BLK - BlackRock, Inc.

NYSE - NYSE Delayed Price. Currency in USD
536.86
+7.72 (+1.46%)
At close: 4:02PM EST
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Previous Close529.14
Open532.53
Bid535.65 x 900
Ask543.30 x 800
Day's Range531.34 - 539.63
52 Week Range401.80 - 539.63
Volume769,790
Avg. Volume479,980
Market Cap83.394B
Beta (5Y Monthly)1.55
PE Ratio (TTM)18.88
EPS (TTM)28.43
Earnings DateApr 13, 2020 - Apr 19, 2020
Forward Dividend & Yield13.20 (2.49%)
Ex-Dividend DateDec 03, 2019
1y Target Est592.29
  • Why BlackRock decided now is the time to act on climate change
    Yahoo Finance

    Why BlackRock decided now is the time to act on climate change

    Blackrock's Brian Deese explains why Blackrock has embraced sustainable investing, expanding on Larry Fink's recent letter to CEOs.

  • BlackRock’s Kapito: People in cash won’t be able to ‘retire in dignity’
    Yahoo Finance

    BlackRock’s Kapito: People in cash won’t be able to ‘retire in dignity’

    A long life can be a problem if retirees have not invested their money, according to BlackRock president and co-founder Rob Kapito.

  • Greta Thunberg Wants More from Corporations – But How Do Investors Monitor Them?
    CorpGov.com

    Greta Thunberg Wants More from Corporations – But How Do Investors Monitor Them?

    Companies May Soon Adopt a Standardized Framework for Reporting ESG Matters By John Jannarone As U.S. President Donald Trump and Swedish environmental activist Greta Thunberg descended on Davos, Switzerland, this week, the topics of climate change and social responsibility came into sharp focus not only for countries, but corporations. The trouble is, it can be […]

  • Bloomberg

    Wall Street’s Bond Transparency Letters Are Revealing

    (Bloomberg Opinion) -- In most bond-market battles, if BlackRock Inc. and Pacific Investment Management Co. are on the same side, it’s a safe bet to assume they’ll come out victorious. After all, the two behemoths oversee about $9 trillion in assets combined and loom large in both actively managed fixed-income mutual funds and exchanged-traded funds.However, their push to delay reporting of large corporate-bond trades was so audacious — and against the grain of just about every other move toward transparency across markets — that it seems to have left the Financial Industry Regulatory Authority with little choice but to side against them, at least for the moment.As a reminder, Finra in April proposed a pilot program that would give bond traders 48 hours to disclose large block trades to other investors instead of the 15 minutes required under current rules. The initiative, as I wrote at the time, would serve to provide some empirical evidence in the debate about the trade-offs between bond-market liquidity and transparency. The regulator held an open comment period for a few months, during which it received 31 letters. I inquired about the status of its proposal in late October and was told there was no update.Well, there is now. Bloomberg News’s Ben Bain, citing two people familiar with the matter, reported Wednesday that Finra informed the Securities Industry and Financial Markets Association that the study had been put on the back burner, pending further discussions with the Securities and Exchange Commission and a bond advisory panel called the Fixed Income Market Structure Advisory Committee. Finra spokesman Ray Pellecchia told Bain, “we’re continuing to review the comments received and consider potential next steps.” But at the very least, it seems the plan has hit a wall.It takes only a quick glance at the comment letters to Finra to understand why. There’s real concern that this proposal was an attempt by the biggest investing firms to tilt the playing field to their advantage and that of large dealers.This passage from Federated Investors, for example, summarizes the general sentiment:The 48 hour delay appears to be intended to accommodate the circumstances of the largest buy-side participants in executing large trades. This may simply reflect the possibility that these institutions have reached their capacity limit in managing fixed income funds. The 48 hour delay would therefore improve liquidity for these institutions while impairing market efficiency for other market participants. This is per se contrary to the SEC’s statutory missions of promoting competition and market efficiency.