Keesa: climate risks have been reflected across sectors and industries for sometime now, and today we're going to discuss recent research on how climate is priced into the market. With Shehriyar Antia, a vice president, Head of Thematic Research at PGIM, who will give us Insights here. So, Change how is climate change being priced into the market? And what are the repercussions for investors? Let start Shariah talking about research from a value versus values perspective. So from an enterprise value creation perspective as well as a moral perspective, what differences did you see when viewing these from different lenses?
Shehriyar: Well, it is such a pleasure to speak with you today. Go thank you so much for for inviting me. So as you mentioned much much has already been been written about climate change. For for investors and and the bulk of it really appeals to the to the moral imperative aspect of climate change. That is, it appeals to this notion that investors need to consider an. Act on climate change because The right thing to do now The moral imperative here is very, very clear. Climate change is impacting our planet. It's impacting human lives and it's impacting our broad economy. This is of course not not debatable edge, it will. It will continue, so even even if I had a magic wand, and I was able to waive it wildly and halt all greenhouse gas emissions tomorrow. The current trajectory of climate change would continue for the next 20 years. The actions we take today will only impact the world after that time but. The moral imperative is not the only lens for investors to to view climate change, and importantly, that that lens has not been very effective in spurring investors to take action. Research found that although roughly 90% of global investors recognize climate change is an important factor. Almost 40% of them have yet to factor it into their investment process. So in response to to this action gap, we deliberately chose to take a different perspective. Here. Keesa, we recognize that investors have a fiduciary responsibility, and in the US at least, the. The prevailing consensus is that consideration of moral imperative is is not always consistent with fiduciary standards. So for our paper we thought it would be useful to set the moral imperative aside for the moment and examine climate change purely from a risk return perspective. And that is that is essentially what we've done. Trustingly, even though we took a very different approach, we held climate change to a very different set of standards. We seem to come out in a similar place that is, investors really need to consider an act on climate change because it's impacting the macro economy. It's impacting markets and it's impacting their investment portfolios today. And will continue to do so. Bottom line, our research found that climate change is a material factor for all investors, whether they are looking to do good or do well, and it should be treated like any other critical factor for their portfolio, such as the level of interest rates or GDP or unemployment.
Keesa: So excellent, I love what you're saying about climate change being really material. I think clearly that's something that we as a marketplace and as a society. Quite frankly, we're seeing more of that and let me ask you what Catalyst might cause markets to. Reprise assets, so we're really taking this seriously. What catalyst should investors be aware of when it comes to repricing? Whether it's gradual or abrupt? Repricing of assets, what sorts of things are important there?
Shehriyar: So, Well, while climate change is is readily is readily apparent, you know really? Key question for investors is. So how are markets handling this? And how well are they pricing it in? And the short answer is of course, not not very well right now. Pricing it in markets are pricing climate in quite inconsistently, quite incompletely. But what's critical for investors is that going forward markets will pricing climate change more, more fully and. As as as as you noted our our research shows this is much more likely to happen in stages and fits and spurts overtime rather than all at once in an abrupt kind of one time. Repricing, what some people refer to as a climate Minsky moment. And one of the reasons we I believe that the climate gets priced into markets. You know, over time, sequentially rather than abruptly are the catalysts for this. Now our report identified 5 catalysts working working to drive markets to pricing climate change more. I'd like to share two of them with you today, two that I think are especially overlooked. I think one is the collective nudges of consumers and investors and the 2nd is the data revolution that's that's underway. OK, so the first one you know. We also think government regulation and policy is the only way for markets to pricing climate risk. And you know Europe. Certainly is the is the poster child for that. Their Europe, European governments have been at the Vanguard of climate policy, and they've really spurred pricing of climate risks throughout their economy. For example, in the utilities sector. But I would offer government regulation is not the only compelling force here. The. The United States government, by contrast, has been very hands off when it comes to climate policy, especially over the last four or five years. But yet a number of U.S. companies have responded with voluntary carbon neutral pledges, more data disclosures. You know, companies like Amazon, Delta, Microsoft, Coca-Cola. Forward X on the list goes on and on the the largest U.S. companies have made these pledges without any government mandates to do so. Which which begs the question, why would they do that went? What forces are they responding to? Our research shows they are responding to the collective nudges from consumers and investors. Bottom line, when their clients, their shareholders, their bondholders want them to take action, companies listen, but, Keesa, probably the most important catalyst, the one that that we're watching most closely The data revolution that's been underway in climate analytics over the last five years or so. Basically new climate analytics are more accessible to investors. There a better quality and more granular than ever before. And the key point here is. Is is pretty straightforward. Better data leads to better investment decisions and new data really enables investors to be smarter in their risk analysis and to and to identify opportunities where maybe markets don't do a great job of pricing in this risk.
