Posted Mar 5, 2024 By Martin Armstrong 

BlackRock finally admitted that their ESG policies in the name of shareholder capitalism have been bad for business. “BlackRock’s business, scale and investments subject it to significant media coverage and increasing attention from a broad range of stakeholders,” the company stated in it’s annual filing with the SEC. “This heightened scrutiny has resulted in negative publicity and adverse actions for BlackRock and may continue to do so in the future.” In other words, “go woke, go broke.” So what does this mean for shareholder capitalism?

BlackRock is now saying it will not put Klaus Schwab and the World Economic Forum ahead of shareholders. The shared values they wrongly assumed the public would embrace have backfired. “Any perceived or actual action or lack thereof, or perceived lack of transparency, by BlackRock on matters subject to scrutiny, such as ESG, may be viewed differently by various stakeholders and adversely impact BlackRock’s reputation and business, including through redemptions or terminations by clients, and legal and governmental action and scrutiny,” the filing continued.

As a recap, the Human Rights Campaign (HRC) pushes the CEI (Corporate Equality Index), a company’s social woke credit score. The Open Society Foundation, operated by the Soros family, funds the HRC. The ESG promotes a company’s green social credit score, has been pushed by Western governments and the World Economic Forum, and takes into account climate issues in addition to obscuring societal norms.

This will change the landscape of ESG policies as BlackRock alone has $700 billion invested in such initiatives. In December 2023, the House Judiciary Committee issued subpoenas to BlackRock and State Street as part of an investigation into the firms’ promotion of environmental, social, and governance (ESG) goals to determine if it violated antitrust laws. BlackRock and others have barred businesses that did not adhere to ESG standards, denying them professional opportunities and overseeing that any company wishing to be affiliated with BlackRock adhere to ESG standards.

BlackRock is defying Washington and the World Economic Forum with this decision to move away from the green credit score. The first bill that President Joe Biden vetoed was a bill intended to dissolve the ESG climate social credit score, which was only foreshadowing the policies that later came about, most notably the Inflation Reduction Act that Treasury Secretary Janet Yellen admitted was intended to combat climate change. He also immediately blocked the Keystone Pipeline and removed America’s ability to remain an energy independent nation. Out of all the issues facing America, Biden chose to use his presidential powers to set the groundwork to create the need for a Great Reset to Build Back Better.

BlackRock CEO Larry Fink supported Biden’s veto and used his company to back Schwab’s vision for a socialistic economy. GOP donors held a conference in March 2023 in which they asked the panel: “Who’s more important: shareholders or stakeholders? Is the ‘stakeholder capitalism’ being sold by Larry Fink and other investors really stakeholder politics?”  Fink responded to critics by claiming BlackRock was not the “environmental police” and it was the government’s responsibility to impose far left woke policies. Yet, Fink admitted in his notorious letter, “A Sense of Purpose,” that he believed it was the responsibility of the private sector to implement policies since government had failed to do so. He was speaking on behalf of Klaus Schwab.

In December 2019, Schwab announced plans for reshaping capitalism into something that does not remotely resemble capitalism through the use of the ESG system. “[To] uphold the principles of stakeholder capitalism, companies will need new metrics. For starters, a new measure of “shared value creation” should include “environmental, social, and governance” (ESG) goals as a complement to standard financial metrics. Fortunately, an initiative to develop a new standard along these lines is already underway, with support from the “Big Four” accounting firms and led by the chairman of the International Business Council, Bank of America CEO Brian Moynihan.”

In January 2022, Fink sent a letter to the CEOs of companies he has invested in, reminding them of Klaus Schwab’s Agenda 2030. He stated:

“When my partners and I founded BlackRock as a startup 34 years ago, I had no experience running a company. Over the past three decades, I’ve had the opportunity to talk with countless CEOs and to learn what distinguishes truly great companies. Time and again, what they all share is that they have a clear sense of purpose; consistent values; and, crucially, they recognize the importance of engaging with and delivering for their key stakeholders. This is the foundation of stakeholder capitalism.

Stakeholder capitalism is not about politics. It is not a social or ideological agenda. It is not “woke.” It is capitalism, driven by mutually beneficial relationships between you and the employees, customers…”

The concept of stakeholder capitalism was introduced back in 1932, leading to the worst economic performance in history. Milton Friedman stepped in and declared corporations are not to use shareholders’ funds for their personal charities. Schwab states that Milton Friedman “neglected the fact that a publicly listed corporation is not just a profit-seeking entity but also a social organism.”

The entire takeover boom of the 1980s took place because you could buy a company, sell its assets, and double or triple your money. As long as companies were concerned only about Stakeholder Economics, investment in US shares was tainted. This is what Schwab wants to restore – corporate socialism.

The “Davos Manifesto” claims that “companies should pay their fair share of taxes, show zero tolerance for corruption, uphold human rights throughout their global supply chains, and advocate for a competitive level playing field – particularly in the “platform economy.” Schwab was banking on three main points to support ESG intiatives: 1) the “Greta Thunberg” effect, 2) younger generations supporting left leaning policies, and 3) investors believing that social policies would be beneficial for their investments.

Thunberg’s time in the spotlight has come to an end. Her dire warnings of the world ending did not come to fruition. Schwab said that Millennials and Gen Z would not “want to work for, invest in, or buy from companies that lack values beyond maximizing shareholder value.” Well, those generations can barely afford basic living necessities, let alone invest in a meaningful way. He underestimated the intelligence of the youth as they are not all blindly backing socialistic policies, regardless of how intensely the education system attempts to mold their minds into believing capitalism is evil. Most importantly, investors can see the ROI on their ESG-linked investments and they’re NOT pleased. The people have been speaking with their assets and removing them from corporations that support failed woke policies.

BlackRock has admitted that woke policies are bad for business, but they are still aiming for the Great Reset. We will soon see how BlackRock handles the impossible balance of pleasing both Schwab and shareholders. Stakeholder capitalism is nothing more than Marxism in sheep’s clothing and will always result in failure.