BlackRock Bring Democracy Closer To Key Shareholders
October 7, 2021
January 14, 2022
Sens. Bernie Sanders, Elizabeth Warren and Tammy Baldwin pressed BlackRock CEO Larry Fink to use his firm’s sizable financial stake in Warrior Met Coal to compel the company’s management to broker a deal with its striking coal miners.
The trio said the miners employed by the Alabama-based coal company are striking to win better pay and benefits from a job that requires them to work in “extremely dangerous” conditions.
Some of BlackRock’s most popular products are its index funds, investment vehicles that allow clients exposure to a portfolio constructed to match the components of a specific financial market index.
Such products allow investors an easy and cheap way to put money in a fund that will offer performance almost identical to a popular market index, such as the S&P 500. More than a dozen BlackRock index funds owned equity in Warrior Met Coal at the end of 2021.
Separately, each fund owns a fraction of the coal company. But combined across all its many funds, BlackRock controlled about 13% of Warrior Met Coal stock at year’s end, making it the company’s largest stakeholder, according to FactSet analysis.
“Mr. Fink: Our request to you is simple,” Sanders, Warren and Baldwin added. “BlackRock’s Board must publicly demand that Warrior Met negotiate in good faith and agree to a reasonable contract that treats workers with dignity and respect.”
About 1,000 workers represented by the United Mine Workers of America have been on strike at Warrior Met Coal since April 2021. But the strike’s beginnings can be traced back to 2016, when Warrior Met bought the mines from bankrupt Walter Energy.
As part of the corporate restructuring, the coal miners agreed to a $6 an hour pay cut and a “substantial” reduction to their health and retirement benefits, according to Sanders, I-Vt., Warren, D-Mass., and Baldwin, D-Wis.
But since the company’s rebound from bankruptcy and return to profitability, its workers have not had their compensation restored as promised, Sanders commented.
“Instead of providing the kind of wages and benefits that the workers need and are entitled to, what is being offered is a totally unsatisfactory contract,” Sanders said Thursday afternoon. “We’re saying to Mr. Fink, ‘Do the morally right thing.’ What we’re asking for is: ‘Tell the company executives to sit down negotiate a fair contract with the union.’”
This isn’t the first time Sanders and Warren have needled Wall Street titans to support workers at major investments.
Sanders wrote a similar letter to Berkshire Hathaway CEO Warren Buffett last year asking him to intervene on behalf of striking steelworkers at West Virginia-based Special Metals. Precision Castparts, a subsidiary of Buffett’s conglomerate, owns Special Metals.
It’s not unusual for those seeking changes in the corporate universe to beseech Fink.
BlackRock manages more than $9 trillion, making it by far the largest money manager in the world. The colossal pool of capital makes Fink one of the most powerful investors and empowers him to pitch serious campaigns against company managers or directors that don’t respect his requests.
Unlike many money managers who are careful not to upset clients, Fink has over the years made climate change his central political cause. He has for years encouraged corporate executives to reduce carbon emissions and shrink their environmental footprints.
Fink took his campaign a step further in 2021 when he called on all companies “to disclose a plan for how their business model will be compatible with a net-zero economy.” He added at the time that his firm planned to change its investment process and how its non-passive funds could dump holdings that don’t adhere to its climate goals.
September 8, 2021
MSBM - UK
The Professional Certificate in Structure and Reporting Mechanism of a Company aims to enable the learner about the detailed structure of the organization’s financial reporting structure.
3 hours per week
MSBM - UK
The Professional Certificate in Project Manager - Role and Skills aims to prepare the leaner for the role of Project Manager.
3 hours per week
This course offers an overview of the organisational culture theories and practices to enable the learner to appreciate the interplay of Human Resources and organisational culture.
3 hours per week