Keesa: climate risks have been reflected across sectors and industries for sometime now, and today we're going to discuss recent research on how climate is priced into the market. With Shehriyar Antia, a vice president, Head of Thematic Research at PGIM, who will give us Insights here. So, Change how is climate change being priced into the market? And what are the repercussions for investors? Let start Shariah talking about research from a value versus values perspective. So from an enterprise value creation perspective as well as a moral perspective, what differences did you see when viewing these from different lenses?
Shehriyar: Well, it is such a pleasure to speak with you today. Go thank you so much for for inviting me. So as you mentioned much much has already been been written about climate change. For for investors and and the bulk of it really appeals to the to the moral imperative aspect of climate change. That is, it appeals to this notion that investors need to consider an. Act on climate change because The right thing to do now The moral imperative here is very, very clear. Climate change is impacting our planet. It's impacting human lives and it's impacting our broad economy. This is of course not not debatable edge, it will. It will continue, so even even if I had a magic wand, and I was able to waive it wildly and halt all greenhouse gas emissions tomorrow. The current trajectory of climate change would continue for the next 20 years. The actions we take today will only impact the world after that time but. The moral imperative is not the only lens for investors to to view climate change, and importantly, that that lens has not been very effective in spurring investors to take action. Research found that although roughly 90% of global investors recognize climate change is an important factor. Almost 40% of them have yet to factor it into their investment process. So in response to to this action gap, we deliberately chose to take a different perspective. Here. Keesa, we recognize that investors have a fiduciary responsibility, and in the US at least, the. The prevailing consensus is that consideration of moral imperative is is not always consistent with fiduciary standards. So for our paper we thought it would be useful to set the moral imperative aside for the moment and examine climate change purely from a risk return perspective. And that is that is essentially what we've done. Trustingly, even though we took a very different approach, we held climate change to a very different set of standards. We seem to come out in a similar place that is, investors really need to consider an act on climate change because it's impacting the macro economy. It's impacting markets and it's impacting their investment portfolios today. And will continue to do so. Bottom line, our research found that climate change is a material factor for all investors, whether they are looking to do good or do well, and it should be treated like any other critical factor for their portfolio, such as the level of interest rates or GDP or unemployment.
Keesa: So excellent, I love what you're saying about climate change being really material. I think clearly that's something that we as a marketplace and as a society. Quite frankly, we're seeing more of that and let me ask you what Catalyst might cause markets to. Reprise assets, so we're really taking this seriously. What catalyst should investors be aware of when it comes to repricing? Whether it's gradual or abrupt? Repricing of assets, what sorts of things are important there?
Shehriyar: So, Well, while climate change is is readily is readily apparent, you know really? Key question for investors is. So how are markets handling this? And how well are they pricing it in? And the short answer is of course, not not very well right now. Pricing it in markets are pricing climate in quite inconsistently, quite incompletely. But what's critical for investors is that going forward markets will pricing climate change more, more fully and. As as as as you noted our our research shows this is much more likely to happen in stages and fits and spurts overtime rather than all at once in an abrupt kind of one time. Repricing, what some people refer to as a climate Minsky moment. And one of the reasons we I believe that the climate gets priced into markets. You know, over time, sequentially rather than abruptly are the catalysts for this. Now our report identified 5 catalysts working working to drive markets to pricing climate change more. I'd like to share two of them with you today, two that I think are especially overlooked. I think one is the collective nudges of consumers and investors and the 2nd is the data revolution that's that's underway. OK, so the first one you know. We also think government regulation and policy is the only way for markets to pricing climate risk. And you know Europe. Certainly is the is the poster child for that. Their Europe, European governments have been at the Vanguard of climate policy, and they've really spurred pricing of climate risks throughout their economy. For example, in the utilities sector. But I would offer government regulation is not the only compelling force here. The. The United States government, by contrast, has been very hands off when it comes to climate policy, especially over the last four or five years. But yet a number of U.S. companies have responded with voluntary carbon neutral pledges, more data disclosures. You know, companies like Amazon, Delta, Microsoft, Coca-Cola. Forward X on the list goes on and on the the largest U.S. companies have made these pledges without any government mandates to do so. Which which begs the question, why would they do that went? What forces are they responding to? Our research shows they are responding to the collective nudges from consumers and investors. Bottom line, when their clients, their shareholders, their bondholders want them to take action, companies listen, but, Keesa, probably the most important catalyst, the one that that we're watching most closely The data revolution that's been underway in climate analytics over the last five years or so. Basically new climate analytics are more accessible to investors. There a better quality and more granular than ever before. And the key point here is. Is is pretty straightforward. Better data leads to better investment decisions and new data really enables investors to be smarter in their risk analysis and to and to identify opportunities where maybe markets don't do a great job of pricing in this risk.
