Necessary sustainability strategiesīlackRock manages investment funds, and the assets it controls have just exceeded USD 10 trillion, far more than any other competitor on the planet. “And any plan that focuses solely on limiting supply and fails to address demand for hydrocarbons will drive up energy prices for those who can least afford it, resulting in greater polarization around climate change and eroding progress,” BlackRock’s chief executive warns. The pace of transition will be very different in developing and developed countries But unprecedented investments in decarbonization technologies will be necessary for all markets, in his view. In the letter, Fink says the pace of transition would be very different in developing and developed countries. “To ensure continuity of affordable energy supplies during the transition, traditional fossil fuels like natural gas will play an important role both for power generation and heating in certain regions, as well as for the production of hydrogen,” he asserted.

And it`s uneven with different parts of the global economy, according to Fink. The transition to a carbon-neutral economy is moving at different speeds, he wrote. As part of that focus, we are asking companies to set short-, medium-, and long-term targets for greenhouse gas reductions,” Fink said. That requires understanding how companies are adjusting their businesses for the massive changes the economy is undergoing. “We focus on sustainability not because we’re environmentalists, but because we are capitalists and fiduciaries to our clients. The fact is that green products often cost more today, so reducing that green premium will be essential for a peaceful and fair transition, the co-founder of BlackRock claims.įink: We focus on sustainability not because we are environmentalists, but because we are capitalists. They risk losing jobs, even as other places gain them, ” according to his letter. And just as some companies risk being left behind, so do cities and countries that don’t plan for the future. “It will also leave behind the companies that don’t adapt, regardless of what industry they are in. The decarbonization of the global economy is going to create the greatest investment opportunity Trucking, shipping, and aviation, as well as agriculture, energy, and construction, are undergoing a great transformation, Fink added and stressed that he believes the decarbonization of the global economy would create the greatest investment opportunity the era. Scientists and engineers are working on solutions for the decarbonization of cement, steel, and plastic, the letter reads. Fink added the distribution of capital and companies’ long-term operations depends on how efficiently the global energy transition is going to be managed. “Most stakeholders – from shareholders, to employees, to customers, to communities, and regulators – now expect companies to play a role in decarbonizing the global economy,” the BlackRock CEO said in a letter. The links between capitalism and sustainability On behalf of BlackRock, he said companies, cities, and countries that are not planning a carbon-free future run the risk of falling behind. In the annual address, Fink reccomends to CEOs in the corporate sector the themes important for long-term stability and goals. Larry Fink, CEO of BlackRock, the world’s largest asset manager, said the proposal to the corporate sector to switch to carbon-neutral business was about profit and not about being “woke.” BlackRock will continue to encourage companies to react to climate change because it has financial significance, he stated in the annual letter for 2022, entitled The Power of Capitalism.

Larry fink 2022 letter