Larry Fink abandons failed "ESG" phrasing for ESG phrasing
By Scott Shepard
Larry Fink is "ashamed."
Quite right, you may respond. But this being BlackRock CEO Larry Fink, he's not ashamed of what he should be ashamed of. He's not ashamed of misusing other people's assets to push his own personal policy preferences. He's not ashamed of lying to CEOs, shareholders, investors, pension fund managers, investigators and the public about the partisan nature of his endeavors. He's not ashamed of leaving his mansion in a limo to take his private jet to the top of the world in the middle of the winter to stay in a well-heated luxury hotel to devise plans for forcing the hoi polloi like us to reduce our carbon emissions.
No, he's "ashamed" to have to participate in a debate about ESG, which he has claimed, and has rightly been dismantled for claiming, is somehow neither woke nor partisan. He claims this despite the fact that his ESG-forcing efforts – efforts that see him forcing on private companies the same two programs of political decarbonization and equity-based discrimination – are the whole-of-government efforts of the Biden Administration. He thereby makes a fool of himself.
He's ashamed that he had to debate and lose, rather than simply having his commandments respected as holy writ. And so he's no longer going to use the term ESG. He's switched, he says, to the phrase "conscientious capitalism." After all, none of us dirty peasants can question anything he says he is doing conscientiously, can we?
Well, probably we can.
You see, Larry doesn't have any intention of changing any of his behavior at all. Instead, he explained, "we [will continue to] talk a lot about decarbonization, we talk a lot about governance … or social issues, if that's something we need to addressed."
In other words, "conscientious capitalism" is going to be just the same as ESG, and Fink and BlackRock are going to proceed just as they have been behaving. Decarbonization on political schedules, just like before? Check. Pushing "social issues" like equity-based discrimination and the other hard-left social policies that this "lifelong Democrat" and his company have proudly "force[d]" on companies where it invests other people's money? Check.
Part of the reason that Fink is trying a new phrase is because the public and state officials and regulators have come to understand what ESG really means on the ground, and have finally begun to respond properly. So what the hell, try a new label. Of course, this ignores the fact that Fink and his co-conspirators have already tried "stakeholder capitalism," only to be caught out by the simple demonstration that there is no such thing as acting in the interests of all stakeholders at the same time, thus giving the lie to that attempted misdirection.
And this new moniker will be torn up just as quickly. Is it conscientious for billionaires – who on average use one million times as much carbon as the rest of us – to demand that we use still less while they live on high? Is it conscientious for billionaires of immense power who have made their way in the world by dint of their effort and their merit, without discrimination, to demand that others who look and love like them submit to new regimes of race, sex and orientation discrimination in part because the discriminators are themselves straight white guys with immense wealth and power?
No, of course it isn't. It's reprehensible, contemptible.
So why this rebranding effort, which is doomed to fail from the start?
Well, BlackRock (and State Street and Vanguard) has both regular and ESG-labeled investments, and in his letter to investors this year, Fink highlighted that he offered both options as part of his claim not to be running BlackRock according to his personal policy preferences. But then he spoke exclusively about the investments that gave him clear license to use those assets to push those policy preferences – in this case, political-schedule decarbonization. And in many, many other venues, he and other BlackRock executives have bragged that the company uses all the assets entrusted with the company (not just the ESG-labeled ones) to push the twin ESG goals of political decarbonization and equity-based discrimination.
This change in terminology, then, is an attempt to get Fink out of a bind. It's straightforward material misinformation to offer regular and ESG-labeled investment options, but then to use the assets from both categories to push ESG goals. Now Fink's instead going to call those same goals "conscientious capitalism" targets, hoping that the change in terminology will solve his problem.
It won't, of course. He's already admitted that the only thing that's changed is the term, not his intended behavior. And so this new phraseology only adds an extra layer of intentional misrepresentation, and eventual peril.
This obfuscation will fail too, Larry. It's just woke in Fink's clothing.Scott Shepard is a fellow at the National Center for Public Policy Research and Director of its Free Enterprise Project. This first appeared at RealClearMarkets. This essay is reprinted with the kind permission of the NCPPR.