 Hi everyone and welcome to our discussion on mainstreaming ESG. I'm Jessica Matthews. I'm global head of sustainable investing at JP Morgan within the private bank and I'm joined by Josh Levin He's the chief strategy officer and is a co-founder at Open Invest Which is a fintech with the mission to bring values based investing to the mainstream via technology So it'll be the Jess and Josh show today And we really just want to talk to you about where you know where ESG has come in this kind of evolution towards mainstreaming what we see today and certainly want to leave with some thoughts on where we see it going and As some of you may know JP Morgan acquired Open Invest this summer to join us in the private bank Josh and I have actually known each other for years and so it's been really exciting for me Because we went from being really excited about you know Evaluating a product in the service to literally bringing that really, you know top Leading expertise right here into the private bank So really excited about all that this will mean for us as a partnership. And so we'll get into a bit about that So Josh, I want to turn it over to you. First of all I do recall that this is really exciting for you because Open Invest really originally got its roots wandering around Fort Mason at at this event years ago So I'm just coming full circle for you But I just wanted to have you kind of expand upon what I sort of alluded to already, which is how you know Mainstreaming sustainable investing is really at the core of the innovations at Open Invest Thanks, Jessica. And yes, it is just great to be back at SoCAP If any of you were there in the fall of 2016 you might Remember us or remember me accosting you in the food truck lines or anywhere else at SoCAP as we launched our first products And we're convinced it was gonna go viral starting with the the community right here the impact of this community and I wouldn't say we went viral but it's been a it's been a great ride and we're really excited where we've gotten to And where we're going But yes, the company started Open Invest started about five years ago and it was really a marriage of two backgrounds I came from the sustainable finance space My co-founder and a bunch of our team members came from Traditional hedge funds some of the world's largest hedge funds where they had led technology teams automating a lot of the key systems portfolio management trading risk controls analytics and And we got together and founded Open Invest as a public benefit corporation Why you probably know what that is our mission is to mainstream ESG through technology and I like to feel that we brought some a level of technology horsepower into the space that hadn't necessarily been there before as We looked at ESG and impact investing I think a core insight was that it's you know people people aren't just looking for a new Label or asset class that it's really broader than that. It's bigger than that people are looking for a whole new way to invest They want to invest with their their whole selves They want to know what they own they want transparency. They want experiences. They want engagement and this is really turning the traditional Industry ethos on its head. It's not leave it to the expert. It's Tell me what's going on engage me represent me holistically keep keep me involved and to do that at scale requires A whole new set of technologies and services things like seamless personalization Real-time tangible impact reporting proxy voting and more and so these are the types of things we built across our platform and We feel that the next big wave in ESG growth Which is starting to hit us and we're very excited about is not going to be driven by products But rather by by features by services and the ESG is ultimately going to mainstream these features rather than products So yeah, that's where we've come to now and here we are with with JB Morgan ready to help drive that wave And I guess Jessica to back to you. I'm just curious to hear your perspective on this When you joined JB Morgan What did you see as the institutional and traditional approach to ESG and and where do you see it going now? Yeah, sure. So I joined three and a half years ago Having been in the field already for ten years and it was actually to your point That's kind of the appropriate word I really got my start doing this 13 years ago more on the endowment some foundation side of things and Really throughout that time and especially once I got here to JP Morgan There was a lot of focus I feel like more on that institutional side of the market and certainly, you know large assets at play But what's been so great about the journey here is first of all like as soon as I walked in getting more experience with you know a high net worth or ultra high net worth Asset base or client base, excuse me And but I would still say the journey was so interesting I'm going to come back to why I'm just going to pick up on what you said about your observations on a Service and an entire experience. I would still say when I got here though What we were very focused on and rightfully so and we needed to do work on this was thinking about Expanding that product palette. So we had a good bit, you know when I got here three almost four years ago But we needed really to expand the options Across different types of investing from you know ESG focus to more themes We certainly needed to expand across asset classes We've been doing a lot of work in the private markets, for example or creating some discretionary for in the public markets So there was a lot of work to do around product and I feel good about that Honestly, I feel good that we've made a lot of progress and if a client comes to us We'd say look you have all of these investment options for you But and this comes back to what you were just saying and I think really excites us here And why do you feel like this was such a good partnership is what is the full client experience around this? And in particular what I'd say that I feel like we needed to spend more time on and I think people around the industry Feel similarly and you guys just have come up with a great tool is around reporting And what does it mean to actually diagnose a portfolio? What is a client going to look at then and see on a quarterly basis or anytime? They really want to call up their advisor to say what's in my portfolio? And you know, how is it improved over time or not and you know, what steps can I take to improve that? So I think this notion of moving away from just sustainable investing as a product to more of a service and an experience is exactly You know the kind of journey that we're on and Look at all this stuff, you know, we're already discussing together Josh from