#30 Tariq Fancy, a sceptical sustainable investor

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Fund Shack
#30 Tariq Fancy, a sceptical sustainable investor
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In 2019, Tariq Fancy quit as BlackRock’s most senior sustainability investor. 

In 2021, he released an in-depth three-part essay explaining his disillusionment with the concept of stakeholder capitalism and the ESG investment industry that has grown up alongside it. 

In this private chat, he explains why sustainable investment is ineffective and what the alternatives could be.

We also discuss his work with Rumie, a charity he founded to expand access to education across North America and which is currently very busy in Afghanistan addressing the plight of particularly girls and women in the aftermath of 2021’s military withdrawal.

You can also watch the video version of the interview here.

If you are interested in this topic, also check out our other conversations, with Cyril Demaria on ESG, Simon Witney on ESG and private equity governance, and this debate between the world’s leading economists and philosophers, on CSR and ethics.

Incorect form of transcript\ some inaudible parts

Ross Butler :

You’re listening to Fund Shack. I’m Ross Butler and today I’m talking with Tariq Fancy. Until 2019 Tariq was chief investment officer for Black Rocks, sustainable investments. Earlier this year, he revealed the reason for his departure was a disillusionment with the impact of sustainable finance. He now runs north America based on line education, charity Rumie, which is very active at the moment in helping girls and women, the situation in Afghanistan. Tariq it’s great. Speaking with you. I’ve been really looking forward to this conversation. I wonder for people that don’t know, if you could just give us a brief bio of, of your experience in the investment world and, and elsewhere.

Tariq Fancy :

That’s so great to be here and quick note on my background, I started out as an investment banker for a few years covering the tech sector in Silicon valley actually then spent a long career as an investor mainly based out New York, doing a lot of distress and special situations, investing in a private equity firm later built strategies and did a few other things. And then in 2013 left to create Rumie, which is a 5 0 1 [inaudible] three or charity that uses digital visual technology to, to advance access, to learning for some of the world’s poorest communities. And then came back to the finance industry in 2018, in 2019, where in some sense I was convert sort of merging to two of, of investing in financial bottom lines and then social bottom lines in a sense, or at least trying to as Black Rocks chief investment chief investment officer for sustainable investing. And since late end of 2019, I’ve been turned my focus back to running Rumie.

Ross Butler :

Okay. That’s love lovely snappy bio. Can I ask you, why did you leave the lucrative world of private equity in the first instance to go and run a charity?

Tariq Fancy :

Honestly, it was a personal decision. It was after the passing of my business school roommate and, and very close friend. And he, and I sort of shared this passion for someday doing something, you know, taking our skills that we learned in finance and doing something that we thought, you know, we really cared about and was making a, a bigger difference in the world. And he, he contracted stage four cancer. And so at some point it was, he wasn’t, he couldn’t kick keep kicking the can down the road. And so while he was fighting stage for melanoma, he actually created an education charity in Kenya which is where my parents grew up, my family immigrated from Kenya. And that sort of inspired me then to take the idea I had for Rumi and just go for it

Ross Butler :

Fantastic. And did you find your pre finance experience useful in setting that charity up and how’s, how’s it going?

Tariq Fancy :

So it was useful actually very useful in the sense that you know, there’s a lot of things I didn’t know, around education, international development and so on, but I did know technology well, and I think that the finance background actually helped me understand you know, really how to build something in a careful way and be kind of ruthless about execution. So and it has been going well, we’re doing work right now for digital learning for girls and women and have Afghanistan that we started in 2017 actually. And that is extremely important right now, given the situation on the ground and the sudden restrictions on access for girls to learn there. Given that 80% of Afghans have access to a mobile phone, which wasn’t the case 20 years ago, when the Taliban were last in charge, it does provide sort of a connection to allow them to continue learning.

Ross Butler :

So you’ve had to pivot quite quick, given what’s happened over, over the summer, how have things changed? Are you, are you managing to reach people?

