ESG Explained — Beyond the Buzzword (Part 1)

Hello and welcome back to The Deal Room, and we have a mini two-part episode because we had lots of questions about an area called ESG, which I'm sure all of you have heard of and probably have some degree of knowledge about it. But I have always on the call with me, Steven, who is a somewhat ESG expert, and he's going to break down everything from the history, how big is the industry, what actually is it? Why is it so hard and challenging to do? And in the second part, we'll talk about things like, is ESG dead? Or in fact, is it even more important than ever? So Stephen, how are you first?

Yeah, I'm a little bit ill. And I think I probably caught, I don't know whether this is the real thing, but I've caught spring week-itis. So this is probably the illness that you get after spending time with so many Highly capable, highly ambitious young people that definitely want to talk to you and want to put their best foot forward. But yeah, we've been all over the houses this weekend and so have you. What are your reflections from your week with various different bulge bracket and boutiques and all of that kind of thing?

Yeah, so really excited actually, because this week I got to work with two banks that I haven't done before. So JP Morgan and Wells Fargo. And so, yeah, it was amazing to see Spring Weeks. Obviously everyone's super keen and everyone's asking you lots of questions. I almost like the fact that there's like no shackles at that point. They're all just super buzzing, super up for it. And yeah, just the enthusiasm overall. So that was amazing. But how, where, where were you? I haven't even seen you.

Yeah, no, exactly. I've been on a bit of a tour. We were Bank of America for a few days, actually. Shout out to the Bank of America team and all of the great Spring Weekers there. We're at Morgan Stanley, which was a fantastic event as well. And then we spent all yesterday at Jefferies. And I can say, having done this for a few years now, my God, there's some quality out there. I look back to when I was 19 and I think, God, I didn't even know. People are talking about return on invested capital. They're talking about marginal propensity to consume. They're putting football fields in their presentation. They're doing all of these things that I only really learned about when I had to, when I was at the bank. So Massive, massive shout out to the confidence and the competence of a lot of these people. But I think you're right when you say the shackles are off. It's always that analogy. I always go back to the kind of sporting concept that, you know, when you're in your mid-30s, I'm a bit of a golfer. When you're in the mid-30s and you're trying to win a big tournament, you have to get into the mindset and think, you know, try to be like a 21-year-old again. Try to play without fear. And the shackles come off, right? You know, there's a big golf tournament at the moment. And there's a certain Northern Irishman trying to win. And he's been trying for 11 years, and the shackles are well and truly on. But you see these young people, and it's like, alright, you guys are up for it. You don't have any of the baggage that I have, having worn a few and seen a few things in my career. So definitely embrace that. That's the secret weapon, the energy, the enthusiasm, the willingness to ask questions. So yeah, despite getting spring weekitis, I came away with a lot of energy. I thought the quality was just outstanding. So shout out to everyone that I met.

Yeah, absolutely. I'd second that for sure. So yeah, where do you want to start then with this ESG topic? I know there's plenty of interest.

Yeah. And just a little bit of background as to why I wanted to do this episode now. Obviously we could have gone down the typical what's going on in the news path, and there'll be plenty of podcasts filling up your feed where you can get your dose of that. I always think it's important, just as an aside, to imagine myself, you know, 30,000 foot, or maybe even as an astronaut, and I don't get to check in with the news. Maybe I get to check in with the news every 2 weeks, right? That really gives you a wonderful perspective on not having to follow the everyday. Like you can follow that every day for entertainment purposes. But it's not necessarily that educational. It's gripping.

Whoa, God, is Piers listening to this? This is controversial stuff coming out of your mouth right now, Stephen, just be careful.

