INVESTOR’S GUIDE • ROUNDTABLEKETTERER: Or UPS! [Carol Tomé is CEO.]BROWN: Sonia Syngal at Gap was handed the
reins, basically, the day the pandemic started.
They were going to spin Old Navy off and have
her be the CEO. In March, they said, “Forget
it, no spinoff; we’re in trouble. You’re the CEO
of Gap now.” And look at the stock chart since
then. And I don’t think an elderly white male
CEO could do what she now has to do, which
is slay Lululemon.FORTUNE: Where do you see the greatest
opportunities and biggest risks in the year
ahead?KETTERER: So many companies have been
using the pandemic to cut costs and increase
operating leverage, and many of them will
likely generate higher profit margins than
they did pre-pandemic. But the catalyst be-
hind all this is not just vaccines and therapies
and testing. We’ve had $10 trillion, globally,
of monetary and fiscal support from centralSUBRAMANIAN: And it goes beyond what millennials want. If
you’re in an innovative sector that is labor-intensive and your em-
ployees are unhappy, they’re going to go to a competitor, and you’re
going to lose your advantage.
What’s also interesting with ESG is that there are opportuni-ties to buy “bad” stocks that have material aspects of their busi-
ness model aligned with ethical considerations. Energy has been
essentially purged from portfolios because of its dirtiness. But
if you look at some of these electric-vehicle companies, they use
batteries—and mining for the metals that go into batteries is a
very dirty business. Whereas some energy stocks could do really
well from here on ESG measures because they’ve established
carbon neutrality goals.
BROWN: We’re gonna get a live test of that, Savita, because Exxon
Mobil basically said, “We don’t care about ESG at all.” And Royal
Dutch Shell said, “By 2050, we won’t have any oil for sale.” So we’ll
see how those two companies fare in the next 10 years.
EISWERT: I do think there’s a sense that people are more aware
today than they were three years ago about social injustice. And I
know at T. Rowe Price, we strive to be a leader here. In an industry
that’s been dominated by white men as ours has been, the question
is, how much talent are we leaving on the table? We want to do
things in the interest of our clients, and that means unlocking tal-
ent from diverse areas. That’s an alpha-generating issue, right?
FORTUNE: I’d be remiss if I didn’t point out that Mallun’s fund,
Operator Collective, operates on that principle.
YEN: At startups it’s very easy to hire people who are just like you.
So we’re trying to get to those companies early to hire outside the
dominant homogenous group. We invest in founders from all back-
grounds, all genders. But because our investor base is 90% women,
40% people of color, when we invest, we are naturally mentoring,
helping, and bringing board members and executives from those
backgrounds into that ecosystem.
EISWERT: There are just great examples of that this year. Lisa Su
at AMD is an amazing leader. She basically is the Intel slayer. It
is incredible what she did building that company. Kristin Peck at
Zoetis is another great leader. They’re showing by example that
they can deliver value.
Here’s the problem: We’ll have another
recession. And the pressure will be on policy-
makers to simply repeat what we just did.”
JOSH BROWN • RITHOLTZ WEALTH MANAGEMENTDavid Eiswert- T. R owe Price Global Stock Fund
COURTESY OF T. ROWE PRICE