Tariq Fancy :

We are, we are in managing to reach them largely because through a mobile phone you can learn safely from anywhere. And we’re working with a mobile operator in the country. And so there’s sort of an infrastructure is built to reach people safely at any time and anywhere that simply didn’t exist 20 years ago. And so the, the power of mobile technology when that infrastructure is built out is extraordinary. And, you know, in most places in the world, you know, Facebook and, and other applications are aggressively growing and our goal is that people should be, you know, using availing themselves of free learning at the same time using that technology and all the work we’re doing is in local languages in D and PTO [INAUDIBLE], and has seen extraordinary uptake on the ground, just given the needs  it’s working really well. So the goal right now is to quickly expand the content and subject areas and the distribution. So we can meet the needs of 70, 30, 8 million AF cans whose labs have been turned upside down. And in particular, the women who will bear the brunt of it. So

Ross Butler :

How do you, do you finance it? How can I make a donation? Where, where do we go?

Tariq Fancy :

So you’d go to about.Rumie.org. Rumie is R U M I E. And if you go to about.Rumie.org, it talks about some of what we do. We’ll be adding a lot more information on Afghanistan, specifically in the next few weeks as we grow this in response to the crisis. But if you go to the site about.Rumie.org, it gives a, a lot more information on what we do and, and how we’ve been doing it for a number of years now.

Ross Butler :

Great. Well, well, the best of luck with that, that sounds like a, a really wonderful initiative. I suppose, the reason that I came across you though, was when you took a break from the charity, if you can call it that, and you joined BlackRock, as it’s, as you say, as it’s CIO of its sustainable investing business, and you left there in mid 2019 because, and my understanding is you didn’t necessarily agree that sustainable investment as a concept was necessarily doing what it says on the tin. And I’m interested in that I’m interested to know to what extent does it not do what it promises? Is it kind of, is it ineffective? Is it counterproductive or is it not as effective as you hoped? And, and why?

Tariq Fancy :

I came to the conclusion after 14 or 15 months there, that it was ineffective and it, you know, it was in a sense harmless because it wasn’t doing much good, but certainly not what people thought it was, but it wasn’t harmful. The conclusion that it’s harmful is something that I reached after leaving and recently went public to make the argument around. And the idea being that if you have something that people believe is creating impact, and it’s based on a set of notions that I would argue are sort of based almost on fantasy, a convenient fantasy that we can sort of win, sort of, you know, make lots of money investing and fight climate change at the same time. If it doesn’t work. What I realized was I knew that when I had left, because I had the vantage point of being a trained investor, who looked at integrating environmental and social considerations you know, ESG broadly, but [INAUDIBLE] in particular is where people are focused across the largest pool of assets available in the world and in capitalism state.

Tariq Fancy :

And so I realized that if, if I knew that it wasn’t having any effect, but the rest of the world didn’t know that then there’s an argument to be made that it actually actively delaying us because the fantasy might take a few years to work itself out. And so, while I was away, I worked on a study with a university, and we actually found that the more you feed people, ideas around, you know, stakeholder capitalism is the answer to reference the business roundtables argument on, you know, how we improve social outcomes that, you know, ESG is, is good for investing that wall. Street’s focus on climate risks, a whole bunch of things that in practice I found had no real impact. The more that they believe it, and the more that they then people who see headlines like that and hear that information are then less likely to argue that we need government regulation to address these problems. For example, of carbon tax. And those are exactly the performs that all of the experts in society, including no prize economists have been telling us we need for decades. And that really is where I think sustainable investing now is turned the corner and is actually potentially harmful. And that it’s wasting valuable time

Ross Butler :

By some measures about a fifth of all the assets under management are managed in some respect with reference to ESG principles. And so if what you’re saying is correct, then what we are looking at is a colosal, could you call it misallocation of resources, or at least in that allocation of resources that aren’t being allocated in the way that most people think they are, this isn’t a small thing. This is a, this is a huge thing.