Well, look, that's why we do different podcasts. And that's why we never meet in the office anymore. But look, you know, there's all of this volatility and loads of oscillations. And there is obviously there's some interesting stuff behind it. But you can zoom out and actually try and pick apart some big themes. And one of these themes, quite apart from everything that's going on, is ESG. And I know that students are massively interested in building a career that has a positive impact. And sometimes when going into finance, you might get some pushback from your peers and your friends going, God, you're going to sell your soul. You're just in it for the money, you know, finance is evil, you know, Wall Street protests, et cetera, et cetera. But I just want to kind of provide students that are looking to have an impact in their financial career with a bit of an overview of ESG. And in the second part of this episode, really, really having that discussion about, all right, is it still relevant? Has it lost its luster? Is it still important? And should you care? So that's what we're going to do. But we're going to start right at the beginning. Shall we do some history?

Yeah, I mean, I couldn't even tell you when this concept of ESG even first came about. So yeah, seems like a good place to start.

Well, it's one of those things that I could probably do a number of episodes just on the history, but I'm going to try and shorten it. This concept of, I'm going to call it paternalistic capitalism, has been around since very, very soon after the notion of capitalism was coined, right? This concept, whether it's the Cadbury factory and the Cadbury town of Bournville in the late 19th century, just for a little bit of a history lesson, Cadbury's in the UK is a chocolate manufacturer. And the owners of Cadbury's, Cadbury family, they were Quakers and they were very paternalistic. They really cared about their employees, maybe to an extent that we wouldn't feel happy with, with our liberal 21st century brains, but they built a whole town which was aimed at being the perfect place to work and live. And there were no pubs and it was a little bit of a strange place to to work and live, but you know what, it had its, it had its benefits. It's still around, by the way, just outside of Birmingham. So this concept of paternalistic capitalism and cooperative capitalism has been around since basically day dot, but we accelerate through, through the kind of First and Second World Wars and into the well, kind of post-Second World War welfare state, consumer capitalism era of the 1950s, '60s, and '70s. And stopping the whistlestop tour in the 1980s. And as a counterpoint to the birth of ESG, the 1980s, greed is good. Go ahead, baby. I know it's your favorite history, favorite era in history. This is the, this is the Friedman, Milton Friedman doctrine. This is from a New York Times article, actually in 1970. So a little bit before deregulation of the Reagan era. So the New York Times article in 1970s was titled A Friedman Doctrine: The Social Responsibility of Business is to Increase Its Profits. So that was the overarching precursor to neoliberalism. So Friedman argued that executives spending money on anything but but something that was going to make money is in effect spending someone else's money for their own purposes. So he was massively anti-corporate social responsibility, anti-philanthropy as part of a business's cause. The social responsibility of business is to increase its profits and to hell with everything else, right? A single stakeholder view of the business. And actually, in the world of Gordon Gekko, and in the world of 1980s Wall Street, etc., I always think to myself, life was just so much more simple, right? Greed is good, make money. Like, there is one metric that you live and die on, and that is profits, or return on investment if you're an investor. And that was the kind of— that was the heady days of the 1980s and into the 1990s. Now, what happened to flip that back towards a more sustainable version of capitalism? Well, there are a number of different forces that has led to the birth of ESG. I'm going to pick out the two main ones. The first was the global financial crisis. Excuse me, global financial crisis, uh, 2007, 2008, the unbridled underregulated pursuit of greed at the expense of normal people was the, you know, was the headline that was, that was kind of carried out, led to the Occupy Wall Street movement, et cetera, and the impending and ever more present climate crisis. So what happens when these two forces meet? Well, the UN gets involved and actually back in 2004, they'd coined the term ESG, environment, social, governance, in a paper titled Who Cares Wins. And then it started to build a little bit of momentum, but really, really kicked off post-financial crisis, where everyone was soul-searching and starting to think to themselves, all right, like, what, what's the point in all of this? What are we doing this for? We basically disrupted the entire financial system. Can we be better actors and can we be better custodians of money and can we be better businesses? Going to fast forward to 2015 and then we're going to take a pause and look at the, maybe the size of the industry. 2015, again, the UN implemented a, well, I would say implemented, announced the Sustainable Development Goals, 17 targets that we need to try and achieve as a business, political, social, and investing community by 2013. Everything from clean water to quality education and climate action, big overarching goals that in the kind of low interest rate soul-searching environment of the 2010s, a lot of the biggest asset managers got massively behind. They all signed up to the principles of responsible investing. Which had at its peak over, I think it was over $100 trillion of assets aligned to these responsible investing goals. Loads of investors were coming out with ESG funds, sustainable development goal funds. This thing was gaining momentum and everyone wanted to be part of it such that I remember going to conferences when I was working in this space and it was like the backslapping capital. Of the world, right? Oh, look at us, we're making so much money. And we're doing good. How cool are we? And it really, it was pretty two-faced. But it was a really interesting period, that kind of 2014 to 2020 era.