that, you know product And yes, there will be some offering a product, but it's more of a customization than a single product And then there's reporting. There's diagnostics, you know, hopefully proxy voting all sorts of things that are going to round this out so So that that's my view about what's what's pretty exciting in this evolution that we've been on But maybe actually over or back over to you I mean from your side of things in your perspective and again, this is a topic about Mainstreaming what is open and best in your team view is the real Impact that this partnership can have Well, I It's funny because I think for years All of you guys folks in the industry have been saying no now we're in the golden age of ESG, right? And it keeps updating and getting hotter and hotter I still think we're just at the tip of the iceberg and Kobe and a lot of the social movements and events of the last two years have further accelerated this but If I can land something here, I think that Technology and new rails and infrastructure at banks and a bunch of big providers are really going to open up the field for a new level of acceleration that people may not have gotten their minds around it's kind of like We were building bit better and better websites But when Apple comes out with the iPhone and you have a whole new paradigm shift that allows The you know the app world to explode it so I'm using that as a bit of a metaphor for That I think we're going from from what you know one point out of 2.0 here in terms of ESG And again, it connects. I think we saw that and have built towards that And benefited from that because of our principles like everybody in this space is driven by their principles For us our principles my principle was I'm just not interested in being five percent of someone's portfolio Like that's not interesting to me. I don't want to be the next brochure or the next thing in someone's cocktail party conversations I mean not that I have anything against that, but the world just can't wait When you came come from world wildlife fun like I did and you're looking at these statistics every day I mean we're just facing a complete environmental catastrophe. It's going off a cliff The chainsaws are buzzing. That's what I hear in the back of my head all day. So I believe in impact investing not just as a career but truly unlocking finance as a driver For rapid social and political change and we need to achieve that now And I want to see that in the next five to ten years certainly in my lifetime So that's the kind of principle. That's the driving force and then when we Will we were raising an investment round and jp morgan looked at it and then said that they wanted to acquire that was not an easy decision for us and One of the main things probably the biggest thing that tipped us was just the scale so Our mission was the mainstream jp morgan chase is as mainstream as it gets. It's the largest bank in the u.s They service Over half of american households So that's that's what we're talking about here And I think that taking our technology tools When applying them to that scale Is not going to just accelerate esg, but it's going to help ensure that there's engagement and impact With the end clients creating the feedback loops With the broader wealth channel Across the u.s That will really help to change consciousness at the street level in terms of what finance is and it's kind of 3d impact on the world So I these are these are broad concepts i'm talking about but i'm saying for example having everyone who's using chase products Starting in investments But ultimately getting down to You know long-term credit cards spending banking and checking Seeing real-time impact reporting on their dashboards right and seeing nudges and realizing how they can make changes in the world And was that add up to concretely? And then nudging them to take other actions and other parts of their lives that can contribute to that and again at the Type of scale that we have here I mean, I don't feel like i'm gonna i'm likely to get another chance in my life to have that type of impact so that's That's what excites us about this partnership. That's what's driven us And just as a note to the industry here You can't do anything at this scale without technology You can't do anything at this scale without technology and everyone Is going to be looking for solutions to compete in this space Uh vcs have gone from esg skeptical five years ago to calling us constantly saying what are you looking at? How do we get an esg technology play? Other banks other players are reacting and will be reacting to what we're doing here Everybody's looking for things to buy and the bottleneck now is really on the supply side So I think it's an exciting time and there's a lot more supply that is needed in terms of scalable esg solutions and technologies Got it and you know one of the things we talked A little bit abstractly maybe about some of these things But maybe just bring it to life and perhaps they seem obvious to some but I think you guys Um, you know this notion where we're talking about curating causes What are some of the ones that you feel like really resonate with clients because um, you know This is certainly not about you keep using the term esg. This isn't about esg scores It's about getting very specific around certain issue areas that clients care about So could you help bring that to life just a little bit more? Yeah, I mean we're like I think of uh So sure responsible investing in esg is in many ways built up for the institutional client even though there's obviously been a lot of diehard retail segments and and mutual funds and other products and we started at $100 like tiny Accounts and wanting to let everybody basically us and our friends be able to do the type of Custom personalized values aligned investing that that ultra high net worth You can do and when you bring it to the mass market Everything ends up change. It it's not just the products. It's how do you even talk about? Um screening How do you talk about impact? How do you talk about proxies? So if we take screening, so I'm using the traditional terms like nobody understands or wants to hear that this is negative screens or has negative screens and positive tells that doesn't actually um That's not understandable jargon to most people So we ended up talking about it in terms of causes And these are really thematic approaches that include positive and negative But can be endlessly mix and match and overlay on your portfolio And then finally quickly learning from our customer base What are the new areas? They're responding to Social movements. They're responding to the news cycle. So we developed things like a cause around refugees which companies are