Larry Fink
Chief Executive Officer at BlackRock
Gary, a big hug. Thank you. Excellent job. Good morning, everyone, and Happy New Year. Thanks everyone for joining this call. Today and throughout BlackRock's history, we have focused on delivering the best financial returns for each and every client. In line with our objectives and goals, we remain relentless about staying ahead of their needs of all our clients needs, providing them with more choice, innovating to help them achieve financial well being.
We serve clients of all types, large, small, individuals and institutions in all parts of the world. So, providing them choice is critical and helping each of them achieve their unique financial goals. We have built the industry's most comprehensive and integrated investment and technology platform to provide them with solutions that fit their unique objectives. Our job is to then to deliver the best financial returns based on their individual preferences. It is this differentiating platform that drives our differentiating results.
BlackRock generated $307 billion in net new assets and positive organic base fees in 2022. These industry-leading results reflect by the decision by thousands of organizations and investors that continually place their trust in BlackRock. The consistency of our results across both good and bad markets, markets up and down, comes from our clients confidence in BlackRock's performance, our guidance and our fiduciary standard. In the United States, we generated $230 billion of long-term net inflows and flows were positive across all regions throughout the world. We generated organic growth across index and active and across all long-term asset classes from fixed income to equities to multi-asset to alternatives as clients turned to BlackRock for more solutions across their entire whole portfolio.
We ended the year with very strong momentum with $114 billion of fourth quarter net inflows, representing 3% annualized organic growth base fees. We estimate that BlackRock captured over one-third of the long-term industry flows in 2022, leading the industry and delivering positive organic base fees for the year. Over the past five years alone, BlackRock has delivered an aggregate $1.8 trillion in net inflows or 5% average organic asset growth compared to flat or negative industry flows. Over this five-year period of time have been both rallies and contractions, but BlackRock has always delivered growth reflecting the power of our connectivity to our clients, our fiduciary standards and our diversified platform.
2022 was a year of transition and a complex market environment for every one of our clients. We witnessed transformation in the geopolitical world order that rewired globalization and supply chains up ending assumptions about inflation and drove the normalization and eventually tightening of monetary policy. Production constraints, labor shortages, and energy and food price disruptions and price increases followed the Russian invasion in Ukraine, causing inflation to hit our 40-year high sparking a cycle of rate hikes by central banks. Inflation continues to be a top concern, despite recent cooling we saw at the end of this year and the beginning of this year. Global growth continues to slow. The challenge -- the challenges society has experienced not just in the past year but since the pandemic has eroded hope, and reinforced pessimism in many parts of the world. We've seen a decline in birth rates, an increase in aging populations, a rise of nationalism and populism, and I fear that we are entering a period of economic malaise.
To correct this, the role of business becomes even more critical than ever. Leaders must continue to invest in technology and research and development to improve long-term prospects and to provide a vision that offers hope about the future. Fundamentally investing is also an active hope, hope that the future will be better than the present. If people do not have hope, they will not take money out of the bank account and invest it in a 30-year retirement outcome. Today, the financial narrative is so often about the near-term market moves, the topic of the day, like the latest means stock or media headlines about political polarization. Throughout our history, BlackRock has taken a long-term approach to investing. It is BlackRock's role to show people the benefits of investing for the long-term to give them hope that over time the returns with a balanced portfolio can deliver long-term financial security.
Against the current backdrop, BlackRock has an even greater obligation to help our clients wade through the uncertainty and give them the confidence to invest in the long-term. We see many opportunities for clients to capitalize on market disruption, to rethink portfolio construction, to consider the renewed income generation potential of bonds, or to reallocate the sectors that may be more resilient in the face of elevated inflation. BlackRock is uniquely positioned to help clients navigate opportunities in this environment because of our diversified platform and integrated investment management technology advisory expertise.
Our whole portfolio approach is resonating more than ever before and underpins the record of $192 billion of long-term net inflows from institutional clients in 2022. Institutional clients are choosing BlackRock, because of our scale, our resources and the expertise to take on the challenges of each and every market. Clients select us because we take and invest for them in the long-term. And in alignment with their beneficiaries whose time horizon span decades. In an increasingly complex investment environment, we're seeing strong demand from clients looking to partner with BlackRock for outsourced solutions and expect this to continue in 2023. Just the last two years, BlackRock has been entrusted to lead several significant outsourced mandate totaling over $300 billion in AUM spanning, existing and new clients. And I'm proud to say, our pipeline remains very strong.
