WEBVTT - M&A Trends, Creating More Diverse Corporate Boards 0:00:00.440 --> 0:00:02.960 This is Bloomberg Business Week. I'm Carol Masser and I'm 0:00:03.040 --> 0:00:05.440 Jason Kelly. We're here every day bringing you the latest 0:00:05.519 --> 0:00:09.800 news from the world's of business and finance, plus technology, politics, economics, 0:00:09.880 --> 0:00:13.480 all harnessing the power of Bloomberg Business Week reporters and editors, 0:00:13.480 --> 0:00:16.639 not to mention our hundred journalists and analysts more than 0:00:16.680 --> 0:00:19.280 a hundred and twenty countries. You can download Bloomberg Business 0:00:19.320 --> 0:00:22.200 Week on iTunes, SoundCloud, or Bloomberg dot Com. You can 0:00:22.200 --> 0:00:24.520 also listen to our radio show weekdays at two pm 0:00:24.520 --> 0:00:28.280 Eastern only on Bloomberg Radio. Vitos Purdudo is co head 0:00:28.280 --> 0:00:31.720 of Global Mergers and Acquisitions at RBC Capital Markets in 0:00:31.880 --> 0:00:34.440 our Interactor Broker studio, along with the one and only 0:00:34.520 --> 0:00:37.199 Ed Hammond, deal's reporter at Bloomberg News. So nice to 0:00:37.200 --> 0:00:39.320 have both of you here, Vito, Let's just get right 0:00:39.360 --> 0:00:41.040 to it. What's the M A environment? Look like we 0:00:41.080 --> 0:00:44.600 had a bunch of deal activity, big deals late last year. 0:00:44.680 --> 0:00:47.120 Is that going to continue? Yeah? Look, I think it 0:00:47.200 --> 0:00:49.120 was an interesting year last year. It was kind of 0:00:49.159 --> 0:00:52.480 two halves. So the M and A market was completely 0:00:52.520 --> 0:00:56.080 made by large deals in the first half of and 0:00:56.080 --> 0:00:59.720 so if you looked at the US market, Um, you know, 0:01:00.080 --> 0:01:03.280 it was fully driven where it was up over in 0:01:03.320 --> 0:01:06.080 the first half because large deals were up that much. 0:01:06.480 --> 0:01:09.320 The European market, just given the uncertainty and the political 0:01:09.400 --> 0:01:13.440 climate over there, was actually off over in the first half, 0:01:14.080 --> 0:01:16.160 and even though they had a massive rally in the 0:01:16.160 --> 0:01:19.280 second half, they were still down last year. I think 0:01:19.280 --> 0:01:21.679 a lot of what we're seeing now are the trends 0:01:21.720 --> 0:01:23.920 that developed in the second half. A lot of the 0:01:23.959 --> 0:01:27.160 transactions are of a size kind of one to five billion, 0:01:27.240 --> 0:01:31.240 kind of mid size, more bite size for corporates, uh 0:01:31.319 --> 0:01:35.199 more doable for private equity firms. But conditions are pretty 0:01:35.200 --> 0:01:38.240 strong right now. We are sitting at financing rates if 0:01:38.240 --> 0:01:39.959 you talk, if you see the markets from a debt 0:01:40.000 --> 0:01:43.440 financing perspective, and the volumes that are occurring, they're they're 0:01:43.520 --> 0:01:46.880 hungry for M and A product right now. So many 0:01:46.880 --> 0:01:51.120 companies are repricing their debt financing, but there isn't a 0:01:51.120 --> 0:01:53.000 lot of new M and A product and so as 0:01:53.080 --> 0:01:56.880 that comes to market, that's really available. Stock prices are 0:01:56.920 --> 0:01:59.880 near all time highs, and then cash on balance sheets 0:01:59.880 --> 0:02:02.760 and dry powder and private equity funds again kind of 0:02:02.920 --> 0:02:05.960 near all time all time highs for private equity, near 0:02:06.000 --> 0:02:08.240 all time highs for corporates, and so you have a 0:02:08.240 --> 0:02:11.600 lot of really good conditions. Um, I do think it's 0:02:11.639 --> 0:02:15.000 a first half of this year market. So when you 0:02:15.080 --> 0:02:18.880 look at the second half, I'm sure it'll extend into it. 0:02:18.960 --> 0:02:20.919 But if you can get your deal done first half 0:02:20.960 --> 0:02:22.840 of this year and not have to deal with the 0:02:22.840 --> 0:02:25.799 political uncertainty, and we're sitting here on a day when 0:02:26.400 --> 0:02:30.440 you know you can't