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Illustration: Sarah Grillo/Axios

How much power do shareholders have over companies? Judging by Uber CEO Dara Khosrowshahi's comments to "Axios on HBO" this week, it must be quite a lot.

Catch up quick: Khosrowshahi praised Yasir Al-Rumayyan, who sits on Uber's board and is a close friend of Saudi Crown Prince Mohammed bin Salman. "He's been a very constructive board member," Khosrowshahi said, "and I personally have valued his input greatly."

  • When Axios' Dan Primack pointed out that Al-Rumayyan represents the government that murdered Washington Post columnist Jamal Khashoggi, Khosrowshahi's first instinct was to play down the enormity of the crime. "I think that government — said that they made a mistake," he said, before later clarifying that "there's no forgiving or forgetting what happened."

The big picture: Enormous shareholders like Larry Fink, the CEO of BlackRock, are regularly imbued with awe-inspiring powers. Fink is "one of the most influential investors in the world," per NYT's Andrew Ross Sorkin, wielding "clout" and "outsize influence."

  • Protestors at the reopening of the Museum of Modern Art last month targeted Fink in particular, saying that because BlackRock owns shares in private prison companies, he was not doing enough to "get rid of mass incarceration."
  • Fink would seem to be a juicier target even than MoMA chairman Leon Black, who runs a multibillion-dollar private equity firm and who gave $10 million to Jeffrey Epstein's personal charitable foundation.

Reality check: Fink in reality has very little clout. Most of the money that he manages is in index funds, which means he has no discretion as to where to put it. If a private prison company is in an investable index, then BlackRock is going to be one of its shareholders.

  • Fink has some discretion over which companies are included in his environmentally conscious fund. Yet even that fund invests in massive polluters like ExxonMobil.
  • Even if Fink divested entirely from such fossil fuel and private prison companies, that would make no difference to their business model or their profitability.

Driving the news: Just about the only real power Fink has comes from his ability to vote his shares to nudge companies in a more ethical direction. But a Reuters analysis of his voting record shows that he doesn't even do that.

  • By the numbers: BlackRock backed only 10% of climate-related shareholder resolutions in 2018.

The bottom line: Activist hedge funds can strike fear into the heart of CEOs, as can countries using their sovereign wealth funds to achieve geopolitical ends. But those skills seem to elude individuals, social activists, and even multitrillion-dollar investors like Fink.

Go deeper:

Go deeper

Manchin, Schumer huddle with Biden in Delaware to discuss spending bill

Senate Majority Leader Chuck Schumer (L) and Sen. Joe Manchin (R) at the U.S. Capitol on Nov. 13, 2014. Photo: Win McNamee/Getty Images

Sen. Joe Manchin (D-W.Va.) will meet with President Biden and Senate Majority Leader Charles Schumer (D-N.Y.) on Sunday morning in Delaware as Democrats look to reach an agreement on the massive spending measure.

Driving the news: Democrats are still negotiating what to keep in the bill and how to pay for it, with Biden saying on Thursday that the party does not have the votes to raise the corporate tax rate.

2 hours ago - Technology

Scoop: Facebook exec warns of "more bad headlines"

Illustration: Megan Robinson/Axios

In a post to staffers Saturday obtained by Axios, Facebook VP of global affairs Nick Clegg warned the company that worse coverage could be on the way: “We need to steel ourselves for more bad headlines in the coming days, I’m afraid.”

Catch up quick: Roughly two dozen news outlets had agreed to hold stories based on leaked materials from Facebook whistleblower Frances Haugen for Monday publication — but the embargo fell apart Friday night as participating newsrooms posted a batch of articles ahead of the weekend.

"Atmospheric river" to whiplash Northern California from drought to flood

A map depicting 24-hour preciptation forecast (inches) ending Monday at 5a.m. local time. Photo: NOAA

A series of powerful "atmospheric river" storms are set dump historic amounts of rainfall across parts of drought-stricken California and the Pacific Northwest from this weekend, forecasters warn.

Why it matters: A strong atmospheric river, packing large amounts of moisture, is predicted to whiplash Northern California from drought to flood.