[MUSIC] You see that there's a pattern or trend in certain specific sectors. Maybe some that are overlooked within the high yield space that are doing this in a way that's more sincere than others. Or what >> I think it's >> Companies within sectors, every sector has got its folks that are cynical and don't really care or don't think it matters. And then it's got its companies and management teams and boards that do. And by the way, I have to say, it's really important to understand where the mandates coming from, right? A CEO is really, a CEO is hired by the board which theoretically represents shareholders. And so a couple of years ago we saw, for example, the business roundtable about 100 some odd CEO signed a pledge that all stakeholders matter. And, we thought to ourselves until we see CEO is going to their shareholders, asking for the mandate to include that in their job description. All it takes is a change in management, right? You're trying to minimize these herky jerky actions, right? That happened when one boss gets fired, another one gets hired. So, you want to build your looking to your point, right? It's about character. You're looking to figure out what is actually systemically in the company's goals. And so, in that sense, that's, I mean, we can know everybody on this call can think through our own industries in our own life experiences to know they're good. They're folks that are trying to do the right thing and folks that aren't that or don't care in every industry and that's true of managers to be honest with you, right? I mean, it's not hard to land on understanding who, it just takes some work and some questions. But to land on understanding who is telling you what they think you want to hear and who was actually, for whom, what they're telling you is in their DNA. And again, it's about fit, right? So, if what you're hearing is not something you're liking, even if it's in someone's DNA, that's okay that there's somebody out there for whom that is what they want. But no matter what you want, you want to look for someone who's, whether it's in our case companies or in the case of folks allocated managers. Who truly believe that, which is a good risk fit and philosophy fit for the folks are looking to hire them or invest in them or provide capital for them to buy their bonds. >> I know we're closing in on the hour, but I wanted to address this with you. Because I find that it seems to be one of the critical components to ensuring that the information that investors receive from companies. And from even third party companies that deal with say, artificial intelligence and machine learning or sentiment algorithms to compliment fundamental analysis on knowing the characters of companies is the issue of disclosures. And I know you mentioned it earlier and without it seems without the disclosures all information or a lot of information without having to use your judgment on knowing whether it's sincere or not. Seems to be really up to that ability to make that judgment and form a correct assessment or rely on others to make that assessment for them. I read some speech I think given back in March from John Coates. So I believe is the acting director for the financial division at the SEC and he was speaking to a group of lost it into two lane I believe. And he was talking about the difficulties in arriving at standard disclosures for ESG investor and some of that seems to come down to the definition or generally accepted definition of what ESG investing is. That everyone can point to and say this is the standard for what this means as a universally accepted understanding across the globe. Everywhere I look it seems that I'm reading a different definition or nuance to definition for what ESG investing means even sometimes within the same source by different authors. So, I'd really like to get your insights into one, what it would take to to have these standard disclosures in place, so that information becomes more trustworthy, and two what that might look like to you? >> Yeah, we like to joke that if you've met one approach to ESG, right. There's many approaches, the ESGs there are people trying to understand what it is. And so that lends itself to the answer to your question to some extent. I'll talk a little bit about what we're learning in our research at the credit round table. because it's nicely broadly encompassing and doesn't just capture what we do at our firm, but what we've learned is a couple of things, right? So there's a lot of time on this topic and we don't have a huge amount of time. So I'm going to try to summarize it, but we can always defer it to a future webinar about standards and disclosures as well. The, so first and foremost, right, it's early days in the US for better or worse, and we don't really know how it's going to evolve here in the United States. We have the opportunity to look at Europe and recognize that what Europe did is they had in order to force disclosure at companies without telling them what to disclose, you have this, they put a lot. They put some onus on investment managers to basically say you have to be able to essentially defend your, what you're saying is ESG. And if you don't have what you need from companies, you need to go force them to give it to you. So it's this market, they're trying to force the market, it's almost like they're trying to create market forces by putting the onus on the manager as well as the company. And the companies have their own disclosure requirements as well. But the challenge and then now there's now the green bond market in Europe is really growing substantially. Built on these early days metrics and measurements and reporting that the ecosystem has tried to figure out how to create for the purpose of complying with these regulations. We don't even have regulations here, and we already have a green and sustainability linked bond market starting to grow. So, we don't have, we don't even have the early days metrics that we can look at and say, okay, why don't you at least put this into your sustainability linked world? And that's a bit of a challenge. And so, when we've done our research, we found that there's as much risk of creating a haves and have nots disclosure world as there is of not getting enough disclosure. What I mean by that is if you create to specific a disclosure requirement list, right? Then only large companies that can afford to comply are going to comply. And so there's this trend toward trying to create a comply or explain state of the world where if you can't comply, you explain why and you end up but you're going to end up in a situation which we don't want. Which is capital getting allocated to the largest capital getters and not being allocated to smaller capital getters because that's not aligned with intentionality. It's aligned with capability. [MUSIC]