Keesa: If we take your concept of The response to consumers and investors that we're seeing As well as the operation of climate analytics, how can we use those two to really understand investors position on Brown stocks versus green stocks? I think I might know an answer. When it comes to data and analytics, but what were your findings there?
Shehriyar: Let me You speak a little bit more about the about the data data revolution. You know what I what I mean by that is is that there's there's these climate analytics available today are better quality that are more accessible. As I noted there, more granular than ever. Never before but you know, let let me curb my enthusiasm here for for for a moment I do want to note that the data is not perfect. There are still remaining gaps in in reporting. There's plenty of room for improvement as far as standardization and uniformity of data, but the underlying trend, I think. Is very, very clear Tisa and that is that climate, data and analytics are much better today than they were five years ago, even three years ago. You know, we we often think about climate change solely as a risk, but some of this alternative data that that and these new climate analytics really shed light on hidden risks. But they also opened up new avenues for investment possibilities. And you know fossil fuel companies offer a really great example of the kind of opportunity that that can be uncovered here by by leveraging some of some climate analytics, traditional ESG investment approaches taken exclusionary approach to. Oil and gas companies that is oil and gas companies had been banished altogether from portfolios of ESG Investors for year, perhaps in part because it was not possible to differentiate between the firms in this sector. But he said what we're seeing from institutional investors around the world is increasingly, they're looking for a more nuanced approach there. Looking to engage with some of these firms. There's a growing awareness that all firms in Brown sectors can be inappropriately painted with the same broad brush and new climate analytics allow investors to differentiate between the firms in this sector too. To identify the greenest firms, let's say within the oil and gas sector for example, you know those those firms that really embrace green technology and renewable energy sources and have made a firm commitment to attune over to a lower carbon future. In differentiating between firms like like, we're talking about, investors can outperform benchmarks because firms that embrace a green future face less risk of extinction in a low carbon world and are likely to outperform their more Dinosaur peers. Also, by engaging with energy firms and encouraging their use of cleaner fuels like natural gas over coal, investors can influence the trajectory actually help reduce carbon emissions going forward. The bottom line for investors is that embracing the data revolution. Leveraging some of these new analytics can really allow savvy, active investors to do good and to do well.
Keesa: So let's talk a bit about some of the hidden risks that we see, so I know you mentioned some of the key areas that a lot of investors have been focused on in terms of using the analytics and using the data to really make distinctions there. Are there some hidden risks that we need to be aware of?
Shehriyar: we need to be aware of. I was listening to it to two recent podcast of of Yours on on Fragility in Supply Chains an You know we touched on on very much this same point in our research as well and supply chains are a prime example of hidden climate risk to companies. What do I mean by this? We don't often think of Swiss or Japanese pharmaceutical companies as being highly vulnerable to climate risk, but they are in their supply chains which which run through places like India. For example, you know many pharmaceutical companies have manufacturing facilities in parts of India that are subject to extreme heat and water stress and manufacturing. Drugs and medicine can be a very water intensive process and. Droughts and extreme, he spills can be very, very disruptive to the to the manufacturing of Pharmaceuticals and medicine. What should investors do about this? Well, they can leverage alternative data and climate analytics to identify these risks and steer their portfolios away from them. So by alternative data I mean satellite images. Geo location data. Of of key manufacturing sites of say pharmaceutical companies in India and and by taking that those those those images and that data by overlaying this with climate metrics and I'm talking about extreme heat and water stress metrics. Investors can identify which supply chains are most at risk. End in which in which firms are most most vulnerable. We actually covered this exact example and others in our in our research and this is a real world example of how using climate analytics and alternative data can really help investors tilt their portfolios away from the most vulnerable areas in firms and. If I can give a little teaser for our for a paper, you know, big big Global Pharma is is not the only industry at at at risk either.
