QAV 812 — ASA’s Chairman on Continuous Disclosure

QAV AU 812 Audio

 [00:00:00]

Cameron: Wel­come to Q‑A-V-T‑K. This is QAV Aus­tralia. We have to point this out now ’cause we’re doing a US show too today. Um, episode 8 1 2. It’s the 25th of March, 2025. How are you TK?

TK: Good, but did­n’t we record nine 11 last week? ’cause you just assign­ing ran­dom num­bers to our shows. Hey, con­fuse

Cameron: It was eight 11. I said it was one short of nine 11.

TK: So it’s

Cameron: Uh,

TK: of nine 11,

Cameron: yeah, yeah, yeah.

TK: That’s

Cameron: be tech­ni­cal about it, you and you and your tech­ni­cal­i­ties with price to oper­at­ing cash flow fig­ures. That’ll be, that’ll be a ref­er­ence to our Amer­i­can show.

TK: Rules are rules.

Cameron: [00:01:00] Peak Fear Day is com­ing for the mar­kets. Tony Dun­no if you know that. Dun­no if you dun­no If you’re feel­ing it, you’re feel­ing the peak fear, you’re feel­ing it.

TK: for­ward to it. Hope­ful­ly it’s a buy­ing oppor­tu­ni­ty. Peak fear,

Cameron: Oh, that’s one way to look at it.

Blood

TK: on the streets.

Cameron: This is to Chan­ti­cleer in the Finan­cial Review. uh, peak Fear Day is com­ing for the mar­kets. Don­ald Trump calls it Lib­er­a­tion Day, the date of his next big reveal on tar­iffs comes at a risky time for Aus­trali­a’s large super­an­nu­a­tion funds. It’s Kiss The Ring Week for Aus­trali­a’s super­an­nu­a­tion sec­tor.

A month after trea­sur­er of Jim Chalmers, an Aus­trali­a’s Ambas­sador to the Unit­ed States. Kevin Rudd a series of meet­ings for super indus­try lead­ers in Wash­ing­ton and New York. You know, if he was an Amer­i­can, it’d be like for­mer Pres­i­dent Kevin Rudd. Why don’t we get, why does­n’t he get for­mer Prime Min­is­ter thrown in there?

Like, uh, why do we throw our for­mer Prime Min­is­ters under the [00:02:00] bus when they get a new job?

TK: Well, I guess the ques­tion is why did he take the down­grade to Ambas­sador to Amer­i­ca after he’d been Prime Min­is­ter? Is he sure to

Cameron: what else is he gonna do? Yeah. Wow.

TK: maybe they decid­ed, he kept throw­ing enough hand, hand grenades. He could do it from over­seas.

Cameron: Yeah. Right. Uh, they host­ed a series of meet­ings for super indus­try lead­ers in Wash­ing­ton and New York. The big dogs of Amer­i­can Cap­i­tal are mak­ing the Long Trek down under for the sec­ond annu­al Asia Pacif­ic Finan­cial and Inno­va­tion Sym­po­sium, or. A, a in Mel­bourne on Tues­day. Uh, the tim­ing of this year’s event is exquis­ite Aus­trali­a’s $4 tril­lion.

Super sec­tor is as exposed to the US mar­ket as it has ever been allo­ca­tions to inter­na­tion­al shares hov­er­ing around 30% for most large funds. The fact the big US pri­vate cap­i­tal giants are press­ing the flesh down under this week tells you there are plen­ty of Aus­tralian sav­ings tied [00:03:00] up in Amer­i­can unlist­ed assets and alter­na­tives into 2025 with glob­al mar­kets danc­ing to the tune of Amer­i­can excep­tion­al­ism. super sec­tor’s posi­tion­ing looked pret­ty smart. Even a vet­er­ans such as Aus­tralian Super Chief Invest­ment Offi­cer, Mark Delaney and Uni Super, CIO, John Pierce, were cau­tious about overex­tend­ed val­u­a­tions and the way US equi­ty mar­kets have been con­cen­trat­ed around a hand­ful of very large. Very expen­sive tech com­pa­nies.

But in the two short months since Don­ald Trump’s inau­gu­ra­tion as US Pres­i­dent, the big bet glob­al investors placed on Amer­i­ca is sud­den­ly look­ing shaky. And April 2nd is gonna be Lib­er­a­tion Day for Amer­i­ca. We’ve been ripped off by every coun­try in the world, friend and foe Trump said in the Oval Office on Fri­day, accord­ing to some guy, investors are gonna have a hell of a lot to chew on over the next week or so. So, uh, there you go. I hope you’re [00:04:00] shiv­er­ing in your boots. Tony,

TK: Not at all. I, I was sur­prised to see the US mar­ket was up 1.8% overnight. I don’t know if you saw that.

Cameron: do.

TK: they’re not shiv­er­ing in their

Cameron: I did not.

TK: for­ward to, uh, lib­er­a­tion day. Um,

Cameron: Mm.

TK: It makes it sound like it’s like the end of World War ii, does­n’t it? Lib­er­a­tion Day.

Cameron: It does. Yeah. Well, you know, if you look at the last, uh, say three months inau­gu­ra­tion, you look at the s and p 500 at the begin­ning of Jan­u­ary it was run­ning at, uh, 5 9, 7 5. It’s cur­rent­ly at 5 7, 6 7, so it’s down a bit. It did get as high as 6 1 4 4 sort of the mid­dle of Feb­ru­ary. It’s down quite a bit from that, but it’s like not doing, it has­n’t, you know, has­n’t had a Nvidia style col­lapse or a Tes­la col­lapse or any­thing like that.

It has­n’t halved. [00:05:00] It’s not that kind of a trounc­ing.

TK: yet.

Cameron: shaky, no doubt yet.

TK: That’s

Cameron: Yeah.

TK: plen­ty of arti­cles out there to say

Cameron: if you look

TK: we’ll see.

Cameron: the Dell Jones Indus­tri­al Aver­age. Uh, ear­ly Decem­ber was at 45,014. Mid­dle of Feb­ru­ary, it was at 44,745. It’s down to 42,583. So what’s that come down by 5%

TK: Yeah.

Cameron: the last, uh, bit. Yeah. So any­way,

TK: Hmm.

Cameron: um, just

TK: it.

Cameron: as we always say, um, what was the Bat­man thing?

What do you say, Bat­man? Just fol­low the rules.

TK: Well, that’s

Cameron: Yeah.

TK: this is just, I mean, it’s feed­ing the trucks, isn’t it? All this. News flow com­ing out of Amer­i­ca? yes. Look, I don’t wan­na under­play it. Um, the wrong kind of macro set­tings can have big [00:06:00] impacts on our port­fo­lios, but, uh, it seems like the way Don­ald Trump is gonna han­dle things is to throw all the stuff out there, flood the field, and then wait for the response and make a final deci­sion or two or three final deci­sions down the track.

the US mar­ket was up because even though Inde­pen­dence Day or what­ev­er it’s called, VE day, he’s going to, um, he’s going to bring in mas­sive tar­iffs. He’s already walked it back and said he’s going to, um. weighed a lot of, uh, car tar­iffs that he had pre­vi­ous­ly flagged were com­ing in.

So, um, he’s get­ting feed­back. And one of the arti­cles I read said that uh, inter­viewed the head of, um, gen­er­al Motors, who said, if the tar­iffs came in as flagged, that they would be bro­ken nine months. you’ve got­ta think that that kind of mes­sage is get­ting through to, to the White House, and they’re gonna mod­i­fy things and yeah.

This is anoth­er, anoth­er, uh, of talk big and we’ll [00:07:00] see what hap­pens when the day comes.

Cameron: What’s it worth to you remove the tar­iffs? What’s it worth? Mm.

TK: of a pro­tec­tion rack­et real­ly, isn’t it?

Cameron: A bit. Yeah.

TK: one. All right.