In 2022, BlackRock's helped millions of investors plan for their financial futures as they continue to turn their ETFs for long-term investments. iShares has led the industry with $220 billion in net inflows. We are proud that iShares offers the most choice in our industry. In 2022 alone, we launched over 85 new ETFs globally. And as a testament to our scale, the demand from our clients and our diversification, we had over 70 different iShares ETFs, with annual net inflows surpassing $1 billion.
Our global as well, well -- was well-diversified across our core equity, our fixed-income factors, sustainable and thematic ETF product categories and we have seen repeatedly in periods of market uncertainty investors turn to iShares precision exposure ETFs to make those tactical asset allocation decisions into year end. iShares' bond ETFs generated a record $123 billion of net inflows. We again led the industry and six of the top 10 asset gathering bond ETFs in 2022 were iShares.
When I started my career a long-time ago as a bond trader, it was much more difficult for individuals to assess the bond market. Their options were high-cost mutual funds or paying large markups to brokers to buy bond directly. 20 years ago, iShares launched the first four US-listed bond ETFs, and today we provide over 450 ETF choices across our $760 billion iShare fixed-income platform.
In an uncertain rate and credit environment this year's iShares bond ETF benefit for having the most diverse product offerings in the industry spanning governments, investment-grade, high-yield, emerging markets, municipals, innovations like buy rights and iBonds. The diversification means we can meet our clients' demands as it evolves. Earlier this year, investors used iShares bond ETFs to express preference for short-duration treasuries and more recently, our high-yield, our corporates, long-duration ETFs had been leading the flows. The role of bonds in the portfolio is increasingly relevant for the first time in years. Investors can actually earn very attractive yield without taking much duration or credit risk.
Just a year ago, the US two-year treasury note was yielding approximately 90 basis points. And today they're earning over 4% with corporate bonds earning over 5% and high-yield earning 8%. Clients are coming to BlackRock to help them pursue generational opportunities in the bond market and our leading $3.2 trillion fixed-income and cash platform is well-positioned to capture accelerating demand. In addition to our industry-leading bond ETF flows, clients turned to BlackRock's high-performing active platform, where over 80% of taxable and -- fixed-income assets are performing above benchmark at a bare medium for the three and five-year period. There'll be more money moving around as investors recalibrate, we believe we will benefit as clients build portfolio -- with high-performing active investments alongside ETFs and of course, private market strategies.
The need for income and uncorrelated returns against the backdrop of higher inflation and a more challenged market for public equities will continue to drive demand for private markets. We raised $35 billion in client capital in 2022, led by private credit and infrastructure. We're successfully scaling successive funds delivering larger funds through -- raises subsequently fund vintages. In 2020, our third Global Energy and Power Fund raised a total of $5 billion surpassing the total assets of Vintage 1 and 2 combined, in 2022, the fourth fund-raise $4.5 billion in investor -- in initial investor commitments at first close achieving over half of our targeted $7.5 billion raise.
Our diversified infrastructure funds are providing social and economic benefits to communities in the United States, and around the world. We recently announced an agreement to form Gigapower, a joint venture with one of our diversified infrastructure funds and AT&T, which upon closing will provide fiber networks to customers and communities outside AT&T's traditional service area. The network will advance efforts to bridge the digital divide and ultimately help spur local economies and the communities in which Gigapower operates.
One of the largest opportunities in infrastructure investing over the coming years will be the renewable infrastructure. In the United States, the Inflation Reduction Act contains a range of measures to spur greater investment in demand for renewable energy, infrastructure and technology. In Europe, the energy supply shocks in 2022 have only sharpened the focus on energy security and given rise to the European Commission's REPowerEU plan for renewal energy investments.
Client demand for income and uncorrelated returns also resonated in our multi-asset and Fundamental Active Equity platforms, where we saw in our tactical asset allocation and equity dividend franchises, we see great opportunities for clients in our income and dividend growth equity offering, which can be tools to help thread the needle between generation income and growth that could potentially outrun inflation. Aladdin is foundational to how we serve clients across our platform. It helps us to deliver a precise tracking for our iShares ETFs, it allows us to on-board and service increasingly large complex mandates, and it has consistently demonstrated its value in preceding -- and processing high trading volumes and providing transparency into portfolios -- in volatile markets.
Our multi-decade investment in Aladdin continues to differentiate BlackRock and continues to differentiate Aladdin, both as an asset manager and as a leading fintech provider. Periods of market volatility have historically underscored the importance of Aladdin. And in 2022, we saw record net sales of Aladdin, contributing to 10% growth in our annual contract value on constant currency basis. We see clients doubling down on technology and leveraging fewer providers to do more with less. This is evident by our mandates this year, about half spanning multiple Aladdin products.