committed to doing the most to help refugees and Clients actually get impact metrics on their dashboards how many Approximately how many refugees have been hired as a result of their portfolio how many have been mentored and so on We also had a lot of folks caring about mass incarceration and traditionally asset managers might just divest the two private prison companies We got together with ngo and created a I think the first kind of master data set on mass incarceration. So which companies are Providing goods and services selling goods and services to prisons lobbying for more of these get tough on crime Fills and conversely who's committed to hiring the formerly incarcerated and so on. So those are just some examples But I think more broadly. It's really responding to the kind of mainstream Understanding uh or nascent understanding of what impact would look like through their life Yep. Yeah. No, I mean having flipped under the hood and seen some of these things In more detail. It really it really is impressive what you guys have done for by the way I went this whole time without noticing you were in your jp morgan police today, which I just love They kept her we kept her a logo ball. We kept the open of this logo ball But yes, it's very comfortable. I have to say you guys make a good police Um, all right. Well lest we we have the so cap audience talk more about our fashion choices today Maybe we should maybe we should bring it to an conclusion Um, and by the way, we have to note that, you know, we were talking earlier about how Like we can't wait to be back at fort mason not the least of which is because Nobody listening to this will know that I put everybody through 30 minutes of technological snafus before we even got on this call So we can't wait to get back to fort mason and do this again live Hopefully next year. Um, all right, so josh, let's let's end on sort of some of the moonshot So you guys have done so much to get here um And you know really have an innovative product out in the marketplace, but Just thinking about what's next what's on the horizon where where do you see this going? We're working on a bunch of stuff With you guys as you know, and I can't I can't share all of it and then Important to us is also maintaining the pace of innovation. Like I said, we're just at the beginning So it's about rapidly building additional things as well. I would say the thing I'm personally most excited about is proxy both So if any of you who are open and best Users know that we released a feature about two years ago where you could vote your Shareholder resolutions with a swipe on your smartphone and it would be curate curated you just get a nod to when there's one that Would be relevant and interesting and then you can swipe your vote and you're actually voting in in these board level decisions So it makes a ton of sense It was a three-year labor of love for me to develop this product It's something that should exist in the world. We all in these companies these companies are getting more powerful there's a democracy waiting and And and I thought when we launched this thing That it was immediately going to go viral. It's like the world's first digital democracy boom here you go get it in the app store Turns out it did not go viral The world was not waiting for easy proxy voting because the world has no idea what proxy voting is just us here In this virtual fort nascent center. No proxy voting is and a few others But a lot has changed in the last few years There's been growing media attention everything from Congratulations, like you guys actually winning these votes Remember when the goal was just to get 10 15 percent and now We're winning some of them and engine number one created a ton of And as you saw and others were were very involved with that action They get a lot of media attention So I think there's growing consciousness around that and then it's part of a larger growing circle around impact investing That creates a new opportunity There's VC money flowing into the proxy voting space and most importantly, I think with JP Morgan scale when you have When you have tens of millions of clients, there's really an opportunity for us to now take these these types of tools and educational content and tip the market And so I am so excited to see what the true full potential is of unlocking street level proxy voting for shareholders a global But you know back to you and Jessica you've you're working on a bunch of things open investment beyond across the bank What would you like to see in the space now? Well, we certainly have our work cut out for us for everything we're going to be doing together But yeah, I mean, I think some of the other interesting things that are happening, you know, you see A lot of commitments around What banks are going to do this one included just the other day To net zero portfolios. I think there's a lot that investors can be doing in their portfolios And it becomes not just, you know, choosing a portfolio that's got a lower carbon footprint But what real changes are we making are there offsets involved? Are we, you know, allocating to more solutions, etc? We think of any number of levers that we could pull so that across asset classes You know, we really are on a journey To lower carbon portfolios. And then the other one that I would give you kind of already alluded to this, Josh It was um, you know, we talked about investing this whole time. It's actually investing in, you know, my title So that's what we focus on we focus on the investments here at JP Morgan But you know, I think we're in a journey now where again, it's it's all about sustainability on the brain of investors But clients as people and so what else do we provide here? We do banking lending Closets we do mortgages. So I think I think really we're going to turn a corner to where we're offering advice I'd like to think that when clients walk in the door We're going to have a goals basis discussion with them. That isn't just about investments. It's really about everything you do with us. So Um, so I think, you know, that's that's what I hope for and we have a lot of every time I think I turn to corner and we are You know, we've accomplished something which we've accomplished a lot There's just there's the next horizon and I think some of those are in scope. So Um, or anyway, well 20 20 minutes goes quickly as a matter of fact, I'm just realizing we're at 21 So I guess I guess we'll conclude conclude this mainstreaming discussion and leave it there Um, any last words josh? No, I think that covers it. Thanks Jessica. Thanks everybody. We'll leave it there. Um, thank you again to the group at Socap for having us and um, we look forward to hopefully doing this again in person next year