More From Day Three at Milken Global Conference

site at the Milk and Institute Global Conference. Give us your interpretation or your reaction to the conference this year, because we were talking during the break and use the phrase people are ready. What are they ready for? Yeah? I mean we've set out with Engine number one to do things in a different way. And so instead of what we all think of as slightly older school e S and g people aren't sure if it works, people

aren't sure to think it returns. We built Engine number one to take the data, the environmental or the climate or the governments data and use it to drive returns. And so, as I've watched and talked with lots of people over the last couple of days, large pools of assets as well as younger people, people are ready, But they're ready because the performance is there, or they're just

ready because it's the right thing to do. What is it they're they're ready, they're ready to have impact in their investments, but they're not willing to do it with giving up returns. So the way they think about it is, we care, we care about people and wages and workers, we care about climate, but we need investors to do it for us in a way where we don't give up returns. So, Jennifer, is it harder though for a company that is delivering the returns to kind of get

them to make the changes? And investors are maybe not going to be so supportive because they're like, listen, I like these returns. So give me an idea. Yeah, we think it's all. We think it's all about using the data on climate or environment people using it to drive returns over time. So to take an example, let's take

General Motors. UM. So Mary bar has got up a great business, she's a great CEO, she's got a strong board, um, but they can actually make more money if they get to an e V transition faster, longer term, longer term. But if you think about it from a scale perspective, so what's the you know, the what's the multiple of

GM today compared to Tesla. Let's take that example. If you can get to an e V transition sooner and you're doing nine million electric cars a year, that's a huge increase in multiple for GM, and we get to the climate transition sooner. So yes, it takes more than a quarter, but it's the way to do it at scale. Hey, talk to us about your investing framework and how you

think about potential targets. Are our audience absolutely familiar with what engine number one has done and did earlier this year at Exxonmobile and also of course at General Motors too, But how do you think about your next potential targets? Yeah, we think about it as being active owners in all these companies, as opposed to target or old school activism. And so what does that mean. That means we're running

with all the public companies, every single one. We run through their wages, their workers, their social impact, and their climate and environmental impact. We do it in dollar sense, and then we forecast how does that change their value and over time? And so we will work with both companies that are laggards where we think they're not managing the business as well as they could, and we'll do that constructively. We won't try to do it um you

know the way we did with that Exxon. Better to do it working constructively with companies, and so we're working with a number of companies now. But behind the scenes, we don't talk about that as much. Tim was doing. You know, we're doing some research. Tim showed a story with me and we've been following this down. Jones, you know, had reported I guess it was. Was it just today, Tim? Yeah, that X and XN is debating abandoning some of its

biggest oil and gas projects. Do you feel like when Well, I think the first win is get the right people on the board. So that was a big victory in getting three people with great energy transition experience, UM. And the second when we're looking for is what's the long

term capital all occasion strategy. And if x and we're not in the boardroom their independent directors, but if Exxon with the new people on the board, comes to a decision to rethink long term petroleum development, we think that's very smart. Aren't for business? Any environment? And the environment? Well,

what does that Excel mobile look like to you? I mean, help us understand that, because I think people think of Exon Mobile is like the opposite of a It's think about the business that it's in, right, it drills for fossil fuels. Uh, it's an energy company. And so if you think about the expertise that Exon has, they have, you know they have huge I p in great technologies and with the batteries. Traditionally they were a founder pioneer from research perspective, and then they have an ability to

execute things at huge scale. If you want to do energy, even a new kind of energy at scale, think about the engineering capability of a Chevron or an Exxon to do that. So they're an energy company. They don't only have to be an oil company ten and twenty years in the future. So in terms of industries, I know you can't probably reveal I don't want to say the

word targets. I know that's what we keep thinking. But I mean, what are the industries that you think you're going to be looking at or are currently looking at pretty aggressively when it comes to doing the research that you know are transitioning need to be trans motioning for the better of all mankind. Yeah, I think I think the heavy fossil fuel industries are definitely, I mean definitely, that's an obvious one, which is why you see us

talking about energy and talking about transportation. That's a place where you transform and companies can be much more profitable and you get to climate better climate impacts sooner. They're also financial services Squares an example where Squares business is cash app in particular serving underserved communities. It's driving financial

inclusion that has huge positive benefit. And a lot of healthcare companies their whole business is to do good and so helping them get that story out and explain to investors that that's a good place to be driving this transition around better social outcomes. The big banks might be a dorko. We are. We quickly put this. We put this valuation framework against every different company in every different industry.