That's such a great summation, I think, of what has probably saved a lot of people, either talking to ChatGPT or reading a long-form book. So yeah, that was a really good synopsis. So tell, maybe tell me then, I'd just like to get a bit of a feel for, you mentioned a few numbers there. I know probably those numbers have changed in those 10 years from 2015, '16. So how big is this industry in the context to just more traditional investing? And also, I'm assuming there's quite a big geography difference between Europe, US, Asia, and so on.

Yeah, it's a really good question. And I think the question of how big is the industry, the ESG, environment, social, and governance industry, I think the reason why I'm putting it so close to the top of this episode is because it belies a really important point. Like, what is ESG? And can you just call yourself an ESG fund without doing that much good stuff? Right? So the way that I tried to solve this question or try to answer this question was by asking a bunch of different chatbots, ChatGPTs, and just to see what they came up with, right? Because if they can't find consensus, I don't know who can. So I asked Gemini, Google's Gemini, and they said the size of the ESG industry is $3.2 trillion. Yes. And by the way, this is ESG assets under management. So $3.2 trillion of assets under management aligned to ESG investing strategies. Hmm. Okay. That's fine. So then I asked ChatGPT. ChatGPT, well done for ChatGPT, referenced its sources. Bloomberg, it says Bloomberg Intelligence projects that ESG assets are on track to exceed $53 trillion by 2025.

Wow. I need to get my market making hat on here.

That's a nice little spread, right? 3.2 to 53 by 2025. Well, we're already in 2025. PricewaterhouseCoopers, PwC, forecasted the ESG-focused institutional investments will increase from $18.4 trillion in 2021 to $33.9 trillion in 2026. And then what about Claude? Don't forget Claude. Based on the latest reliable data, global ESG assets were estimated to be around $35 to $40 trillion.

Where's Grok? Grok? Is Grok in this?

Grok doesn't believe in ESG, unfortunately. He, weirdly enough, refused to answer my question, strangely. So this, again, this is such an important point because who knows, right? What do you define as an environment, social governance strategy? What would you put within the ESG assets under management bucket? Do we have a really, really tight definition? And we'll go on and talk about the different ESG strategies in a bit, or do we go super, super broad and just go, hey, look, anything, any investment vehicle that excludes guns or pornography, that's ESG, right? And therefore you've basically got $100 trillion of AUM.

Isn't there also like quite a large incentive for companies to massively high-tick this number? And so you could basically say, well, the true number is probably 1/10 of whatever the public figure is.

Yeah, it's, gosh, and this, and this is why, and we will definitely get onto this probably in part 2. This is why ESG has been somewhat discredited, right? So have a normal fund, slap on a nice little picture of a wind turbine on the prospectus, call it an ESG fund and just get on with your business. It's been the detractors' view of ESG. And we'll get onto maybe some of the best actors and maybe some of the more malign actors in a little bit, but I just wanted to maybe focus quickly on the geographic split. As you can probably imagine, it is Europe that's leading the way and by quite some way. So I've got a note here that says 46% of global sustainable investing assets are European, 28% US, 14% Japan, interestingly enough, 8% Canada. So Europe is really leading the way and Despite, and again, we'll talk about this later, despite the backlash in the US, that hasn't really reverberated so strongly here in the UK and in Europe as well. We still believe in the concept of sustainable investing, and we have gone so far as to actually do some really, really good stuff in terms of regulation, guidance, best practice. And it really is becoming a much more, still fragmented, but much more kind of mature and well gateposted industry here, here in the, here in Europe, not, not necessarily in the US.

