2030 Finance | January 17, 2019

How real is the fake letter from Blackrock’s Larry Fink?

David Bank
ImpactAlpha Editor

David Bank

Publications, including the Financial Times, were pranked by a letter purportedly from BlackRock CEO Larry Fink. One reason for their credulity: the fake letter made cogent points that could plausibly have come from Fink himself.

Fink’s annual letter to corporate leaders has come to rival in influence Warren Buffett’s letter to shareholders. Last year, Fink urged CEOs to define their companies’ social purpose, or risk losing their “license to operate.” In 2017, he admonished them to invest more in their employees.

In the fake letter from still-unknown hoaxsters, the faux Fink ticked off a roster of global risks but concluded, “We find that the biggest contributor to uncertainty is also the greatest threat to the long-term stability of our economy and our investors’ assets: climate change. Companies must address climate risk factors or fail in their fiduciary duty.”

The tipoff may have been in the section of the letter headed “Purpose in Action, or Purposeful Inaction?” That reflects the pressure that climate activists and some investor groups have been putting on BlackRock to flex the muscle that comes from $6.4 trillion in assets under management. The fake letter purported that BlackRock would divest from coal in its actively management funds and screen out fossil fuels “which we see as declining and endangered.” It said BlackRock would vote in favor of management “only when we find them to be working toward net zero carbon emissions by 2050.”

  • The Swiss investor group Ethos, along with asset managers and other organizations, this week sent Fink a letter urging BlackRock to support climate-related shareholder proposals, citing research that BlackRock backed less than one-quarter of such resolutions last year. The Sierra Club’s petition calling on BlackRock  to “stop funding the climate crisis” has nearly 25,000 signatures.
  • The pranksters apparently also paid for the letter to appear as an ad at the top of Google searches. “A brilliantly executed fake,” tweeted ShareAction UK. “Now the world will be watching even more closely for ambitious #ClimateAction from #BlackRock.”