Schwarzman To Blackstone Shareholders: Drop Dead

Paraphrasing! But only a little?

Dear... shareholder,...
Get... bent...

Fiduciary duty can be an annoying thing, especially when it’s owed to two separate groups who do not necessarily see eye-to-eye on certain things. Like, say, shareholders of and investors in those handful of hedge funds and private-equity firms that have gone public. Like, say, the Blackstone Group.

Stephen Schwarzman has found a way to cut that particular Gordian knot: Deny having a fiduciary duty to one of those groups, in this case the people who own a significant chunk of his company, a move which certainly makes other decisions easier, even if it isn’t true.

“We are not going to make decisions for the short term,” Schwarzman said Sunday at the 21st Annual Venture Capital and Private Equity Conference at Harvard Business School. He said the duty is to the limited partners, or investors that commit to the firm’s private-equity funds.

Blackstone’s Schwarzman Says Duty Isn’t to Public Shareholders [Bloomberg]