Cameron: Yeah. It’s the way it seems to me. What do you have on your list of talk­ing points today? TK

TK: lot actu­al­ly. Um, I want­ed to, to revis­it the, the ques­tion from last week, which, um, I must admit came in late and I prob­a­bly did­n’t prep for it enough the sec­ond buy line and the, the yel­low line on the bread light of the buy line fol­lows the cell line. Um, just add to what, uh, we talked about last week.

Um, I went back and checked my notes and I think, I think the his­to­ry of the two dif­fer­ent buy lines is the green dash buy line, which we now call the sec­ond buy line was [00:08:00] the buy line we used from the start of QAV. So it’s the most recent line drawn by the most recent high the same in reverse for the most recent cell.

The most recent low, the biggest low, sor­ry, the biggest high and the biggest low, um, the buy line fol­lows. The cell line I think came in dur­ing covid The mar­ket was tak­ing off real­ly quick­ly, but a lot of stocks were still below their buy line because of the, it was such a pre­cip­i­tous down­turn when Covid hap­pened, um, that the buy line was a long way from where the stocks were, but they were increas­ing dra­mat­i­cal­ly.

And, um, we could see that if they were going, the stocks were most like­ly going to cross the buy line, but we did­n’t wan­na miss out on the first 20 or 30% growth. so, you know, I had, um, had dis­cus­sions with Brett and thought about the, look­ing at the pri­or buy [00:09:00] line, the buy line that hap­pened after the first buy line that hap­pened after the last cell line.

And we were using that, but that real­ly has­n’t been used much except for that cir­cum­stance. So I just want­ed to high­light that, that, um, to all intents and pur­pos­es, unless there’s anoth­er major crash and sud­den rebound, it’s the sec­ond buy line, which is the, the impor­tant one, and the bread let­ter to use.

Cameron: Right, so that gets back to my ques­tion is do we need the first buy line or do we just get rid of it?

TK: We can get rid of it. But, um, again, it was use­ful I think when we had that big down­turn in rebound dur­ing Covid. ’cause um, yeah, the, the, the buy line as tra­di­tion­al­ly drawn was way above where the stocks were rebound­ing from. And we could see there was a fair bit of symp­tom hap­pen­ing quick­ly, and there was no, and the num­bers were good and there was no rea­son not to be in that mar­ket.

Um, and then we, well, I went back and had a look at pri­or [00:10:00] buy lines and thought that might be a bet­ter indi­ca­tor in that cir­cum­stance. So take it out if you want, but I think it, it may come back into play again dur­ing a unique set of cir­cum­stances

Cameron: Will just ignore it for the time being. Um,

TK: Until

Cameron: use the sec­ond buy line.

TK: Day when the mar­ket tank and went either again.

Cameron: How is that? Remem­ber that film Inde­pen­dence Day, ear­ly nineties? Bill, who was, who was the pres­i­dent? One of the bills, bill Pull­man.

TK: Oh yeah,

Cameron: Is he the one that’s dead or is it the oth­er bill that’s dead?

TK: Oh there’s of bills. I’m not sure

Cameron: There were two bills and they actu­al­ly were in a, um, uh, film togeth­er. Um, uh, yeah, bill Pull­man’s still alive. That’s good.

TK: there are much

Cameron: any­way,

TK: Pull­man. Randy Quay the drunk­en Viet­nam

Cameron: Randy Quaid, God, what hap­pened to Randy Quaid? Like, he, he went off [00:11:00] the deep end

TK: yeah.

Cameron: at one point. I nev­er, I, have, yeah. I don’t remem­ber what hap­pened to him after that.

TK: there should not Google what hap­pened to Randy Quaid.

Um, and of friend, um, oh, what’s his name from the fly? And, uh, my most recent­ly on, um, um, the, uh,

Cameron: Juras­sic Park.

TK: of the Yes,

Cameron: Yeah. Yeah.

TK: And all those. He was in it

Cameron: Pax­ton.

TK: Oh, bill Pax­ton died. Yeah, yeah,

Cameron: Pax­ton’s, the one that he died, and Bill Pull­man were in a, um, uh, sort of cheesy Cole­man film that I watched a while ago called Brain Dead.

TK: Were they top cast?

Cameron: wow. Harsh, uh, was a low bud­get hor­ror film from 1990. Any­way, yes, [00:12:00] bill Pax­ton. I love Bill Pax­ton.

TK: Did you?

Cameron: They’re every­where, man. They’re every­where. And aliens.

TK: Yeah.

Cameron: tomb­stone. True lies weird sci­ence. Yeah. Any­way, how did we get onto that?

TK: for me.

Cameron: Inde­pen­dence, inde­pen­dence Day. I was just think of that speech that Bill Pull­man gives in the film. It’s like this, this rah Amer­i­can speech. He’s talk­ing to all the fight­er pilots to Will Smith and what­ev­er about they will not, it was like they could

TK: of

Cameron: take Girl Holmes. Yeah, I get it. Con­fused with Mel Gib­son’s speech and um,

TK: in

Cameron: what­ev­er his blue paint face one. Yeah, that one.

TK: yeah. Which of course, William

Cameron: All right. Mov­ing on from two BL?

TK: paint on his

Cameron: no.

TK: Uh, com­pa­ny news. So, uh, findy is back in the news. They’ve launched the $45 mil­lion. Rais­ing. So that might be of inter­est to, uh, share­hold­ers who hold, sor­ry. [00:13:00] Uh, to Findy share­hold­ers uh, bought it from our buy list before.

findy, the ASX list­ed ATM own­er backed by the Flan­nery fam­i­ly has launched a 45 mil­lion cap­i­tal rais­ing to fund CapEx and to restruc­ture con­vert­ible notes held by its Indi­an investor, pyra­mi­dal Alter­na­tives. The com­pa­ny split the cash call into a $40 mil­lion share place­ment, rep­re­sent­ing 20.3% of NDI shares on issue, and a $5 mil­lion share pur­chase plan.

were priced at $4 a share, or a 12.3% dis­count to the last close, 21.4% low­er than the 30 day vol­ume weight­ed aver­age price. Uh, Fey’s core busi­ness is set­ting up and run­ning auto­mat­ed tele machines, auto­mat­ic tele machines for big Indi­an banks. It shares have risen 91.6% over the past 12 months as it won new con­tracts and broad­ened out the prod­uct offer­ing via Bolton acqui­si­tions.

But the shares have been flat year to date. Uh, the term sheet said 22.8 mil­lion [00:14:00] of the pro­ceeds along­side debt would fund CapEx to deploy 2,293 under a new agree­ment with the State Bank of India, which ini­tial­ly award­ed the con­tract for 4,219 ATMs in Octo­ber, 2023. Uh, a lot, uh, the rest of, a lot of the rest of it would go to, uh, pay­ing out pyra­mi­dal who had loaned them mon­ey.

Um. And they said that, uh, poten­tial investors were told the restruc­ture would add 7 mil­lion after tax prof­it after a boost in inter­change fees announced this month. from the A FR on the 19th of March.

Cameron: And when that news came out, the share price jumped. I remem­ber about 14% from $4 56 up to $5 44, and today it’s down to $4 and 12.

TK: So just above the issue

Cameron: What the, what the hell?

TK: It’s strange, isn’t it? If you [00:15:00] can buy shares at $4, why would you be buy­ing them at five?

Cameron: The. Findy shares have been so volatile over the last sort of year or so since we’ve been pay­ing atten­tion to them. I mean, they’ve had a good year, don’t get me wrong. They’re at $3 50, back in Jan­u­ary. Uh, no, sor­ry, that’s, that was this year. Go back a year ago. A year ago they were trad­ing to get $3 20. They’re up at $4 50 some­thing now, as I said. So it’s, they’ve had a good year, but they were up at $7 38 the end of last year. So it’s been incred­i­bly crazy lev­els of volatil­i­ty, which I nev­er real­ly under­stood. ’cause they’ve nev­er real­ly come out with dra­mat­i­cal­ly bad news. It’s just been all of this, oh, Steven short­ing all of this stuff that they’ve been doing in India.

