The Six Trillion Dollar Man Speaks: Attracting The Best And Brightest Millennials

 A Stated Purpose Crucial to Recruit and Retain Millennials

Larry Fink reiterates in his 2019 letter that a sense of purpose beyond generating profits needs to infuse corporations. [1] This is especially critical for attracting the best and brightest of the Millennial generation.

“Attracting and retaining the best talent increasingly requires a clear expression of purpose. Over the past year, we have seen some of the world’s most skilled employees stage walkouts expressing their perspective on the importance of corporate purpose.” Larry Fink 2019 letter to corporate CEOs

20,000 Google Employees Walk Off Job

One of the major walkouts we believe Mr. Fink is referring to occurred at Google in 2018 when 20,000 employees worldwide, approximately one-fifth of the corporation’s employees, walked off the job to protest management’s handling of sexual harassment issues. The walkout came in reaction to an article in the New York Times of 25 October 2018 reporting a senior executive in the company had resigned at the request of the CEO in 2014 because of credible accusations of sexual harassment against him by an employee. [2]

Employees Sent Blistering Message for Change to Management

This story generated negative publicity for Google worldwide.  Adding to the furor, the employees only learned of this four years after the event, and the news came not from the company but from the New York Times. Even worse, the Times reported the executive had allegedly been given a ninety million dollar severance package. Ninety million? This action hardly fit the corporation’s self-stated purpose on its website. “Google's mission is to organize the world's information and make it universally accessible and useful." [3] Perhaps this is true, perhaps not. But in this case, Google seemed to exempt themselves from their own statement of purpose.

Employees Outraged

When the news broke, it outraged employees. In a coordinated effort, 20,000 employees stopped working to make it clear to executive management that they had to change their policy on handling credible accusations of sexual harassment and change it immediately. [4]  

This phenomenon will increase

In a handful of years, Millennials will comprise more than half of the nation’s workforce.  Fink wants executive managers of corporations to heed this lesson from the Google walkout.

“This phenomenon will only grow as millennials, and even younger generations occupy increasingly senior positions in business.”

He pointed to a survey of Millennials released earlier in the year by Deloitte.

“..millennial workers were asked what the primary purpose of businesses should be – 63 percent more of them said “improving society” than said “generating profit.”

(Deloitte defines this generation as those born between January 1983 and December 1994.)

You can download the thirty-one page Deloitte survey here: deloitte-2019-millennial-survey.pdf 

Environmental, Social, and Governance (ESG) Investing

Management must recognize that purpose is critical to attracting and hiring the best and brightest of the millennials—who today represent 35 percent of the workforce – express new expectations of the companies they work for, buy from, and invest in.

We have written at length about ESG investing, and we discovered much of the demand is happening because of the push by the Millennials. This begs the question: does your firm offer ESG funds in your Qualified Retirement Plan? Further, how does your firm rank in the screens ESG indexers use to rate companies?  77% of Millennials have an interest in ESG investments U.S. Trust reported in a 2018 report.

Millennials are not the most trusting generation, and who can blame them? 26% have zero trust in business leaders according to the previously cited report from Deloitte. From the same report, we learn the top three personal concerns of Millennials are:

1: Climate change/protecting environment (29%).

2: Income inequality/distribution of wealth (22%)

3: Unemployment (21%)

Many of our readers like data, and being in the financial business, you get plenty of it. As of this moment, the data on Millennials is telling all of us in the industry—no matter the size of your firm— that we need to make major changes in structure and direction now. And yes, all businesses need to have a stated and specific purpose.

Larry Fink writes, Companies that fulfill their purpose and responsibilities to stakeholders reap rewards over the long-term. Companies that ignore them stumble and fail.

When it comes to “improving society,” all of us in the industry need to understand that buying fair trade coffee for the break room won’t cut it anymore.

 

Resource(s):

[1] https://www.blackrock.com/corporate/investor-relations/larry-fink-ceo-letter

[2] https://tinyurl.com/nytimesarticlegoogle

[3] https://about.google/

[4] https://www.nytimes.com/2018/11/01/technology/google-walkout-sexual-harassment.html

 

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Contributing Writer: Subject Matter Expert Charles McCain