Episode 4: The Governance Imperative

Full transcript

Ivy Kuo: Hello, I'm Ivy Kuo, Asia Pacific ESG leader at PwC, and you're listening to PwC’s podcast on ESG in Asia Pacific, the podcast for bite size updates on the latest ESG trend. From climate change to social and labour rights due diligence, the aim is to bring together ESG practitioners to discuss and solve today and tomorrow's sustainability challenges, which will reflect PwC'S The New Equation strategy of building trust and making a lasting difference. This first series is all about sustainable supply chain, and I'm delighted to introduce you to PwC's subject matter expert, Jeremy Prepscius.

Jeremy Prepscius: Thanks, Ivy for the introduction. In this podcast series, we will be exploring the issues and changes driving the field of supply chain sustainability. This field is vast and there are many important parts of it, but we'll be focusing on a few key areas, particularly human rights, modern slavery, de-carbonization, and the governance aspects which will impact accountability.

We have a great lineup of speakers, including a broad set of professionals from those in the trenches of implementation at the top of corporate leadership. Let's get started with this episode. Welcome to this fourth episode on sustainable supply chains. Today we're using our discussion to explore the governance drivers that will be impacting supply chain sustainability. As we get started, just a short reminder, all opinions are our own and not reflective of any organisations which we may otherwise be associated with.

I'm particularly pleased to have this discussion with my two guest speakers because, they have, as always, deep experience and engagement on today's topic and can help us understand these issues both today and by looking into the future. My first guest is Sean Lees, who is the business and human rights specialist at the UNDP, the United Nations Development Programme in Bangkok. Sean, tell us a bit about your background and how your job connects to sustainable supply chains.

Sean Lees: Thank you very much, Jeremy. It's a real pleasure to be here today. My journey really begins at the dining table amidst family discussions with my father who was an international businessman back in the early days when Asia was just opening up. In fact, he started doing business with China in the late seventies working for Corning Glass, the makers of the high-tech glass that is on your iPhones and iPads.

And in those conversations, I developed a real passion for the subject of trade and politics, the cultural dimensions. I then went to law school at my father's urging and was quickly disabused of the notion of becoming a trade lawyer though. And especially after meeting a political asylum seeker and taking up in the legal aid clinic, helped by the law school, of a case of a Nigerian woman seeking asylum.

And I think, a lot like one of your other guests, Archana Kotecha. I quickly developed a passion for human rights. And next thing I know, I'm working for UNDP in Sudan and Afghanistan, Iraq, et cetera. And eventually finding myself in Bangkok and meeting Livio Sarandrea, our global advisor on business and human rights here in Bangkok for Asia.

And about that time, the slavery in seafood supply chain story really blew up, and he asked me to do some scoping on opportunities. And well, my world came full circle, an interest in international trade, met with my passion for human rights, and we've now been programming in Asia and in seven countries in partnership with the European Union for the last seven years. And here we are today. Thanks for having me, Jeremy.

Jeremy Prepscius: So a real human connection, a fieldwork connection into full circle and trade, right?

Sean Lees: Right.

Jeremy Prepscius: And here in Asia. Okay, really interesting. 

And my second guest today is Melissa Brown, who has been working in this sustainability field, Melissa, for decades, sort of like me. You've had a really interesting career from Barclays and J.P. Morgan and Citigroup leading ASRIA back in the day 2003, which was the Asia Socially Responsible Investment Association.

You've been a member of the UNPRI, you've been on the Hong Kong SAR Exchange Listing Committee. You've worked on energy transition via Daobridge Capital. So we actually go back a bit in time. What sparked your interest in sustainability, and how has this pathway developed over time and connected to supply chains?

Melissa Brown: Well, a little bit like you, yes, it's true, I've been at this for decades, but also I did meet you at kind of critical point when I was beginning to look at a new set of issues about 20 years ago. But to go back in time, really, I came to Asia to work as an investor and as a financial analyst in Korea in the late 1980s. So it was just as the Korean market was opening. And then after that I lived for many years in Hong Kong SAR.

But the really important thing in terms of understanding how I look at these issues as an investor is that when I lived in Korea, I was fortunate enough to have a chance to cover and do a lot of the early analysis on a number of Korean companies that are now very, very familiar, not just in Asia, but to global consumers.

I had a chance to watch those companies that are now global leaders really in an earlier stage of their evolution, especially as they were beginning to adapt to global investors and to the types of questions that global investors insist on when they're making a buy or sell decision or to invest in a securities.