…The purpose of reapportioning this transactional cost is not to significantly improve liquidity, but rather to provide a relief valve for the largest asset managers in the U.S. corporate bond market… market structure should not favor large traders to the detriment of smaller traders.As far as Finra comment letters go, that’s quite spicy. For some context, Federated manages about $527 billion of assets overall. BlackRock has $565 billion in just its fixed-income iShares ETFs, to say nothing of its actively managed bond funds and other investment options. BlackRock expects that number will reach $1 trillion within the next five years, Chief Executive Officer Larry Fink said last week in an earnings conference call, calling the bond ETFs “a modernizing force in financial markets.”The backlash doesn’t stop there, though. T. Rowe Price Group Inc., which has twice as many assets as Federated at $1.12 trillion, also cautioned against carrying out the pilot program:The 48-hour delay would create an unlevel playing field in the fixed income markets because it would only apply to the most sizeable trades. As a result, the largest investment advisers and broker-dealers would have an information advantage over other market participants when negotiating trades, effectively creating a two-tier system of haves and have-nots.Let that sink in for a moment. A trillion-dollar investment firm is concerned about “have-nots.” T. Rowe either believes that a two-tier system would be bad for the corporate-bond market as a whole or that it would be at risk of becoming a “have-not” itself.Still, the biggest dagger to the heart of the pilot program might have been from Vanguard Group Inc. and its $5.6 trillion in assets under management. “The Proposed Pilot is a harmful solution to an unsubstantiated problem,” the letter signed by Chief Investment Officer Gregory Davis said. “We routinely trade corporate bond blocks much larger than the current dissemination caps and... have observed that liquidity for corporate bond block trades has generally improved over time.”Citadel LLC and AQR Capital Management also voiced opposition. Citadel faulted some members of the SEC’s advisory committed for simply asserting that bond trading would improve despite “little evidence to suggest that the Proposed Pilot will meaningfully improve liquidity conditions.” That’s similar to how AQR put it:While we are strong supporters of making policy decisions based on the type of data-driven analysis afforded by pilot programs, the reality is that all pilots are disruptive to the workflow of market participants and thus have inherent costs. In order to justify imposing such costs on the marketplace as a whole there should be clear evidence that the changes being tested have at least a reasonable likelihood of achieving the desired outcome. We do not believe that the Proposed Pilot meets this basic standard.Of course, this argument presents something of a Catch-22. The reason there’s no evidence that delayed disclosure of large corporate-bond trades improves overall liquidity is because it hasn’t been tested. And without trying it out, there will never be the empirical data needed to get a program like this off the ground. For this reason, I’m not sure I’d entirely rule out the possibility of some sort of corporate-bond experiment, even if the details aren’t quite the same as the earlier proposal. A person familiar with the matter told Bain that Finra could still make changes and go forward after consulting with the SEC.Overall, though, the comment letters reveal real concern — and borderline fear — about what might happen to the bond market if big investment managers are afforded even more power when they’re already gobbling up ever-larger shares of just about every asset class. One firm even went so far as to say that hiding block trades creates “the potential for many victims.” That alone should be enough to give Finra pause.To contact the author of this story: Brian Chappatta at bchappatta1@bloomberg.netTo contact the editor responsible for this story: Daniel Niemi at dniemi1@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Brian Chappatta is a Bloomberg Opinion columnist covering debt markets. He previously covered bonds for Bloomberg News. He is also a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • For Oil, There’s a Green Swan Lurking in This Plastic Bag
    Bloomberg