It all seems good to me. I dun­no why there’s been so much volatil­i­ty.

TK: Yeah. I am not sure it goes, goes hand in hand with, uh, a growth stock,

Cameron: Well wel­come back to the [00:16:00] show, Steven Mabb chair­man of the Aus­tralian Share­hold­ers Asso­ci­a­tion, here to talk us through how the a SA is going to rep­re­sent angry QAV mem­bers, regard­ing lack of dis­clo­sure dur­ing con­fes­sion sea­son. And oth­er­wise, wel­come back. It’s been a while, chair­man Mabb

steven: Yes. Thank you very much for hav­ing me back on, gen­tle­men. Love­ly to, to chat to you again and, uh, I have been lis­ten­ing every week, so I feel like I’m, uh, I’m, I’m in the loop with what, uh, what you’ve been cov­er­ing. But look­ing for­ward to the dis­cus­sion today and, and hope­ful­ly offer­ing what­ev­er help I can. 

Tony, do you want to, um, pick it up from there?

TK: Yeah, so lots of exam­ples. Steven, you and I have talked about them before­hand. I’m still try­ing to come to con, you know, grips with what’s going on. Anoth­er clas­sic exam­ple hap­pened today, which we had­n’t got­ten round to talk­ing about on the show before you came on, but, uh, there was anoth­er, um, [00:17:00] was a by a com­pa­ny called Helia. Um, there’s an arti­cle in today’s a FR about, uh, them, them being a, a mort­gage, uh, insur­ance lender who looks like they’re going to lose their biggest con­tract with the Comm Bank. And, uh, the shares have dropped a lot. um, the inter­est­ing thing for me with that was that the CEO sold out. A lot of their shares three days before the announce­ment was made. it’s not just con­tin­u­ous dis­clo­sure. There’s a lot of, I’m gonna call it, with­out pick­ing on this par­tic­u­lar exam­ple, but a lot of flaunt­ing of the ASX list­ing rules going on. there have been some, went back and researched it because I was rack­ing my brains to try and think of when com­pa­nies had been, um, giv­en a tick­et for dis­clo­sure rules and oth­er list­ing rules, and there have been some big cas­es.

Um, uh, I think Rex Air­lines were under inves­ti­ga­tion, um, if not fined by ASIC. [00:18:00] I think one of the big banks was as well. But it tends to be large com­pa­nies where the focus is of the, ASIC, who seems to be the, the reg­u­la­tor who can take legal action. Um, I’m not that famil­iar with the as SX list­ing rules and whether they can, take action and whether there’s a bit of. Fin­ger point­ing, going both ways with the reg­u­la­tors. ’cause the, if, if you look at the Cor­po­ra­tions Act, it says that, sec­tion 6 7 4 says that, uh, ASX list­ed com­pa­nies are required to com­ply with A‑A-A-S‑X list­ing Rule 3.1. So it just hand­balls that straight to the ASX then they go through that.

The list­ed com­pa­ny must imme­di­ate­ly dis­close any infor­ma­tion that a rea­son­able per­son would expect to have a mate­r­i­al effect on the share price or val­ue of the secu­ri­ties. And, um. Da da da da da goes from there with a few carve outs for, con­fi­den­tial infor­ma­tion, um, pro­tect­ed IP and things like that. [00:19:00] the Cor­po­ra­tions Act had a change a cou­ple of years ago, which said that, uh, if you were going, if they were going to be pros­e­cut­ed, they could rely on the fact that they, the pros­e­cu­tor had to find that they did it neg­li­gent­ly or act­ed with mal­ice, um, rather than just they made a mis­take. Um, so that’s made it hard­er for legal action to be tak­en suc­cess­ful­ly against com­pa­nies.

And that, that seems to have thrown a span­ner in the works. And there’s cer­tain­ly less activ­i­ty going on in the, the legal, um, pros­e­cu­tion sense and the class action sense that there has been in the past. So. I’m not sure what’s going on. You might be able to shed some light, but it cer­tain­ly seems, par­tic­u­lar­ly with the lat­est report­ing sea­son, that a lot of com­pa­nies, um, came out with results, which were a sur­prise to the mar­ket.

Um, they were dif­fer­ent to con­sen­sus, both on the upside and the down­side, but, um, the ones that we are par­tic­u­lar­ly annoyed with are the ones on the down­side whether there should be a change to the, to the rules. And, and a cou­ple of things I’ve been mulling is around if [00:20:00] you present results and this, the stock price moves more than 10%, then the ASX should be all over you say­ing, well, tell us, you know, why you weren’t con­tin­u­ous­ly dis­clos­ing the fact that it was a gonna be a, a mar­ket mov­ing announce­ment, um, at the time, and whether you were in pos­ses­sion of infor­ma­tion ear­li­er. Uh, that’s just one, you know, poten­tial, um, rule change that could, that could hap­pen. But it just seems to me that, uh, you know, if you look at, say for exam­ple, Bendi­go Bank, I’ll, I’ll use them as an illus­tra­tion. They came out. the, with the results, the stock price was ham­mered. ASX wrote them a let­ter say­ing, please explain.

They came back and said, and, and still blown away by this. They said that did­n’t think a rea­son­able per­son would expect a reduc­tion in our net inter­est mar­gin to affect the stock price, so there­fore we did­n’t dis­close it. And that, as, as far as I can tell, that’s the where the mat­ter rests. Now, I don’t know if the ASX or bASI­Cal­ly gonna take fur­ther action, but you know, [00:21:00] I, if you don’t, if you’re run­ning a bank and you don’t think that increase mar­gin con­trac­tion is gonna affect the stock price, then um, I’m, I’m not sure where you, you know, what world you are liv­ing in, but why are you try­ing to man­age net increase mar­gin? If it’s not that impor­tant to the stock price, then just leave it alone. that’s not what banks do. So there’s a, there’s a lot of, um. A lot of strange things going on. I, I feel it’s get­ting worse this par­tic­u­lar report­ing sea­son, inter­est­ed to know whether we can do some­thing about it, both as share­hold­ers and I guess, um, from the a SA per­spec­tive.

steven: Yeah. Thanks TK, uh, a lot there. And, um, I guess I’d start off by say­ing I’m, I’m not a legal expert obvi­ous­ly, and nor is any­one in the a SA man­age­ment team, but we’ve, we’ve gone and had a deep­er dig in into this since you and I first start­ed dis­cussing it. So a few things that. Hope­ful­ly I can share that might be help­ful for peo­ple.

and the first one is that the ASX actu­al­ly can’t find com­pa­nies for breach­es of the list­ing rules. It’s an ASIC respon­si­bil­i­ty to [00:22:00] take legal action or fine, um, a com­pa­ny. What the ASX can do is send out these aware let­ters or these please explain let­ters, which is nor­mal­ly, you know, what we all see as.

Share­hold­ers when we, uh, if we’re, you know, sub­scrib­ing to alerts, et cetera. Um, and then the com­pa­ny has to respond obvi­ous­ly there. Uh, if the ASX isn’t hap­py with that response, they can threat­en sus­pen­sion. That’s kind of the first step. And, you know, ask for more infor­ma­tion or more, more clar­i­fi­ca­tion.

they’re still unhap­py, then they can actu­al­ly sus­pend the com­pa­ny. Which is the next step. And then ulti­mate­ly they can delist the com­pa­ny if, from the ASX itself, but they can’t take, um, legal action or, or, um, enforce any fines against the com­pa­ny. So what appar­ent­ly often hap­pens is if the as SX isn’t hap­py or isn’t sat­is­fied with the com­pa­ny’s response, they will refer it to [00:23:00] ASIC.