And the nice thing about the vote et F, So we've got a private fund, We've got a vote e t F. It holds all big companies, so we can work through a lot of these issues over time. We'll have to find a better river target. Yeah, would you come back, would love to love your premise and what you're doing. Jennifer Gracio, she's chief executive officer of Engine

number one right here at Milken This is Bloomberg. So I do feel like this topic is definitely the kind of conversations that are happening here at Milkin, which is where Tim and I have been for the last few days. Uh. And the topic is about the role of universities in our democracy. Our next guest says in a new book, universities are a bulwark institution when it comes to democracy. Ronald J. Daniels is president of Johns Hopkins University. He

joins us on the phone from Baltimore. He's the author of his book What Universities, Oh Democracy? The Johns Hopkins Bloomberg School of Public Health. It is supported by Michael R. Bloomberg, founder of Bloomberg LP and Bloomberg Philanthropies. Ron it's really great to have you on the show. How are you. I'm great, and thanks for the opportunity to talk to you about the book. Well, let's talk about the book. What was the moment that prompted you to to write

this time? When did you realize that you needed to write this? So you know, it was an interesting moment several years ago. Um. And it was a time when there were a few instants across American campuses where UH there were deep platforming of speakers and disinventations and so

for what that were happening across the country. And it was at that moment that we, like several other universities, really felt it was important to UH very intentionally remind our students, particularly in the context of the first moments, that when they step onto the campus, of what it is that sets the university apart from other institutions in society, and in particular our commitment to open debate, to contestations, UH to UH to UM, deep probing of and critique

of one's positions, to see that as a lifebut of the institution. And it was in that context that we had a session early on in the year for incoming students and we talked UM a lot about the role of free speech and academic freedom and so forth. Then you know, I stood at the back of the lecture hall and at the end of the lecture I talked to a few students and I said, so, what did you think of the event? What do you take from it? And remarkably so all the students said, we never knew,

we never knew the case for free speech. No one had ever exposed us to this argument before. I said, my god, you've come through great schools from across the country, and you're telling me that you never were exposed to these central ideas which are at the core of American democracy.

And so, you know, that was a moment when I started to think more and more about the ways in which the university uh intersects with democracy, and to ask the question, as much as we do for democracy, and as much as I think we're a bulwark institution for democracy, as you mentioned earlier, is there more we can do? And that the book well, and you you write about

early on in the intro. You know that democracy and liberalism liberalism do not exist in easy alignment with one another, and it is that collision of opposites that is a vital part of liberal democracy. Genius genius, however, I mean, it fascinates me, and I think about when I went to college, the whole idea was diversity of thought and challenging one another but having an intelligent and level headed discussion. Journalism.

I like journalism because there are you know, different perspectives and hopefully we put out those different perspectives for people to make informed decisions. But something happened in academia right where there was so much pushback against controversial thought because if you didn't believe in it, or you didn't agree with it, you didn't want to hear about it. And that's that's a dangerous that's you know, freedom of speech. That's when we start to really kind of filter out

what's being said. So you know, it's um, these these incidents, when they happen in universities, they always get a lot of attention, and to my mind, particularly lost for years where university presidents of faculty members have really been much more active and educating students about the centrality of free speech and academic freedom, and particularly saying, you know, however, one wants to think about other institutions in American society,

the university, with its commitment to fact and to reason and too spirited debate, it must be a place where we bend over backwards to provide space for people to express their views and to have them tested and challenged. And so I think that had happened. Um, but um, what I think has not happened as much as it should.

And again it's something I talked about in the book is are educating the students that are here with us, and you know, increasingly representative of the great diversity of American society, how they can have good conversations, how they can actually meaningful engage, meaningful engage one another across difference and find ways to UM continue conversations even when you

have very deeply dividing perspectives in the world. And to my mind, UM the university essentially a rare opportunity for that. We are talking with Johns. Hopkins University President Ron Daniel still with us. His new book out is what Universities? Oh Democracy? What's something you guys have done at Hopkins to ensure that there's diversity of thought, that democracy is really being played out UM fairly and and and in a good way and the way it should be UM.

As I described the a few moments ago, one was the UM the orientation programming that we were doing around our academic freedom policy and and right from the moment that kids get on campus giving them exposure to that. We have UM this past year UM step that up much more significantly and in fact had a day in orientation dedicated to educating students on the tenants of democracy and giving them exposure to a host of different challenges

confronting America. That involved more than twenty five faculty from across the university. So what we're trying to do is right from the get go, is remind students that there's something really precious at stake here and that they have got to think about their role as citizens and how they are going to advocate for democracy, understand its challenges, and work to improve it. And that's something that we really really want to see as foundational to the experience

at Hopkins. How have you seen that change? And justin we have about thirty seconds left changed during your tenure at Hopkins. So you know, I think, um, we've just become, like so many other universities, much more attentive to the level and intensity of polarization and discord and distrust around us.

And so we're working to become much more effective and trying to push back against these trends and again get the incredible diversity of our student bodies is used that as an opportunity to try and build bridges and habits that they'll take on graduation out in through the country. I want to get right back to Ronald J. Daniels, the guests we have joining us now, President of Johns Hopkins University. He joins us on the phone from Baltimore.

