The world's largest money manager is overhauling the way it handles employee concerns about workplace misconduct, following an external review and accusations of inappropriate or intolerant behavior.
BlackRock's CEO Laurence D. "Larry" Fink outlined in a memo to all staff, obtained by Pensions & Investments, its new action plan to ensure every employee feels "welcomed, included, and safe."
Mr. Fink said he found it "disturbing" to read stories earlier this year of "inappropriate or intolerant behavior recounted by former employees." Some accusers also raised concerns about the way such incidents were handled by BlackRock.
At the time, BlackRock said it would take action to improve the situation, including creating a dedicated investigations team, and then retained law firm Paul, Weiss to conduct a review and provide recommendations.
The law firm spent three months reviewing BlackRock leadership, people and records, speaking with more than 50 current and former employees and examining the firm's policies, practices and documents, Mr. Fink said.
"In total, the review highlighted many things we can be proud of, but it also highlighted things I wasn't happy about. These included instances where people at BlackRock had experiences that did not meet what we all should expect of BlackRock. The review reinforced the value of the steps we have previously announced, but also helped us identify areas where we can continue to improve and do more," Mr. Fink said.
As a result of the review, BlackRock is taking action in four areas, Mr. Fink said.
It is further strengthening the support provided to employees who have concerns, including additional measures for navigating that process, providing more support following an investigation and expanding options for employees to engage on issues that do not warrant making a formal complaint. Changes include providing employees who raise a concern with the option of a support colleague throughout the investigation process.
The second area for action is to provide more clarity about the process for investigating misconduct, ensuring that every employee understands how the processes work, where to take concerns and BlackRock's commitment to "fairness, thoroughness, and a just and equitable outcome."
Accountability for promoting an inclusive workplace will be reinforced to every BlackRock employee. Mr. Fink wants everyone — especially leaders and managers — to be clear that colleagues should be treated with respect, and that they should "speak up and take action if they see or learn about inappropriate behavior," the memo said. The governance and oversight of the investigations process will also be formalized, with a commitment to providing greater transparency on outcomes to employees who raise concerns.
The fourth area of action relates to continued investment in BlackRock's human resources team, processes and procedures, Mr. Fink's memo said.
"No one at BlackRock should experience language or conduct in the workplace that is disrespectful or inappropriate. If they do, they should have a clear channel for reporting it, and confidence that it will be addressed with compassion, empathy, rigor, and fairness," Mr. Fink said.
Senior leaders should "model inclusive behavior," the memo said. "The example set by BlackRock senior leaders is critical to building and maintaining a workplace culture where all employees feel valued, heard, and able to thrive."
BlackRock will also implement 360-degree reviews for every member of the global executive committee — including Mr. Fink — this year, ensuring, "we have a clear picture of how the conduct of each of our senior leaders impacts everyone we work with," the memo said.
The firm will continue to work with third-parties to give an outside perspective on how BlackRock is doing and where it can improve, and has already committed to an external review of the impact of its diversity, equity and inclusion efforts. That review will take place next year.
BlackRock has $9.01 trillion in assets under management.