    For Oil, There’s a Green Swan Lurking in This Plastic Bag

    (Bloomberg Opinion) -- Back in 1999, one of the most talked-about scenes in one of the most talked-about movies involved a dancing plastic bag. It was surely a more innocent time. Still, two decades on from American Beauty and its bag-shaped pretensions, this is an opportune moment to reiterate that it’s just trash. China has unveiled plans to curb the use of non-degradable plastic bags in supermarkets and malls across major cities as well as food-delivery services. The problem with plastic isn’t plastic, much of which is useful and likely irreplaceable. Rather, it’s that we produce a lot of low-value but long-lasting plastic — especially packaging — that overwhelms our waste-management capabilities (or inclinations, for that matter) and winds up polluting the planet. Plastic bags blowing about in a fall breeze aren’t, as the movie contends, a metaphor for the hidden wonders of suburbia; they’re an expression of failure.As my colleague David Fickling writes, growing demand for petrochemicals is an article of faith in the oil and gas business, and one that gets a lot more airing these days to offset the disquieting narrative of electric vehicles stalling out gasoline consumption. In its most recent Energy Outlook, BP Plc identified “non-combusted” demand for oil as the single-biggest source of projected growth through 2040, with single-use plastics accounting for almost 40% of that 5.5 million barrels a day.Under an alternative future in which governments phase out single-use plastics aggressively and ban them altogether by 2040, BP’s outlook has global oil demand peaking in the late 2020s. That seemed like a far-off jetpack era back when we were watching dancing bags but now looms with humdrum imminence. This matters a lot because the oil industry plans to invest north of $34 billion a year in petrochemicals through 2024, according to estimates from Sanford C. Bernstein — equivalent to building the entire fixed asset base of a supermajor, Chevron Corp.China’s latest plan isn’t anywhere near a worldwide moratorium on Ziplocs. Yet it presents a risk that goes beyond this or that forecast for oil demand.It just so happens that a day or two after Beijing’s announcement, the Bank for International Settlements released a new report called “The Green Swan.” This lays out risks posed to the global financial system by climate change and the limitations of current models in quantifying potential impacts. One point raised is that while economists traditionally support carbon pricing to mitigate climate change, “given the size of the challenge ahead, carbon prices may need to skyrocket in a very short time span towards much higher levels than currently prevail.” In other words, we left it too long, so we now need to make carbon prohibitively expensive.Analogous to that is the act of just prohibiting stuff — which is where China’s new regulations come in. Those aren’t carbon-related per se, but the mechanism is the same. In theory, a mixture of price signals, recycling programs and consumer education could moderate the problem of plastic pollution. In practice, less than a fifth of plastic is recycled, a finding sometimes framed as a growth-driver for the industry. The relatively low value of the product, use of mixed plastics and general consumer confusion over what goes into what recycling bucket are big obstacles to getting that figure higher.Faced with that, more national and local governments are choosing to effectively set the “price” for certain plastics at some level tending to infinity by just banning them. In that sense, the difficulties of recycling may be less a bull argument for plastics and more a precursor to drastic measures.The resort to policies of interdiction, rather than market-led solutions, is itself a green swan: fiat dislocation that is hard to model. It doesn’t take a global ban on single-use plastics to present a problem to an oil industry that has (a) made petrochemicals a central part of its growth story and (b) begun deploying billions already in projects ranging from Saudi Arabian Oil Co.’s Asian joint ventures to Exxon Mobil Corp.’s shale-linked crackers on the Gulf coast.“To stop plastic use entirely will be hard, but to kill demand growth will require solutions for only 3% of global demand each year,” writes Kingsmill Bond, energy strategist at Carbon Tracker and co-author of a forthcoming report on the future of plastic demand. An ethylene plant running at 60% of capacity wouldn’t be stranded per se, but it wouldn’t be a must-own either.The cloud of uncertainty gathering over future oil demand raises the industry’s cost of capital, manifested in demands for higher cash payouts. BlackRock Inc.’s Larry Fink made much the same point in last week’s climate letter (including the potential for green swans, though he didn’t use that phrase). Today’s teenagers don’t sit around filming pollution; they head to Davos and lambast tycoons about it. In this sense, China’s bag ban may be less important for its specific impact on oil volumes and more for its general impact on expectations of growth and thereby sentiment and risk premiums for oil-related assets. Much as I hate to admit it, sometimes a bag is more than just a bag.To contact the author of this story: Liam Denning at ldenning1@bloomberg.netTo contact the editor responsible for this story: Mark Gongloff at mgongloff1@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Liam Denning is a Bloomberg Opinion columnist covering energy, mining and commodities. He previously was editor of the Wall Street Journal's Heard on the Street column and wrote for the Financial Times' Lex column. He was also an investment banker.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Benzinga

    BlackRock, France, Germany Govts. Seek $500M Investment For Their Joint Climate Fund

    The CFP was announced at the One Planet Summit in September 2018. Leading partner BlackRock Inc. (NYSE: BLK) said the vehicle will feature a first-loss tranche of at least $100 million in catalytic capital, anchored by government and foundation partners, which BlackRock will use to mobilize a goal of at least $400 million in institutional capital commitments. The governments of France and Germany, both of which are partners in the CFP, will contribute $30 million each.

  • REFILE-DAVOS-BlackRock, partners eye initial $500 mln for climate fund
    Reuters

    REFILE-DAVOS-BlackRock, partners eye initial $500 mln for climate fund

    A BlackRock-backed group aims to raise an initial $500 million for a private equity fund that will invest in climate change-linked infrastructure upgrades in emerging markets. The group will provide the first $100 million of funding for the Climate Finance Partnership (CFP), which was set up in 2018 along with France, Germany and the Hewlett and Grantham charitable foundations, it said in a statement on Wednesday. The funding will go towards a first-loss tranche that will absorb any initial losses, a safety net for other institutional investors that BlackRock expects to help it raise at least another $400 million.

  • BlackRock, partners eye initial $500 million for climate fund
    Reuters

    BlackRock, partners eye initial $500 million for climate fund

    A BlackRock-backed group aims to raise an initial $500 million for a private equity fund that will invest in climate change-linked infrastructure upgrades in emerging markets. The group will provide the first $100 million of funding for the Climate Finance Partnership (CFP), which was set up in 2018 along with France, Germany and the Hewlett and Grantham charitable foundations, it said in a statement on Wednesday. The funding will go towards a first-loss tranche that will absorb any initial losses, a safety net for other institutional investors that BlackRock expects to help it raise at least another $400 million.

  • Moody's

    China, Government of -- Moody's: US-China trade deal positive for selected financial services providers in both countries

    Moody's Investors Service says in a new report that the phase one trade deal between the US (Aaa stable) and China (A1 stable) is positive for the development of many financial firms, but that the effects will roll out gradually and require significant upfront investments. "The key beneficiaries will be US financial institutions that view China as strategically important, because of the large market for financial services for its rapidly growing middle class, while large Chinese institutions will in turn benefit from the expertise that the foreign companies bring," says Sean Hung, a Moody's Vice President and Senior Analyst.