We continue to evolve and enable clients to further simplify their operating infrastructure with Aladdin. Clients increasingly want to tailor how they use Aladdin to meet their own unique and specific needs, and we're providing them with choice and flexibility. We are creating deep integration with ecosystem providers and third-party technology solutions. Our partners include asset servicers, cloud providers, digital asset platforms, trading systems and others who can work with clients and their Aladdin environment to provide a more customized and seamless end-to-end experience.
We continue to innovate in a variety of areas, expanded choice we offer clients, we're transforming on how clients can engage with companies, they are invested in through our voting choice technology. BlackRock was the first organization to build and launch technology empowering institution clients in BlackRock's separate accounts and nearly 650 pooled vehicles to choose how to vote the shares of the company's they own through our own index capabilities. Nearly half of our clients index, equity assets under management are now eligible. This includes all public and private pension plans we manage in the United States as well as retirement plan serving more than 60 million people around the world. And in just the last six months, the number of index equity clients nearly committed to voting choice has more than doubled. We are also working to expand this capability to individual investors in markets like the United Kingdom and in funds where it's possible. The majority of BlackRock's clients are investing to finance retirement. BlackRock has been in the forefront of innovation and advocacy for retirement solutions throughout our entire history.
We recently made a minority investment in the Human Interest which is helping small and medium-sized businesses provide affordable, accessible retirement plans to their employees. So, more Americans can serve and save for a secured financial future. We believe Human Interest visions aligns closely with BlackRock's mission of helping more people experience financial well being by making them -- by making retirement plans accessible to more Americans.
We have always believed in being agile in how we manage BlackRock, that is how we built our industry-leading position and generated value for shareholders over the long run. The uncertainty and the opportunity around us makes us even more important that we stay in front of the changes in the market and focus on delivering for each and every client. To extend our market leadership, we must invest in our people, invest in our platform for the long-term by allocating resources where they are needed most, in ways that are cost-effective and support our ability to scale.
As Gary mentioned, our restructuring effort resulted in a number of valued colleagues and friends, leaving the firm. We greatly appreciate the contributions they have made to BlackRock and wishing the best for them. BlackRock remains a growth company, even with this restructuring, our headcount will still be 6% higher than a year-ago. Looking ahead, we have deep conviction in our strategy and ability to execute with scale and with expense discipline. We are honored that our clients have entrusted us with over $300 billion of net assets in 2022. We see similar clients needs reshaping and shaping the opportunity set for 2023, be it a large insurance companies seeking outsourced partnership with scale and expertise, pension funds looking for attractive yields and less duration and credit risks, or financial advisors using our models and iShares to build better portfolios to meet the challenges -- the long-term challenges of our clients.
The investments we have made over the years have also positioned us to capture emerging opportunities in bond ETFs, huge opportunities in the rebuild out of infrastructure in the United States in the world and opportunities in transition finance. Our momentum in Aladdin has never been stronger and our advisory capabilities continue to play a critical role in our dialog with clients. I've spoken frequently over the years about the need for CEOs to effectively articulate the values their companies deliver to shareholders, clients, employees and other stakeholders. Similarly, as CEO of BlackRock, I have a responsibility to articulate the BlackRock story, and it has never been more critical to do that than now.
Over the past year, BlackRock has been the subject of a great deal of political and media discourse. It is my duty to address the questions being asked of us, a responsibility that I take very seriously. Some of these people have suggested, we are either too progressive, some of them suggested we're too conservative and how we manage our clients' money. I wanted to just tell everybody we're neither. We're a fiduciary. We put our clients returns first. We offer every client investment choices, and then pursue their objectives that they choose and the performance they seek.
I want to make it clear to our clients, our shareholders and all our stakeholders that we will be deterred and pursuing the outcomes that our clients desire. This steadfast focus has not only enabled us to deliver for clients, but also to drive growth for each and every one of our shareholders. Since our IPO in 1999, BlackRock has delivered a 7,700% total return to our shareholders. And this is the strongest return of any financial services company in the S&P 500 over that period.
I thank BlackRock employees for their commitment to upholding our culture and living every day our purpose. They're always striving to better serve each other and each of our clients and finding new and innovative ways to be helping our stakeholders achieve a financial well-being. I really do want to call-out and thank Gary once more for his last earnings call. He's been a friend way beyond his term at BlackRock. He's been an advisor. Sometimes, he's been tough, sometimes, he's been lovely. But Gary has been an important part of driving our growth over these last 10 years and driving the success of our share price for our shareholders. I am thrilled personally and professionally, he will continue to be with us for BlackRock as Vice-Chairman and I look forward to having Martin Small join us as the CFO for our next call in April.
Thank you, everyone. And let's open the call up for questions.