call an election in such a caucus, 0:02:30.520 --> 0:02:35.160 excuse me, and and so even call a caucus, bro, 0:02:36.520 --> 0:02:38.480 imagine the deal was done like that. You're gonna sort 0:02:38.480 --> 0:02:41.680 of partially announce the deal and then I'm gonna trickle 0:02:41.720 --> 0:02:44.680 it out over days and days. It's embarrassing, Yeah, and 0:02:44.720 --> 0:02:48.000 it's difficult. I think the problem right now is people 0:02:48.040 --> 0:02:49.720 look at it and there are a lot of key 0:02:49.800 --> 0:02:52.560 assets that people want to sell because they weren't able 0:02:52.600 --> 0:02:54.679 to last year, and so there's a lot of pent 0:02:54.760 --> 0:02:57.600 up demand both in terms of buying and selling. And 0:02:57.639 --> 0:02:59.239 as a result, you know, I think people want to 0:02:59.280 --> 0:03:01.120 make sure that you know, I'm not going to risk 0:03:01.280 --> 0:03:03.239 uncertainty and if I can get it out sooner, and 0:03:03.280 --> 0:03:05.760 that's what we're seeing from our clients right now. But 0:03:05.760 --> 0:03:08.840 but there's not a lot of large deal flow versus 0:03:08.840 --> 0:03:11.359 what we saw last year. We saw some real blockbusters 0:03:11.360 --> 0:03:13.360 in that first half of the year. And so in 0:03:13.400 --> 0:03:16.840 the immediate term, how much is your phone ringing or 0:03:17.000 --> 0:03:21.480 your email box filling up with concerns from a CEO 0:03:21.840 --> 0:03:27.680 who might be thinking about selling around coronavirus. So, look, 0:03:27.880 --> 0:03:31.200 I think that impacts you if you're dealing with business 0:03:31.240 --> 0:03:35.760 that excuse into Asia China more specifically. So you saw 0:03:35.840 --> 0:03:38.480 some I p O s get pushed out and I 0:03:38.560 --> 0:03:42.440 think somewhere because of exposure to that market, somewhere just 0:03:42.480 --> 0:03:46.120 because of concerns on volatility. UM. I think you know, 0:03:46.680 --> 0:03:50.280 M and A deals don't happen when there's uncertainty, and 0:03:50.360 --> 0:03:52.320 so you need to be certain about your performance. You 0:03:52.360 --> 0:03:54.800 need to be certain about the market performance. And so 0:03:54.840 --> 0:03:58.760 I think the risk is more you know, it's going 0:03:58.840 --> 0:04:02.080 to be isolated a certain areas. Now, we've spent a 0:04:02.080 --> 0:04:04.120 lot of time looking at this UH and I would 0:04:04.120 --> 0:04:08.280 tell you the the amount that the Chinese economy accounts 0:04:08.320 --> 0:04:11.760 for the global economy is much more significant than if 0:04:11.760 --> 0:04:13.920 you go back to stars. Right, So if you go 0:04:14.040 --> 0:04:16.800 back to two thousand three, I saw a statistic for 0:04:16.880 --> 0:04:19.360 luxury goods. A third of all luxury goods today are 0:04:19.360 --> 0:04:21.920 sold in China. Yeah, we've talked about the fall off 0:04:21.920 --> 0:04:25.479 in Hong Kong. Yeah, ten was the number back in 0:04:25.520 --> 0:04:28.840 two thousand three, And so if you think about that, 0:04:28.920 --> 0:04:30.640 if you think about the importance they are just to 0:04:30.680 --> 0:04:33.919 the global economy, it's going to have an impact, but 0:04:34.000 --> 0:04:35.560 I do think it's going to be more of a blip. 0:04:35.760 --> 0:04:37.520 The other thing I was talking to someone this morning 0:04:37.520 --> 0:04:39.960 about was how soon I was asked this question by 0:04:40.000 --> 0:04:41.760 a client, how soon do you think people are going 0:04:41.800 --> 0:04:44.599 to start mentioning the coronavirus in their earnings? Well, I 0:04:46.279 --> 0:04:48.479 couldn't be. I mean you look at LVMH, tiffany where. 