Finding the Optimal Balance in Management
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Questions and Answers

Which company ranked higher in terms of Global Assets under Management (AUM) in 2019 than BlackRock?

  • Bank of New York Mellon
  • Capital Group
  • Goldman Sachs Group (correct)
  • PIMCO
  • Among the top 20 Asset Management Firms in 2019, which firm had the lowest total AUM in billions of U.S. dollars?

  • BNP Paribas
  • Deutsche Bank
  • Bank of America (correct)
  • Northern Trust
  • Which of the following companies did not have a total AUM exceeding $2,000 billion in 2019?

  • PIMCO (correct)
  • Capital Group
  • JP Morgan Asset Management
  • Goldman Sachs Group
  • According to Nelson Peltz, what should managers and boards do in order to properly handle shareholders' focus on quarterly earnings?

    <p>Wear bifocals to keep an eye on both short-term and long-term targets</p> Signup and view all the answers

    According to Sam Zell, what did he find hypocritical about BlackRock's stance on social responsibility?

    <p>Their push for social responsibility while being an investment firm</p> Signup and view all the answers

    How did Nelson Peltz suggest that CEOs could benefit from Fink's message about finding a purpose?

    <p>To guide them when faced with activist investors' campaigns</p> Signup and view all the answers

    Which company was included in the active asset managers mentioned in the text?

    <p>Capital Group</p> Signup and view all the answers

    What was BlackRock's fixed-income investments amount when it was acquired by PNC?

    <p>$24 billion</p> Signup and view all the answers

    In which year did BlackRock go public with $165 billion in assets?

    <p>1999</p> Signup and view all the answers

    Which company did BlackRock purchase in 2004 from MetLife, Inc.?

    <p>SSRM</p> Signup and view all the answers

    According to Rosanna Landis Weaver, the larger issue on her mind was about how much corporate executives were paid, and BlackRock had a poor record on voting in support of ______ executive compensation plans.

    <p>exorbitant</p> Signup and view all the answers

    Christopher Hohn criticized BlackRock's voting record on climate-related resolutions as ______, stating that major asset managers like BlackRock were 'full of greenwash'.

    <p>appalling</p> Signup and view all the answers

    Research groups InfluenceMap and ShareAction reported that Fink’s firm backed only 10% of climate-related resolutions put forward by shareholders, whereas European firms like Legal and General and UBS were in the 80-90% range, indicating differences in asset managers' ______.

    <p>voting patterns</p> Signup and view all the answers

    Larry Fink emphasized the importance of better quality data to this shift in capital markets, asking companies to disclose climate-related risks in line with the TCFD’s recommendations, if you have not already done so. He noted that BlackRock will be increasingly disposed to vote against management and board directors when companies are not making sufficient progress on sustainability-related ______ and the business practices and plans underlying them.

    <p>disclosures</p> Signup and view all the answers

    A growing number of CEOs of some of the most successful and large publicly listed firms were becoming increasingly vocal about the importance of corporate ______.

    <p>purpose</p> Signup and view all the answers

    Larry Fink mentioned that BlackRock will increasingly vote against management and board directors when companies are not making sufficient progress on sustainability-related disclosures and the business practices underlying them, given the growing investment risks surrounding ______.

    <p>sustainability</p> Signup and view all the answers

    Larry Fink highlighted the importance of better quality data to the shift in capital markets, asking companies to publish a disclosure in line with industry-specific SASB guidelines or disclose a similar set of data in a way that is relevant to their particular business. He also emphasized that companies should disclose climate-related risks in line with the TCFD’s recommendations. If companies do not comply, BlackRock will be increasingly disposed to vote against management and board directors. This indicates a focus on improving ______ in corporate reporting.

    <p>transparency</p> Signup and view all the answers

    Some activist investors publicly released their ESG policies and how they were planning to engage with companies. For example, Trian Partners and Jana Capital raised new funds focusing specifically on improving corporate performance on ESG issues believed to improve financial performance and therefore valuation. New activist funds, such as Impactive Capital, emerged pursuing similar ESG and financial performance improvements. Novick reflected, 'ESG issues have become investment factors.' They affect a company’s strength and the quality of its assets. We believe over the next few years the data will be so compelling that all investment processes will integrate ESG issues. At the same time, she identified important barriers, including terminology, 'We still do not have a way to talk about these products. We are working on creating a taxonomy where at the one extreme you have a product that uses screening to avoid certain companies or industries and on the other extreme you will have products that have true impact investing in solutions, such as alternative energy and green ____.'

    <p>bonds</p> Signup and view all the answers

    Novick reflected, 'ESG issues have become investment factors. They affect a company’s strength and the quality of its assets. We believe over the next few years the data will be so compelling that all investment processes will integrate ESG issues.' At the same time, she identified important barriers, including terminology, 'We still do not have a way to talk about these products. We are working on creating a taxonomy where at the one extreme you have a product that uses screening to avoid certain companies or industries and on the other extreme you will have products that have true impact investing in solutions, such as alternative energy and green ____.'

    <p>energy</p> Signup and view all the answers

    Novick reflected, 'ESG issues have become investment factors. They affect a company’s strength and the quality of its assets. We believe over the next few years the data will be so compelling that all investment processes will integrate ESG issues.' At the same time, she identified important barriers, including terminology, 'We still do not have a way to talk about these products. We are working on creating a taxonomy where at the one extreme you have a product that uses screening to avoid certain companies or industries and on the other extreme you will have products that have true impact investing in solutions, such as alternative ____ and green bonds.'

    <p>solutions</p> Signup and view all the answers

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