Tariq Fancy :

I would agree. It’s an absolutely huge thing, because in many ways I I’d say that this there, I wouldn’t throw ESG out entirely because I think a lot of people will say, well, how, first of all, they’ll be surprised at the fact that ESG could be harmful to environmental and social considerations, given that the whole idea of why we’re in theory doing it is largely that it’s supposed to be beneficial. So that’s one bit that’ll surprise people, but I, I would, I would say that it’s not so much everything in ESG is useless and needs to be thrown out. It’s that you have, I think tools, standards, data, and people, frankly, human capital that have come around ESG that are all helpful. Unfortunately they’re being combined into narratives and products that are harmful. And I say those type of there’s narratives around it that I think are very dangerous and mislead the public.

Tariq Fancy :

And there are a set of products that are being built off those narratives that generally implied that they’re creating real world impact that they don’t create. And there’s no reason to believe that they do create, and that is also very harmful because on one level it’s obviously you would argue it’s unethical to sell someone a product. If they believe it’s doing something in the world, that it isn’t doing just as an attempt to sort of get higher fees out of it. Which I think is quite widespread across the industry. And I think secondly, you know, if the narratives around it are based around the idea that you can buy an ESG product and make money and fight climate change at the same time, what we really need to do is step back and look at what we’re actually saying the mechanism for change, to which buying an ESG fund or doing ESG integration or any of these things create real world social value is based on an idea that the markets will self correct.

Tariq Fancy :

I mean, that, that is ultimately at the end of the day, what it is. I found that out because I spent enough time trying to understand how to articulate. Just not, not just how it’s good for investing, which was, it took a bunch of time to figure out because frankly, a lot of it was being said in the space was quite, it wasn’t greenwash, but it’s what someone else I know called green wishing, right? It was so unlikely and hopeful that it was, you know, borderline greenwash. But I think at some, at some point, you know, these narratives, they’re all based on the free market, correct themselves, they don’t work in practice. I can talk in detail for the, about the fact that I think that there are solutions we can implement, but the ones that are being done in the industry are [INAUDIBLE].

Tariq Fancy :

And so what you end up seeing is that there’s great. There’s great. Hope around ESG is gonna do something right. And every year you see more and more talk about your ESG, right? It’s incessant, everyone claims to be doing it thinks it’s the big thing. You have this growth and ESG assets, right? So you can almost graph them what I call sort of sustainable bubble and all the words are increasing. They’re increasing alongside ESG assets. And then finally enough they’re, those are both increasing on a graph alongside carbon emissions and inequality and all the things that they’re arguably meant to do something about. And the reality is, is because, you know, when you dig underneath these narratives and you dig underneath the, what the products are, they don’t seem to have much of an effect at all. I mean, for the most part, there’s a fraction of fraction of cases where some of the there’s a kernel of truth, but for the most part, it’s mainly marketing.

Tariq Fancy :

And that’s really where the, the, a concern comes in for me. And to give you analogy of used places when I first left BlackRock you know, I left, I transitioned out over six months and did on good terms and I still don’t, you know, I talk to folks at BlackRock and I’ll tell you, I don’t think it’s a BlackRock specific a problem. I think it’s an industry problem. Although BlackRock is of course the biggest player and has been a, you know, at senior management has been a big voice around it. But I, I think that, you know, what I thought of that when I was leaving was that it was like giving wheat grass[INAUDIBLE] to a cancer patient. You know, the, the cancer is I would argue not just climate change, which is slowly spreading, but also I would say inequality and other social issues that undermine not the planet, but our political systems.