And also to watch those companies adapt not just to Korean customers, but to global investors and have to learn to adapt to global standards, not just on quality or product performance, but also on a whole host of other issues. The labour issue came up very early for a number of Korean companies, certain types of environmental issues came up very early, especially as they might have related to hazardous chemicals.

So I had a chance to really watch that evolution. It was critical to me as an analyst in the companies. And that pattern continued when I was in Hong Kong SAR. And then after a number of years covering, again, a range of companies at J.P. Morgan and then Citi where I covered power, and I had an early introduction to really what is now climate finance, but also an opportunity to look at carbon trading very much at the early stage.

It really opened up for me contacts with a different set of global investors who were beginning to structure portfolios looking at these issues. And many of them simply did not have access to the investment research they needed in Asia.

So actually, Jeremy, when I met you the first time around, that was really what I was beginning to look at, which is it's one thing for an investor to say, "We want to make sure that we're investing in companies that are compliant with local labour laws," but it's a very different thing to understand what those laws actually are and to know how to compare them to the laws that you have in your home country.

And then more difficult still to figure out what does good look like, what does bad look like, and what is the data that you might want? So I've had a chance to look at these issues alongside investors for many years, but I also have had a lot of work that I've undertaken in the policy space with the Hong Kong Stock Exchange, again, with the global investor group. So I've been pretty spoiled. I've had a number of years to look at this field evolve, and I'm looking forward to having that conversation today.

Jeremy Prepscius: Great. And that question of what is current conditions, what does good look like? How do we understand and maybe incentivize movement in that direction? That's kind of the core of everything that we're talking about here. Maybe just to round out the intros just a bit, I bring a few bits and pieces. As you noted, I've been around for a while.

I ended up accidentally working for Nike back in the late nineties, which was really my introduction to the connection of supply chains and externalities as I was part of the small team that was working on the working conditions question. And after a decade there, I spent 15 and a half years doing sustainability consulting throughout Asia for BSR. Now I'm here at PwC working on sustainable supply chains.

So to set up this conversation with the two of you, we're here to explore the drivers of governance and what this means for supply chain sustainability. Melissa, you obviously bring the insights from the broad investment community and what this means for corporate. And Sean, you have the insights based on work with governments and the UNDP.

Now this is the fourth conversation I've facilitated on unsustainable supply chains, and we've explored a few key topics with various speakers, looking a bit at the past history, diving into a few key issues such as modern slavery and the climate imperative in particular. The overall thesis I'm working on is that supply chains are changing.

Sustainability and ESG is being integrated, this change from the current state to what does good looks like. And those changes are being driven at least partially by changing the regulatory environment and by investor expectations. And this is where your insights are so valuable.

So the first question I'd like to explore is exactly that. Are we at a time of change when it comes to global supply chains and ESG? What are you seeing and why? And maybe Melissa, start with you.

Melissa Brown: Well, I'm going to sound like a classic investor, and so investors do think thematically and they do think about the global context. So there are really three themes that I think are really very important right now in terms of understanding what investors are focusing on and why. And the first one really is what makes this even more relevant than it was one year ago, two years ago?

And the full spectrum of ESG issues. A lot of people in the ESG world right now, the investors are very focused almost on playing catch up on climate. But when you're looking at the broader spectrum of issues that affect supply chains, you've got a whole range of issues. But really, the issue is globalisation. COVID and the Ukraine crisis have been immensely disruptive.

It has really reoriented policy, not just for countries and regions, but within regions and also obviously for companies in very, very dramatic ways. So we're seeing companies change priorities as investors and their customers change priorities. You want to be able to get products to the right market at the right time. And that means that the tolerance for problems is significantly lower than it was because all of the other risks have risen.

And literally you've got some of the biggest countries in the world looking at their home markets and reshoring in ways that wasn't the case. And that's a big threat and source of disruption, particularly in the Asian region. The second point is a little bit technology facilitated, but it's a little bit the fruit of a lot of work that's been done over the last 10 years, which is actually there is better visibility.

There is a tremendous amount of complexity, and in some instances, in certain niches and with certain standards, still a lot of chaos and a lot of pressure on people to constantly be adapting to new reporting standards and different sources of enforcement and compliance. But the simple truth is there is much better visibility. Investors know a lot more, customers know a lot more.

When I went online to buy this headset so that we could do this podcast, I was able to choose one that was green compliant. That wasn't the case two years ago, five years ago. And when you add into the mix better satellite data and tracking, we're just in a very different world. And that means that awareness can actually be validated in ways that it couldn't be.

