BlackRock CEO, Laurence Fink is taking the radical step of applying a social good filter to their investment selection processes:
“Society is demanding that companies, both public and private, serve a social purpose,” he wrote in a draft of the letter that was shared with me. “To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society.”
Why, and why now? Because he perceives that governments are not adequately looking after the common good:
In a candid assessment of what’s happening in the business world — and perhaps taking a veiled shot at Washington at the same time — Mr. Fink wrote that he is seeing “many governments failing to prepare for the future, on issues ranging from retirement and infrastructure to automation and worker retraining.” He added, “As a result, society increasingly is turning to the private sector and asking that companies respond to broader societal challenges.”
Wow, I’m just not sure whether to be happy or sad about this. OK. I’m happy. It’s good to see a company like this signaling that there is more than just the unrelenting quest for profits.
It will be very interesting to see how they actually assess social impact.
HT Alex Steffen (over on Twitter)