Tariq Fancy :

And so it was like giving wheat grass to cancer patient goes very well marketed. It looks and sounds nice it’s green, but of course, you know, there’s no reason to believe it’s gonna stop the spread of cancer, nor any experts who have told us that that would be the case. So should be the case. And I think where I landed after, and, and why I went public this year about it was that I started to realize that it was almost undeniable in my mind that the rest of the world didn’t know the extent to which most of this is just marketing. I would argue marketing intended or certainly designed whether, you know, intentionally and cynical or not to preserve the status quo. And what that means is that it’s not just giving Wera[INAUDIBLE] to a cancer patient, the, the data and the study that I had done with this Canadian university showed that it was actually misleading the public. And it was like giving the giving cancer to, you know, Wera to a cancer patient. And then realizing very definitively that that cancer patient is be, is now delaying chemotherapy because of the sort of frankly false promises. And that, and that, that is, I think the biggest concern that I would have is that it it’s now becoming counterproductive.

Ross Butler :

Yeah. I think if you conclude that it’s not doing any good, I think you have to then conclude that it’s doing harm because we’ve only got so much attention and we’ve only got so many resources. There’s only so things we can do. And if we we’re doing something that’s not helping, then it’s, it’s part of the problem. It’s not part of the solution. So I can, I can see how you got there, I suppose, in terms of moving forward, I quite like to understand why, why the problem is persisting and why people are continuing to promote the, the concept. Now maybe there’s cynicism there. But, but maybe they’re just mistaken. I mean, the investment industry is full of smart people and your, your criticism of it and your, and your series of essays on medium. They’re very good. But not, not particularly difficult to understand. So why aren’t people getting it? Why aren’t people becoming a little bit more skeptical and thinking, well, maybe this isn’t working,

Tariq Fancy :

You’re asking the right question. I think that is starting to happen now. There’s no question that based on certainly the inbound and the response I’ve gotten, that I’ve sparked a debate, which, which was my goal. I think that there’s a debate that we desperately need to have sooner than later that’s in the public interest. And I don’t want a debate that has a bunch of people saying capitalism is crap and throwing stones at it. And you know, which, which is important to understand the majority of millennials do not believe in capitalism, right? There’s studies around this. I would argue it’s because the version of cap. First of all, I don’t share the baby boomer perspective. I sit in between those two generations from a age perspective, I wouldn’t that the baby boomer generation is correct in blaming millennials and saying, oh, they don’t just get it.

Tariq Fancy :

Which is the sort of version I’ve heard a lot. I would turn around and point the figure right back at them and say, no, listen, the reason that they don’t believe in capitalism is because they’re, they’re seeing a poor version of it. That’s not serving the long term public interest. And, you know, maybe I’m old school, but I think business and markets exist to serve the public interest rather than the other way around. And so I think that what’s happening now is to answer your question is that, you know, people are starting to ask these questions. I don’t think they’ve been asked because the incentives of the system are operating exactly as we should expect him to. So one of the things I discuss in the essay is that I don’t actually think that you could put it at the doorstep of any individual person and say, this person is bad or evil.

Tariq Fancy :

I think that a system works according to how we should, we should think it should work according to the incentives of the people right now, for the most part, the average CEO is very short term incentivized as well as the average investment manager. So they are the average CEO pay is 320 times. The industry worker that’s the highest has been in decades. The average CEO tenure is five years. That’s the shortest has been in decades. And so very clearly, you know, capitalism from the perspective of not just managers who are, you know, who are folk, who are incentivized towards profit, also fund managers, they’re, they’re very short term oriented. And it’s important to note that they also are legally obligated to choose, to chase profits, right? It’s not like they’re, there’s a sort of caricature of the CEO as being sort of this [INAUDIBLE] individual who has in their ability to, you know, the, the controls to do all the right things in safe society, if they want, I actually think that’s unfair even to the average CEO or fund manager.