0:04:48.480 --> 0:04:51.799 Obviously the China pieces a huge motivation. Could they? Could 0:04:51.800 --> 0:04:55.120 they potentially, Declara Mac. I don't think so. But it's 0:04:55.600 --> 0:04:57.320 but but you know, I look remind people where the 0:04:57.360 --> 0:05:01.560 back is material at first change and then the deal, 0:05:01.680 --> 0:05:07.080 and basically it's it's it's way you almost impossible. I 0:05:07.120 --> 0:05:09.320 think there's only been in Delaware law, there's only been 0:05:09.320 --> 0:05:12.719 one that and it's you can't And in general, market 0:05:12.720 --> 0:05:16.160 conditions like this are excluded from that definition. So I 0:05:16.160 --> 0:05:18.880 think that's difficult. But I do think if you recall 0:05:19.000 --> 0:05:21.960 when Tiffany's had to make comment about their UM the 0:05:22.000 --> 0:05:24.680 main store and the impact that was having from being 0:05:24.720 --> 0:05:27.000 so close to Trump Tower in New York City. Since 0:05:27.000 --> 0:05:30.000 the streets are shut down, UM, you're gonna see things 0:05:30.040 --> 0:05:33.560 like that impacted. You start hearing about Macau shutting down 0:05:33.560 --> 0:05:36.480 for two weeks, you start hearing about Apple and Starbucks 0:05:36.520 --> 0:05:40.760 closing stores, Right, you're gonna feel some impact. Now. I 0:05:40.800 --> 0:05:43.440 do think, um, we'll know a bit more as this 0:05:43.480 --> 0:05:46.279 plays out, but it will impact the companies that are 0:05:46.279 --> 0:05:49.440 exposed to that market in general. Speaking of M and A, 0:05:49.560 --> 0:05:51.960 just want to bring you a quick headline Intercontinental Exchange 0:05:51.960 --> 0:05:56.760 approaches eBay about a takeover that is just crossing the 0:05:56.760 --> 0:06:00.360 Bloomberg according to just got three set can here. What 0:06:00.440 --> 0:06:03.040 would you say to that? You know, you're seeing a 0:06:03.080 --> 0:06:05.640 blend of a lot of these companies like this. We 0:06:05.640 --> 0:06:08.200 we've been talking to big theme this year of convergence. Yeah, 0:06:08.440 --> 0:06:10.080 and so when you take a look at sort of 0:06:10.520 --> 0:06:15.440 buyers extending their reach in the other areas, especially technology related, UM, 0:06:15.480 --> 0:06:17.479 that's fairly inesting. I haven't I haven't spent a lot 0:06:17.520 --> 0:06:19.160 of time in that space. But that's something I'll be 0:06:19.160 --> 0:06:21.240 taking a closer look at. That's a really instrument all right, 0:06:21.360 --> 0:06:24.760 video about five and a half percent as expected. We'll 0:06:24.839 --> 0:06:26.680 keep watching that one. He is the co head of 0:06:26.720 --> 0:06:29.600 Global M and a over at RBC Capital Markets are 0:06:29.600 --> 0:06:33.000 thanks to him, and of course to Ed Hammond, our 0:06:33.279 --> 0:06:41.680 m and a man on the scene. All right, Well, 0:06:41.760 --> 0:06:44.240 this story immediately jumped out to both Carol and myself. 0:06:44.279 --> 0:06:47.800 It's a topic that we talked about a lot on 0:06:47.880 --> 0:06:50.760 this show. We talked about it at the Bloomberg fifty. 0:06:51.240 --> 0:06:54.400 It's just something that's very much, as Tom Keane would 0:06:54.440 --> 0:06:58.000 say in the Zeitgeist for more diverse corporate boards. Move 0:06:58.240 --> 0:07:00.360 down the org chart. That's the headline on the story 0:07:00.400 --> 0:07:04.039 by Jeff Green in the latest edition or the upcoming edition. 0:07:04.080 --> 0:07:07.880 I guess of Bloomberg business Week magazine. Jeff Green normally 0:07:07.920 --> 0:07:10.640 based out in Detroit City. He's here with us in 0:07:10.760 --> 0:07:13.880 New York City, and so is Joe Webber, the editor 0:07:13.880 --> 0:07:17.160 of Bloomberg Business Week. Detroit people feel about Detroit City. 0:07:17.640 --> 0:07:20.080 That a thing you like that Detroit City. The rocket 0:07:20.120 --> 0:07:22.880 is understood. Come on, as long as you spelled Detroit, right, 0:07:22.880 --> 0:07:26.440 We're good. Alright, good. Uh so j G, welcome back 0:07:26.440 --> 0:07:30.040 to New York. Tell us about this story, because this 0:07:30.240 --> 0:07:33.640 is the constant refrain. People say, all right, we want 0:07:33.680 --> 0:07:35.520 a more diverse board, but the candidates just starting out there, 0:07:35.520 --> 0:07:37.440 there's nothing I could do about it. Bro Yeah, Well, 0:07:37.600 --> 0:07:39.840 I started