Keesa: Such amazing information away regarding your paper and let us know how we can get ahold of it, obviously. and in the last question what are the top three issues investors should consider now around climate? Sit, sit here and you know, think, think about the rest. Rest of this. This this year there are. There are really 33 topics or three issues that that sort of come to mind when it when it comes to investors and climate change. First is climate policy. In the US. The second is climate change will absolutely be the kryptonite for passive investment approaches going forward. And the third is what kind of pandemic teach us about climate change. So that first point climate policy in the in the US Dividing Administration has made very, very clear their their objectives and priorities for for climate policy, which remains unclear is how they plan to get there. Well, there should be some more clarity around this in the in the next few. Two months and specifically, investors should pay attention to what policies and actions are passed through Congress and what gets signed into law, because those those policies those actions will be the most enduring ones for the for the future. Some areas that investors should be mindful of. It does not appear likely that that there will be a carbon pricing mechanism. In in the United States, nationally, as as as there is in in Europe. But it'll be interesting to see how much of President Biden's climate policy will be will be policy carrot that is investment incentives, tax credits and the like, and how much of his climate policy will be policy stick. That is penalties, regulations, corporate mandates. In any case, the. The details of policies going forward and how exactly they're they're there to be carried out will be a source of risk and opportunity for investors. But let me be very, very clear about one really, really important point here due to investors should absolutely watch to see what plays out with US climate policy, but they should not wait to take action. They absolutely need to move today. To address climate in their in their portfolios, you know markets will be pricing this in more more fully as as as we spoke about regardless of government policy. Several other catalysts are already in motion and and that brings me to the to the second key point. For for investors as investors think about the best approach to integrate climate change into their. Into their portfolios I I want to highlight one finding of our research that that really stood out very clearly. Pure passive index approaches which have gained in popularity immensely over the last few years, are simply not equipped to handle climate change either the risk or the opportunity. In fact, climate change could very well be the kryptonite for these passes. Approaches, let me explain a little bit what I what I mean by this. You know certain aspects of of climate risk that the fact that its impact is nonlinear, that it's so highly uneven across countries even within countries make it very, very difficult for passive index approaches to to to handle. It's, you know, these kind of irregular nonlinear risk. Are really the blind spot for index approaches that that have underlying presumption that you know risks are uniformly and evenly distributed across an asset class. So to her passive approaches will stumble when it comes to climate risk. When it comes to investment opportunities arising from from climate change, you know passive approaches are likely to miss the miss. Many of them as well. There's there's no way for passive approaches, for example to to embrace alternative data to to use it to differentiate risk the way investors can now, there's there's no way for passive investors to take advantage of market miss. Miss pricing either. Passion investors will will miss out on many emerging opportunities as the world transitions to A to a low carbon future. The key point here is that an active bottom up approach that embraces new climate data analytics and integrates it directly into the investment process is the best way for investors to navigate climate change. Really both the risks and the opportunities and and the third key point for investors for the for the rest of 2021. You know, as we begin to emerge, at least here in the United States, from the from the limitations of the pandemic over the past year. This is a really good time to reflect on our response to our experience with covid over the last year and what it could possibly teach us about how to consider how to think about how to respond to climate change. And there are some some clear parallels between between Cogan and climate here. First. Their impact is universal. No corner of the world was was was spared from Covid and no corner will be spared from climate change as well, either directly or indirectly. There's there's nowhere to hide, and quite frankly, investors need to address climate change. Head on 2nd parallel. The early part of last last year, last January and February, you know Covid was was sort of on the. On the scene it was in the news here, here in the United States, but it didn't really seem like a big deal until all of a sudden it was a huge deal. You know, both both the pandemic and climate change are are examples of non non linear growth that is both covid and climate grow exponentially and appear to be well contained. One day and then are accelerating wildly out of control the next bottom line. Exponential growth surprises markets. And investors and the 3rd parallel, Keesa, for both covid and climate. There is a clear and pressing need to act early preemptively even if you if you wait to see the effect it's it's already too late to. Add no, I'm I'm hopeful that that that all of us, not just investors, can can actually learn from from our experience with the pandemic this this past year and that we had a society will be will be smarter in the in the way that we prepare for and handle climate change in the in the future. I I know we can do this.
