BlackRock Encourages "A Sense of Purpose"

BlackRock CEO Larry Fink is encouraging companies to be more socially responsible. In his annual letter, the investment firm CEO describes the increasing wealth disparity in the United States:

"We are seeing a paradox of high returns and high anxiety. Since the financial crisis, those with capital have reaped enormous benefits. At the same time, many individuals across the world are facing a combination of low rates, low wage growth, and inadequate retirement systems. Many don’t have the financial capacity, the resources, or the tools to save effectively; those who are invested are too often over-allocated to cash. For millions, the prospect of a secure retirement is slipping further and further away – especially among workers with less education, whose job security is increasingly tenuous. I believe these trends are a major source of the anxiety and polarization that we see across the world today."

Fink is encouraging more engagement of shareholders and a focus on creating long-term value:

"Companies must ask themselves: What role do we play in the community? How are we managing our impact on the environment? Are we working to create a diverse workforce? Are we adapting to technological change? Are we providing the retraining and opportunities that our employees and our business will need to adjust to an increasingly automated world? Are we using behavioral finance and other tools to prepare workers for retirement, so that they invest in a way that that will help them achieve their goals?"

But critics say Fink is overstepping. On Squawk Box, Sam Zell said, "I didn't know Larry Fink had been made God."

Discussion:

• What's your view of Fink's position? Is this a good idea, or should he keep his thoughts to himself?
• What are Fink's communication objectives, and how well does he meet them?
• Assess the letter in terms of organization and writing style.