His book is called What Universities Oh Democracy? The Johns Hopkins Bloomberg School Public Health. It is supported by Michael R. Bloomberg, founder of Bloomberg LP and Bloomberg Philanthropies. Ron I asked

you why, what prompted you to write this book? Partly because when I started reading it and thinking about it, I thought about January six and what happened in the United States on January six, And I'm wondering how you see the role of the university in that context when a lot of people would say, wait a second, We're at a point in the history of the United States where too many people democracy feels really fragile. So, you know, I think January six is an extreme manifestation of that.

But well before January six, of course, all of the trends indicated that democracy was and is under significant threats. So if we look at the level of polarization of distrust and institutions, as I mentioned earlier, you know, just even people's views have shifted over the last several decades in terms of their willingness to have a serious conversation

with someone of the opposite political party. In fact, even it's been documented that Republicans and Democrats are less excited about and even you know, concerned that their children might marry someone of who comes from a family of the

opposite political party. So it's in this context of deep discord and distrust that given that more than uh of students graduating from high school in the United States will go on to uh college, it seems that we have got an opportunity in terms of the four years or two years even for two year colleges that students are with us to try and enter being here and try and first of all sensitize them to what's at stake

in democracy. But more than that, helped them to find ways to abridge the difference and to just turn down the temperature and restore some idea of what political philosophers called civic friendship. We don't necessarily have to agree with each other, but we at least have to understand that we're all tied into this enterprise of American democracy together. Ron, have you had any conversations with the politicians down in

Washington lazy, like, how is it that? And and it's I think it's safe to say whether it's on the left or on the right. There are prominent players in our political sector right now and certainly in government, UM that have gone to the best of the best in terms of universities Princeton, Harvard, Yale, Stanford, where you would expect that there is this wonderful diversity of thought and there would be civic friendship you know, coming out out of it. And yet we have these extreme views, um

that are really uncomfortable in making democracy very difficult. How do you square that? And what's the responsibility is it the universe? Would you point? Yeah, No, I think it's a great question. And I think this is when we see these habits and we see the incentives that politicians are facing. You know, again, there's you know, lots of reasons for that in terms of the role of social media and so forth, and just changes in the nature of the party system, like all these things can explain

the incentives for for extremism. But it seems to me that what we've got to do is to try and push back again, set and give our students a sense that there is something that stake here, and that, however strong those temptations might be, there's an overriding responsibility and a call to commitment by them to help peel this country. And so, you know, again, we can talk about this in abstract terms, or we can get you know, in

more concrete ways. You know, the move that we've seen over the last several decades to universities allowing students to self select their first year roommates instead of actually the universities deciding how to mix it up. I mean, that's something that I think a number of universities, including our own, recently, have decided to say, you can't replicate the kind of

enclaves that you're coming from on campus. We're gonna insist that you meet others and learn about others, you know, at the same time, UM, and we're thinking about living and dining arrangements and so forth, and trying to again really foster UH, the UM requirement that people interact across UH the differences that are here. We're also thinking about how we can can I Can I jump in? Run?

Can I jump in? I think that's brilliant because when I went to college, I didn't have any choice in my freshman roommate and um, I have to say, she was a black American and it was is really good for me having grown up in a New York City suburb where it was largely white and um, along with being in New York City, it was just eye opening for me. And I think it was really educational. But I didn't have a choice, and it was, I think

a great thing. And I see what the kids. I saw what my daughter who went off to college, where they're back and forth and talking to each other and everybody's kind of select they were able to select like who she was with. UM, and I just think, I think you're spot on about how that could make a difference. So that's just, you know, that's just it's such a small thing, but it's a very powerfuling in a way.

And you know, when we know that the city that we know, we Americans are increasingly living in Enclays where we're with people who are a lot like us in terms of shared political beliefs, socio economic levels and so forth. But again, we can mix it up at university and say, given the incredible diversity of backgrounds as here in perspectives, we're not going to let you replicate the enclaves, the

solitudes we've seen in America. The other thing that I was just you know, I also think it's important is, you know, having students and be exposed to lots and lots of structured debates where we see conservatives and liberal

progressives interacting with each other in the same forum. It's not a case of you bring in a confortative one week and then on the same subject the liberal students will bring in their candidate or their speaker, but rather that you know, we start to model how it is that you have good conversations that UM again are indicative of our effort to try and figure out what are the best ideas on artiments that Leach have listen such

a timely conversation. Thank you so much for joining us, UH, and I hope we can get you back on in the future. Again. That was Ron Daniels, his president of John Hopkins University. His new book is What Universities Oh Democracy Now. As we mentioned Michael Bloomberg certainly UM a supporter of the Bloomberg Hopkins School of Public Health,