In his annual letter to CEOs, the BlackRock chief executive writes: \u201cClimate change has become a defining factor in companies\u2019 long-term prospects.\u201d<\/p>\n
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Larry Fink, CEO of\u00a0the world\u2019s largest money manager,\u00a0wrote in his\u00a0annual letter\u00a0to corporate executives<\/a>: \u201cClimate change has become a defining factor in companies\u2019 long-term prospects \u2026 But awareness is rapidly changing, and I believe we are on the edge of a fundamental reshaping of finance (…) And with the impact of sustainability on investment returns increasing, we believe that sustainable investing is the strongest foundation for client portfolios going forward.\u201d<\/p>\n The chief executive of\u00a0one of the biggest holders of most U.S. also outlined a series of initiatives that highlighted strengthening BlackRock\u2019s commitment to sustainability and cutting investment ties with high sustainability-related risk companies, which suggests a shift in the company\u2019s assets that totaled almost $7 trillion in the third quarter of 2019, according to its latest financial results<\/a>.<\/p>\n \u201cEven when other financial problems lasted for many years, they were all, in the broad scheme of things, short-term in nature. Climate change is different.\u201d (…) Investors are asking how they should modify their portfolios (…)<\/em>\u00a0\u201cAnd because capital markets pull future risk forward, we will see changes in capital allocation more quickly than we see changes to the climate itself (…) In the near future \u2014 and sooner than most anticipate \u2014 there will be a significant reallocation of capital.\u201d<\/em><\/p><\/blockquote>\n Fink\u2019s letter come as business leaders, policymakers and investors prepare to travel to Davos, Switzerland for the\u00a0World Economic Forum\u2019s\u00a050th annual forum<\/a>\u00a0to be held 21-24 January. It also arrives just days after BlackRock joined Climate Action 100+<\/a>, an influential pressure group with a combined $35 trillion in assets calling for the biggest polluters to reduce their emissions.<\/p>\n In previous years he\u2019s underscored the theme that profit and social purpose are inextricably linked, reported Fortune<\/a>, “people are looking to corporate executives to step in and offer fixes to social problems that governments are failing to solve”, Fink wrote in last year\u2019s letter.<\/p>\n Activists have been calling on BlackRock to do more around the climate crisis.<\/p>\n According to Fortune<\/a>,\u00a0coalitions of youth activists and other groups and firms have all targeted the firm demanding more action for climate change, accusing it of passive management despite\u00a0becoming the world\u2019s largest and most trusted manager of other people\u2019s money. Environmental groups like\u00a0Extinction Rebellion<\/a>\u00a0claimed\u00a0BlackRock\u2019s statement would make little difference and said \u201cthe world\u2019s biggest miners and polluters will not be losing any sleep\u201d over the announcement. \u201cBlackRock remains waist-deep in fossil fuel investments and the world\u2019s top backer of companies that destroy the Amazon rainforest and ignore the rights of indigenous people,\u201d it added.<\/p>\nQuestioning\u00a0BlackRock<\/h1>\n