kind of looking at it backward. I was 0:07:39.880 --> 0:07:42.600 looking at the number of first time executives that were 0:07:42.600 --> 0:07:44.560 showing up on boards. There's a lot of a lot 0:07:44.600 --> 0:07:47.520 more first timers now on the SP it doesn't turn 0:07:47.520 --> 0:07:50.080 over much, but when it does, they're more likely to 0:07:50.080 --> 0:07:51.920 be first timers. And I was trying to figure out why. 0:07:52.280 --> 0:07:54.000 So I started looking at, well, who has the most 0:07:54.040 --> 0:07:57.080 people UM, and Marriott jumped kind of to the top. 0:07:57.160 --> 0:07:58.880 So I went to them and said, what's going on here? 0:07:58.880 --> 0:08:00.800 And like they had no idea that they were in 0:08:00.840 --> 0:08:02.800 any way. Look, you know would be on this list. 0:08:03.360 --> 0:08:05.760 And so I talked to Arnie Sorenson. He said, it's 0:08:05.840 --> 0:08:08.000 it's not really on purpose. We're not trying to be 0:08:08.040 --> 0:08:10.120 more diverse. But he said, you know, I was one 0:08:10.160 --> 0:08:12.320 of the first people allowed to be on an outside 0:08:12.320 --> 0:08:14.040 board at Marriott. I went on he first, he went 0:08:14.080 --> 0:08:17.160 on Walmart. Now he's on Microsoft UM. And he said, 0:08:17.160 --> 0:08:18.840 I thought it was a great experience. So he made 0:08:18.880 --> 0:08:21.720 it a requirement that his reports come to their board 0:08:21.760 --> 0:08:23.840 meetings and kind of see how it works. And then 0:08:23.960 --> 0:08:25.960 for those who are interested, he said, why don't you 0:08:26.000 --> 0:08:30.120 think about going on some outside boards. Oh? Interesting, So 0:08:30.160 --> 0:08:33.480 this is allowed, so non CEO, but maybe C suite 0:08:33.600 --> 0:08:37.800 or kind of how it's percolated down to reports to 0:08:37.920 --> 0:08:41.880 reports to reports at Marriott's three levels. At least one 0:08:41.920 --> 0:08:44.040 of those people that would have been in the story 0:08:44.280 --> 0:08:46.839 she just left for another company, but it had been 0:08:46.840 --> 0:08:50.319 a report to report to report. Perhaps the programs working 0:08:50.960 --> 0:08:53.120 because one of the things that comes with these positions 0:08:53.200 --> 0:08:56.319 is oftentimes a little networking effect, right, Yeah, and a 0:08:56.400 --> 0:08:58.880 higher profit and a higher pay. It doesn't hurt if 0:08:58.880 --> 0:09:01.720 you're trying to keep somebody. So what are those well, 0:09:01.760 --> 0:09:04.679 I mean you get access to both for the company 0:09:04.760 --> 0:09:06.760 that you work for and the company you're going to. 0:09:06.840 --> 0:09:10.160 There's access and networking. Um, you know the Home DEEPO 0:09:10.160 --> 0:09:12.160 in Adobe or a couple of the boards where people 0:09:12.200 --> 0:09:15.040 from Marryott are now serving Home Deeper in particular, they 0:09:15.080 --> 0:09:17.720 talk about how it's a customer service. They have people 0:09:17.800 --> 0:09:19.520 trying to wait on you on the floor, you have 0:09:19.600 --> 0:09:21.679 people you know, waiting on you in the rooms, and 0:09:21.720 --> 0:09:24.720 there's a lot of potential cross pollenization, a lot of things. 0:09:24.920 --> 0:09:28.800 So it makes a business sense. And it's not just Marriott, 0:09:28.840 --> 0:09:31.120 I mean I was, there was several. Almost every big 0:09:31.160 --> 0:09:34.760 company now is letting their lower level executives serve in 0:09:34.800 --> 0:09:37.480 some capacity, usually just one, but I mean one is 0:09:37.600 --> 0:09:40.360 really all you need for one is more than none, 0:09:40.400 --> 0:09:42.120 which is what it used to be, right, especially for 0:09:42.200 --> 0:09:44.320 lower level. It's a retention tool. You have somebody you 0:09:44.400 --> 0:09:46.880 might want to be CEO someday, you put them in 0:09:46.880 --> 0:09:50.680 this position basically the boss of a CEO. I'm I'm 0:09:50.720 --> 0:09:54.560 an e v P but by day, but you know, 0:09:54.600 --> 0:09:56.800 eight times a year, I'm the boss