And as far as we all know right now, it’s pos­si­ble that the ASX has referred this Bendi­go Bank exam­ple to, to ASIC, um, and maybe ASIC’s inves­ti­gat­ing one, one of the obvi­ous prob­lems there is, you know, ASIC does­n’t dis­close all of that stuff in advance, and they’re also, um, I think swamped with more com­plaints and, uh, you know, uh, requests for, uh, inves­ti­ga­tion across all the finan­cial ser­vices than they can han­dle.

So obvi­ous­ly, I assume ASIC are try­ing to. Man­age their work­load and, uh, deter­mine which, which of the var­i­ous breach­es are the most sig­nif­i­cant. And I know Joe Lon­go, the chair of ASIC, has talked a few times about them being more selec­tive with their legal enforce­ments. Um, and I’m para­phras­ing here obvi­ous­ly, but you know, going after the cas­es that they think they can win.

’cause some­times they might think there’s a, a prob­lem there or assess that there might be a prob­lem there, but they’re not sure they can win it, uh, in court. And in turn, they’re not tying up their resources and their [00:24:00] fund­ing to go after a case that they’re less cer­tain about win­ning. I’m not say­ing that’s the case with Bendi­go, I just mean this is how ASCA alleged­ly or appar­ent­ly pri­or­i­tiz­ing their, their work.

Um, so there’s a few steps. Please explain let­ter threat­en sus­pen­sion, actu­al­ly sus­pend or delist. Now if you think through those, there’s some con­se­quences for share­hold­ers. Obvi­ous­ly, if you do sus­pend a com­pa­ny. Even for a short peri­od of time, the, the most obvi­ous one being that you can no longer trade the shares while they’re sus­pend­ed.

So it’s the ASX are reluc­tant, I think to, uh, rig­or­ous­ly sus­pend com­pa­nies because they know there’ll be, you know, at least some of the share­hold­ers then that are unhap­py that they can’t, can’t trade their shares. So I, from what I under­stand, it’s uh. Um, it’s not their first option to sus­pend a com­pa­ny.

Uh, they’ll, uh, they’ll pre­fer not to sus­pend some­one unless they think it’s, uh, it’s nec­es­sary or, um, you know, needs fur­ther action. And I guess some­times those things are [00:25:00] prob­a­bly judg­ment calls, aren’t they? You know, is the, is the Bendi­go bank result so far away that it was rea­son­able to expect a big reac­tion or, or not?

And, and those things, you know, I lis­tened to your. Episode last week, and I could­n’t dis­agree with your sen­ti­ments. So it’ll be inter­est­ing to see whether ASIC actu­al­ly do take action on this one if, if it’s been referred to them. The oth­er option, of course, is a share­hold­er class action. if enough share­hold­ers are unhap­py with what’s hap­pened here and they don’t think the dis­clo­sure’s been appro­pri­ate, then share­hold­ers them­selves can get togeth­er with some legal eagles and uh, and uh, take out a class action against the com­pa­ny.

Uh, so that’s. mech­a­nism, if you like. Um, I’ve been fol­low­ing, you know, a pret­ty small group of com­pa­nies myself per­son­al­ly, for the last few report­ing sea­sons, and I agree. There’s been, there’s been a lot of volatil­i­ty up and down in some of the com­pa­nies that I’ve been close­ly watch­ing. But what’s inter­est­ing is when I went and had a look at the VIX for the A SX, so the [00:26:00] ASS X 200 VIX over the last.

Um, 18 months, it’s actu­al­ly been pret­ty sta­ble at a mar­ket lev­el. So, um, you know, it’s, it’s been some­where between 10, 11, 12, which is kind of quite low by, um, par­tic­u­lar­ly volatile stan­dards. And there’s only been a cou­ple of spikes, um, dur­ing that peri­od where it’s got up to around 15, 16. So. So when you look at all the com­pa­nies in total, does­n’t look like it’s been an over­ly volatile time, but obvi­ous­ly that’s not, you know, nec­es­sar­i­ly the indi­vid­ual com­pa­nies that you are fol­low­ing or I’m fol­low­ing where, you know, maybe they, they have been more volatile than the mar­ket as a whole.

So, so there’s some, I guess some things I’d, I’d share that, you know, might be help­ful. Um, hap­py to, you know, take any fol­low up ques­tions on that.

TK: Thanks Steve. Um, yes, there’s a num­ber of ques­tions I have from that, and the first one is, it’s kind of a meta argu­ment going on here. If com­pa­nies are required to main­tain con­tin­u­ous [00:27:00]disclosure and the ASS X is a list­ed com­pa­ny and it’s refer­ring dis­clo­sure issues to asset, why aren’t they being dis­closed itself? You know that if, if, if action is being tak­en against Bendi­go Bank, and I’m pick­ing on Bendi­go Bank as a, as an exam­ple, there are plen­ty of oth­er ones that could eas­i­ly fall in that same cat­e­go­ry. Why aren’t we as share­hold­ers on not a share­hold­er, sor­ry? Why aren’t share­hold­ers, You know, tak­en into the, into the loop in terms of the fact that that has been referred to ASIC, has it been, has, has the com­pa­ny been told it’s been referred to ASIC?

And if it has, why aren’t, why isn’t the com­pa­ny dis­clos­ing that fact sort of in the chain, as you’ve described, is, is com­plete­ly opaque, but I would’ve thought it was very mar­ket. sen­si­tive and, and share­hold­ers should be aware of the fact that ASIC is

inves­ti­gat­ing a com­pa­ny.

so I mean, that’s, that’s the first thing.

Why isn’t it being made trans­par­ent? Um, and I guess, you know, the fol­low up ques­tion from that is, [00:28:00] is ASIC resource prop­er­ly? If it’s, if it’s, when I did a search on the pros­e­cu­tions the last 12 months, they tend, maybe it was, per­haps the results were vol­ume weight­ed, but they tend­ed to be large cor­po­ra­tions, trea­sury, wine group, star casi­no, Rex air­lines, et cetera.

There was noth­ing about small­er com­pa­nies. So does there need to be a sep­a­rate sec­tion of ASIC, which is resourced enough to look at reg­u­la­tion and com­pli­ance for small cap stocks?

steven: Yeah, so, so good ques­tions. I mean, as, as I say, we love try­ing to shine a light on, on any­thing that we think share­hold­ers should know about, and, uh, we’re all for as much trans­paren­cy as pos­si­ble. Um, so no argu­ments at all there, that it would be bet­ter to, you know, to be aware of these things. would say the cou­ple of high pro­file, um, flare ups we’ve seen in the last, you know, three or four months, name­ly min­er­al resources and WiseTech, um, ASIC have come out pret­ty quick­ly in the media and announced that [00:29:00] they’re inves­ti­gat­ing and look­ing into aspects and call­ing direc­tors in, et cetera.

So it seems they’ve act­ed, in a pret­ty. Time­ly or pret­ty quick man­ner there. Um, but obvi­ous­ly they’re very large and very high pro­file com­pa­nies that are get­ting lots of media atten­tion, so maybe that’s forc­ing their hand a bit more. but yeah, no, no issues in term from our per­spec­tive, obvi­ous­ly, in terms of, you know, why should­n’t that be dis­closed as soon as it’s, um.

As soon as it’s known or as soon as it could be shared, as long as there’s no, you know, con­fi­den­tial­i­ty issues. So I’ll, I’ll go back and find out if there are any re spe­cif­ic require­ments there. I’m sure once the com­pa­ny has been made aware of that they prob­a­bly should be mak­ing an announce­ment, you would think to the, to the mar­ket accord­ing­ly.

So I’ll go back and dou­ble check. Um. That par­tic­u­lar point. Um, and yeah, I mean, in terms of their resources, I’m, I’m actu­al­ly hav­ing a, I’m going to a round table meet­ing next Mon­day with one of the asset com­mis­sion­ers, so I might see if I can [00:30:00] slip this ques­tion in and actu­al­ly, um, ask, uh, around this par­tic­u­lar issue, what their process is and how they’re allo­cat­ing resources, et cetera.