Tariq Fancy :

I mean, having being a portfolio manager myself, once I know that, you know, you are bound by obligations around fiduciary duty, right? You’re focused on dollar value, right? Not, not social values. And you’re also financial incentivized around return. And so the idea that the industry has pushed is that while ESG integration is a, win-win why, because ESG is good for investing. So we are going to do more of it. And a, that’s not, you know, out of the bounds of fiduciary duty, because again, it’s not, it’s not the old school, what people use to think, which is that it’s gonna cost you money to do good. Somehow this new thesis has been weaved and no, no, no, it’s, it’s good for investing. So therefore, number one, it’s fully compatible fiduciary duty. Number two, you don’t need to worry the industry is gonna do it all by themselves because it’s, it’s, it’s good.

Tariq Fancy :

And why wouldn’t we do it, right? Like, you know, you can trust us cuz we we’re profit seeking and there’s profit there. And I think that the, the, the central part of the debate that needs to be addressed is the idea that that, that is frankly not true, right? ESG being better for investment returns is financial jargon proxy for you know, profit, responsible companies are more profitable. The fundamental problem that in our society that we all kind of know intuitively and certainly across the data of the largest asset manager in history is that our, our fundamental issue is that there’s a lot of things that are being done in society today that are not good for the public interest, but they’re being done cause they’re profitable, right? Burning fossil fuel today is cheaper than it needs to be for us to make the transition that we need to make.

Tariq Fancy :

And so for decades, as in using this one, as an example, people have said, we need a price on carbon, right? I mean, that’s pretty simply the answer like you, you have to tax the pollution. Otherwise there’s no disincentive to do it as much. And in response, we’re not getting a carbon tax and we’re getting a bunch of anecdotal stories about, you know, green is growing and this and that and you know, that’s it sound good. But once you dig below the anecdotes, the numbers are clear that we’re not moving as fast as we need to move. And, and I think that fundamentally the, the ESG thesis itself is flawed. It seems designed more to, for the system to optimize delaying taxes and regulation, and then selling a bunch of high fee products in between to address social lengths than it is to actually solve these problems and sorry for the very long answer. But the fundamental point I say at the end day is in a short term oriented system. You need regulation to solve these problems cause if you just leave it to the market to fee, correct, it will not work.

Ross Butler :

The solution you’ve already alluded to is very simple to say, which is a carbon tax taxes are tend to be national. Surely it only makes sense if it’s international, if not global I mean, how do we move forward there, if that is the solution, do you see you know, do you think this is feasible?

Tariq Fancy :

I think it is, but I think it’s feasible only if we bring the debate to the us. So I’m a Canadian I grew up in Toronto, went to university in the US and then spent most of my working career here. I’m, I’m physically in, in New York at this minute. And I will tell you that the Canadian side, there’s not much, we, it can get done alone, right? There was just an election in Canada. Climate change comes up a lot. There’s obviously challenges cause of the west of the country has the [INAUDIBLE] region. It’s politically tricky to, to, to figure out a national approach and you could argue that’s the same for all countries. They have internal challenges around it. And then a lot of them look and say, well, what does it matter if no one else is doing it? And I, and I personally think that the United States, there, there is a way to get a global approach, but it has to begin in the us because if the us like this decade still has a position of leadership that people may argue won’t exist decades from now.

Tariq Fancy :

But I do think in the 2020s, it’s true that the us has unique position lead as well as frankly today in administration that believes it’s science, which, you know, we, we, we take for granted, but you know, a year ago the president told people to drink bleach in the face of a hundred year, you know, the biggest crisis a hundred years. And so, you know, we do have a moment in history for the next few years where the preconditions are there. But, and I think that if the us were to lead, I think you’ll find that the Canadians will fall. The Europeans will fall the other streaming to follow. Cause I can tell you one thing as a Canadian, no Canadian political party wants to be seen to be the right to the right of the us on issues like this. Right? And so the us has an ability to lead, you know, as a, as a side, interesting tidbit in my paper, I use the analogy of competitive sports.

