Blackrock CEO Larry Fink explains why he won't pick an 'heir apparent' to take over his job
As the CEO and chairman of BlackRock, an investment manager with $5.1 trillion in assets under management, Larry Fink is one of the most influential people in finance.
At 64, he plans on retiring at some point in the next 10 years, but as he told Bloomberg Markets in a recent interview , he hasn't picked out a successor from among his leadership team. In a way, the choice to not pick a successor early is his succession plan."Why would we do that and close optionality?" he said. "If we did that, some members of our leadership team would not be growing as fast as they're growing. The beauty of what we have now is seven or eight people who are fully in the mix."
Some firms have clearly defined succession plans for positions throughout the company in order to avoid any possible chaos. In an interview with former Nasdaq CEO Bob Greifeld last year a few months ahead of his stepping down as CEO, he told Business Insider that "our final grade is who replaces us, how we do there. So, you name a job - I can't tell you any of the replacements [for confidentiality] - but I know who they are." He even joked that if a beam fell on the publicist in the room with us, he knew who'd immediately take his place.
Likewise, Greifeld chose to remain as chairman after passing on the CEO reins to Adena Friedman. Fink's approach is the inverse. In fact, he said that if he chooses to stay on as chairman of BlackRock after ending his run as CEO, it would "be a disaster."
"It doesn't work," he told Bloomberg. "Leave. Make sure that when you leave, you're there to provide advice when asked, but leave and allow the new leadership to create their identity."
He said that he wants to leave both the CEO and chairman roles open, because he thinks they could be complementary roles, depending on who fills them. He wants to avoid tying himself too closely to the future success of his firm. "I don't believe it's about one magical person," he said. "I've seen organizations that have that one magical person, and when that one person leaves, it all becomes a mess."
Bloomberg asked Fink whether he's afraid that his lack of a succession plan will cause in-fighting or an exodus of top executives similar to the one that followed Jack Welch passing the torch to Jeff Immelt at GE.Fink said some of those top seven or eight executives may choose to leave after he makes his decision shortly ahead of his last day, but he's already heard from a few of them that they made handshake deals with each other that if one gets the CEO or chairman spot, the other won't leave.
"I would not call it a 'Game of Thrones,' he said, referring to the HBO show. "It's not 'Leave It to Beaver,' but it's a very cohesive, collaborative group."