I think it’s a fair­ly small group, so hope­ful­ly I’ll get my ques­tion answered. Uh, it’s not Joe Lon­go, but it’s one of the oth­er ASIC com­mis­sion­ers, so hope­ful­ly they’ll be in the loop and they can give us an answer there. And yeah, let me know if there’s any oth­er ques­tions that we wan­na pose to ASIC on these issues that are rel­e­vant

TK: Well, if you, if you’re talk­ing with them, invite them on our show. uh, we’d love to have them here and, and answer these ques­tions direct­ly and, in a con­struc­tive way with­out, you know.

steven: Yeah, I will, I will def­i­nite­ly ask. We, we actu­al­ly have, um, at the a SA con­fer­ence com­ing up in May, you know, a sub­tle plug there. But, uh, um, we are actu­al­ly gonna do a reg­u­la­tors pan­el this year. And we’ve got, uh, Sarah Court, who’s the deputy of ASIC, com­ing to sit on that pan­el along with one of the head, uh, um, GMs from, from the A SX, uh, one of the com­mis­sion­ers from the A TO, um, and one of the com­mis­sion­ers from a PR.

um, so they’re [00:31:00] com­ing to meet with retail or reg­u­lar share­hold­ers and, uh, it’ll be a q and a ses­sion where, uh, for 45 min­utes we, um, we put our var­i­ous hot ques­tions to the lead­ers of those reg­u­la­tors and, and hope­ful­ly get some insight­ful answers. First time we’ve done that. So, you know, as a, as a SA mem­ber, TK, let me know if you’ve got any par­tic­u­lar ques­tions you’d like us to, to them in a, in a cou­ple of months time.

TK: Alright, well I think you know my ques­tions, but I’ll hap­py to for­mal­ize them for you. Um, are there oth­er, oth­er oppor­tu­ni­ties for share­hold­ers to take action like a rem strike on these issues? apart from, you know, sell­ing the shares, um, it’s, it’s almost a short­ing oppor­tu­ni­ty with when, when the bad news comes out and there has­n’t been con­tin­u­ous dis­clo­sure ’cause the mar­ket racks pret­ty vio­lent­ly down­wards to the stock.

But, um, know, I know that you have mon­i­tors. I know that they go along to board meet­ings and rec­om­mend things. But if there’s a com­pa­ny you feel that has­n’t main­tained con­tin­u­ous dis­clo­sure, would you rec­om­mend the REM strike against [00:32:00] the.

steven: Yeah, absolute­ly. Yeah. And I sus­pect, um, the big proxy advi­sors and super funds that, you know, typ­i­cal­ly are much, you know, larg­er share­hold­ers than we are, often be doing the same thing if they feel like the com­pa­ny isn’t being, um, as quick or as open with their dis­clo­sure as they should have been.

I did also hear, um, I spoke to one of the for­mer. Uh, GMs of the ASX about these issues as well. Um, and, and he shared that when they send out these aware or these please explain let­ters, it is a bit of a tell for share­hold­ers that the ASX does­n’t think the com­pa­ny’s been as trans­par­ent as they should have been.

Now, whether they take action or not, it’s actu­al­ly say­ing that, you know, of all 2000 plus com­pa­nies this year, these are the 15 or 20 or 25 or what­ev­er it was. we are not hap­py with, uh, at, at a first order lev­el, at least. Um, and that might be, you know, some­thing to include in the check­list or think about that.

Um, the mar­ket oper­a­tor at [00:33:00] least does­n’t feel in the first instance that they’ve been as, um, open with their dis­clo­sure or, or as open in con­fes­sion sea­son as they should have been. ’cause it takes, you know, some time and effort to look at these things and send out the let­ter and then respond to the response so don’t do it.

Friv­o­lous­ly is what he said. He said, you know, when there’s, um, when there’s let­ters like this going out, it is some­thing you should prob­a­bly, you know, con­sid­er as a share­hold­er, what­ev­er the out­come.

TK: Do, do they actu­al­ly respond to the response? I can’t think of any exam­ple of where I’ve seen the ASIC, where I’ve seen the ASX respond to a please explain let­ter. may lead to ASIC doing some­thing, but I’ve nev­er, I can’t recall of an exam­ple where the ASX has done some­thing

steven: Yeah, I think they respond to the com­pa­ny, but I don’t think the com­pa­ny’s required to, you know. anoth­er announce­ment, mar­ket announce­ment around that. We got a response and the mar­ket oper­a­tor was hap­py, right? So I assume if you don’t see anoth­er response, the mar­ket oper­a­tor said they were hap­py.

Or if you do see anoth­er dis­clo­sure, it’s, you know, that ASIC are inves­ti­gat­ing or the as SX is gonna sus­pend it, like they’re the [00:34:00] next two, steps in the process beyond, we were sat­is­fied enough with your response where you’re not gonna get anoth­er dis­clo­sure. I’m not say­ing

TK: do we.

steven: way, I’m just explain­ing what the

TK: Yeah.

steven: we under­stand it.

TK: So as a share­hold­er, do we assume, if we don’t hear any­thing after the As SX, please explain that it’s been replied to that the ASX are hap­py with it.

steven: Um, yeah, unfor­tu­nate­ly it’s either that or they’ve referred it to ASIC and then I, I would guess nor­mal­ly in the next few months, if ASIC are gonna do some­thing, then you’d be hear­ing about it then. Um, I don’t think ASIC are gonna sit on it for a year. Um, I cer­tain­ly haven’t seen that. Uh, so I’d say if you haven’t, you know, if you haven’t seen any­thing in a few months, you could prob­a­bly safe­ly assume there was no fur­ther action tak­en.

If they’d been sus­pend­ed, that’s gonna be announced. Or if ASIC is start­ing an inves­ti­ga­tion, that’s gonna be announced so. Um, yeah, I guess that’s, that’s about all we’re going to know as reg­u­lar share­hold­ers with the way it’s being applied at the moment.

TK: I guess my over­ar­ch­ing com­ment is that’s very byzan­tine and opaque um, you know, very unhelp­ful for share­hold­ers. I, I won’t go any fur­ther than that in crit­i­ciz­ing the reg­u­la­tor, but [00:35:00] does­n’t seem to, you know, the trans­paren­cy box or even tick the help­ful box apart from your com­ment that if they send out a let­ter, it’s, poten­tial­ly a red flag.

And that’s what I want­ed to, to dis­cuss with you is we talked about last week putting red flags on com­pa­nies that we thought had bro­ken con­tin­u­ous dis­clo­sure. assess­ment of it was they bro­ken con­tin­u­ous dis­clo­sure, and we might come up with some rules around that. Like, know, there was a, a sur­prise drop in the share price of more than X per­cent, 20%, for exam­ple. It’s, this is, I mean, my high lev­el sit, uh, you know, view of the sit­u­a­tion is it’s the wild west are under-reg­u­lat­ed. ASX does­n’t have the, as you said, does­n’t have the legal abil­i­ty to do any­thing but sus­pend, and it’s not in their inter­est to sus­pend because they col­lect list­ing fees from these com­pa­nies for a start.

So they don’t want com­pa­nies being sus­pend­ed. They don’t wan­na.

steven: sor­ry, just on that one, on the list­ing thing, I should have men­tioned that I did ask about the list­ing fees. And, um, they said that the list­ing fees are paid a year in [00:36:00] advance. So if you are sus­pend­ing a com­pa­ny, ter­ror tem­porar­i­ly does­n’t impact the list­ing fees or the rev­enue as SX gen­er­at­ing at all.

It’d only be if you per­ma­nent­ly sus­pend or, or delist them that they then lose their rev­enue from that par­tic­u­lar com­pa­ny. So a short term sus­pen­sion is, there’s no dis­in­cen­tive, I sup­pose, there for ASX from a rev­enue point of view oth­er than, you know, again, poten­tial­ly there’s oth­er share­hold­ers that are unhap­py that the shares are sus­pend­ed.