Tariq Fancy :

A lot. I lean into basketball. Originally when I wrote it, I use soccer. I’m a huge football or soccer fan. But I switched it to basketball precisely because I thought, well, you know, there isn’t, there is a global approach that can work. I really do think there is just like right now countries are looking at coordinating on taxes, same idea, but that came about because the Biden administration sort of said, enough is enough. We need to work and coordinate on minimum taxes. Otherwise people just came the system it’s politically difficult for the Biden administration to do that for climate change. I do believe they would do it. I believe that if there was the political room to do it, they would step into it. But that politic room doesn’t exist. If the business community is unified in what I think is a completely VACU thesis that in 2021, we can rely on the free markets to like correct, you know, the largest market failure in history.

Tariq Fancy :

And so really long way of answering it. I think the debate it’s the us business community needs to be, you know, that’s where the debate needs to happen. Because I think that if you get to a point where you can actually split the community and say, listen, like what’s being done right now is not even in, in the interest of people at BlackRock who are in their twenties and thirties, right. To kick the can down on the road, on these issues. And that there’s a large intergenerational issue that’s being unaddressed. You do get to a point where you can start to actually create a debate that I think gives the politicians here room to move. And I think if they can move, I do think that there’s a global approach. That’s possible.

Ross Butler :

I like the idea of a carbon tax, because it’s simple. And I think with a complex problem, like climate change, you need to keep the solution simple. Otherwise you just get in a, in a model and you’re not gonna bring people with you. But it’s only simple to say it’s actually very complex when in practice. So for example it’s always important to work out what the unintended consequences of any interference in a complex system is. And there will clearly be consequences that are negative for people and they will be unequally distributed. So for example, many, you’re a concerned that if you raise the price of energy, it’s the poorest in the rich countries and, and the poor in the poor countries that will, that will be hit hardest. And so in order to get this through these big political questions need to be dealt with satisfactorily.

Tariq Fancy :

I would agree with that. I think, you know, know I’m actually not that worried about challenges like that. And the reason I’ll say that is that there’s no shortage of good ideas to address that. I mean, I think there was two years ago a huge number of economists, including 45 Nobel prize winners endorsed the idea publicly of a, of a price on carbon. And I think for that specific endorsement, it was in the idea behind, it was very much openly around the idea that the carbon tax should be revenue neutral or in some way that the proceeds of it should be distributed towards those who need most. And so for them actually, they may pay a little bit more at the pump, but then they’re getting much more back in, you know, a set of other you know, social programs that could be things dedicated toward education.

Tariq Fancy :

It could be just cash dividends. And of course the richest would be the ones that’d be paying, cuz they’re gonna pay the carbon tax just as much. You know, another sort of taxes probably around that, but you know, not not necessarily receive it back. And so in that sense, progressive rather than the regressive tax, I don’t think there’s a shortage of ideas to do that. I think the problem is that right now, for the same reasons you can’t increase taxes on wealth or any, or you know, or marginal taxe rates on the wealthy, which, you know, have of being shorter, being lows have been in decades. And you know, the economist, Tom Boetti has written a lot about sort of the growth inequality as, as you know, as partly as a result of that, you know, you kind of have a situation where the solutions are there it’s politically difficult to get them done.

Tariq Fancy :

And I think that’s largely because, you know, I think that right now the, those who have power are sort of beholden to a set of fantasies that say that they can sort of keep, have their cake and eat it to. And so sustainable investing is a great idea for them, you know, Davos and all of these gatherings of the world elite, they seem to always land on solutions that don’t involve taxes, regulation. I get it. Nobody wants taxes and regulation, right? I mean, that’s not something that anyone wishes, I’m a capitalist I’m former investment banker. It’s not the kind of thing that I, you know, we rerun and, you know, are desperate to see happen, but at some point in a competitive market, it’s kinda like a competitive sport, right, where you’re playing and there’s dirty play, right?

