Consumers have been pushing companies toward sustainability through their purchasing power. Last year, 87% of millennials said that they would purchase a product from a company that advocated for an issue they cared about, according to Cone Communications. That same study showed that 76% of millennials would refuse to purchase a company’s products upon learning it supported an issue contrary to their beliefs. Although companies courting these consumers have made adjustments. Others have not. Some speculate that's about to change.
According to the New York Times, Larry Fink, the founder of BlackRock, informed business leaders that their companies need to do more than make profits — they need to contribute to society — if they want to receive investment firm's support.
“Society is demanding that companies, both public and private, serve a social purpose,” Fink wrote in his annual letter to business leaders. “To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society.
“Many governments (are) failing to prepare for the future, on issues ranging from retirement and infrastructure to automation and worker retraining.” He added, “As a result, society increasingly is turning to the private sector and asking that companies respond to broader societal challenges.”
It’s no surprise that his missive is coming now. The United States has just ended one if its most tumultuous years in recent memory featuring a mass shooting in Las Vegas, the white supremacists’ march in Charlottesville, and an ongoing investigation into the president’s possible collusion with a foreign government. We’ve seen that same president issue a travel ban targeting those from Muslim-majority countries, pull the country out of the Paris Climate Accord, and roll back protections for the LGBTQ community.
Will it work? It's possible. BlackRock manages more than $6 trillion in investments through 401(k) plans, ETFs and mutual funds. Although, like many, we're not ready to make predictions.
If your company is reviewing or implementing corporate social responsibility initiatives, Give2Get can help. Contact us today at [email protected]