of the CEO 0:09:57.040 --> 0:09:59.640 of a major company. Potentially. It's also like an executive 0:09:59.640 --> 0:10:01.640 program to some extent, if you think about it, you're 0:10:01.679 --> 0:10:05.120 taking your lower level executives and exposing them to another 0:10:05.160 --> 0:10:08.040 corporate board and kind of their expertise and what they're 0:10:08.080 --> 0:10:10.040 working on. And in that way, I mean there's a 0:10:10.040 --> 0:10:12.320 payoff for the company as well. Yeah, and you know 0:10:12.480 --> 0:10:17.040 the sort of the collateral undamaged whatever, the the good 0:10:17.080 --> 0:10:18.959 thing that comes out of it is the next layer 0:10:18.960 --> 0:10:22.200 and the layer below that in most corporations is more diverse. 0:10:22.280 --> 0:10:25.640 I mean, you know, what is it of C E 0:10:25.720 --> 0:10:29.600 O S or white males? It gets better it's our 0:10:29.720 --> 0:10:31.720 female and you know the numbers get bigger when you 0:10:31.760 --> 0:10:33.839 get further down. Well, and the other point you make 0:10:33.880 --> 0:10:37.280 this in the story is this idea that when boards 0:10:37.280 --> 0:10:40.439 are looking for new members, they are often not looking 0:10:40.880 --> 0:10:43.679 for white dudes. They are looking for people of color 0:10:43.920 --> 0:10:47.120 and women often and so that only it becomes sort 0:10:47.160 --> 0:10:50.720 of a virtuous sort of situation. So who else is 0:10:50.920 --> 0:10:53.440 shining in this regard? You know, if if Marryott just 0:10:53.520 --> 0:10:56.640 happened to stumble into this, uh, like, what else is 0:10:56.640 --> 0:10:58.200 happening out there? Well, it's not. I mean a lot 0:10:58.240 --> 0:11:00.120 of companies are doing it for the other reasons. I 0:11:00.120 --> 0:11:04.240 mean I think I remember Cummins, you know, the industrial company, 0:11:04.559 --> 0:11:07.240 for no reason they could explain LOOKS is really good 0:11:07.240 --> 0:11:10.320 in this and big companies like m X and and 0:11:10.400 --> 0:11:14.360 other companies, you just it's because they have the policy. 0:11:14.440 --> 0:11:16.160 I mean, I've written about this in the past. I 0:11:16.240 --> 0:11:18.200 did an article for Business Week a few years ago 0:11:19.080 --> 0:11:21.240 when I first saw this kind of happening, and it 0:11:21.280 --> 0:11:23.120 was interesting. Some of the people I wrote about one 0:11:23.160 --> 0:11:25.600 of them now runs of General Motors. The other one, 0:11:25.679 --> 0:11:28.280 the other woman now runs Automation, and they've both been 0:11:28.320 --> 0:11:31.680 featured in these stories about how they're you know, they decided, Um. 0:11:32.200 --> 0:11:34.360 I think it was the CEO of General Motors said 0:11:34.400 --> 0:11:37.320 I'm gonna put some of my lower level executives out there. 0:11:37.679 --> 0:11:39.760 And Mary Borrow was one of the people who got 0:11:39.800 --> 0:11:42.200 a shot, and I interviewed her at the time. She was, 0:11:42.240 --> 0:11:45.080 you know, two layers from CEO. So let me ask 0:11:45.080 --> 0:11:48.120 you this, because this is right in your wheelhouse. We 0:11:48.360 --> 0:11:52.400 made a lot of this decision by Goldman Sax recently 0:11:52.440 --> 0:11:54.000 to say we're not going to take you public if 0:11:54.440 --> 0:11:57.400 you don't have at least one diverse member of your board. 0:11:57.440 --> 0:12:00.240 And a year from now, I believe her in one 0:12:00.240 --> 0:12:02.160 that's going to go to two. How big a deal 0:12:02.240 --> 0:12:03.840 is that? I mean, you know this space much better 0:12:03.840 --> 0:12:05.120 than we do. How big a deal with that? Well, 0:12:05.160 --> 0:12:06.960 I don't think Goldman Sax is going to not do 0:12:07.000 --> 0:12:09.840 a deal. But I don't think Goldman Sax has to 0:12:09.840 --> 0:12:11.800 worry anymore that anybody is going to come to them 0:12:11.800 --> 0:12:14.800 with a board that isn't going to have a diverse candidate. 