Assertion Not checkable as stated
Korean government warned Lawrence not to return after Taekwang dispute
“So after Taekwong, and I was told, my lawyer called me up a couple weeks later and said he had gotten a call from the Korean government, and the Korean government said, Tell Mr. Lawrence not to come back to Korea.”
Insight
Hydroelectric dams are the world's best infrastructure assets due to near-zero reinvestment
“Really dams are the best infrastructure asset in the world today. That their reinvestment requirements are almost nothing, and so they're essentially financial assets.”
Insight
Investors should evaluate funds by capital-weighted returns rather than time-weighted returns
“So if you look at funds, don't look at the time weighted return, which is the NAV, the per share NAV over time. Look at the capital weighted returns, because so many of the big funds, the brand name funds, they did really well with small amounts of money, and …”
Opinion
China Yangtze Power is the finest infrastructure asset in Asia
“It's the finest energy asset in China, It's the finest infrastructure asset in Asia. It's the lowest cost producer of clean energy in a country that's choking on coal. This is really an important asset period in China.”
Insight
Lawrence: Frank corporate engagement in Asia requires strict one-on-one privacy
“And I've always said that you can discuss anything with Asians and be very frank and open and honest with them, but you've got to do it privately and confidentially. If you add more people in the room, the chances of success declines exponentially.”
Assertion Supported
Grantham study: Fossil fuel divestment cost less than 0.5% in performance
“Jeremy Grantham put out a document three or four years ago that said there was almost no cost to that exclusion. Okay, and this was when the divestment move really happened. People were extremely concerned about just the divestment point of view. So he went fr…”
Disclosure
Overlook pushed Taiwanese portfolio firm to underwrite $2B in offshore wind
“For example, we have a company in Taiwan that has an eight million ton footprint. It's a big footprint. Okay. And we've pushed them to invest in renewable energy to get their energy consumption correct. And they now with offtake agreements have underwritten th…”
Insight
Generalist analysts cannot realistically evaluate ESG in one-hour company meetings
“It's just not realistic to ask analysts who are in there trying to figure out what the competitive forces are or what pricing power is to deal with this as well in an hour.”
Opinion
Lawrence: Many climate philanthropists are bureaucratic and slow
“A lot of climate philanthropists, Are fantastic, and they're critical, they're providing critical service to the world, but they're very bureaucratic and slow.”
Insight
Booming economic conditions often fail to generate good equity returns
“And I think booming conditions often don't lead to good equity returns.”
Opinion
Chinese equity markets resemble Asia 25 years ago, dominated by unsophisticated punters
“And in many ways, China today is just like Asia, 20, 25 years ago. The local investors are largely punters. They're largely short term. They don't really have the sophistication.”
Insight
Corporate pricing power is as valuable in deflationary environments as inflationary ones
“Pricing power is as good, In a deflationary environment as is an inflationary environment.”
Assertion Not checkable as stated
Overlook's AUM capacity cap equalized its time- and capital-weighted returns
“And then about 20 years ago, I came up with this idea, let's limit the amount to, I think it was 12% of the last four years average NAV. So in big years, I bring in percentage-wise less, and in bad years, I can bring in percentage-wise more, and so you're kind…”
Assertion Contradicted
Studies show capital-weighted fund returns lag time-weighted returns by 7.5%
“And so it's been documented that if a fund has a, say, for example, a 10% time weighted return, the studies have shown that the capital weighted returns about two and a half.”
Insight
Lawrence: Small governance nudges prompt corporate leaders to finish the job
“When you can take a company and move it from like 12 o'clock to one o'clock, We're not trying to move it to two o'clock or three o'clock or four o'clock. Just move it a little bit to one. Then he begins to see the benefits of good corporate governance. Then he…”
Insight
Lawrence: Poor ESG correlates with low-margin, capital-intensive businesses
“And what I saw, what I began to piece together is this concept of a pyramid, and if you think about a pyramid, and that includes the entire universe of public companies, and at the top are these very special, really terrific, world-class companies, but at the …”
Disclosure
Overlook excludes carbon-intensive industries from investment universe annually
“And then about eight or nine years ago, we started taking action every year to outlaw an industry. And the early years, it was really a fight on my part. We started out with coal, coal mining, coal transportation. We outlawed fossil fuel refineries, which in A…”
Assertion Supported
Lawrence: China Yangtze Power made $5B cash flow with under $200M capex
“So last year it made about five billion dollars US of cash flow, and they had to reinvest less than two hundred million to maintain the dams, the hydroelectric dams.”
Assertion Not checkable as stated
Lawrence: Carbon Disclosure Project succeeded in the West but failed in Asia
“We support CDP. We're pushing all our companies to undertake CDP work, which is formerly known as Carbon Disclosure Project. It's been very successful in Europe and the U.S., been very unsuccessful in Asia.”
Insight
Lawrence: Misallocating climate capex creates 15- to 20-year structural problems
“And then when we talk to the board, when we engage the board, what we're looking for is the allocation of capital expenditure consistent with Paris agreement. And it's really when you start misallocating your capex, you're building in a problem for the next 15…”
Disclosure
Lawrence: 44% of Overlook's portfolio failed ESG review over missing emissions
“44% of our portfolio got failing grades last year, simply because they could not tell us what their admissions were.”
Assertion Not checkable as stated
Lawrence: Overlook incorporated sustainability 8 to 10 years ahead of BlackRock
“BlackRock comes out and says that they're going to be incorporating sustainability. We did this eight, nine, 10 years ago.”
Assertion Supported
Lawrence: Fossil fuel industry outspends all climate philanthropists annually
“The fossil fuel industry spends way more than the whole group of climate philanthropists would pay, or would spend every year”
Assertion Supported
Lawrence: China's renewable energy investment far exceeds the rest of the world
“Number two, you need to acknowledge the amazing investment that China has made in renewable energy. It far exceeds anywhere else in the world, and yeah,”