So that's the second issue I'm very conscious of. And the final one, as a finance person, but also someone who talks a lot to companies, the way these issues are affecting access to capital is changing. And I don't want to overplay it because investors have a tremendously bad habit of always saying, "Oh, investors don't like this or don't like that."

But actually the incentives are what has changed. And they've changed in part because there are now new ways to fund yourself if you want to look at sustainability linked bonds or loans. In many instances, companies can tap into new sources of capital, but there are going to be terms and conditions to that loan agreement that will relate to the ability to provide visibility on and confirm performance on KPIs that are going to relate to ESG performance.

That's really, really new. And that tells you a lot about companies both having a carrot. The stick is going to continue to be there. If you can't confirm what you're doing, you're simply going to lose certain clients and certain investors will not invest in your stock, perhaps others might.

But this is really a, it's a new time, and I think those drivers really make the issue of global supply chain something that is, I'd have to say in the financial world, if you aren't able to do due diligence on that issue, confirm what a company's rating or status is, increasingly, it's just not going to be very easy to have a significant holding in a company like that.

Jeremy Prepscius: And you talk about the change in just the last couple of years, and we put this in the context of change the last 25 years, oh my goodness. The change that's happening and the hockey stick curve that's happening in the last couple years is just really, really interesting. So Sean, over to you. So are we seeing actual change? Are you seeing indicators from governments elsewhere?

Sean Lees: Well, let me just say first off that Melissa's done an amazing job in articulating these three thematic views on change that are occurring. And indeed, I can just say that in discussions with some lawyers I still maintain contacts with, indeed, they're saying in international business transactions that human rights provisions are making their way into termination clauses of contracts and what have you.

So we're seeing that change in many different areas at the micro-scale and individual transactions, but indeed also with regards to government policy. People, especially from civil society, are asking more and more, "Where's the change? Have we seen change yet? How effective have you been? How effective are we being?" And I have to say, from where I sit, and I sit closely with governments, I sit in policy forums, closed door policy forums on occasion to discuss these matters, it's still very difficult to say.

And it's difficult for several reasons. One, as you've said in some of your introductions, it's supply chains. Trying to understand where supply chains are today, it’s fast moving, it's complex, there's a lot of chaos. Another theme perhaps Melissa was pointing to at this moment. And also, there's a lack of transparency with regards to data provided by governments and a lack of trust in that data.

Governments haven't been forthcoming with data on a whole myriad of issues in our region and on things like air pollution, on migration rates, on targets related to the sustainable development goals. And also there's a new lack of confidence perhaps in the data provided if only because of the, or the rollercoaster ride we've been through with regards to COVID and COVID reporting rates, et cetera.

So data is not available there for us to make any definitive conclusions about whether changes happen. But again, where I'm looking from, from my perspective, I think that the change is now just getting rolling, but you have to be very selective about what indicators you are using to measure that change. And we won't be able to say whether change is happening unless we have the right indicators, and we won't be able to populate those indicators unless we have some trusted data points.

And those are few, but here's some indicators to measure change that maybe people in your audience might contemplate. 

First, I think we need to ask whether governments, whether we're seeing an increase in the number of laws, regulations, policies that are addressing human rights and environmental risks in supply chains.

So for example, we might ask our countries here in this region developing mandatory human rights due diligence legislation, how many countries have ratified the ILO Conventions, Convention 98 in particular on collective bargaining. Have they passed a national action plan on business and human rights?

Has the government ratified a free trade agreement with the European Union or others that might have strong sustainability chapters in those agreements? Does your securities and exchange commission require detailed ESG disclosures?

And then also, how many criminal defamation laws do you have on the books? Which ones are you repealing and or rewriting? As you know, criminal defamation is used by some bad actors here by some bad corporates to silence critics, notably human rights defenders. So those are some, just a cluster of indicators that I think are important to understand whether governments are serious about provoking change in business operations in our countries.

But there are also some non-governmental ones, and I promise not to list too many more, but I'd like to know, for example, how many companies and including state-owned enterprises are actually conducting human rights impact assessments, and how many of those are actually being authenticated by and or subject to assurance by firms like PwC. We should be able to look to that and other benchmarking indicators for a better, better view of what changes afoot in the years to come and the months to come.