  • Business Wire

    Davos 2020 Climate Finance Partnership Press Release

    Parties to the Climate Finance Partnership (CFP) have taken another step forward in their partnership to accelerate the flow of capital into climate-related investments in emerging markets, reaching agreement on the core terms and structure of their flagship blended finance investment vehicle. The parties to the CFP are France, Germany, the Hewlett and Grantham foundations, and BlackRock.

  • Activist investor calls on Toshiba Machine to put defense plans before shareholders
    Reuters

    Activist investor calls on Toshiba Machine to put defense plans before shareholders

    Japan's most prominent activist investor on Wednesday demanded Toshiba Machine Co hold an extraordinary shareholders meeting to discuss its plans to introduce defense measures against a hostile takeover. The demand from investor Yoshiaki Murakami came a day after he launched a hostile bid of up to $235 million for control of the company. Toshiba Machine has said it could adopt poison-pill measures to fend off acquisition attempts by issuing stock warrants to existing shareholders and diluting the holdings of unwanted suitors.

  • 7 Most-Searched ETF Areas in the Past 7 Days
    Zacks

    7 Most-Searched ETF Areas in the Past 7 Days

    Inside the ETF areas that are trending lately.

  • Microsoft CEO Says U.S.-China Spat May Hurt Global Growth
    Bloomberg

    Microsoft CEO Says U.S.-China Spat May Hurt Global Growth

    (Bloomberg) -- Sign up here to receive the Davos Diary, a special daily newsletter that will run from Jan. 20-24.Microsoft Corp’s chief executive officer said he worries that mistrust between the U.S. and China will increase technology costs and hurt economic growth at a critical time.Using the $470 billion semiconductor industry as an example of a sector that is already globally interconnected, Satya Nadella said the two countries will have to find ways to work together, rather than creating different supply chains for each country.“All you are doing is increasing transaction costs for everybody if you completely separate,” Nadella said in an interview with Bloomberg News Editor-in-Chief John Micklethwait at Bloomberg’s The Year Ahead conference in Davos. That’s a concern as the executive said the world is on the cusp of a revolution around technology and artificial intelligence.“If we take steps back in trust or increase transaction costs around technology, all we are doing is sacrificing global economic growth,” he said.The Trump administration is considering steps to further limit the ability of U.S. companies to supply Huawei Technologies Co., China’s flagship tech company, in addition to pressuring countries around the world to avoid using its equipment for 5G mobile networks.The agreement signed last week between the U.S. and China was “not sufficient,” said Nadella, but represented “progress” on the issue of intellectual property protections for U.S. technology companies working with China.To enable different countries to use technology from outside their borders, Nadella suggested a system that relies on verification. For example, Microsoft has set up technology centers where various governments can inspect the Windows source code to satisfy themselves as to the security of the product.“There has to be a way for any country to be able to trust, through verification, the technology that they are using as part of a their infrastructure,” he said. “Mechanisms like that have to be in place, and then build trade on top of it instead of thinking of trade and trust as the same thing.”Two InternetsNadella said he worries about the development of two separate internets, noting that to some degree they already exist “and they will get amplified in the future” with massive technology companies already in place in China.The viewpoint clashes with Microsoft co-founder Bill Gates, who has been skeptical about the idea that ongoing U.S.-China trade tensions could ever lead to a bifurcated system of two internets.China and the U.S. are the two leading AI superpowers, however the cooling political relations between them have slowed the international collaboration.Even amid the tensions, countries should find ways to establish global norms around cybersecurity -- such as agreements not to hack each other’s citizens -- privacy and responsible AI, Nadella said. “Despite whatever trade dynamic causes people to separate, you would hope people would recognize we all benefit from more global norms, not less.“ Earlier this month, in a blog post about his goals for the year, Nadella said these areas are essential to earn and sustain people’s trust.Nadella also warned that countries that fail to attract immigrants will lose out as the global tech industry continues to grow. The CEO has previously voiced concern about India’s Citizenship Amendment Act, which bans undocumented Muslim migrants from neighboring countries from seeking citizenship in India while allowing immigrants from other religions to do so, calling it “sad.”“Every country is rethinking what is in their national interest,” he said. Governments need to “maintain that modicum of enlightenment and not think about it very narrowly,” Nadella said, adding that “people will only come when people know you’re an immigrant-friendly country.“However, Nadella said he remained hopeful. “I’m an India optimist,” he said. “The fact that there is a 70-year history of nation building, I think it’s a very strong foundation. I grew up in that country. I’m proud of that heritage. I’m influenced by that experience.”Carbon IssuesMicrosoft has recently unveiled plans to invest $1 billion to back companies and organizations working on technologies to remove or reduce carbon from the atmosphere, saying efforts to merely emit less carbon aren’t enough to prevent catastrophic climate change.“We will now have to make sure all our data center operations are first consuming renewable energy,” Nadella said.Microsoft and Amazon.com Inc., along with other technology companies, have been criticized for supplying software and cloud services to large oil and gas companies like Chevron Corp. and BP Plc. BlackRock Inc.’s Larry Fink has been trailed to work and public engagements by protesters decrying the investment firm for inaction on global warming and other issues.Activists have been pushing for companies to stop working with the largest producers of greenhouse gases. BlackRock has said it will cut exposure to thermal coal as the world’s largest asset manager moves to address climate change.Nadella declined to comment on whether Microsoft would stop working with the major carbon producers. “The energy transition is going to include all of us,” he said.(Updates with comment about global policies on security, privacy in 12th paragraph)To contact the reporters on this story: Dina Bass in Seattle at dbass2@bloomberg.net;Amy Thomson in London at athomson6@bloomberg.netTo contact the editors responsible for this story: Giles Turner at gturner35@bloomberg.net, Molly SchuetzFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Retirees Should Know These 3 Facts About Required Minimum Distributions - January 21, 2020
    Zacks

