BlackRock CEO succession outlook shifts amid exits, buying spree
Management changes follow a year when company committed nearly US$30 billion to three major deals
BLACKROCK senior executive Mark Wiedman’s departure is just the latest sign that the hunt for chief executive officer Larry Fink’s replacement looks far different than it did a year earlier.
Wiedman, 54, the head of global client business and a two-decade BlackRock veteran, is choosing to pursue opportunities outside the company, people familiar with the matter said on Tuesday (Jan 14). The firm is expected to elevate multiple executives as soon as this week, some of the people said.
Last year, Wiedman received US$8.5 million of long-term, performance-based stock options as part of an incentive pay plan for “a select group of senior leaders who we believe will play critical roles in BlackRock’s future”, the company said in a proxy filing.
The management changes follow a year when BlackRock committed almost US$30 billion to three deals that position the firm to become a major player in data and private assets – and integrate new executives who could someday succeed Fink, 72.
Wiedman’s departure also comes after that of BlackRock veteran Salim Ramji, who’s now the CEO of Vanguard Group.
“When you have a talented group of ambitious executives, it’s natural for these leaders to want their own shot at running an organisation,” said Edward Jones analyst Kyle Sanders. “While we think BlackRock still has a deep, talented management team, the list of potential CEO successors is shrinking.”
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Wiedman oversaw the early growth of the firm’s massive exchange-traded funds (ETF) business, helped start its prominent financial-markets advisory arm that has advised the Federal Reserve and US government through financial crises and led corporate strategy for BlackRock.
Most recently, he has been in charge of the global client business and relationships with key financial clients worldwide. He also has led its efforts to transition to a low-carbon economy.
Next generation
Fink, who’s also a BlackRock co-founder, said in July that he’s working to prepare the next generation of leaders at the firm.
Other potential successors include chief financial officer Martin Small, chief operating officer Rob Goldstein, senior managing director and head of international Rachel Lord as well as Raj Rao, a member of the firm’s global executive committee and president of BlackRock’s recently acquired Global Infrastructure Partners.
Fink doesn’t want to be someone “sitting there just blocking and tackling”, he said in Washington during an event about retirement. “When I do believe the next generation is ready, I’m out.”
He may stay on as chairman even if he steps down as CEO, he added.
“It’s often difficult for founders of successful firms to walk away,” Sanders said. “I think BlackRock is a better, stronger firm with Larry in charge, but there is a balancing act between him staying and the loss of talented executives.”
The world’s biggest asset manager acquired GIP for US$12.5 billion in October and is in the process of completing a deal for data provider Preqin. Its US$12 billion purchase of private-credit shop HPS Investment Partners will refashion BlackRock’s ability to provide a full range of public bonds and private credit financing to borrowers across markets.
BlackRock is scheduled to report its fourth-quarter results before US markets open on Wednesday. BLOOMBERG
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