So thinking about just quickly from a careers perspective, if I was an early careers professional student thinking about this area, is, is London the place to be, you would say?

Well, yeah, it's a good question. I mean, there's a lot of, I spent a lot of time in the Netherlands. Netherlands, Amsterdam was huge on ESG when I was in that space. You know, the Nordics are very, very ESG focused. And obviously if you've got big multi-trillion dollar sovereign wealth funds, then you've got a lot of firepower to go behind it. So yes, London's not a bad shout. You know, the smaller hubs around Europe are definitely worth it as well. So yeah, you know, you're in a good place if you care about this kind of stuff. And I don't think it's going away anytime soon across Europe.

Okay. So we've got this far and actually at this point I still don't even know like what actually is ESG investing in terms of the specifics. So how does this work? I'm assuming like any investment, there's different ways to approach this from a strategy perspective. So maybe we could unpack some of that.

Yeah, absolutely. So it's ESG. I've really, I've always really struggled with this term. I'm going to give you the kind of textbook definition. Environment, social, corporate governance is a set of considerations, including environmental issues, social issues, and corporate government issues that can be considered in investing. Environment, social governance. They are three drastically, dramatically different things. It's almost, I can't even provide an appropriate analogy to it. You know, in the world of mainstream finance, it's like bundling together totally, totally different things and trying to create some form of strategy from it. You know, you can be the world's most impactful environmental company and absolutely suck at, you know, providing for the community and providing for your employees. You can be the best governed company in the world, but the products that you make can kill people and you get them lumped in together. And to say that you could have an ESG score, we'll get into that in a second. To say that you can have an ESG score makes absolutely zero sense from my perspective. Again, maybe to use a finance analogy, to try and provide a score that combines revenue you know, current liabilities and free cash flow from operations and bundle it into one single number. It doesn't make any sense because they're three very, very different things and they represent very, very different elements of your business model. So this is, this is why, you know, the whole premise of ESG is flawed because it bundles three things together that shouldn't be bundled together. Now, each, and when standing alone, the E, the S, and the G are wildly important, extremely important for every business. And every business should be massively, massively focused on the environment, on social issues, and governance. But to try and lump them together, especially for very, very different business types, it doesn't make a lot of sense.

Is there any examples you would say of a business who does do all three well?

Yeah, there are some examples. I mean, again, not to use a bit, not to use an overly glib example, but Patagonia is a really, really strong example of a company that absolutely nails it from an environmental perspective. Absolutely nails it from a social perspective. You know, they were the first company to provide free childcare longer maternity leaves, paternity leave, all of that kind of stuff. And their governance structure is so by the book. We covered this actually a couple of years ago on the podcast. The founder of Patagonia putting the business in a perpetual trust such that no one can change the ethos of the company. So, you know, if we were to ESG rank a company, Patagonia would be well up there. But there were like, there were, there are companies that do one thing really well and two other things dreadfully, but then their score's overall quite good. And you're thinking, why is that? So definitely when we move on to talk about ESG investing strategies, definitely consider that as you're thinking about these things.

Yeah. Maybe one other question before we get to that, because I'm very interested to know about the score, the scoring system here and how you balance that out in a marking way. But one thing I hear a lot when I hear ESG is also impact investing, and I don't actually know what the difference is, to be quite frank with you. So what is impact investing as opposed to ESG?

