Dear Larry,

I once again took the liberty of marking up your CEO letter to show you how close you are to using the full extent of your power to solve the problems you so eloquently articulate about the existential issues confronting the entire economy and global society. What your 2022 letter lacks is, similar to last year, an implementation plan. The solutions are within your grasp and using your power to drive timely action can help ensure we meet our goals.

I particularly appreciate the creation of the “Center for Stakeholder Capitalism” as it answers the request As You Sow made in two shareholder resolutions for an implementation plan of the Business Roundtable pledge. This is exactly what we were looking. You have my gratitude and personal offer to assist in any way to, “bring together leading CEOs, investors, policy experts, and academics to share their experience and deliver their insights.”

My mark-ups of your CEO letter this year are fairly minimal. The conceptual framework describing system-level problems is strong, yet you fail to use Blackrock’s brand and clout to incentivize solutions on climate change, racial injustice, and other pernicious issues.

Larry, you are in a very unique position. You are one of a handful of people on the planet who has the power to make real change, in the real world, to solve our most dire problems. I urge you to use this power for the good of all -- not just talk about it.

Here is a link to the marked up PDF for download.

I have also included a short synopsis of the changes below:

Paragraph 1: No changes

Paragraph 2: I added “reducing systemic risk.” I believe that this is what you are actually working towards yet you do not articulate it. All investors want the companies they invest in to actively identify material risks and act on them.

Paragraph 3: I added “their interconnectedness with the larger ecosystem.” You imply the interconnections between companies, society, and ecosystems -- risk for one is risk for all.

Paragraph 4-5: No changes.

Paragraph 6: I added “its supply chains.” As you know, stakeholder capitalism has five elements, employees, customers, community, supply chain, and shareholders. Not sure why you left out supply chains which reflects back to the prior change about interconnection.

Paragraph 7-8: No changes,

Paragraph 9: I added the bold-underline text in the following sentence:

“Customers want to see and hear what you stand for, and more importantly the policies and practices you implement, as they increasingly look to do business with companies that share their values demonstrate this by action.”

You seem to think that customers want talk. I disagree - they want action. Without implementation this idea is empty words.

Paragraph 10-26: No changes for 17 paragraphs!

Paragraph 27: I added the bold-underline text in the following sentence:

We focus on sustainability not because we’re environmentalists, but because we are capitalists and fiduciaries to our clients. That requires understanding how companies are adjusting their businesses for the massive changes the economy is undergoing. As part of that focus, we are asking all companies to set short-, medium-, and long-term targets for greenhouse gas reductions of 5% per year for the next ten years to reach net zero before 2050. These targets, and the quality of plans to meet them, are critical to the long-term economic interests of your shareholders. It’s also why we ask you to issue reports consistent with the CA100+ benchmarks and Task Force on Climate-related Financial Disclosures (TCFD): because we believe these are essential tools for understanding a company’s ability to adapt for the future. To incentivize these targets we will vote no-confidence for all board candidates of companies that do not make these commitments and stick to them. It is the responsibility of every board to make climate change central to your company’s strategy.

This paragraph needed the most work and exemplifies how you can use your power to create real on-the-ground change. If BlackRock voted no-confidence against boards of companies that did not have a real climate plan in place, this would change the world. Boards report to their shareholders, it is time for Blackrock to lead. The CA100+ benchmarks require absolute emissions reductions across scope 1, 2, and 3; you are a member of the CA100+ and should be compelling action using this benchmark as well as TCFD.

Paragraph 28: I add “but we must have 50% emissions reduction within the next decade.” Your statement, “It will not happen overnight” removes the imperative to act quickly. Time is of the essence and you should be specific.

Paragraph 29: No changes

Paragraph 30: I deleted “Which will take time.” same rationale as paragraph 28

Paragraph 30-more:

“And any plan that focuses solely on limiting supply and fails to address demand for energy hydrocarbons will drive up energy prices”  I swapped the word energy for hydrocarbons as the whole point is to electrify and use renewables at every possible point.

Paragraph 31-45: No other changes and again kudos and gratitude on the creation of the Center for Stakeholder Capitalism. This is a great step toward implementation of the New Purpose of a Corporation as we as we requested in our 2020 and 2021 shareholder resolutions.

I trust that these small edits will assist you to use your power to incentivize real change with global impact.  

 Sincerely,