Lassman<\/strong>, President & CEO, Competitive Enterprise Institute
\nCharlie Copeland<\/strong>, President, Intercollegiate Studies Institute
\nPeter Schweizer<\/strong>, President, Government Accountability Institute
\nFather Robert A. Sirico<\/strong>, President and Co-Founder, The Acton Institute
\nAdam Brandon<\/strong>, President, FreedomWorks
\nPenny Young Nance<\/strong>, CEO and President, Concerned Women for America
\nBob McEwen<\/strong>, Fmr. Member, Ohio, U.S. House of Representatives
\nRichard A. Viguerie<\/strong>, Chairman, ConservativeHQ.com
\nBishop E.W. Jackson<\/strong>, President, STAND Foundation, Inc.
\nEd Corrigan<\/strong>, President, Conservative Partnership Institute
\nScott Walter<\/strong>, President, Capital Research Center
\nRabbi Aryeh Spero<\/strong>, President, Caucus for America
\nMark Lewis Melcher<\/strong>, President, The Political Forum
\nBill Walton<\/strong>, President, Council for National Policy
\nJ. Christian Adams<\/strong>, President, Public Interest Legal Foundation
\nColin A. Hanna<\/strong>, President, Let Freedom Ring
\nEunie Smith<\/strong>, President, Eagle Forum
\nRichard Manning<\/strong>, President, Americans for Limited Government
\nEverett Piper<\/strong>, President Emeritus, Oklahoma Wesleyan University
\nLynda McLaughlin<\/strong>, CEO, M3 Media Management
\nTim Huelskamp<\/strong>, Ph.D., Fmr. Member, U.S. House of Representatives
\nGinni Thomas<\/strong>, President, Liberty Consulting
\nJohn McLaughlin<\/strong>, CEO, McLaughlin & Associates
\nLt. General William G. Boykin (Ret.)<\/strong>, Executive Vice President, Family Research Council
\nJake Hoffman<\/strong>, President & CEO, Rally Forge
\nDr. Tim Daughtry<\/strong>, Author, Daughtry & Company
\nRod D. Martin<\/strong>, Founder & CEO, The Martin Organization, Inc.
\nHon. J. Kenneth Blackwell<\/strong>, former Treasurer, State of Ohio
\nDaniel Greenfield<\/strong>, Shillman Journalism Fellow, David Horowitz Freedom Center
\nTrevor Loudon<\/strong>, President, Liberty Trail Corporation
\nDavid Bozell<\/strong>, President, For America
\nHorace Cooper<\/strong>, Co-Chairman, Project 21
\nJohn Graves<\/strong>, President, Vision America Action
\nKevin D. Roberts<\/strong>, Ph.D., Executive Director, Texas Public Policy Foundation
\nHaley E. Martin<\/strong>, President, The Martin Foundation
\nDavid Kupelian<\/strong>, Vice President and Managing Editor, World Net Daily
\nJim Ross Lightfoot<\/strong>, Fmr. Member, U.S. House of Representatives, Lightfoot Strategies
\nDaniel Grant<\/strong>, President & CEO, 2nd Vote Value Investments, Inc.
\nDavid A. Clarke, Jr.<\/strong>, Retired Sheriff Milwaukee Co. Wisconsin, President America’s Sheriff LLC
\nEileen J. O\u2019Connor<\/strong>, Founder, Law Office of Hon. Eileen J. O\u2019Connor PLLC
\nScott Shepard<\/strong>, Coordinator, Free Enterprise Project, National Center for Public Policy Research
\nSherri R. Martin<\/strong>, Executive Vice President, The Martin Organization, Inc.
\nSheryl Kaufman<\/strong>, Corporate Chief Economist, Retired, Phillips Petroleum Company
\nGeorge K. Rasley, Jr.<\/strong>, Managing Editor, ConservativeHQ.com
\nJim Simpson<\/strong>, Author, Journalist, Candidate, U.S. Congress
\nBecky Gerritson<\/strong>, Executive Director, Eagle Forum of Alabama
\nStella Morabito<\/strong>, Author
\nIain Murray<\/strong>, Vice President, Competitive Enterprise Institute
\nDoreen Denny<\/strong>, Vice President of Government Relations, Concerned Women for America
\nGuillermo J. Aragon<\/strong>, Chief Financial Officer, Martin Imaging, Inc.
\nChristina Murphy Lusk<\/strong>, J.D., Deputy General Counsel, Campaign for the American Future
\nSandy Rios<\/strong>, Director of Governmental Affairs, American Family Association
\nKelly Monroe Kullberg<\/strong>, Advisor, American Association of Evangelicals (AAE)
\nNicholas W. Carper<\/strong>, CFA, Principal (Retired), Mitchell, Sinkler & Starr
\nRichard Morrison<\/strong>, Research Fellow, Competitive Enterprise Institute
\nScott Thomas Parkinson<\/strong>, Vice President of Government Affairs, Club for Growth
\nDavid W. Almasi<\/strong>, Vice President, National Center for Public Policy Research
\nBillie Tucker<\/strong>, CEO, CEO Service Bureau<\/p>\n
\nBoard of Governors of the Federal Reserve System
\n20th Street & Constitution Avenue, NW
\nWashington, D.C. 20551<\/p>\nCLICK HERE TO SIGN THE LETTER<\/a><\/h2>\n","protected":false},"excerpt":{"rendered":"