Yeah, it's a really, really good question. And again, each of these different topics we can pick apart for an entire episode, but we're trying to give you good bang for your listening. Fuck. The way that I like to think about it is you have this spectrum, right? You have this investing spectrum that goes all the way at the left-hand side in your kind of mind's eye, all the way at the left-hand side. Greed is good, make a load of money, don't care about anything else, right? That's just like your Gordon Gekko. All the way at the right-hand side is pure philanthropy, giving money away without any expectation of return. Now, The, all of the investing strategies that have some form of ESG or impact investing thesis sit somewhere along the spectrum. Right now, the Harvard Business Review has said that there are 7 different types of sustainable investing strategy, and they move along the spectrum, the Gordon Gekko to philanthropy spectrum, from negative screening, and I'll talk about that in a second, on the left-hand side. Negative screening, positive screening, portfolio tilt, ESG integration, shareholder interaction, shareholder action, shareholder activism, and then impact investing all the way to the right-hand side. Very, very quick description of these different strategies. So negative screening, all right, normal fund, but I don't allow gambling and pornography. Positive screening, normal fund, but I don't allow gambling and pornography, and I am going to positively overweight certain areas that I think are quite good, maybe renewable energy. Portfolio tilt just takes that to a kind of slightly more systematic degree. I, I'm going to overweight every company that has an ESG rating of over X by 15% relative to the benchmark. ESG integration is where you're really looking deeply into the behaviors, the performance, the carbon emissions, the employee surveys, and actually making active investment decisions based on ESG factors as opposed to rules. So by the way, those four I would consider in no way to be impact investing. The concept of impact investing is your dollar is going to have a positive impact on a particular environmental or social theme, right? If you're just doing positive screening or negative screening, it's more of a kind of mental hygiene point. Like you're not having a positive or negative impact. You're just not aligned to something that has a positive or negative, or that has a negative impact. It's a different mindset. You're not going to change the world. By not investing in gambling. You might start changing things when you move on to shareholder action and shareholder activism, because you are doing things like building up stakes in companies in order to force them to decommission their coal power plants or invest in an update to their manufacturing facilities or get out of slave labor, child labor and slave labor and things like that. So that is where you start to get a little bit of positive impact from your investing. And then as you move all the way to the right-hand side, you get impact investing, which is, look, I'm even willing to consider, certainly in the short term, a slight decrease in my financial ROI in order to maximize my non-financial ROI. That is when we get into the world of impact investing. And by the way, impact investing It only really works with private companies or project finance where you are the additional dollar that makes that project happen or makes that impact happen within a company, right? Very hard to do impact investing in the public markets because you just don't have enough power, right?

You just mentioned a word there, which I also hear within this mix in this domain, which is project financing. Just quickly, what's project financing?

Yeah. So project finance is one of the sweet spots of the world of impact investing. I would say if I was really, really passionate about investing money that is going to have an additional positive impact, we talk about the concept of additionality a lot in the world of impact investing. Does my dollar, does my additional dollar help create additional impact, right? If my dollar was not there, would that impact happen? In the public markets, if my dollar was not there, someone else would fill that dollar because there's liquidity, right? So in the world of impact investing, the place where your additional dollar can go the furthest is either in startups where private companies trying to do good, seeking their round of capital to bring that breakthrough impact technology to the fore. Or project finance, which again, imagine trying to build a massive wind farm. Imagine trying to build a carbon capture facility. Imagine trying to build a huge solar farm. From an environmental perspective, that dollar that you're putting in is going to have an additional positive impact in the long term on the E part of the ESG. So Project finance, long-term capital, that's where these dollars really, really get used very, very well.

Yeah, actually what's really cool with this two-part series is just this week I interviewed someone at UBS as part of this series that I'm doing with women in the industry, and she works in project financing. So it'll be really nice to hear her. She explains some of this actually in her day-to-day, her day-to-day job. But with that, final part of that question actually is that, so if I'm thinking as a young person, as a job to work, this is really like, let's say, sparked my intrigue. I'm like, actually, this sounds really aligned to my personal goals as well as working in the financial industry. Would all banks do this as a potential pocket within their teams?