TK: Well, except that if just, just say for exam­ple, the ASX did tem­porar­i­ly sus­pend that they thought, all the peo­ple they’ve writ­ten, please explain to us to, um, even­tu­al­ly com­pa­nies are gonna stop lis­ten­ing with the ASX and go to a dif­fer­ent I. Share mar­ket. So there is a con­flict of inter­est I think there in the As SX and look, it’s, I don’t nec­es­sar­i­ly have a prob­lem with that because it’s ASIC who are the reg­u­la­tor, right?

The as SX are just facil­i­tat­ing things. So that. But if we don’t see what ASIC could doing and we’re not see­ing any­thing com­ing out of ASIC and we can’t, we can’t have con­fi­dence in ASICs. So it’s real­ly the wild west, unless it’s a big, [00:37:00] high­ly com­pa­ny like WiseTech or, or min­er­al resources or what­ev­er, um, we’re a lot and we’re reliant on. Rear win­dow to uncov­er those things. We’re not reliant on ASIC uncov­er­ing those things or the ASX uncov­er­ing those things. Let’s be clear, it’s, inves­tiga­tive jour­nal­ism that uncov­ers those things. Um, it’s, it’s the wild west. And, and so we have to real­ly, as share­hold­ers, take our own actions. And so get­ting back to my ques­tion, I’m, I’m try­ing to for­mu­late a set of red flags and rules that we can take our­selves.

And so I wel­come your input on to that. and it comes in my mind as I’ve been try­ing to toss this over, it comes down to the ques­tion of if the share price is down 20%, for exam­ple, 30% what­ev­er, it, it’s the age old ques­tion and the share mar­ket, is that a buy­ing oppor­tu­ni­ty or is that a shelling oppor­tu­ni­ty? And, um, so, you know, imme­di­ate reac­tion was to slap a red flag on some­thing, but it may be that all the bad news is out­ta the stock and, uh, it’s time to buy. So I, I’d like your input [00:38:00] onto, onto doing things for our­selves, I guess.

steven: Yeah. So, um, I can share that, you know, I, I per­son­al­ly have added to my check­list, do I trust man­age­ment as a, a go, no go. And if I can’t answer in the affir­ma­tive there, then I, no mat­ter how good the fun­da­men­tals are, I no longer will own a com­pa­ny like that. And that’s, you know, a, a judg­ment call of course.

But there’s five or six things I’m reg­u­lar­ly look­ing at there now, and this would def­i­nite­ly be one of them if they’re, if they’re not dis­clos­ing. Um, mate­r­i­al dif­fer­ences from what they’ve guid­ed or the mar­ket expects in advance. Can I real­ly trust that man­age­ment team? You know, I, I’m not sure I can. Um, so that would just be my per­son­al view on that.

I will say though, there’s com­pa­nies that don’t give for­mal guid­ance, right? So take data three, for exam­ple, which is an ASX 200 com­pa­ny. very delib­er­ate­ly and for a long time have not giv­en any for­mal guid­ance. They don’t want to get into the fore­cast­ing game, which, you know, res­onates with QAV, I think.

Um, but there’s a bunch of ana­lysts that [00:39:00] cov­er, uh, data three, and they come up with their fore­casts for what their sales and rev­enue are, et cetera. And my under­stand­ing is even then, if the com­pa­ny, um, believes that their results will be more than, I think it’s 10%. High­er or low­er than the con­sen­sus of the major ana­lysts cov­er­ing the com­pa­ny.

They’re then sup­posed to dis­close that in con­fes­sion sea­son. So even if they’re not giv­ing guid­ance, they’re still kind of being forced in a way by, by the as SX rules to, um, to update the mar­ket when they’re, you know, expect­ing to deliv­er result mate­ri­al­ly dif­fer­ent to, to the ana­lyst’s fore­casts. Um, so,

TK: I just stop you there?

steven: Can I just sure.

TK: so are you, are you, can you point to that rule? I had­n’t, I’ve, I’ve heard you speak about that 10% rule, but I could­n’t find it when I had to look myself. rules are, as I see them, are fair­ly

steven: a

TK: and you could dri­ve a truck through them. Real­ly.

steven: yeah, I’ll go and find that Tika. I don’t know the exact list­ing real num­ber, but I’ll go and find that. ’cause yeah, our, our, um, pol­i­cy man­agers, you know, cov­ered that with me a few times. So yeah, I’ll go and find out and come back to you on [00:40:00] that one. Um. But yeah, take data three as an exam­ple. It’s, it’s been very volatile.

It around the, the release of half or annu­al, um, earn­ings and yet has­n’t diverged much from the ana­lyst con­sen­sus at all. So I look at that and go, well, this is either a buy­ing or a sell­ing oppor­tu­ni­ty if you think it’s extreme. ’cause it’s, it’s share prices moved 10, 15, 20% in one or two days, and then with­in a week revert­ed back to where it was.

So I don’t per­son­al­ly, I don’t real­ly want the as SX to send them a let­ter there because it’s. Oth­er share­hold­ers that seem to be dri­ving that action. It’s not that they deliv­ered a result that was wild­ly dif­fer­ent to what, um, what they had been deliv­er­ing and what the con­sen­sus was. It’s just for some rea­son there’s been lots of oth­er share­hold­ers buy­ing or sell­ing, uh, at that par­tic­u­lar week, um, to, so to me that’s dif­fer­ent to the Bendi­go Bank exam­ple where they’ve deliv­ered a, you know, a core.

Finan­cial result that’s very dif­fer­ent to, to what was expect­ed. And it’s some­thing that, you know, rea­son­ably, you would antic­i­pate would affect the share price. So [00:41:00] I, I, I see a dif­fer­ence between those two things where it’s oth­er share­hold­ers react­ing to what’s a busi­ness as usu­al result ver­sus not dis­clos­ing things that, you know, the mar­ket real­ly should have known about.

TK: Yeah, but I, look, I, I take your point. Data three is a good exam­ple. You don’t have to pro­vide guid­ance. Um, but if some­thing hap­pened inter­nal­ly with­in data three, like a data cen­ter call on fire or some­thing, they would have to announce it. So the mar­ket is part of con­tin­u­ous dis­clo­sure. So there’s still, have to pro­vide guid­ance, but you still to update the mar­ket if, if some­thing’s hap­pen­ing with­in the com­pa­ny, which affects the share price.

steven: Oh yeah, 100%. Com­plete­ly agree with that. I just mean where you are not giv­ing guid­ance about what your earn­ings or your sales result was going to be. Um, even then, you’re still required to. To update in con­fes­sion sea­son if your result’s gonna be mate­ri­al­ly dif­fer­ent to what the ana­lyst’s, um, con­sen­sus num­bers are.

So, uh, yeah, that’s, that’s prob­a­bly all I could, uh, all I could offer there.

TK: The oth­er, the oth­er thought I had too was, is the fact, is there some, some kind of [00:42:00]information in the mar­ket? Um, when a com­pa­ny does­n’t make a dis­clo­sure dur­ing con­fes­sion sea­son? you know, nor­mal­ly I would take that to mean when the results came out, they’re gonna be with­in a, a nar­row range of con­sen­sus.

But clear­ly that has­n’t been the case this time. So is there, do we, does the ASX need to have a list­ing? We’re all say­ing as soon as the, the. Books are ruled off when they go to the orders. For exam­ple, you must update the mar­ket with what you think. Um, results are going to be as almost like a pre result announce­ment, and, and you have to do it.

It’s not whether you think it’s, you have to con­fess or whether you think it, you’re away from guid­ance. You have to do it as a stage in the process.

steven: Yeah, I mean pos­si­bly, I mean, that might be a, you know, a good addi­tion­al dis­clo­sure I guess. You know, typ­i­cal­ly we’d be get­ting that info. only a week or two before we’re get­ting the actu­al report at that point. Right. So it would be nice to know, but it’s not like you’d be get­ting it months in advance if [00:43:00] it’s when the audi­tors have looked at the books and, and then signed it off.

