BlackRock oversees $9.1 trillion in assets as the world’s largest money manager, and it’s amassed enormous power through its many funds and high-profile chief executive and cofounder, Larry Fink. It’s gone from a company mainly known only on Wall Street to one the general public now knows best for two things: its sheer size and ESG investing.
BlackRock’s dominance as a passive investment behemoth and a vocal champion of environmental, social, and governance investing has drawn far more mainstream attention than ever in recent years.
That’s led to viral conspiracy theories over what BlackRock owns and how it influences decision-making at other companies, presidential candidates raising the issue during debates, attacks on Fink personally, and criticisms by lawmakers primarily on the right who have seized on ESG as a boogeyman. The firm has defended itself, responding to critics that it works as a fiduciary and acts in clients’ best interest, not as a force for political activism. It has delayed launching an ESG fund for more than a year against that backdrop, Business Insider first reported last August.
BlackRock manages assets for clients across wealth management, pension plans, insurance companies, governments, and other types of clients. Its reach is wide for sophisticated and everyday investors: 35 million people invest in BlackRock’s 1,300 exchange-traded funds. It sells a powerful portfolio-management software called Aladdin, used by virtually all of Wall Street, and it manages some $320 billion of so-called alternative assets like private credit.
At the same time, BlackRock is shaping the next generation of leadership.
Rob Kapito, the president and another cofounder, and Fink lead the New York-based firm. BlackRock has made personnel changes and appointments in the past year that point to who may be positioned to take over once Fink and Kapito leave.
For a window into BlackRock’s workforce, powerful executives, dealmaking, and more, here is Business Insider’s latest reporting on BlackRock.
Founder-led BlackRock is shaping the next generation of top management.
“I’m not planning to leave BlackRock anytime soon,” Fink said at the firm’s investor day in June 2023, “but BlackRock’s board and I have no higher priority than developing the next-generational leaders for BlackRock.”
Business Insider reported that a group of top executives, including Mark Wiedman, Martin Small, and Rob Goldstein are viewed as contenders to replace Fink. An exclusive org chart that Insider published shows where these executives and other influential employees sit within the firm.
More of Business Insider’s reporting on BlackRock’s workforce:
BlackRock is prioritizing the private markets.
Managers typically charge far higher fees to oversee private-markets assets for clients than the traditional stock and bond funds that BlackRock is best known for, and clients’ appetite for those assets is growing.
This year the firm set a goal to double the revenue that its private markets business generates, and it’s on the hunt for deals to make that happen.
BlackRock announced last year that it is acquiring a London-based private credit manager. Business Insider previously reported that a prior private credit-focused acquisition BlackRock made in 2018 led to asset growth but departures of some senior employees who were frustrated by the deal’s integration.
Last month BlackRock reorganized the executives overseeing private assets — which is no longer structured as a standalone unit — to boost growth. Fink indicated last April that the banking sector turmoil this spring and the market volatility that ensued had presented opportunities for deals, and analysts have pointed to alternatives as one area where BlackRock could seek out M&A.
Read more here: ‘BlackRock has a lot of catching up to do’: Why Larry Fink’s fund giant is ramping up lending efforts
BlackRock — and Fink personally — have become political targets over ESG investing.
BlackRock and Fink himself have faced intense scrutiny over the firm’s climate-aware investment strategies. Conservative politicians view BlackRock as promoting liberal ideals in the companies BlackRock’s funds own, while progressive politicians say BlackRock isn’t doing enough to fight the climate crisis.
BlackRock often responds by reminding each side — and investors at large — that it is a fiduciary and works in the best interest of its clients. Late last year, a small activist hedge fund with a tiny stake in BlackRock even called on the company to replace Fink over the firm’s approach to ESG investing.
Business Insider reported last March that Fink backed off of sustainability talk in his annual letter after a year of political attacks. And during the firm’s investor day last June, there was no mention of the term “ESG,” according to a 33,000-word transcript of the event from the research provider Sentieo.
Executives used different language to discuss sustainable investing, describing “transition capital,” or opportunities for investments toward a low-carbon economy, at length.
More of Business Insider’s reporting on BlackRock’s climate-focused and ESG investing:
Fink says BlackRock is spending a lot of time studying artificial intelligence tech, and the firm continues to push into crypto.
BlackRock is spending “a huge amount of time” on AI, and how it will “reshape” the firm, Fink said last year. BlackRock has experimented with AI for several years: five years ago it formed a team now called AI Labs that works on the technology.
Fink and Kapito said in a memo this week about laying off 3% of employees that the firm was looking to “new technologies” to “find new sources of alpha, enhance service to our clients, create additional growth engines for Aladdin, and achieve significant efficiencies in how we operate.”
BlackRock is also pushing to launch a spot bitcoin exchange-traded fund in the US, even as the crypto sector faces a regulatory crackdown. The Securities and Exchange Commission said this week that it was delaying its decisions on those applications for spot bitcoin ETFs, including for BlackRock.
More of Business Insider’s reporting on technology and digital assets at BlackRock: