Nicklaus: The greening of Wall Street is more evolution than revolution –

Posted: January 17, 2020 at 1:43 pm

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BlackRock Chairman and CEO Laurence Fink is interviewed by Maria Bartiromo on Fox Business Network's "Opening Bell with Maria Bartiromo," Wednesday, March 26, 2014 in New York. (AP Photo/Mark Lennihan)

Superlatives make me suspicious, so color me skeptical when one of the worlds biggest money managers talks about a fundamental reshaping of finance.

That was the headline on a letter that Larry Fink, chief executive of BlackRock Inc., sent this week to CEOs of major companies. The letter said climate change and sustainability have become central to BlackRocks investment strategy.

You may not have heard of BlackRock, but the CEOs certainly have. Finks company manages $7 trillion in assets, and it voted against 4,800 directors at 2,700 companies last year. Finks letter said it will increasingly use its voting power when companies are not making sufficient progress on sustainability.

The firm plans to introduce sustainable versions of its iShares index funds. Instead of weighting investments by market capitalization, the new funds will concentrate money in companies that get high scores on environmental, social and governance issues.

Over time, Fink predicts, the sustainable funds will become BlackRocks flagship offerings, with traditional index funds fading in importance.

Finks letter comes as Australian wildfires dramatize how climate change can affect a national economy. But will it send CEOs scurrying to make their companies greener? Are his superlatives justified?

Originally posted here:
Nicklaus: The greening of Wall Street is more evolution than revolution -

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January 17th, 2020 at 1:43 pm