BlackRock, the world’s largest asset manager, dramatically increased the security expenses for its CEO Larry Fink over the past year, according to securities filings.
The expenses included $216,837 paid to hire security guards and another $563,513 to update a security system at Fink’s home.
BlackRock began providing Fink with security services in 2022 at the request of the board, according to documents filed last year. At the time the company hired a third-party security firm to make a recommendation about what security Fink might need. In 2022, the first year of his company-provided security, Fink received $198,410 for security guards and a further $177,950 for a home security system.
Over the past several years both Fink and BlackRock have come under fire from conservative politicians and pundits (as well as some liberal activists) for the firm’s use of ESG principles in its investment products. Many of these groups believe that Fink’s decision to incorporate environmental, sustainability, and governance as one of many factors in selecting investments is an attempt to push left-wing ideologies on businesses. In reality, the practice simply seeks to provide a more holistic view of a company’s future by tallying up risk factors and opportunities beyond just its financial performance.
In his 2020 annual shareholders letter, Fink announced that BlackRock, which manages some $10 trillion, would place sustainability at the core of the firm’s investing approach. That decision put BlackRock and Fink squarely in the crosshairs of some Republican officials who believed the move was a form of ideological screening that discriminated against certain companies.
Several Republican officials then sought to end contracts with BlackRock over public funds it managed.
In Texas, the state pulled an $8.5 billion education fund that BlackRock managed. In Florida, Republican Gov. Ron DeSantis threatened to find another money manager for state funds managed by BlackRock. DeSantis succeeded in yanking $2 billion in assets under management from BlackRock, but as of last January, BlackRock still manages $13 billion for the state.
The personal backlash against Fink came to a head during the Republican primary debates at the end of last year. During a December debate, DeSantis and biotech investor Vivek Ramaswamy took aim at BlackRock. DeSantis touted the fact he had “taken away $2 billion” from the firm, while Ramaswamy called Fink “the king of the woke industrial complex.” Eventually that prompted a response from Fink calling the affair a “sad” representation of the state of American politics.
Fink has repeatedly addressed the backlash he was facing, on one occasion saying he was surprised by how personal attacks had become. “It’s hard—because it’s not business anymore, they’re doing it in a personal way,” Fink told Bloomberg in January 2023. “And for the first time in my professional career, attacks are now personal. They’re trying to demonize issues.”
More often than not, Fink attributed the furor to a misunderstanding of what ESG ultimately was and the fact that both he and BlackRock had gotten trapped in the crosscurrents of U.S. politics. “The narrative is ugly,” Fink said in the Bloomberg interview. “The narrative is creating this huge polarization…Unfortunately there are some politicians who are taking some parts of a sentence out of context and that’s the world we live in today.”
BlackRock, like other financial institutions, is now more lukewarm on some previously stated climate change commitments, which some see as a result of the pressure from conservative politicians and activists.
Ultimately the boycotts had little effect on BlackRock’s business. At the beginning of 2023, Fink acknowledged that the year before, BlackRock had lost around $4 billion in assets under management as a result of boycotts against the company. However, that number, Fink said, was little in comparison with the $230 billion BlackRock brought in new money from U.S. clients.
