Some of the most fascinating topics covered this week are: Investing (Lessons from investing in 483 companies; ESG brings distinct value to developing nations), Parenting (Working-class parents are becoming more like middle-class ones), Space Tech (Cloud computing is betting on outer space), and Sports (Game of Life: Lessons we can learn from sports)
Image: Shutterstock
At Ambit, we spend a lot of time reading articles that cover a wide gamut of topics, ranging from zeitgeist to futuristic, and encapsulate them in our weekly ‘Ten Interesting Things’ product. Some of the most fascinating topics covered this week are: Investing (Lessons from investing in 483 companies; ESG brings distinct value to developing nations), Parenting (Working-class parents are becoming more like middle-class ones), Space Tech (Cloud computing is betting on outer space), and Sports (Game of Life: Lessons we can learn from sports).
Here are the ten most interesting pieces that we read this week, ended October 09, 2020-
1) Charlie Songhurst – Lessons from Investing in 483 Companies [Source: The Investor’s Field Guide]
In this podcast, Charlie Songhurst discusses the lessons he’s learned about business, investing, and people from such a large sample size of companies. He was the former head of strategy at Microsoft and is a prolific investor, having personally invested in nearly 500 companies through his career. He starts with his idea of having people stack rank their vices of power, money, and fame. He says, “So, someone who's interested in power tends to be better at execution. Someone's more interested in money, tends to think more about some capital efficiency. I tend to avoid people interested in fame, but if you are doing something in showbiz, it would presumably be the number one criteria.”
On recruiting great people, he thinks that recruiting is way underestimated precisely because in an early company, people replicate themselves. “So because people tend to hire not so much in their own image, but with that own set of biases, all the initial people you hire will influence all the other hires. And so you can either get this sort of upwards iterating culture of excellence. Or you can get this downwards iterating culture of excellence. So those first few hires are utterly critical.”
He also talks about what kills start-ups, organizational politics, the term alien founders, investing, COVID impact, and crypto. When asked what he thinks about what is the most mis-valued asset in the world, he says, “it's probably entrepreneurs in markets that are non-obvious. And I don't mean because their end market is not obvious. It's people addressing global problems, but in some secondary city in Romania, because capital markets at that stage, are just not efficient enough to find them.”
2) Laughing at work should be a norm [Source: The Economist]
A sense of humour is necessary in life. A study of undergraduates found that those with a strong sense of humour experienced less stress and anxiety than those without it. But, how important is it at work? Humour can be a particular source of comfort at work, where sometimes it can be the only healthy reaction to setbacks or irrational commands from the boss. The healthiest kind of workplace humour stems from the bottom up, not from the top down. Often the most popular employees at work are those who can lighten the mood with a joke or two.
Everyone can appreciate a quip about the cramped commuter trains, the officious security guard, the sluggish lifts or the dodgy canteen food. In that sense, workers can feel they are all (bar the security guard) “in it together”. This helps create team spirit and relieve stress. Work is a serious matter but it cannot be taken seriously all the time. Sometimes things happen at work that are inherently ridiculous. Perhaps the technology breaks down just as the boss is in mid-oration, or a customer makes an absurd request.
Satire should not just be applied to other people. Perhaps the most important thing is not to take one’s own work too seriously. As the late, great gag-writer and comic Bob Monkhouse recalled at the height of his career, “They laughed when I said I wanted to be a comedian. Well, they’re not laughing now.” Though a sense of humour is necessary at work, one needs to understand that it shouldn’t demean anyone.
3) Tidjane Thiam: ESG brings distinct value to developing nations [Source: Financial Times]
The author of this article, Tidjane Thiam, chair of the audit committee of the Kering Group, member of the Group of 30, and the African Union’s special envoy on Covid-19, highlights how important ESG investing is. Suddenly everyone is thinking about ESG investing. Funds that invest according to environmental, social and governance (ESG) principles have attracted net assets of more than $70bn from April to June, pushing their assets under management to a historic high of $1tn.
The fact that investors are now increasingly supporting and rewarding responsible corporate behaviour is good news for all countries but never more so than for countries with limited resources, as is often the case in lower-income countries and in Africa. Many leaders of companies are increasingly embracing ESG. This new focus by business will over time have a significant, positive impact on the growth prospects of less-developed countries. Particularly important in emerging and developing economies is the G — governance. Why? Because companies will invest and create jobs in countries with good governance and where corruption is not tolerated. The first victims of corruption are always the poor who end up paying more for basic services and goods.
Corruption and poor governance are both morally wrong and economically inefficient. Civil society and non-governmental organisations have a key role to play to denounce abuses and drive change. In 1Q2020, 94% of ESG funds outperformed their parent benchmarks. This owed something to the fact that ESG funds were not exposed to oil and gas, carbon-intensive industries that suffered a slump in demand as a result of the pandemic. However, it seems that the outperformance continued in Q2 2020, after these stocks recovered. ESG also looks at how companies treat their employees, including their approach to health and welfare benefits. Companies that have treated their employees well since the pandemic started, made working from home easier and mitigated the impact of furloughs, did better financially than those that did not.