- BlackRock Inc’s BLK Chief Financial Officer Gary Shedlin said the company is putting a stop to hiring and reducing expenses during a financial conference hosted by Goldman Sachs.
- “We’re trying to be a little more prudent,” he said, adding that these measures will put BlackRock in a better position next year, Reuters reported.
- Shedlin added that BlackRock witnessed some weakness in retail mutual funds, with some short-term performance challenges.
- However, it expects a sizeable ramp-up in performance fees from illiquid businesses in the coming years.
- In Q3, BlackRock’s assets under management dropped 16% Y/Y to $7.96 billion, as investments in Europe and Asia lost value due to a stronger dollar. Its net income also fell 17% to $1.45 billion.
- Shares in BlackRock are down roughly 30% this year, underperforming the benchmark S&P 500 Index.
- Separately, small activist investor Bluebell Capital Partners Ltd has sought to replace BlackRock CEO Larry Fink for being inconsistent in its focus on environmental, social, and corporate governance (ESG) issues.
- Related: BlackRock’s Eco-Friendly Stance Upsets Republicans, $1B Pulled In ESG Protest.
- As per the Reuters report, Bluebell said BlackRock and Fink have “alienated clients and attracted an undesired level of negative publicity” with the firm’s ESG strategy.
- The hedge fund that owns 0.01% in the asset manager also wants BlackRock to “initiate a strategic review of (its) stance on ESG” and adopt other governance changes.
- Price Action: BLK shares closed at $708.00 on Tuesday.