More than two years after facing criticism from US conservatives for its support of sustainable investing, BlackRock, the world’s largest money manager, is now shifting its focus.
CEO Larry Fink has notably avoided discussing climate-related topics, with only eight mentions of climate, sustainability, or green in his annual letter out of 11,000 words in March.
BlackRock is now emphasizing its pension and infrastructure offerings, with Fink highlighting retirement in his March letter and mentioning variations of the word “retire” 98 times. This marks a significant shift from 2020 when retirement was only mentioned twice.
The company has been promoting its work on retirement in prominent American newsletters and has been discussing its plans for Global Infrastructure Partners, which it acquired for $12.5bn earlier this year.
According to Pierre-Yves Gauthier, founder of research house AlphaValue, this shift represents a practical repositioning to better align with the US market.
BlackRock stated that its focus on retirement and infrastructure is in response to client demand, as evidenced by record inflows and assets under management in the third quarter.
While the company continues to offer sustainable investments, its recent emphasis has been on retirement and infrastructure. Sustainable investments under management reached $1tn this year, with a significant presence in the retirement market.
BlackRock has also been actively involved in infrastructure projects focusing on decarbonisation and green energy options, such as investments in carbon capture projects and partnerships with companies like Microsoft.
In response to criticism from Republican politicians, BlackRock has made efforts to change its public image. The company hired new executives for corporate affairs and communications, revamped its lobbying efforts, and CEO Larry Fink has personally engaged with Republican officials.
BlackRock’s shift in tone coincides with the introduction of new business offerings, including a retirement programme launched in April to address retirement insecurity issues.
Additionally, the company’s “Voting Choice” programme allows clients more say in voting on proxy ballot questions, reflecting a customer-centric approach.
BlackRock’s support for environmental and social proposals has decreased, with a focus on proposals aligned with clients’ financial interests.
For clients interested in sustainability, the company has implemented an activist voting policy for climate-focused funds.
Overall, BlackRock remains responsive to client needs and continues to evolve its offerings to meet changing demands.