    Retirees Should Know These 3 Facts About Required Minimum Distributions - January 21, 2020

    Like many investors, you're likely aiming to build a comfortable nest egg to ensure a comfortable retirement. Make sure you know all about what financial planners dub the accumulation and distribution phases of retirement planning.

  • Bloomberg

    Companies Must Step Up to Tackle Climate Change, Says Larry Fink

    (Bloomberg) -- Government institutions can’t solely address climate change, placing a burden on companies to help deal with the issue, BlackRock Inc.’s Chief Executive Officer Larry Fink said.Dealing with the challenge “requires real long-term planning,” Fink said in an interview with Bloomberg News editor-in-chief John Micklethwait. That doesn’t suit many governments, which operate on two-or four-year cycles, he said.“Climate change is not going to be fixed by a central bank,” Fink said at the World Economic Forum in Davos.Last week Fink warned corporate America that the global climate emergency will upend business sooner than many leaders expect. He outlined a plan for BlackRock to adopt climate considerations into managing its $7 trillion in client assets. He wrote that “every government, company and shareholder must confront climate change,” and that corporations will need to reveal more information about their climate-related risks.His message arrived against the backdrop of Australia’s catastrophic wildfires, which ravaged a combined area twice the size of Switzerland. Last year was the second hottest on record in 140 years of data.Fink also said that climate change will be a disruptive force that could have social implications. The potential for insurance costs to rise against disasters like flood and fire could add further strain to cash-strapped households, for example, while carbon taxes can be regressive.“We have to be thoughtful with the solutions,” he said. “We understand the societal impact.”BlackRock also said last week that it would incorporate sustainability into its investment processes. While that will include divesting from stocks and bonds of thermal coal producers in its actively-management funds, it will be more difficult to apply the considerations to its suite of passive investments, which hold close to $5 trillion in assets.Fink said that BlackRock’s role as a fiduciary -- safeguarding client assets -- plays into its approach to decision-making. For example, it couldn’t legally pull client funds from all fossil fuel producers in funds which track indexes that include those companies.“It’s not my money,” Fink said. “If a client gives me a contract to invest in the S&P 500 Index,” he said, the firm couldn’t invest it in “the S&P 497.”The firm said it will double its number of sustainable exchange-traded funds to 150 and pressure index providers to create more environmental, social and governance-related benchmarks.Fink’s climate proposals followed a year in which activists and non-profits railed against BlackRock for what they called a lax attitude toward climate change.To contact the reporter on this story: Annie Massa in New York at amassa12@bloomberg.netTo contact the editors responsible for this story: Sam Mamudi at smamudi@bloomberg.net, Alan MirabellaFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Bloomberg