0:12:14.800 --> 0:12:16.840 I mean, I think it's gonna be basically, I want 0:12:16.840 --> 0:12:19.199 Goldman sex and my deal. I'm going to start looking 0:12:19.240 --> 0:12:20.840 because if you look at most I p o s 0:12:21.200 --> 0:12:22.760 and you look at you go just pull them up 0:12:22.760 --> 0:12:24.959 on the Bloomberg and look at the screen. The last 0:12:24.960 --> 0:12:27.800 two people picked for almost every board are women. But 0:12:27.880 --> 0:12:30.679 we work wasn't that way. They waited till everything that. 0:12:31.600 --> 0:12:34.480 But I'm just saying a high profile you know I 0:12:34.600 --> 0:12:36.760 p O that had a lot of different problems, but 0:12:36.800 --> 0:12:38.720 they didn't have women on ten percent of the big 0:12:38.720 --> 0:12:41.120 I p o s every year don't have any women 0:12:41.160 --> 0:12:43.200 on the board. I mean, that's that's a that's not 0:12:43.320 --> 0:12:46.800 my stat but I quoted a lot um. It was 0:12:47.000 --> 0:12:49.800 I think it was twenty women on boards. Went and look, 0:12:49.880 --> 0:12:51.520 they look at the top twenty five I p O 0:12:51.600 --> 0:12:55.880 deals every year and they don't, you know, invariably ten 0:12:55.920 --> 0:12:57.959 percent percent. And this is the one in this way 0:12:58.000 --> 0:12:59.640 that that jumped out of me. Although women make up 0:12:59.679 --> 0:13:01.920 half the work, first, they didn't exceed a quarter of 0:13:02.080 --> 0:13:06.880 SMP directors until just last year, right, so total total. 0:13:07.559 --> 0:13:09.160 What I what I guess I think about with this 0:13:09.240 --> 0:13:12.120 framing is like overall problem is like we know diversity 0:13:12.120 --> 0:13:14.360 on boards is a problem, right, and like novel solution 0:13:14.400 --> 0:13:16.520 that hadn't been talked about, and don't jump to this, 0:13:17.320 --> 0:13:19.440 We'll just open up the funnel a little bit, like 0:13:19.480 --> 0:13:21.600 it doesn't have to be top of the food chain 0:13:22.280 --> 0:13:25.439 down the later the company's opening. If you want to 0:13:25.480 --> 0:13:28.280 see diversity, look for chaos, look for turmoil. We did 0:13:28.280 --> 0:13:31.000 another story looking at the consumer segment. You know, it's 0:13:31.040 --> 0:13:33.480 the worst place to be in theory as a CEO. 0:13:33.600 --> 0:13:35.920 At the moment, they're more CEOs are being fired at 0:13:35.920 --> 0:13:38.800 consumer companies than anywhere else. However, it's also if you're 0:13:38.800 --> 0:13:41.040 willing to, you know, be a little risky, it's the 0:13:41.120 --> 0:13:42.800 great place to be a woman right now. I mean 0:13:42.880 --> 0:13:45.160 it's they have a food chain too, they have a 0:13:45.240 --> 0:13:47.960 they have a bench. So you're seeing women just like 0:13:48.240 --> 0:13:50.360 jump to the floor there. And when you're on a board, 0:13:50.360 --> 0:13:52.280 even if you're a lower level executive, you get paid 0:13:52.280 --> 0:13:55.240 for it, right exactly, it's not and it's not too shabby. Yeah, 0:13:55.360 --> 0:13:58.400 not for nothing, all right, Jeff Green, what a treat 0:13:58.480 --> 0:14:00.640 to see you here in New York City. Managining diversity 0:14:00.720 --> 0:14:04.520 reporter for Bloomberg, usually based out in Detroit, Michigan, I 0:14:04.559 --> 0:14:09.000 said it correctly that Detroit Detroit City. Joel Weber, editor 0:14:09.040 --> 0:14:11.760 of Bloomberg Business Week, he is here in New York. 0:14:11.880 --> 0:14:15.800 You just call it motor City. My god, there's a 0:14:15.800 --> 0:14:18.800 lot of growing going on right now, just saying this 0:14:18.840 --> 0:14:24.320 isn't a good corporate board. No, not even close. You're 0:14:24.400 --> 0:14:28.120 listening to Bloomberg Business Week with Carol Messer and Jason 0:14:28.200 --> 0:14:32.640 Kelly on Bloomberg Radio. Alright, so this story one of 0:14:32.640 --> 0:14:35.000 the most right on the Bloomberg Today. Goldman Sachs is 0:14:35.280 --> 0:14:37.880 Adam Corney is one of Wall Street's most prominent evangelists 0:14:37.920 --> 0:14:41.920 for rewiring trading desks deaths. I can't say it trading 0:14:42.000 --> 0:14:45.160 desks with cutting edge technology anyway. It talks about the 0:14:45.160 --> 0:14:48.480 commitment really that has been made to technology at Goldman Sachs. 