Tariq Fancy :

Dirty plays, winning games. People are doing things that no one wants in the game, but it’s, it’s, it’s because the rules haven’t been updated for decades and they’ve figured out ways to, you know, effectively score points and win games by, by being on sportsmen. Like you need referees, right. And capitalism has referees there’s Ru you know, there’s no such thing as a free market. That’s an idiotic idea. Every single market has rules. Right. Right. I mean, the first lawyer you talk to will say, no, no, market’s a collection of rules. Those rules needs to be updated significantly. Right. The thing about a carbon tax is that the crazy thing is we’re, we’re only we’re discussing now that we probably need one soon, but people knew that a decade ago. Right. And, and all that was sort of seen is that I would argue a consensus that emerged in the 1980s, that was sort of a Thatcher Reagan consensus around the idea that free markets magically solve all problems.

Tariq Fancy :

In some cases, of course, you know, deregulation makes sense, but it’s been taken to an extreme where even post-financial crisis, we haven’t seen the kind of regulation we would need, nor are the change in narrative that like the free markets have got this figured out. And in 2021, you know, the solutions that we’re banding about. I mean, again, as people who have won Nobel prizes for saying, we need a carbon tax there’s nobody who said even vaguely serious economists, who’s talking about ESG integration as a way to fight climate change, low carbon ETFs, you know, proxy fights against oil companies, one by one. I mean, they know that these things don’t work. You need to address a systemic crisis. You need systemic solutions. Those have to be led by government.

Ross Butler :

It’s interesting what you say about the, the free market being rules based, you know, I completely agree. And I think Thatcher and Reagan were they, they were operating in a moment of time with, with their own political pressures. But I think the philosophies on which their doctrines were based would not didn’t disagree with that. Like Hayak or Milton Friedman. I think all of these people, they, they don’t see freedom as as an ANM or, you know, they don’t see freedom as a situation with rules. That’s just chaos. They see freedom very much. I think, as you describe it, which is a rule based game and freedom is a principle whereby most of the rules should respect the integrity of freedom, but that some of them have to, you know, so I think Hayek in particular mentioned a pandemic as a situation where state and intervention may be required.

Ross Butler :

So I don’t think the free markets unnecessarily in opposition to the concept of, of intervention. And the other thing I was thinking when you were speaking is that it’s very easy to pontificate from a high, you know with a very well paid job. And it’s much harder to do good on the ground and to do good on the ground. You typically the make personal sacrifice, and then you can get a real feel for, well, what are the impacts of certain policies on actual people? And so that’s why I find your, your bio interesting, because you’ve been a venture capitalist and a private equity guy and a big institutional investor, but you’re also thinking about Afghan girls and the impact of, you know, the current situation on them right now and how to get to them. And I think you need that bridge between lofty political ambitions and you know, what’s actually happening to real people in order to like, stay that your policy ideas you know, will play out the way you think they might in, in the real world.

Tariq Fancy :

I agree with, with that. I think I, I agree with everything you just said. I think that you could take an approach based on the power of markets and still, and still say yes, but markets need rules and those rules need to be updated to, to, to serve where we are in 2021. And, and, and I’m not an expert on, you know, Thatcher Reagan historian or, or even Milton Friedman. But what I know of all of them is certainly Milton Friedman was that they would probably agree with the carbon tax at this point, because, you know, it’s fairly clear that that we need to do something and fast and that, you know, announce of prevention is worth a pound of cure. And, you know, so time is of the essence. And I think right now, what needs to happen is that business leaders who understand that we need to, to make serious changes and quickly need to rise above their own short term interests.

Tariq Fancy :

And that might mean that asset owners are the ones that start doing it, the clients of asset managers, or it is excos, or, you know, types of people who, you know, they’re willing to stand up and say something that may not be in their own interests in the same way that, you know, Warren buffet, 10 years ago, RO rode oped saying that, you know, he should be tapped more. And so I think I, you know, and I would also add like, there’s, there’s a lot that people can do, even from the business side of things. I mean, I, I think, you know, obviously there’s, you know, you can run an NGO like I am, and of course people can support using a technology based model to sort of support our work, to grow that and, and impact more Afghan women. But even if you are sitting in a company and you have a specific role, there’s a lot good that can be done.