    SAP Says Companies Will See Spread of Activism From Stakeholders

    (Bloomberg) -- Sign up here to receive the Davos Diary, a special daily newsletter that will run from Jan. 20-24.SAP SE’s co-chief executive officer said companies will continue to face activism not only from shareholders, but increasingly from employees and consumers.“This will continue to be something that CEOs will have to understand and balance across the different stakeholders,” Jennifer Morgan said in an interview with Bloomberg News’s Stephanie Flanders on Tuesday at Davos.The Walldorf, Germany-based company attracted the interest of activists at Elliott Management Corp., which revealed a 1.2 billion-euro ($1.3 billion) stake when SAP announced a change in strategy in April.Read More: SAP’s an Old Company With New TricksActivists have been broadening their scope of engagement with companies. Protesters have been pressing BlackRock Inc. to divest from fossil fuel companies and others that contribute to climate change, while employees at Google have protested over the conduct of executives.Morgan -- who became co-CEO in October alongside Christian Klein and is the first female chief executive of a DAX-listed company said -- said user experience is set to be the new battleground.“If a company is not competing on experience its a race to the bottom”, she said. “When you’re in a consumer-led economy like the United States, for example, the disruption that we see happening for traditional industries is happening in the experience gap”.Morgan used fitness company Peloton Interactive Inc. as a good example of tapping into someone else’s experience “gap” saying they provide not just a better service but a real experience that people will pay more for.To contact the reporter on this story: Sarah Syed in London at ssyed35@bloomberg.netTo contact the editor responsible for this story: Giles Turner at gturner35@bloomberg.netFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • BlackRock’s Hildebrand Says Lawmakers Key to Climate Fight
    Bloomberg

    BlackRock’s Hildebrand Says Lawmakers Key to Climate Fight

    (Bloomberg) -- Sign up here to receive the Davos Diary, a special daily newsletter that will run from Jan. 20-24.BlackRock Inc. Vice Chairman Philipp Hildebrand says the fight against climate change will require a joint effort between governments and the private sector.“We should have no illusion about this, ultimately climate change cannot be tackled by just the private sector,” Hildebrand said in an interview with Bloomberg TV at the Swiss resort of Davos. “This is a government problem, it will require sustained coordinated government responses. There will be laws, there will be regulation, and the private sector adapts to that.”Sustainability and climate change are expected to dominate discussions at this year’s annual World Economic Forum, which has been held in the Swiss Alpine town of Davos since the 1970s. The event attracts the world’s most important lawmakers and wealthiest people and this year at least 119 billionaires are converging to join bankers, politicians and other grandees for their pilgrimage.BlackRock’s Chief Executive Officer Larry Fink issued his strongest statement last week as he pledged to incorporate environmental concerns into the firm’s investment process for both active and passive products. As well as sitting on the firm’s global executive committee, Hildebrand oversees BlackRock’s Sustainable Investing divisions.The $7 trillion asset manager said it will exit both debt and equity investments in thermal coal producers across its active portfolios and will introduce new investment products that screen fossil fuels. The firm is tackling the subject as asset managers come under greater pressure on sustainability, with BlackRock in particular facing increasing scrutiny for its behavior and voting record around environmental issues.As the world’s largest manager of index funds, BlackRock invests in the world’s biggest polluters. The firm plans to address the apparent conflict by creating sustainable versions of its flagship iShares index business and to double the existing number of ESG-compliant exchange-traded funds to 150.Anne Richards, chief executive officer of Fidelity International, said active managers are best placed to push the companies they invest in to change their behavior on environmental issues.“As active managers, one of the tools you always have in your kit bag ultimately is threat of divestment,” Richards said in a Bloomberg TV interview from Davos. “The first starting point is engagement, because it’s when you own the shares you really have leverage to talk to management.”The majority of Fidelity International’s assets are in active funds, although the firm has several indexes and ETFs, according to a company spokeswoman. Assets under management stood at $339.2 billion at the end of 2019.Index TrackersPassive funds will “never have that tension,” Richards said. “They will always be holders unless the index changes.”BlackRock’s passive offerings account for about two-thirds of its assets under management at $4.9 trillion and the iShares ETF business continued to be a major driver last year, pulling in more than half of all inflows during the fourth quarter. Passive funds blindly mimic an index and, by design, may include polluters. In an industry where there’s no standard definition of what makes a company or investment environmentally sustainable, moves by asset managers are also constantly evolving.(Updates with comments by Fidelity International’s Richards starting in seventh paragraph)\--With assistance from Chris Bourke.To contact the reporters on this story: Lucca de Paoli in London at gdepaoli1@bloomberg.net;Francine Lacqua in London at flacqua@bloomberg.net;Suzy Waite in London at swaite8@bloomberg.netTo contact the editors responsible for this story: Shelley Robinson at ssmith118@bloomberg.net, Patrick HenryFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Financial Times

    Larry Fink rules on the best global standards for climate risk reporting

    BlackRock chief Larry Fink has warned that the world’s largest asset manager will take a “harsh view” of companies that fail to provide hard data on the risks they face from climate change. As part of his annual missive to chief executives last week, Mr Fink said the $7tn asset manager had spent “several years” talking to companies about their preparations to report on the risks and opportunities they faced from global warming. In the letter, Mr Fink said that by the end of the year he wanted all companies to “disclose in line with industry-specific” guidelines set out by the SASB — the Sustainability Accounting Standards Board, a non-profit organisation that sets voluntary financial reporting standards.