’cause typ­i­cal­ly they, you know, they, they bring those half or annu­al reports out with­in six to eight weeks of the end of that peri­od. So dur­ing that time, I assume, you know, CFOs and audi­tors, et cetera, are, um, you know, get­ting every­thing final­ized to go in the report and Yeah, I would­n’t think they’re sit­ting on that.

an extend­ed peri­od of time, so it would prob­a­bly help a lit­tle bit, but my guess is you’d only be get­ting that a week or two before the actu­al final ver­sion of the half or the annu­al report was com­ing out.

TK: Yeah. And that’s a ques­tion too, isn’t it? So you’re right, you’re only get­ting it, you’re only get­ting it ear­li­er. But com­pa­nies that do, um, pro­vide con­tin­u­ous dis­clo­sure once they know, come out and say it. even if it’s only a, a three or four weeks before they their audit­ed results. But, but what we’re find­ing is that com­pa­nies are just speed­ing through that and then get­ting to their annu­al results and deliv­er­ing clangers at in the last report­ing sea­son any­way.

steven: Yeah, absolute­ly. So look, I will raise these issues in the pub­lic forum. [00:44:00] With the ASX reg­u­la­tor and with the ASIC reg­u­la­tor in a cou­ple of months time, get it on the, on the record, we’ll have rep­re­sen­ta­tives from the FIN and the Aus­tralian and the A, b, C there, most like­ly cov­er­ing the con­fer­ence. So, uh, hope­ful­ly we’ll, uh, we’ll, you know, we’ll get a bit of media cov­er­age for that as well, if we’re lucky.

And, uh, and then I’ll obvi­ous­ly get back to you in a cou­ple of months with what their, you know, respons­es were to these fol­low up ques­tions. ’cause I think they’re, you know, they’re all real­ly valid and us as indi­vid­ual share­hold­ers obvi­ous­ly do. affect­ed pos­i­tive­ly or neg­a­tive­ly by these kinds of things.

So, uh, you know, no, no push­back at all from us on try­ing to get the, uh, bet­ter enforce­ment and bet­ter dis­clo­sure if we can.

TK: Ter­rif­ic. Thanks Steve. That’s great. Um, I might put pen to paper and for­mal­ize some ques­tions for you to ask.

steven: Yeah, that’d be great. And then, and then I had a cou­ple of quick ques­tions rela kind of segue­ing on, on this issue for, for lis­ten­ers. Uh, if any­one wants to, you know, shoot cam­era a response if you’ve, if, if you’ve got one. These are, these are a cou­ple of things that have just bub­bled up [00:45:00] in the last few weeks at a SA that we’re think­ing of, uh, push­ing for­ward with to try and help reg­u­lar share­hold­ers.

Um. And the first one is around dona­tions. So, you know when com­pa­nies are giv­ing polit­i­cal or char­i­ta­ble dona­tions, you know, we saw a lot of this in The Voice, for exam­ple, where, you know, com­pa­nies were mak­ing dona­tions to, you know, dif­fer­ent sides of the voice cam­paign. And we had a lot of share­hold­ers that were unhap­py one way or the oth­er about that.

So one of the things we were, you know, con­sid­er­ing is should we, should we ask for a share­hold­er res­o­lu­tion at AGMs? Uh, and maybe it’s a non-bind­ing res­o­lu­tion, but share­hold­ers get to have a vote on it just like they do with remu­ner­a­tion each year, um, to explain what your polit­i­cal or char­i­ta­ble dona­tions have been for the year and how they tie to the busi­ness.

So what is the, you know, the align­ment with the strat­e­gy or the pur­pose of the busi­ness. So, for exam­ple, if you’re an insur­er. Um, you know, and you made some char­i­ta­ble dona­tions. You know, maybe it’s a good idea to, to make some [00:46:00] char­i­ta­ble dona­tions to trou­bled youth orga­ni­za­tions because, you know, you’re pay­ing out lots of car theft cas­es from youth steal­ing cars, for exam­ple.

So that might be, you know, a sen­si­ble way to, to make it dona­tion tied to. of your busi­ness and how it might pos­i­tive­ly affect your busi­ness over time. Um, so we are think­ing it’s just, it could be a nice idea to, um, shine a bit more light on this. If, if the board or the man­age­ment team are giv­ing away com­pa­ny mon­ey to polit­i­cal orga­ni­za­tions or char­i­ta­ble orga­ni­za­tions, you know, what, why are you doing that and how does it tidy your strat­e­gy?

And, uh, and give share­hold­ers a even just a non-bind­ing vote on that from time to time. So that’s one idea. and then the oth­er one was actu­al­ly about cap­i­tal man­age­ment. So one of the things a SA has been argu­ing for many, many years is for fair cap­i­tal rais­ings for small share­hold­ers. Um. But often what hap­pens is the com­pa­ny will do a cap­i­tal rais­ing and maybe it’s, you know, unfair or, uh, you know, imbal­anced towards their small share­hold­ers, but it’s already [00:47:00] hap­pened, you know, it’s too late to do some­thing about it at that point.

the, the oth­er thought was, you know, do we ask for, um, a non-bind­ing res­o­lu­tion as well from time to time on the cap­i­tal man­age­ment struc­ture of the com­pa­ny? In gen­er­al, what’s your approach to man­ag­ing cap­i­tal and if you do need to raise cap­i­tal. How do you intend to do it? Um, and then if they do diverge away from that, to explain why you’ve diverged away from your stat­ed cap­i­tal man­age­ment pol­i­cy.

So giv­en, you know, these are par­tic­u­lar­ly the, the sec­ond one’s a very impor­tant thing for share­hold­ers, the way that the board and man­age­ment team are think­ing about man­ag­ing the cap­i­tal of the com­pa­ny. It could be a, you know, a nice short state­ment, just like the remu­ner­a­tion report and just like the cor­po­rate gov­er­nance state­ment.

That cov­ers the way the com­pa­ny’s think­ing about and approach­ing and apply­ing these things for share­hold­ers to A, be aware of, and B, have a, even if it’s non-bind­ing, vote on it from, from time to time. So we’d be inter­est­ed in, obvi­ous­ly your thoughts and also the thoughts of any of the, [00:48:00]the QAV mem­bers on those cou­ple of ideas that we might be able to push for­ward with over the next cou­ple of years.

TK: Yeah, look, I’m hap­py to give you my thoughts and pass on any lis­ten­ers’ thoughts as well. On the dona­tion side, this has been a, an issue for, for years and it’s, um. You know, it comes out from time to time in the cul­tur­al wars on both sides of pol­i­tics. Uh, gen­er­al­ly the larg­er com­pa­nies will give to both polit­i­cal par major polit­i­cal par­ties, and if you ask them why there’s, peo­ple have done it AGMs from time begin­ning, they gen­er­al­ly say some­thing like, well, we we’re not biased in who we give to, but we have to give to because it’s part of our a to, um, the gov­ern­ment of the day.

And, um, you know, it’s impor­tant for us to have doors open to present our case when we’re reg­u­la­tors are con­sid­er­ing changes, that, that kind of thing. So I, I get that. Um, there have been cas­es where com­pa­nies have donat­ed more to one side of pol­i­tics than the oth­er. Um. [00:49:00] that, you know, my expe­ri­ence is that gen­er­al­ly comes out in the rear win­dow type columns in the news­pa­pers. Um, there’s been, you know, cas­es where ex oper­a­tors have become chair of com­pa­nies and they’ve pushed dona­tions to their old par­ty, that kind of thing. And it, it becomes known. Um, so it gets out, uh, whether it should be a share­hold­er vote. Um, that’s an inter­est­ing ques­tion. Uh, yeah, I’m, I’m not sure that’s, that’s the first one about polit­i­cal par­ties.