Keesa: Such great insight, Shehriyar. Talking about the catalyst behind markets in terms of repricing assets. Rather, collective nudges of consumers and really understanding and responding to consumers and investors. Number one in that second one, new climate analytics or just becoming more accessible and also the top three issues you believe investors should consider around climate. US climate policy point until we know what now the next question is how, how? Is it going to get done? Climate change as kryptonite for passive investing. Very interesting phrasing there and then. Third, the learning lessons that we're picking up. Obviously the pandemic being a top one and really, investors need to look at addressing climate issues today. Thank you so much for your time, Shehriyar. If we take your concept of The response to consumers and investors that we're seeing As well as the operation of climate analytics, how can we use those two to really understand investors position on Brown stocks versus green stocks? I think I might know an answer. When it comes to data and analytics, but what were your findings there?
Shehriyar: Let me You speak a little bit more about the about the data data revolution. You know what I what I mean by that is is that there's there's these climate analytics available today are better quality that are more accessible. As I noted there, more granular than ever. Never before but you know, let let me curb my enthusiasm here for for for a moment I do want to note that the data is not perfect. There are still remaining gaps in in reporting. There's plenty of room for improvement as far as standardization and uniformity of data, but the underlying trend, I think. Is very, very clear Tisa and that is that climate, data and analytics are much better today than they were five years ago, even three years ago. You know, we we often think about climate change solely as a risk, but some of this alternative data that that and these new climate analytics really shed light on hidden risks. But they also opened up new avenues for investment possibilities. And you know fossil fuel companies offer a really great example of the kind of opportunity that that can be uncovered here by by leveraging some of some climate analytics, traditional ESG investment approaches taken exclusionary approach to. Oil and gas companies that is oil and gas companies had been banished altogether from portfolios of ESG Investors for year, perhaps in part because it was not possible to differentiate between the firms in this sector. But he said what we're seeing from institutional investors around the world is increasingly, they're looking for a more nuanced approach there. Looking to engage with some of these firms. There's a growing awareness that all firms in Brown sectors can be inappropriately painted with the same broad brush and new climate analytics allow investors to differentiate between the firms in this sector too. To identify the greenest firms, let's say within the oil and gas sector for example, you know those those firms that really embrace green technology and renewable energy sources and have made a firm commitment to attune over to a lower carbon future. In differentiating between firms like like, we're talking about, investors can outperform benchmarks because firms that embrace a green future face less risk of extinction in a low carbon world and are likely to outperform their more Dinosaur peers. Also, by engaging with energy firms and encouraging their use of cleaner fuels like natural gas over coal, investors can influence the trajectory actually help reduce carbon emissions going forward. The bottom line for investors is that embracing the data revolution. Leveraging some of these new analytics can really allow savvy, active investors to do good and to do well.
Keesa: So let's talk a bit about some of the hidden risks that we see, so I know you mentioned some of the key areas that a lot of investors have been focused on in terms of using the analytics and using the data to really make distinctions there. Are there some hidden risks that we need to be aware of?
Shehriyar: we need to be aware of. I was listening to it to two recent podcast of of Yours on on Fragility in Supply Chains an You know we touched on on very much this same point in our research as well and supply chains are a prime example of hidden climate risk to companies. What do I mean by this? We don't often think of Swiss or Japanese pharmaceutical companies as being highly vulnerable to climate risk, but they are in their supply chains which which run through places like India. For example, you know many pharmaceutical companies have manufacturing facilities in parts of India that are subject to extreme heat and water stress and manufacturing. Drugs and medicine can be a very water intensive process and. Droughts and extreme, he spills can be very, very disruptive to the to the manufacturing of Pharmaceuticals and medicine. What should investors do about this? Well, they can leverage alternative data and climate analytics to identify these risks and steer their portfolios away from them. So by alternative data I mean satellite images. Geo location data. Of of key manufacturing sites of say pharmaceutical companies in India and and by taking that those those those images and that data by overlaying this with climate metrics and I'm talking about extreme heat and water stress metrics. Investors can identify which supply chains are most at risk. End in which in which firms are most most vulnerable. We actually covered this exact example and others in our in our research and this is a real world example of how using climate analytics and alternative data can really help investors tilt their portfolios away from the most vulnerable areas in firms and. If I can give a little teaser for our for a paper, you know, big big Global Pharma is is not the only industry at at at risk either.
