BlackRock CEO Larry Fink explains why his firm will not cut ties with Saudi Arabia

BlackRock CEO Larry Fink is not ashamed to maintain business with Saudi Arabia.
BlackRock CEO Larry Fink is not ashamed to maintain business with Saudi Arabia.
Image: Mike Cohen/ The New York Times
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When BlackRock’s Larry Fink chose not to travel to Saudi Arabia for an international investment conference two weeks ago, the CEO of the world’s largest asset manager seemed to be living up to his new identity as a social activist on Wall Street.

The Saudi government’s apparent murder of journalist Jamal Khashoggi, who was killed in the Saudi consulate in Istanbul just days before the investment conference, presumably would not hold up against the new moral standards Fink described in a open letter to CEOs last January, when he warned public companies that BlackRock would be expecting them to demonstrate how they made a positive contribution to society.

“There was a really great view of responsibility in Saudi Arabia” for Khashoggi’s death even before the grisly details came to light, Fink said yesterday (Nov. 1) at The New York Times’ DealBook conference in Manhattan. “At the same time, they were going to have this very public showcase conference to show all the positives about the nation in front of this event, this media, and real life issue, and it was very clear to me that I’ve found it to be inconsistent.”

But Fink made it clear that he has no intention of cutting ties completely with Saudi Arabia. Having made a public statement by pulling out of the conference alongside many other leaders from Wall Street and the tech industry, his influential firm has otherwise not missed a beat in its relationships there, where it has done business with the government, families, and corporations for 15 years.

Not attending the conference, Fink wagered, would not jeopardize all of his relationships in Saudi Arabia. “I never believed that decision would cost us all the business,” he said. In fact, BlackRock has not lost any business there, he confirmed.

“Keep in mind, it is a big country. There are many fine people in country, like there are many fine people in every country,” he continued. “These things are not black and white and they’re very complex.”

We still don’t know who exactly murdered the journalist; there are only theories, Fink argued, downplaying what others judge as overwhelming evidence of involvement by Saudi Arabia’s de-factor leader, crown prince Mohammed bin Salman.

Investment firms like BlackRock had been expanding in Saudi Arabia, drawn to a privatization program and promised reforms to the nation’s financial markets. Fink now predicts that “some companies may not do business in the kingdom, but in many cases some of the companies never had business” there. BlackRock has established a history, and Fink says he believes the firm “will be there for many years in the future.”

His position on the matter could be crucial to the broader corporate world, and not only because of the $6 trillion in assets that BlackRock has under management. His nuanced approach, like that of Siemens CEO Joe Kaeser, will perhaps serve as a model for business leaders who are caught between the public pressure to take a stand against the Saudis and the financial pressure to stay connected to the wealthy kingdom’s money.

Just how tough a time are other CEOs having walking the line on this issue? Consider Tesla CEO Elon Musk’s responses to journalist Kara Swisher’s questions about Saudi Arabia in a new, wide-ranging interview published on Recode.

Would you take their money now?

I think we probably would not, yes.

Okay, and what about their influence in Silicon Valley, given the billions that are being poured in here?

I know I can’t speak to that, I mean, it’s not … Saudi Arabia’s an entire country, so I think you don’t want to, if there’s one really bad thing that occurred, nail down the whole country, it’s not great.

It’s their ruler.


It’s their ruler, it’s the guy who runs everything.

They didn’t elect him, you know?

No, they didn’t, that’s right. No, I get that, I’m not impugning all Saudis, but it is the government.

I think we should just consider that there is a whole country, and there’s, you know … There are a lot of good people in Saudi Arabia, and Saudis who are outside of Saudi Arabia. So I think you cannot paint an entire country with one brush.

No, no, I’m just talking about the people who have the money.

I think there are serious issues, it’s not good.