  • BlackRock Has Bigger Weapons in Its Climate Armory
    Bloomberg

    BlackRock Has Bigger Weapons in Its Climate Armory

    (Bloomberg Opinion) -- BlackRock Inc., the world’s largest asset manager, says it will cut exposure to companies linked to thermal coal, among other climate-friendly measures. It’s a powerful signal. Unfortunately, it only scratches the surface. If BlackRock CEO Larry Fink is serious about helping to eliminate coal while reshaping finance, his outfit can use its holdings of sovereign debt to tackle governments, too.Coal power generation has fallen steeply in Europe and the U.S. in the past year or so, thanks to cheap natural gas, higher carbon prices and green pressure. Yet in Asia, once you iron out some local peculiarities, demand for the black stuff remains remarkably resilient. That suggests that even if global appetite peaks soon, as most analysts estimate, it could well remain at high levels for years to come. Analysts at UBS Group AG estimated last July that on current trends the last coal-fired power station may close only in 2079. To blame are the likes of China, India and Vietnam. Their fleet is young, still growing and often state-backed; Western money managers selling out of public securities won’t change that. There is good news. BlackRock is an investment giant, with $7.4 trillion of assets under management, so Fink’s call to arms last week marks a significant move. Cutting off funds for coal producers and driving up their cost of capital is key to suffocating a sector that is the single largest cause of increased global temperatures.BlackRock’s strategic shift is also driven by self-interest. That’s encouraging, as such initiatives tend to outlast moral outrage. Heat from activists, like the BlackRock’s Big Problem campaign, helped, but Fink argues he is making sustainability the new standard because it makes financial sense. The surge of inflows into the firm’s environmentally friendly funds last week will encourage that view.The devil, as ever, is in the detail. BlackRock’s aim to divest thermal coal equity and debt will apply to its actively managed funds. Yet those amount to only under a third of the money it manages. As worrying is the threshold to be used to determine what has to go: The fund manager will sell out of any company where 25% of revenue or more is derived from thermal coal. That gets at narrowly focused producers like Australia’s Whitehaven Coal Ltd., but leaves untouched stakes in diversified heavyweights,  like BlackRock’s 6% holding in Glencore Plc, the world’s top producer of seaborne thermal coal, or other sprawling conglomerates. It also tackles primarily miners, not utilities that consume the fuel.It’s possible to aim higher: Axa SA last year vowed to reduce its exposure to the thermal coal industry to zero by 2040.The bigger problem is that while such moves are necessary, they aren’t sufficient. That’s firstly because of the haven offered by private markets. If a large investment fund divests a stock or bond, or pressures companies into selling out of coal projects, what next? BlackRock investors may feel better, but will global production reduce overall? Quite possibly not. Will the world be greener? Also, possibly not, if the pit is sold to owners out of the public eye. Arguably, it may become harder to monitor. That suggests a more effective pressure point is demand, and that means tackling governments and state-backed firms still funding and supporting the fuel. Indeed, real impact will require a change in policy in Asian markets like Vietnam where coal is still a major employer and seen as a driver of economic growth.  As a major investor in sovereign debt, even if much of it is in passive funds, BlackRock has enough leverage for meaningful dialogue at least.The challenge is significant. Consider China, which wants to reduce its reliance on coal. At least 200 million tons of coal capacity were ready to start production in 2019, while another 409 million tons of government-approved capacity are under construction, according to Bloomberg Intelligence numbers published last September. Together, that’s almost a quarter of China's up-and-running thermal coal capacity. In Indonesia, coal consumption may grow at the world’s fastest pace. Earlier this month, Jakarta ordered coal miners to slash production after record output last year. Prices immediately turned higher.Policy, then, is the lever to significantly reduce coal use in the region where it’s still growing: Asia. Go back to the UBS numbers. On current trends, the last coal-fired power station closes in six decades. But a red alert scenario where leaders accelerate closures would shutter the last plant in 2058,  according to the bank, closer to the 2050 target set by the Intergovernmental Panel on Climate Change.Indonesia’s tussle with JPMorgan Chase & Co. in 2017 — when Jakarta temporarily severed business ties over a negative research report — is a reminder of just how much emerging market governments care about perception. BlackRock can make that count. To contact the author of this story: Clara Ferreira Marques at cferreirama@bloomberg.netTo contact the editor responsible for this story: Matthew Brooker at mbrooker1@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Clara Ferreira Marques is a Bloomberg Opinion columnist covering commodities and environmental, social and governance issues. Previously, she was an associate editor for Reuters Breakingviews, and editor and correspondent for Reuters in Singapore, India, the U.K., Italy and Russia.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Bloomberg

    Can You Get $10 Billion of Stock Orders in 10 Hours?