Keesa: Such amazing information away regarding your paper and let us know how we can get ahold of it, obviously. and in the last question what are the top three issues investors should consider now around climate? Sit, sit here and you know, think, think about the rest. Rest of this. This this year there are. There are really 33 topics or three issues that that sort of come to mind when it when it comes to investors and climate change. First is climate policy. In the US. The second is climate change will absolutely be the kryptonite for passive investment approaches going forward. And the third is what kind of pandemic teach us about climate change. So that first point climate policy in the in the US Dividing Administration has made very, very clear their their objectives and priorities for for climate policy, which remains unclear is how they plan to get there. Well, there should be some more clarity around this in the in the next few. Two months and specifically, investors should pay attention to what policies and actions are passed through Congress and what gets signed into law, because those those policies those actions will be the most enduring ones for the for the future. Some areas that investors should be mindful of. It does not appear likely that that there will be a carbon pricing mechanism. In in the United States, nationally, as as as there is in in Europe. But it'll be interesting to see how much of President Biden's climate policy will be will be policy carrot that is investment incentives, tax credits and the like, and how much of his climate policy will be policy stick. That is penalties, regulations, corporate mandates. In any case, the. The details of policies going forward and how exactly they're they're there to be carried out will be a source of risk and opportunity for investors. But let me be very, very clear about one really, really important point here due to investors should absolutely watch to see what plays out with US climate policy, but they should not wait to take action. They absolutely need to move today. To address climate in their in their portfolios, you know markets will be pricing this in more more fully as as as we spoke about regardless of government policy. Several other catalysts are already in motion and and that brings me to the to the second key point. For for investors as investors think about the best approach to integrate climate change into their. Into their portfolios I I want to highlight one finding of our research that that really stood out very clearly. Pure passive index approaches which have gained in popularity immensely over the last few years, are simply not equipped to handle climate change either the risk or the opportunity. In fact, climate change could very well be the kryptonite for these passes. Approaches, let me explain a little bit what I what I mean by this. You know certain aspects of of climate risk that the fact that its impact is nonlinear, that it's so highly uneven across countries even within countries make it very, very difficult for passive index approaches to to to handle. It's, you know, these kind of irregular nonlinear risk. Are really the blind spot for index approaches that that have underlying presumption that you know risks are uniformly and evenly distributed across an asset class. So to her passive approaches will stumble when it comes to climate risk. When it comes to investment opportunities arising from from climate change, you know passive approaches are likely to miss the miss. Many of them as well. There's there's no way for passive approaches, for example to to embrace alternative data to to use it to differentiate risk the way investors can now, there's there's no way for passive investors to take advantage of market miss. Miss pricing either. Passion investors will will miss out on many emerging opportunities as the world transitions to A to a low carbon future. The key point here is that an active bottom up approach that embraces new climate data analytics and integrates it directly into the investment process is the best way for investors to navigate climate change. Really both the risks and the opportunities and and the third key point for investors for the for the rest of 2021. You know, as we begin to emerge, at least here in the United States, from the from the limitations of the pandemic over the past year. This is a really good time to reflect on our response to our experience with covid over the last year and what it could possibly teach us about how to consider how to think about how to respond to climate change. And there are some some clear parallels between between Cogan and climate here. First. Their impact is universal. No corner of the world was was was spared from Covid and no corner will be spared from climate change as well, either directly or indirectly. There's there's nowhere to hide, and quite frankly, investors need to address climate change. Head on 2nd parallel. The early part of last last year, last January and February, you know Covid was was sort of on the. On the scene it was in the news here, here in the United States, but it didn't really seem like a big deal until all of a sudden it was a huge deal. You know, both both the pandemic and climate change are are examples of non non linear growth that is both covid and climate grow exponentially and appear to be well contained. One day and then are accelerating wildly out of control the next bottom line. Exponential growth surprises markets. And investors and the 3rd parallel, Keesa, for both covid and climate. There is a clear and pressing need to act early preemptively even if you if you wait to see the effect it's it's already too late to. Add no, I'm I'm hopeful that that that all of us, not just investors, can can actually learn from from our experience with the pandemic this this past year and that we had a society will be will be smarter in the in the way that we prepare for and handle climate change in the in the future. I I know we can do this.
Keesa: Such great insight, Shehriyar. Talking about the catalyst behind markets in terms of repricing assets. Rather, collective nudges of consumers and really understanding and responding to consumers and investors. Number one in that second one, new climate analytics or just becoming more accessible and also the top three issues you believe investors should consider around climate. US climate policy point until we know what now the next question is how, how? Is it going to get done? Climate change as kryptonite for passive investing. Very interesting phrasing there and then. Third, the learning lessons that we're picking up. Obviously the pandemic being a top one and really, investors need to look at addressing climate issues today. Thank you so much for your time, Shehriyar.