Jeremy Prepscius: That's a really, really interesting question, and maybe we explore this as a subtopic just for a minute. So Melissa, from your perspective, obviously we have global trends and global pushes, and I tend to look at EU laws and regulations or the voluntary nitty guidelines on human rights due diligence coming out of Japan. Where is leadership in the transparency aspects coming from? Is it coming from investors, or is it coming from the local government? What has been and will drive this change and transparency, which is so important to really understanding and driving the kind of ESG and sustainability?

Melissa Brown: Sean, thanks for your comments because I think you framed it so well. But actually, we've now driven into the core of the problem. And I think the most useful things I can say to you are really pragmatic things from, really from observing markets and from observing scandals.

Because of so many of these issues, the human rights world in particular, has such a deep and carefully structured toolkit at this stage of the game, but it tends to be most relevant to multinational companies. Because you've got companies who are operating out of their home jurisdiction where typically they have less political capital, they are themselves more vulnerable, and so they're going to look to international standards.

In the Asian context, you'll see something similar. Think about the number of Asian companies right now that are dealing with issues that they will struggle to talk about with candour, but the inability of many of the companies who are caught up in this to respond, there would be some companies that have actually taken steps, but many of them will actually feel that it's not prudent to speak about them publicly.

They may speak to certain investors about what they believe they have done or can do privately. And so some of the biggest global investors who will actively engage on social issues will have had some of those conversations. But of course, there's a lack of transparency around the processes that are used. That is not always a bad thing.

There are instances where seasoned investors who have a long track record with companies, where they have been significant shareholders, can be influential, can deliver a clear message, can give companies confidence about the direction in which to move, but it's not going to be something that's going to be systematic.

And that's rightly incredibly frustrating to people who work in the human rights area. Because this is a field where there's a great deal of expertise, and for all the right reasons, expectations about really taking steps to remediate problems has to be transparent, it has to be credible, it has to be something that can be confirmed.

So I'd have to say we're stuck in this halfway house. But another area where you can see would be instances where I'll use the example of Korea where there are Korean companies that have had problems that have gone on for decades really, on hazardous chemical problems that affected workers. And you look at the companies now that were involved in this, and you would think, these are globally successful companies, why did they drag their heels?

Why did it take so long for them to find ways to address complaints? And the simple fact was they were willing to acknowledge a little bit, but there were home country issues that stood in the way and a broad range of stakeholders didn't have access to all the tools. So that's one of the reasons, again, going back to Sean's point, finding ways for people to speak candidly about these issues is oftentimes the biggest barrier.

Jeremy Prepscius: In my experience, looking from the past, in the labour side, there's always been this interesting kind of divergence between, as you can imagine, whether it's wastewater treatment or to some degree carbon and emissions, which at the end of the day is a money and technology application.

 Often, not entirely, because that opens up the whole just transition question, versus a division of a pie sometimes, which gets you into who owns what or has owned what or has received what over time. And that gets a lot more oppositional sometimes. Right? And so working through that has been challenging.

And you can see the issues around Asia, whether it's sometimes in land acquisition, graft and corruption. These are some of the key ESG issues that relate to the governance of a company. Right? And will influence how a company is governed. Let's go into the second kind of topic here.

I'd like to us to put ourselves based on what we've been talking about, which is global trends, some degree of highly variable local conditions, different incentives on the company. Let's put ourselves in the C-suite of a large Asian conglomerate. You've got a variety of different holdings around the region, and the C-suite is beginning to thoughtfully look outwards and think about what to inspect, what to expect from their investors and the regulators.

Let's give ourselves a long horizon, five to seven years. What should they expect that could impact the value chains in which they operate, either whom they buy from or whom they sell to so that they can be prepared for these trends coming towards them. Melissa, do you want to start with this one?

Melissa Brown: Sure, sure. I'll kick it off. I think my comments are going to be a little bit structural, and then I'll try to see if I can make them a little bit more specific. When I think about this issue, because there are so many issues at the moment, and there's obviously so much corporate diversity around the region, but we're now at a point where very different again from 10 years ago where the pool of expert reporters in Asia may not be all that broad or deep, but there are now genuinely Asian companies in a number of countries that are at international best practices standard.

And you're absolutely right, Jeremy. The conglomerates are interesting, especially with those that have deep consumer relationships in multiple markets globally. There's actually a trend that I'm beginning to notice because any of these companies that are diversified conglomerates are going to have a number of issues where they need to stand close to their peers, but where they may also have problems that are actually really thorny issues.

Where either because of where they produce or who they've partnered with or the considerations of the countries in which they operate, they cannot easily make change and they face complicated choices. They may have to sell things, they may have to really make hard decisions about either cutting certain things, adopting very new processes to eliminate certain types of chemicals, to insulate themselves from risks, say for example, related to water.