    (Bloomberg Opinion) -- The last place on earth where bankers and traders can make real money is opening up. As part of its trade deal with the U.S., China vowed to grant Western financial institutions more access to its $14 trillion wealth-management industry. A number of foreign-controlled joint ventures with banks are in the works. Days before Christmas, Beijing approved the first one, a tie-up between Amundi Asset Management and a unit of Bank of China Ltd. Shortly afterward, China Construction Bank Corp. agreed to partner with BlackRock Inc. and Temasek Holdings Pte, while Industrial & Commercial Bank of China is flirting with Goldman Sachs Group Inc.Millions of dollars are being thrown at this. JPMorgan Chase & Co. and Nomura Holdings Inc. are buying up extra office space in Shanghai, where staff could be paid more generously than in Hong Kong. Goldman plans to double its headcount in China to 600 over the next five years. But why would foreigners want to crowd into the world’s most competitive market? Simple: Investors in China still have faith in active managers. Last year, it took just 10 hours for a star stock picker to attract more than $10 billion in orders for his firm’s debut mutual fund.Foreign firms might reason that they have deep talent pools, too. Bin Shi, a portfolio manager who has been with UBS Group AG since 2006, can churn out profit better than many of his mainland competitors. His Luxembourg-registered All China Fund returned 50% over the past year. By tapping into local banks’ distribution networks, Western asset managers could benefit from the army of retail investors that might come crowding in.If allowed to compete, Wall Street managers could almost effortlessly bat local competitors away. After all, Beijing wants Chinese wealth managers to emulate the U.S. model. In the West, middle-class savers have built up their nest eggs with mutual funds. They get some sense of their risk-return trade-off by checking (sometimes obsessively) the charts and numbers that showcase the historical ups-and-downs of their fortunes.Not so in China. Two years after the government unveiled sweeping rule changes, many products still carry the false perception of guaranteed future returns. It’s not uncommon for money managers to post these forecasts on their websites weekly. The concept of metrics like net asset value remain completely foreign to a money manager sitting in a Chinese bank branch. In that sense, Western competitors are miles ahead.Then consider the options. If Chinese savers looked at BlackRock’s range of offerings, for example, they’d be blown away. Some funds are designed to help you retire by 2040, while others are more tactical in nature. Blending bonds with stocks in a portfolio is commonplace, and financial metrics such as the Sharpe Ratio or effective duration for fixed income funds are readily available for savers to peruse, if they decide to get a bit technical.In China, investments that can deliver steady, stable gains are rare. Moms-and-pops are stuck with either bank deposits, which are essentially subsidies to the state-owned banks, wealth management products — nowadays pretty boring, thanks to Beijing’s sweeping rule changes to limit risk — or speculative private funds that can cost you dearly.To Beijing’s credit, foreigners have a fairly level playing field in the asset-management business. The new rules, which require banks to spin off their wealth units, are re-drawing the landscape entirely. The first such operation opened for business just six months ago, and there are now about half a dozen. It wasn’t until early December that the government even finalized net capital rules for these operations. So assuming the likes of Goldman and BlackRock can get their licenses quickly, their peers won’t be that far behind. That’s quite a positive step for a country that actively blocks Alphabet Inc.’s Google and Facebook Inc. to allow its domestic players flourish.Of course, we all know the realities of marriage: Whether a partnership yields happiness is anyone's guess. But that shouldn't discourage Western asset managers from trying. There's plenty of money to be made.To contact the author of this story: Shuli Ren at sren38@bloomberg.netTo contact the editor responsible for this story: Rachel Rosenthal at rrosenthal21@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Shuli Ren is a Bloomberg Opinion columnist covering Asian markets. She previously wrote on markets for Barron's, following a career as an investment banker, and is a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Financial Times

    Don’t expect the earth from fund managers on climate change

    More than three years ago, BlackRock, the world’s largest fund manager, published a paper promising to take more account of climate risks when investing in companies. “Investors can no longer ignore climate change,” the 16-page report observed. Last week, under pressure to practice more vigorously what it preached, the fund manager’s chief executive announced a series of measures designed to show it was following through on its commitment.

  • Oilprice.com

    Why BlackRock Is ‘Going Green’

    Investor pressure on fossil fuel producers as well as users has been increasing dramatically of late, and BlackRock, the world’s largest money manager could no longer afford to ignore this trend

  • Thomson Reuters StreetEvents

    Edited Transcript of BLK earnings conference call or presentation 15-Jan-20 1:30pm GMT

    Q4 2019 BlackRock Inc Earnings Call

  • Barrons.com

    Larry Fink Defends BlackRock’s New Emphasis on Climate Change. What Investors Need to Know.

    The BlackRock CEO says that “ESG will be one of the key lenses for how investors look at everything, from corporate to country to municipal.”