WOKE WEDNESDAY: Directors get analyzed in the alternative democracy, and Morningstar makes anti-woke pillars

Live from Blackrock’s Kosher Dill Pickleball Court, it’s the ESG Industry’s ONLY weekly woke data podcast, featuring BS-man Matt Moscardi! In today’s Earmuffs Solid Guestimate called June 21, 2023: our alternative democracy and an anti-ESG update

Our show today is being sponsored by ESGauge, your ESG data solutions provider 

DAMION1

Alternative Democracy: Directors We Hate Edition (20% or higher)

1. Charlotte's Web Holdings

1. I only picked this company because I was excited there was a company called Charlotte's Web Holdings but there’s some spider-hating going on:

2. John Held, Thomas Lardieri, Alicia Morga, Jacques Tortoroli: all 67% NO!

3. That was right after they ratified the setting of the number of directors of the Company at six (6) directors: 98% YES

2. Etsy

1. M. Michele Burns: 30% NO

2. Fred Wilson: 34% NO

3. I guess Etsy not as woke as they pretend?

1. a third-party report on the effectiveness of our efforts to prevent harassment and discrimination: 11% YES

3. PagerDuty

1. Sameer Dholakia: 30% NO

2. Jennifer Tejada: 25% NO

4. Delta Air Lines

1. George N. Mattson: 18% NO

2. shareholders approved the adoption of a shareholder proposal requesting shareholder ratification of termination pay: 60% YES

1. John Chevedden

5. Target: nobody’s mad at woke directors!

6. Live Nation Entertainment

1. Greg Maffei: 36% NO

1. CEO Liberty Media

1. Liberty Media holds 30% shares

2. Say on Pay: 54% NO

1. CEO Michael Rapino $139M

2. CFO Joe Berchtold $52M

3. Pay Committee

1. *Chad Hollingsworth: 12% NO

1. SVP Liberty Media

2. Jimmy Iovine

3. Dana Walden

7. SeaWorld Entertainment

1. Ronald Bension, Neha Jogani Narang, Kimberly Schaefer: 32% NO

1. attended fewer than 75% of the aggregate of the total number of meetings of the Board and Board committees

8. Teva Pharmaceutical

1. Dr. Sol J. Barer: 24% NO

2. Janet S. Vergis: 23% NO

3. Say on Pay: 51% NO

1. CEO Kare Schultz $15.5M

2. Hmmmmm

3. Maybe because the company literally ranks in the 0th percentile in market cap compared to their peer companies to determine compensation

1. Teva $8.3B; median $113B

9. Fastly

1. Aida Álvarez: 47% NO

1. Pay committee; chair of Nom

2. Say on Pay: 53% NO

1. New CEO Todd Nightingale received 12$M pay-for-pulse stock award that vests over 4 years if he stays alive

3.  grant of the performance-based nonstatutory stock option (the “Bergman Performance Award”) to Artur Bergman, Fastly’s Founder, Chief Architect, and member of the Board of Directors was not approved: 

1. 2.3M ($18.4M) shares representing 2% of outstanding shares

1. Already owns 8.8M shares (7%)

2. The filing included the vote with and without Founder Bergman’s shares: 69% NO without Founder

10. AMC Networks

1. Class B: 100% Yes

2. Class A

1. Joseph M. Cohen: 43% NO

2. Leonard Tow: 81% NO

3. Carl E. Vogel: 44% NO

11. SandRidge Energy

1. John Lipinski: 29% NO

12. Guardant Health

1. Ian Clark: 38% NO

2. Meghan Joyce: 25% NO

3. (As an FU?) Samir Kaul: 99% YES

13. Last but not least: anti-woke report: Caterpillar

1. an audit analyzing the impacts of the Company’s Diversity, Equity & Inclusion policies: 1.7% YES

1. National Center for Public Policy Research

2. Where adopted, such programs have raised significant objections, including the concern that the programs and practices themselves are deeply racist, sexist, otherwise discriminatory and potentially in violation of the Civil Rights Act of 1964.(3) And that by devaluing merit, corporations have sacrificed employee competence, moral and productivity to the altar of “diversity.”

MATT1

THE FIVE PILLARS OF THE ANTI-WOKE!

The 5 categories of 'anti-ESG' funds, according to Morningstar

In ESG, there are three generally accepted pillars of use for ESG data - “risk”, “impact”, and “values”.  Risk is avoiding major costs to maximize market returns - for instance, it would be bad if all my utilities facilities were flooded thanks to climate change.  Risk is about making it rain.  Impact is about “changing the world” - investing in companies that have technologies or do things like end poverty or reduce carbon for everyone.  Values is usually religious or socially conscious investing - ironically, values was and is the generally MOST liberal or MOST conservative wing of ESG data.  Anti-abortion and human rights at the same time.

Morningstar’s Alyssa Stankiewicz now brings us the pillars of the anti-woke, and I love it.

• Anti-ESG

• They have to use ESG ratings to tilt towards companies that ESG ratings rate poorly - it’s the ESG of anti-ESG?

• Basically it’s the “white discrimination”, “oil discrimination” play

• Also, very anti-choice

• THIS IS ESG - USE ESG DATA IN REVERSE, INVEST THAT WAY

• Political funds

• FUCK THE LIBERAL AGENDA

• They had to create their own measures of “liberalness” and “conservativeness”, which basically either is creating a new rating system OR buying ESG data, picking the liberal sounding things

• THIS IS HOW ESG STARTED - GET SOME DATA, MAKE A RATING BASED ON A WORLD VIEW, INVEST THAT WAY

• “Renouncers”

• This is a weird one - they’re EX ESG funds - removing ESG from all documents because they’re cowering in fear and/or have decided ESG is a Marxist plot

• In order to renounce, they have to actually have ESG data and have been ESG

• THESE ARE YOUR RUN OF THE MILL COWARDS

• A paper by MICHAEL J. COOPER, HUSEYIN GULEN, P. RAGHAVENDRA RAU looked at how funds change their names to conform with whatever the new hot style is - they found changing the name worked to generate investment in flows without changing any returns or process.  

• The Renouncers seem to be the anti-woke version of name changing for the cash

• Vice

• Screening - include ONLY tobacco, alcohol, weapons, and gambling

• This is the anti-excellence play

• THIS IS ESG VALUES, JUST INSTEAD OF “REMOVE TOBACCO” IT’S “ADD TOBACCO”!

• Voters

• Strive!  We’ll vote your proxies with “excellence” and “anti-wokeness” so you don’t have to!

• Also means they require no data, no methodology, just an underlying index to lease and a team to make up votes

• THIS IS ESG MAKE-BELIEVE!  

• Arguably this is political too - these funds are indexers that achieve nothing except fees for a 0.07% vote in favor