BlackRock's Larry Fink will receive a "Humanitarian of the Year" award tonight from the IRC. They should ask him to stop causing so much climate change.
This article was written by our partner Majority Action and originally published on Medium.
I was disappointed to learn that the International Rescue Committee (IRC) plans to recognize Larry Fink, CEO of BlackRock, with the John C. Whitehead Humanitarian Award at its 2018 Rescue Dinner on November 1. The IRC provides humanitarian services to refugees and others “whose lives and livelihoods are shattered by conflict and disaster.” Why are they honoring someone who has failed to use his power to help those the IRC strives to protect?
As the head of BlackRock, Mr. Fink is powerfully positioned to address the root causes of forced migration and improve the lives of refugees. With more than $6 trillion in assets under management, BlackRock is the world’s largest investment manager. BlackRock is often the largest or second-largest single shareholder in U.S. public companies, giving it substantial influence and voting power within corporations in every single sector of the economy.
Through its shareholder voting power, BlackRock has the ability to confront the behavior of bad corporate actors.
Yet under Mr. Fink’s leadership, BlackRock has repeatedly failed to hold companies in the fossil fuel and private prison industries accountable for exacerbating climate change and preying upon refugees and migrants.
When they have Mr. Fink on stage, the IRC should use the opportunity to ask him to publicly commit to using BlackRock’s voting power to reform companies driving climate change and perpetrating human rights abuses.
Climate change is expected to drive staggering migrations throughout the 21st century. The American Association for the Advancement of Science estimates that 50 million people will migrate to escape their environment by 2020. Others forecast that by 2050, as many as one billion people will be displaced by the effects of climate change.
A major shareholder in most major fossil fuel companies, BlackRock remains one of the leading investors in the coal economy and is the largest investor in developers of new coal plant worldwide. But despite big talk from BlackRock about how “investors can no longer ignore climate change,” the company routinely torpedoes shareholder resolutions on climate change. This past season, BlackRock voted against every shareholder resolution at US large cap fossil fuel companies calling for transparency in political contributions this year.
BlackRock’s proxy voting guidelines state that the company can vote to replace directors in companies that fail to deal with environmental factors such as climate change. However, BlackRock voted to re-elect US fossil-fuel company directors 99% of the time this year, despite the failure of those companies to commit to meaningful climate change mitigation and enact reasonable reforms. In doing so, BlackRock is sending a clear message to energy and utility companies undermining effective action on climate change — “don’t worry, keep up the good work!”
BlackRock’s investments in private prison companies both exacerbate and profit off of the misery of detained asylum-seekers. BlackRock is a top shareholder of GEO Group and CoreCivic, private prison companies with huge immigration detention contracts. Both companies are notorious for widespread human rights issues. Just this month, the Los Angeles Times reported widespread abusive practices and refugee suicide attempts at a GEO-operated immigration detention facility.
Mr. Fink has not said a word publicly about the longstanding abuses of this industry, and in 2018 BlackRock voted to re-elect every single director at both GEO and CoreCivic. BlackRock even helped block a resolution that would have given GEO shareholders more power to hold the company accountable.
Even when Mr. Fink says it’s time to take action, like he did on firearms in the wake of the Parkland massacre this year, he has failed to back his rhetoric with action. BlackRock had a chance in May to stand up to a particularly problematic director at Sturm Ruger, America’s largest gun manufacturer. The director is an NRA fanatic with a track record of overt racism and extremism, who also championed the NRA’s nearly successful attempt to crush a public gun company for pursuing gun safety measures. But despite clear knowledge of these issues, and our delivering over 116,000 signatures calling on them to act, BlackRock voted for her anyway.
Mr. Fink’s inconsistency and reluctance to take bold action when he clearly has the power to do so does incalculable harm to people the world over. People in Mr. Fink’s position must use their immense power to address some of the world’s most intractable problems. They must be held accountable, not celebrated, when they don’t.
To best serve the needs of both present and future refugees, the IRC should use its awards ceremony to call on Mr. Fink to publicly commit to using BlackRock’s voting power to actually create climate accountability and protect refugees.
Eli Kasargod-Staub, CFA, is co-founder of Majority Action, a shareholder advocacy organization dedicated to empowering everyday people to hold corporations accountable at the highest level.
This article was originally published on Medium.