0:14:48.760 --> 0:14:51.720 And so you do wonder about him stepping down. Trinaderag 0:14:51.800 --> 0:14:54.200 And is finance reporter at Bloomberg News. He's in our 0:14:54.200 --> 0:14:58.840 Bloomberg Interactor Broker studio. He wrote it, sor I've been 0:14:59.000 --> 0:15:01.160 I'm spending too much to Twitter is a little crazy today. 0:15:01.320 --> 0:15:02.960 All Right, I'm going to step back from Twitter and 0:15:02.960 --> 0:15:05.760 I'm going to focus on straight. Um. I'm glad you're here. 0:15:05.760 --> 0:15:07.400 We're gonna look you in the eye and welcome you 0:15:07.440 --> 0:15:10.280 to our home. Thank you. Tell us about this story, 0:15:10.280 --> 0:15:12.120 who this guy is, and what he's meant to Goldmen, 0:15:12.200 --> 0:15:14.720 and what it means that he's leaving. Well, the interesting 0:15:14.720 --> 0:15:16.120 thing is how much the story has changed just in 0:15:16.120 --> 0:15:18.240 the last few hours since we published the story, Because 0:15:18.480 --> 0:15:20.520 when we were talking about this story, initially it was 0:15:20.560 --> 0:15:24.240 Adam Corn, one of the most prominent tech evangelists inside 0:15:24.240 --> 0:15:27.880 Goldman's accent across Wall Street. But in the last few 0:15:27.920 --> 0:15:30.480 years we've also heard the new breaking news that his 0:15:30.600 --> 0:15:33.800 boss was also one of the most senior engineers there 0:15:33.960 --> 0:15:37.360 is leaving the film. And you know, some people might 0:15:37.360 --> 0:15:39.560 find it weird. Why are we talking about engineers when 0:15:39.560 --> 0:15:42.040 we're talking about a big Wall Street banking investment bank. 0:15:42.040 --> 0:15:43.880 Why do I care? They're not the real players. We 0:15:43.880 --> 0:15:45.960 need to talk about the traders and the investment bankers. 0:15:46.560 --> 0:15:48.800 It turns out that's not the case the new Goldman. 0:15:49.320 --> 0:15:51.840 Just last week they did a huge deal with their 0:15:52.040 --> 0:15:56.120 big debut investor day where they talked about tech transformation 0:15:56.200 --> 0:16:00.360 being the centerpiece of their trading vision and strategy. So 0:16:00.400 --> 0:16:03.920 when you have two people who have been integral to 0:16:04.000 --> 0:16:06.080 that process, who have been at the firm for so 0:16:06.120 --> 0:16:08.600 many years, who know all the core products have been 0:16:08.600 --> 0:16:11.680 building it leaving in the midst of all these initiatives. 0:16:12.040 --> 0:16:15.680 It's certainly it feels like a really puzzling move, and 0:16:16.120 --> 0:16:19.640 one wonders that there's more to it, and especially that 0:16:19.800 --> 0:16:22.840 it's not like one guy. I mean that there's there 0:16:22.960 --> 0:16:25.920 is a trend here. I mean, especially when as you 0:16:25.960 --> 0:16:28.760 do in your story, you talk about Marty Chavez, you 0:16:28.840 --> 0:16:33.440 talk about Alicia Weasel. Is that am I saying that? Right? Um? 0:16:33.520 --> 0:16:37.120 You know, these are a lot of important people who 0:16:37.520 --> 0:16:40.000 not only set the strategy, but we're executing it and 0:16:40.040 --> 0:16:43.360 we're put forth by Goldman. So what do you make 0:16:43.400 --> 0:16:45.800 of it? Let's take a step back when you when 0:16:45.800 --> 0:16:48.520 you think of all the palace intrigue inside Goldman Sacs 0:16:48.520 --> 0:16:50.240 of the last couple of years. What is it that 0:16:50.240 --> 0:16:53.320 we've talked about a lot. Ever since David Solomon took over, 0:16:53.480 --> 0:16:55.840 see you, and the new management was in place. We 0:16:55.840 --> 0:16:59.040 we kept talking about the old guard and people associated 0:16:59.080 --> 0:17:00.880 with Lloyd blank Fire, and then the old leaders of 0:17:00.960 --> 0:17:03.520 the firm leaving and and in new blood coming in 0:17:03.600 --> 0:17:06.280 