One of the most important structural trends I see is that the companies who do this better are the companies, and this is very nerdy, but it's important, they've taken the time and trouble to create board level sustainability committees. And it's really interesting when you talk to the companies who've done that, especially when that committee is chaired by someone who is frankly powerful and has prestige on the board.

Is that those committees are used frankly as a testing ground and as a context for closed door learning so that other board members alongside management can have candid conversations, can bring in outside experts and really make tougher decisions. I would say five years ago, too many Asian companies were just kind of saying, "Well, we're reporting more."

Now what we're saying is companies that have to make decisions and they have to be able to compare to their peers, and increasingly, they have to be able to satisfy Asian regulators and Asian consumers. I really look to see, because there is a big difference, the companies that have that internal capacity at the board level are making more important decisions. So that's one trend that I noticed. And the second one is a theme that has always perplexed me.

I think the investment community to a degree has given itself a little bit of a bad reputation, but some of that is a lot of complaints coming from companies saying, "Oh, investors always want this kind of undifferentiated data dump." Now part of that is companies themselves love providing long lists of disclosures. That works pretty well for some of the ESG data companies. That's what they ask for, that's what is delivered. That is not an effective way to communicate with investors or other stakeholders. Investors are in fact quite rational.

They really want to know what is strategic for your company, if you've actually already done well or have good transparency and can explain your strategy, the market accepts where you're positioned on your net zero pathway, but actually you have some quite significant water problems and you have too many significant capital assets, physical assets sitting in areas that are going to be subject to adverse weather events.

You've got some tougher decisions to make. And better companies need to be communicating about the relevance of the issues, what they are working on. And sometimes that means being explicit and clear about the ability to set and meet targets and also what they're investing in.

Because at the end of the day, I'm an investor. Companies can tell me they're doing all sorts of things, but if I can't track it to what they're spending money on, there's going to be a lack of credibility from my perspective. And I think there's this bottom line realism to the best investors who are most engaged with companies that they want to have an intelligence strategic conversation.

And I think companies don't have to claim that they're on top of everything and they need to have a more candid and transparent discussion about the things that are hard. And those things where they've really done the work, make sure the data's credible. And I think the final one you'll hear from the best investors is make sure your chief executive knows what those numbers are and that the board members do too. This is not simply the job of the sustainability team. These are strategic issues now.

Jeremy Prepscius: So in summary, if you're a board of a conglomerate, the thing to get ready for is an intelligent, strategic numbers driven, integrated conversation with your investors. Okay. Now that is exciting. And that's why the conglomerate piece and the board engagement in conglomerates are so interesting because this is about the leadership of the group. Sean, looking at governments, what should this C-suite be getting ready for?

Sean Lees: Well, if we're looking at, let's say you're working at the Ministry of Corporate Affairs or coordinating Ministry of Economic and Investment Affairs, these kinds of ministries you find in both small and large governments here, you have to be aware of the tightening regulatory environment that the EU is provoking to some extent, the Japanese, and certainly out of North America.

I would be looking carefully at the costs and benefits, the trade-offs of developing your own mandatory human rights due diligence legislation. I was just in a phone call a few weeks ago with a sustainability professional in a semiconductor company in Malaysia. And he said, Sean, in the last two months, I've fielded more phone calls from investors about human rights risks than I have in the last five, 10 years of working in this area.

And so he's doubling down on due diligence and making a real go at it, hiring the professionals to do a deep dive into his supply chains so he can report back to investors. And indeed, just as Melissa said, it's about the communications. Where I wouldn't, if I, okay, I know you've asked about government, but if I was a company, I wouldn't be investing in slicker sustainability reports that carry little data or haven't been subject to assurance.

That's a waste of money at this point. You need to actually have that actionable data, that clear data that Melissa's also talking about. This is perhaps just the first step. I think Melissa's hit more of the big top line issues, getting the board involved and having these subcommittees. That is probably more, even more important. But the second thing you need to start doing at the working level is start looking at what human rights due diligence means and how to make sure that's credible. There's a lot of eyes on this right now. It can't be ignored any further. 

Jeremy Prepscius: So maybe taking those questions then and turning them into, okay, what actions should companies be taking now to get ready to be able to have that strategic, informed, data driven, inclusive, both on E and S and G issues, externally with their investors, their customers, their regulators. What do they need to be doing now, where do you start? Let's start with you Sean.