Yeah. Yeah. So all banks have sustainable or all asset managers have sustainable— all major asset managers have sustainable investing arms, and all banks have sustainability units. The difficulty is, and then the hard thing from a young person's perspective who is coming in with that kind of young person energy that we spoke about at the beginning of the podcast, is you like, you want to have an impact, right? You want to do some good stuff and you want to stay true to the values that you've built as you've been kind of expanding your mind during university. And the last thing you probably want to do is get stuck in a very, in a slightly more bureaucratic organization where you actually think, we talk a lot about sustainability, you know, we put, put out glossy brochures, but actually what are we doing here? You know, what, what is, what is the point of what we're doing? Yeah, maybe we're not investing in arms, maybe we are slightly overweighting some companies that score well on an ESG rating scale, but is that really moving the needle? So there's lots of different ways that you can navigate, right? You know, if my thesis is somewhat right, that the best impact investments are private companies, startups, project finance, and you can find some unbelievable small asset managers in these spaces, then where you want to navigate is you might want to start off doing investment banking, moving into private equity or venture capital, and then moving into impact. Or you might want to start off doing, yeah, something like project finance within a large bank and then move to more of a sustainability or environment-focused project finance organization. So you don't necessarily just go, need to go, all right, I need to get in the sustainability fund within this company. That might actually turn you off a little bit, sorry to say. So yeah, there's routes to get where you want to be. You probably aren't going to be able to jump straight into an amazing impact investing project finance or venture capital fund from day dot, but you might get there in 3 or 5 years.

Yeah. And just to close on that, one thing that this lady said was that she actually used to work for Tesla. And she works specifically at the battery pack division of Tesla. And she was like, that felt good for all these different reasons. However, through project financing, she gets to touch many different projects and offer a much bigger impact to the work that she's doing rather than the concentration within just one specific company and one product. So yeah, it was, made a lot of sense when she was explaining it. Cool.

Well, look, should we move on? Yeah. So we, should we talk about, let's bring this part to the close by talking about why it's really, really hard to do. And we've covered a little bit of this before. And then obviously we'll tee it up for the next episode where we discuss whether ESG is indeed dead or not. And I'm just trying to think about, excuse me, just trying to think about why this thing is so extraordinarily hard. And we've touched upon this difference between the E, the the S and the G. I think there's so much confusion whenever there is multiple different standards, multiple different acronyms, multiple different ways of measuring. You're going to get uncertainty. And what do markets love? What do investors love? They love certainty and they love data points. You know, I've got a very, very strong thesis that I've probably spoken about many times before on the podcast, which is one of the reasons why finance is so unbelievably attractive to people with analytical or competitive mindsets is because you can compare your performance. Everything is relative comparison. I outperformed you, I get rewarded more than you as an investor. My company's profit margin is higher than your company's profit margin, therefore I should receive the most dollars. That comparability is a thing of absolute beauty for anyone that wants to do analysis, right? So the dollar and the global account— international accounting standards and things like that have prepared the way for the industry that we all work in to absolutely flourish. Now, if you don't have that, it's really, really hard to make good, defensible, evidence-based, comparable decisions. Right? And I've just written in my notes, I just went through a little scroll of some of the different frameworks that I remember from when I was doing this thing full time. You've got the GRI, I'm not going to explain what they are because it will take too long. You've got the GRI, the CDP, the SASB, the TCFD, the WDI, ratings agencies, MSCI, Sustainalytics, RepRisk, ISS, Dow Jones, Bloomberg, FTSE Russell, Vigeo Iris, The PRI, the CDSB, the SDGs, like, and they're all trying to do roughly the same thing, which is trying to figure out how sustainable companies and funds are. You're never going to get anywhere as an industry. And actually, with that amount of confusion, you're going to get mistrust and you're going to get disinformation. So why is it hard to do? Because we don't really know what we're measuring. Standards, the standards aren't clear enough. And therefore the ability to undermine the industry is pretty wide.

So to make that really simplistic then, if you think about say a sovereign rating agency where it's dominated by the big three. So this is just basically the opposite of that, where what, there's too many participants trying to mark too many different types of approaches. There's no standard uniform way like you would with a Moody's, Fitch, S&P.