or people close to the new management taking prominent roles 0:17:06.280 --> 0:17:09.000 across the firm. However, the moves that we're putting on 0:17:09.080 --> 0:17:12.040 this week feel different. These are people who are supposed 0:17:12.040 --> 0:17:14.320 to be a part of the nucleus of David Solomon's 0:17:14.359 --> 0:17:18.000 team taking Goldman Snacks forward, the likes of Ezra the 0:17:18.280 --> 0:17:20.480 Adam corn. These were people who were supposed to be 0:17:20.520 --> 0:17:24.399 the next generation leaders driving that vision forward. So for 0:17:24.440 --> 0:17:28.080 them to abruptly leave is definitely a bit of a 0:17:28.119 --> 0:17:30.520 head scratch. So what are you okay, so scratching your head, 0:17:30.520 --> 0:17:32.399 But what are you hearing from folks about what it means? 0:17:32.400 --> 0:17:35.040 Maybe about what's going on inside Coleman Sacks. Well, well, 0:17:35.160 --> 0:17:38.560 one thing is clear, there's no way, in no way, 0:17:38.600 --> 0:17:41.600 shape or firm doesn't indicate that Godman's pulling back from 0:17:41.600 --> 0:17:44.520 its text strategy, right. That should have said no, No 0:17:44.560 --> 0:17:49.600 one can have any sort of thoughts about going back 0:17:49.680 --> 0:17:52.359 on that promise. That is the only way forward for them. 0:17:52.480 --> 0:17:55.119 And we have talked about a procession of tech innovatives 0:17:55.119 --> 0:17:56.600 who have left the firm. But at the same time, 0:17:56.640 --> 0:17:59.400 Goldman has tried to offset the losses by bringing in 0:17:59.480 --> 0:18:02.040 tech fire are par from the outside. They've got Marco 0:18:02.160 --> 0:18:06.840 or Gentye from Amazon, they got another senior leader from Verizon, 0:18:06.920 --> 0:18:09.280 So they have been beefing up a talent from outside, 0:18:09.480 --> 0:18:13.080 and I'm sure over time that these outsiders will also 0:18:13.119 --> 0:18:15.200 bring in people that they work with closely over the 0:18:15.280 --> 0:18:18.520 years to fill up the ranks inside Goldman Sax. And 0:18:18.720 --> 0:18:20.800 you know, that's what leads you to wonder maybe some 0:18:20.920 --> 0:18:23.119 of that tension is that play. Although we have no 0:18:23.200 --> 0:18:26.560 indication exactly why they left, all we know is last 0:18:26.560 --> 0:18:29.560 week these people were all part of the showcase invested 0:18:29.600 --> 0:18:32.760 at Goldman Sacks and suddenly they're not there. And Tree, 0:18:32.760 --> 0:18:34.520 as you know, and we certainly around this table, I 0:18:34.560 --> 0:18:37.120 feel like for years, remember Jamie Diamond holding some event 0:18:37.160 --> 0:18:39.679 and talking about the amount of money spending out technology 0:18:39.760 --> 0:18:41.320 and cybersecurity and all these things, and I think we 0:18:41.400 --> 0:18:43.919 all at that point, you know, started to say, Okay, 0:18:43.960 --> 0:18:45.960 Wall Street is not just about the finance part. It's 0:18:46.000 --> 0:18:49.040 a big part about technology. So how do you read this? 0:18:49.119 --> 0:18:51.840 Is this just another sign because as you said, they're 0:18:51.840 --> 0:18:54.440 not cutting back on their commitment to technology. They brought 0:18:54.480 --> 0:18:57.600 into big names. Is it just David Solomon continuing to 0:18:57.800 --> 0:19:00.600 kind of remake this firm and his bitch or where 0:19:00.640 --> 0:19:05.160 he sees it going the tech transformation, the people he's 0:19:05.200 --> 0:19:08.000 put in place is certainly part of the stamp he's 0:19:08.080 --> 0:19:10.560 leaving on the firm. But the problem is, right now, 0:19:10.600 --> 0:19:12.479 when we're talking about that stamp, it's about a lot 0:19:12.520 --> 0:19:14.560 of the people who are leaving. And I'm sure he 0:19:14.600 --> 0:19:17.119 doesn't like that. I'm sure he doesn't want that, but 0:19:17.560 --> 0:19:20.640 he will continue to pour as much money as possible 0:19:21.080 --> 0:19:25.600 into upgrading the technological system because Wall Street has been 0:19:25.640 --> 0:19:28.159