Sean Lees: First, they need to be looking at what sort of sustainability assets they already have. Do they have a background in human rights issues, the whole gamut from land rights to the environmental rights issues to the migrant rights issues, migrant labour rights issues, that is. And then also make sure those sustainability professionals are better integrated cross-functionally.

Are they actually having meaningful conversations with human resources departments, procurement, legal, trade compliance, and are you as a CEO and or senior manager in the firm making sure those conversations actually happen. I speak to a lot of sustainability professionals and companies here in Asia that they say the first challenge and perhaps the hardest challenge is just getting buy-in inside the company.

The second thing is to look at ways to leverage whatever you're doing on the environment, on carbon reduction and or mitigating biodiversity loss risks and seeing how you can integrate social impact professionals on that journey. Pick up things along the way that the company can do to streamline and to reduce their risk profile. I'm hearing from some people they're doing this now and they're finding cost savings as well.

They're really tightening up their operations as they do so. And again, I just want to go back to those sustainability reports, and many of which I review and put more time and effort into. It doesn't have to be a longer sustainability report, it just has to be a more credible sustainability report. Get the mindset, take this out of the PR departments, take it out of the CSR departments, and put it up front as a key priority of how the company communicates with investors.

Jeremy Prepscius: Melissa, I remember you and I had a conversation, I think it was about 10 years ago where you said, "The next sustainability report that I see a smiling worker on the front page of, I'm just going to throw in it the garbage." All right. So Sean talked about reporting and getting integrated. Where else should companies be focusing on now to get ready for these conversations over the next five to seven years, which I think we all agree are coming down the road of increasing frequency and importance?

Melissa Brown: I think the two things that are top of my list, and I'm going to repeat myself just slightly, but hopefully I'll do it with greater clarity. The first is that companies typically should not report with the old ideas of this kind of comprehensive reporting on every indicator and every aspiration, that's not an effective way to report, it never has been.

The reporting needs to be much more similar to what you're going to see in a chairman or a CEO's letter in a normal financial annual report. And it needs to be strategic. Most companies, from my perspective, the smartest thing they could do is say, "These are the two or three things we are working on now, and here's why. Here's why they are important. Here's why they are hard. Here's why."

And again, some companies I think are very poor at talking about, and Sean, this really relates to the very complex issues you look at, is, “here's the part of this issue we control and here's why we may have to work with others”. So the boundary issues of what does the company control, what do their peers control, what can they influence, what can they not. Many countries in governments coming out of COVID really have essentially a policy deficit right now.

Companies may want clarity and may want to do certain things. That doesn't mean that their governments are going to be providing the right incentives or the support they want. Companies often haven't even bothered to try to figure out how to communicate about those types of challenges clearly. I'm a big believer that you can find ways to communicate clearly about what a company can actually do.

I think that would take a lot of pressure off, I think it would result in greater clarity. So that's really the first thing. And I think the second thing is to ensure that what companies are saying about targets and performance on targets, is rational. We've had so many companies that are still absolutely stuck in the mud on net zero and net zero pathways.

And they're kind of offering targets, but the targets are actually typically a little bit implausibly low because there's caution and there's concern. And there's been a lack of real thoughtfulness, I'd have to say about how to also make it transparent to investors and other stakeholders the types of decisions that companies are going to have to make.

It's not just about reaching the target, it's about how are you going to reach the target and what's your confidence level in reaching the target and what issues will be involved in making the decisions necessary to reach those targets. Communicating better about that I think will mean you have better informed investors who really can partner with companies to a greater extent.

And it will also mean I think companies will be in a little better control of their destiny, and when they do start providing more nuanced, clearer data, they'll be able to ensure that that data can be validated and verified to a much greater extent. To simply back into a default position of being reluctant or actually providing, frankly, lame and not very credible targets, doesn't serve anyone's benefit at all.

Jeremy Prepscius: And that's what this next period of ESG and sustainability is. That's why it's going to be so important and so interesting because it is about education, it's about integration. It's becoming comfortable with the difficult and challenging questions that are in front of us. Those are going to be key. So this has been a great discussion, and Sean, Melissa, I really appreciate this today.

And as always, I always learn a lot in all of these. In brief summary, as supply chains evolve over the next decade, how they integrate the environmental and social and governance factors and accountability that we've been talking about today, these are going to increasingly directly relate to the world we inhabit. They do today, and they'll do even more in the future.

From the impacts of climate change to the opportunities for inclusion, good jobs, and a just transition, these will create the world we live in and hopefully will create the world we want. 

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