Exactly. You know, Moody's, Fitch, S&P. What you are trying to understand is how likely is this particular instrument to default, right? And that is, you know, there are tried and tested methods, quantitative and qualitative methods in order to get to a pretty homogenous outcome for the 3 different rating agencies. One might rate an instrument AAA and one might rate it AA+, but they're pretty similar. I'm going to give you a couple examples of the ratings divergence that makes this whole thing extremely difficult. So you've got MSCI, Sustainalytics, and S&P Global, three big ESG ratings agencies. I'm going to take three companies here and just show you the difference in terms of their approach to these three different companies. So the first, first is Berkshire Hathaway. So MSCI rates it BB, which is sub-investment grade. Whereas Sustainalytics rates it very low risk from an ESG perspective, i.e., it's good. S&P Global gives it a score of 14 out of 100 on ESG, i.e., it's very bad. Now on Tesla, MSCI rates it an A, pretty good. Whereas Sustainalytics gives it a medium risk and S&P Global gives it a very, very low 32 out of 100. Which surprises me because Tesla is doing some quite good stuff from an environmental perspective. The Home Depot over in the US, MSCI gives it a AA, gold standard. ESG Sustainalytics gives it a low risk, 12.5, which is again very good. But then S&P Global only gives it 37 out of 100, high risk. Why? Because everyone's got totally different ways of approaching this stuff. And if you're going to get this divergence across people that pertain to be experts, are you going to get really, really good decisions? Are you going to get consistent decisions? Are you going to get great outcomes? Probably not.

To close then, this first part, is there like a philosophical part of this type of investing and is there a case to be made that, well, if I do have if I'm investing and my goal is to make as much money as possible, if I think about myself as an individual, if I could get to a place to satisfy all my needs and desires, I probably would give it away and have zero expectation of anything in return. But until I get to that point, then I'm probably not going to have that same degree of thought. So is there some sort of like philosophical part of this that we haven't really touched on?

Yeah, there definitely is. And this can actually be quite well explained or represented through the last 10 years, right? So market's doing pretty well, you know, 2015 plus low interest rate environments. Consumer was feeling not bad. Economic growth was okay. And ESG was flourishing, right? So there was an argument that said, look, in good times, absolutely, you know, let's do good old, you know, good ESG investing, you know, let's give something back, let's feel really good about ourselves. But as interest rates start ratcheting up, wait a second, now I kind of need to look after my own house first, before I start thinking about, you know, what might be considered to be a strategy that doesn't make me as much money. And I think it's really interesting to think about this concept again, just theoretically, that in theory, it's brilliant to be an impact investor, an ESG investor. I totally agree with the concept of companies doing good and making money, investors thinking about the social and the environmental issues that they're facing. All good from a theoretical perspective. But then I start to think to myself, all right, well, what about my pension? You know, I want to retire and have a really, really comfortable retirement. If someone's going to say, look, you know, it's either you make it, you have a comfortable retirement or you have a slightly less comfortable retirement, but you're investing in some really good stuff. Then I have to start thinking, oof, it's now a personal decision. And I might, I might need to wear this for a little bit in order to do quote unquote, the right thing. Now, I don't want to end with that message, because we're going to go and talk about it in the second part. Because there is a way of, you know, this is not a zero-sum game. I'm very, very clear on that. It's not either you make money or you do good. You can do both. And we'll talk about that in the second episode. But there certainly is this concept of like, You know, should investors just make as much money as possible and then regulators regulate and put the right guardrails in place so that they can only invest in certain elements and at certain times? And should they also tax appropriately so that the quote unquote trickle down comes into play? So investors, you, you know, you're like thoroughbreds, right? Right. You just, you just You're just horses and you just go as fast as you can to the finish line, but we need to make sure that there are rails on the left and the right-hand side so that you get to the finish line. That might be an argument that a lot of people are talking about.

Yeah, I'm not sure that would hold weight in its implementation in a Western democracy, but, uh, uh, okay, well, look, right there is a very good reason why if you don't, and I was looking on Spotify, I think 66% of people follow, subscribe to that channel. So there's a big portion of you there that don't. So as you just heard, plenty more insights for Steven to share. So make sure you stay tuned and we'll drop that the following week. So thank you very much everyone for listening and thank you Steven, as always, for your insights.

Yeah, thanks, Ant.