Tariq Fancy :

And I think there’s a lot of room for CEOs to do better right by, and, and so I don’t think that they, that it’s all lying when they go on. They say they want to pursue the social good. But I do think that there needs to be two things. Number one, there needs to be more rigor around what’s being done, because if the incentives of the system are set up in a way that it’s cheaper to market yourself as being sustainable than it is to actually make the long term investments to be sustainable, then we have a problem. And again, when capitalism is so short term oriented, that, that it seems to be what’s happening in a lot of cases. And while, while you hear a lot out about ESG, but then somehow we’re not making any progress on our social sort of challenges.

Tariq Fancy :

And then the second thing, and then the most important thing is that as, as much as I’m a capitalist and spend most of my career in the private sector and, and, you know, as a, as a fund manager and other things, I would also say that it’s important. We understand the limitations on what the system can provide, right? Mean businesses doing right by stakeholders. That’s a great idea, but we can’t rely on that. Just like we can’t rely on a system that’s built out of a series of transactions that are based on fiduciary duties and other things that are meant to maximize profit. And then look at that existing, alongside a market failure, where obviously it’s cheaper to do lots of that. We need less of done, you know, any way you look at that system, it’s gonna produce suboptimal outcomes. And I think that right now, I think, you know, there’s a real battle for the future of capitalism where I, I think that and it doesn’t just have to be younger people who are sort of saying, wait a second, you know, we’re on the hook for this we’re capitalists, but it needs to look different.

Tariq Fancy :

It’s also, I think a series of, of business leaders who really understand the importance of, of saying here’s what business can do the way it’s set up. And there’s a whole bunch of amazing things, but here’s a limitation on what business can do unless we change the rules, which is just like an athlete on the field saying, listen, like at some point I don’t wanna be playing in a game where, you know, the, someone punches the defender so they can go, so score a goal, like, you know, we need a referee. And I think that that’s the debate that really needs to happen now. And I hope that that kicks off sooner than later. Yeah.

Ross Butler :

What’s next for you? Is Rumie sole focus ?

Tariq Fancy :

Rumie is my sole focus right now, right now, the, the kind of impact that we can have scaling technology across millions of people through their mobile phones and markets, like not just Afghanistan, actually also in north America or other biggest growth areas or in north America using some new tools with built around mobile first micro learning. It it’s done extraordinarily well, especially in the pandemic, it’s it it’s grown very, very quickly. And it’s, it scales very, very cheaply. So right now I think that there is sort of this step change or revolution we could drive in access to learning that is, is, is truly exciting. And because I, I started out as a tech banker in Silicon valley because I taught myself programming and actually did a bunch of internships and technology before ever citing to try out finance.

Tariq Fancy :

And then of course doing it as a, as a banker in Silicon valley. And so now I, you know, looking at the tech, the technology it’s possible, we see so many tech trends that are extraordinarily exciting, that the fact our everyday lives there aren’t enough. I think that really square or zero in on how to improve humanity and use all that, those tools and infrastructure to, to truly address things like the education gap. And that’s, and that’s really exciting for me. And that’s, that’s kind of the focus and the near term, especially on the situation in Afghanistan, because you know, the people there need all the help they can get. And we work with some really, really heroic women’s rights campaigners that you know, interfacing with them regularly makes me realize on some level, the privilege that I have, no matter what I’m doing, just because I was, you know, born and raised in north America and had access, you know, to pub great public education and other things that, that if I’d been born there, I wouldn’t have, I wouldn’t have ever gotten, you know, to ever see or touch.

Ross Butler :

Well, the very best of luck with it sounds incredibly worthwhile. And thanks very much for sparing your thoughts for Fund Shack.

Tariq Fancy :

Thanks for having me. It was a great discussion.

Ross Butler :

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