The sec­ond one is, of course, is about oth­er, oth­er groups, um, you know, you know, par­tic­u­lar char­i­ties or what­ev­er. Um, and we, you know, I, as a broad brush, I, I, I’m sup­port­ing cor­po­rates for donat­ing to their char­i­ties and, and the idea of the triple bot­tom line, I think took hold about 10 years ago and seems to have gone by the way­side.

1. Of re of recent times, but there was a lot of, a lot of ben­e­fit in com­pa­nies broad­en­ing their foot­print of the [00:50:00] com­mu­ni­ty and, and help­ing com­mu­ni­ty char­i­ties to, um, to sup­port, know, their, their, uh, end users. Um, and, you know, so I kind of sup­port that, whether you need to do it case by case, that tends to be just like a bud­get line item that goes to cor­po­rate affairs or to HR to, to make those dona­tions. Um, so my, my gen­er­al feel­ing is man­ag­ing on a case by case basis, uh, rather than have every­thing be put to share­hold­er votes. ’cause it, it’d be a. It’ll be a tedious task. And there’s enough red tape in cor­po­ra­tions at the moment, even though I’m argu­ing for more reg­u­la­tion on con­tin­u­ous dis­clo­sure. So it’s, um, there’s enough, there’s a lot of reg­u­la­tion out there any­way. Um, so that’s my feel­ing on that issue. On the issue of cap­i­tal rais­ings, um, I think from mem­o­ry there’s a 10% rule now which comes up at AGMs from time to time where a, a com­pa­ny will have, in its con­sti­tu­tion, it can from, time to time raise cap­i­tal up to a, a ceil­ing, which I think is [00:51:00] 10% with­out hav­ing to go to a vote or a prospec­tus.

And that’s usu­al­ly when that’s kind of, um. D and there’s a, there’s an out­line of any PO poten­tial things that are com­ing up that the com­pa­ny might need to raise cap­i­tal for. it’s a tricky one. Um, because wey draws line on need­ing a prospec­tus, we draws a line on need­ing a vote. And I think in, in my mind, if the com­pa­ny was rais­ing up to 10%, peo­ple aren’t being dilut­ed hor­ren­dous­ly, but it gives them flex­i­bil­i­ty to act quick­ly if it’s an acqui­si­tion, for exam­ple.

Um, uh, or if they need some­thing else quick­ly to act quick­ly for. So they’re my thoughts.

steven: And I, I would­n’t dis­agree with any of that. I guess the, the idea was just to have that, um, pol­i­cy or that think­ing, um, spelled out in advance so that you’re well informed if you, you know, are think­ing of buy­ing shares in that busi­ness or you already own some shares in that busi­ness.

So, so, um, you know, on the, on the dona­tion side of it, we, we ask. The com­pa­nies every year if they do make dona­tions [00:52:00] to dis­close it in the annu­al report, but they don’t tie it to the pur­pose or the strat­e­gy at the moment. So that was the think­ing. If you are, if you are mak­ing dona­tions of any kind, you know, why do you do it and what’s the pur­pose?

And, and hope­ful­ly they’ve got a good answer for that rather than just being a pet project or a pas­sion of a par­tic­u­lar board mem­ber that year or what­ev­er it might be. Uh, so it would­n’t be about say­ing, no, you should­n’t do that, but, but just giv­ing share­hold­ers a chance to have a, a non-bind­ing say on whether they’re hap­py with the way that the com­pa­ny’s using those funds.

and then on the cap­i­tal man­age­ment side of it, yeah, should def­i­nite­ly write about, you know, the amount of cap­i­tal that could be raised with­out requir­ing share­hold­er approval. But the ques­tion for us as small­er share­hold­ers here is obvi­ous­ly. If you do need to raise cap­i­tal, what for­mat are you gonna use?

Are you gonna give us an SPP? Are you gonna give us a pro rata rais­ing? Like how, how are you gonna treat us as small­er share­hold­ers in a reg­u­lar cap­i­tal rais­ing sit­u­a­tion? Or if you’re an emer­gency sit­u­a­tion, what would you do? But also you could be ask­ing them for things like, what’s their pay­out [00:53:00]policy?

You know, what’s the, what’s the board think­ing about an aver­age div­i­dend pay­out pol­i­cy as part of man­ag­ing their cap­i­tal base, et cetera. So there could be a few things like that in there where they just give you a bet­ter idea. About their, and it might actu­al­ly make some of these boards and man­age­ment teams that aren’t great cap­i­tal allo­ca­tors think a bit more about these things.

Um, if they had to actu­al­ly put it to share­hold­ers, even in a non-bind­ing way, and then you would get some pret­ty good feed­back as a board and a man­age­ment team from your share­hold­er base then too, to say, you know, 95% of our share­hold­ers are in favor of what we’re doing, so let’s keep doing it. Or 50% are against, we’ve got a prob­lem.

We need to rethink this. So, just, just thought. Uh, lead­er­ship ideas at the moment. But yeah, if any, thank you for your thoughts and if any­one else has got any thoughts, let us know and we’ll, uh, you know, we’ll see whether we push those for­ward in, in any way in the next, uh, next 12 months.

Cameron: Okay, back to me. I have some­thing, uh, here. Uh, while you two were. Talk­ing away. This is the UM, ASX list­ing rules for con­tin­u­ous [00:54:00] dis­clo­sure List­ing rules 3.1 to 3.1 B 7.3. Mar­ket­ed mar­ket sen­si­tive earn­ings sur­pris­es. I’ll just read this out. Gen­er­al­ly speak­ing, an enti­ty’s earn­ings for a par­tic­u­lar report­ing peri­od are not required to be report­ed to the mar­ket until the due date for the release of that infor­ma­tion under chap­ter four of the List­ing rules.

How­ev­er, enti­ties, the mar­ket’s expec­ta­tions of its earn­ings over the near term may be a mate­r­i­al dri­ver of the price or val­ue of its secu­ri­ties. Those expec­ta­tions may have been informed by. Earn­ings guid­ance the enti­ty has giv­en to the mar­ket. In the case of enti­ties cov­ered by sell side ana­lysts, the earn­ings fore­casts of those ana­lysts or the enti­ties PCP earn­ings, those expec­ta­tions may also have been informed or mod­i­fied by.

Out­look state­ments made by the enti­ty in its last annu­al report or at its last results announce­ment or [00:55:00] annu­al gen­er­al meet­ing. Oth­er dis­clo­sures the enti­ty has made to the mar­ket over the report­ing peri­od and mar­ket wide or sec­tor wide events that can rea­son­ably be expect­ed to affect the enti­ty. If an enti­ty becomes aware that its earn­ings for the cur­rent report­ing peri­od will dif­fer mate­ri­al­ly, down­wards, or upwards from mar­ket expec­ta­tions, it needs to con­sid­er care­ful­ly whether it has a legal oblig­a­tion to noti­fy the mar­ket of that fact. This oblig­a­tion may arise under list­ing Rule 3.1 and sec­tion 6, 7 4. If the dif­fer­ence is of such mag­ni­tude that a rea­son­able per­son would expect it to have a mate­r­i­al effect on the price or val­ue of the enti­ty secu­ri­ties referred to in this guid­ance note as a mar­ket sen­si­tive earn­ings sur­prise. Alter­na­tive­ly, in the case of an enti­ty which becomes aware that its earn­ings for a report­ing peri­od will dif­fer mate­ri­al­ly from earn­ings guid­ance, it is pub­lished to the mar­ket. It may arise under Sec­tion 1 0 4 1 H because fail­ing to inform the mar­ket. That its [00:56:00] pub­lished guid­ance is no longer accu­rate, could con­sti­tute mis­lead­ing con­duct on its part. And then it has a bunch of, uh, bits and pieces, ques­tions and answers around that. if that helps, but that’s what I came up with in the list­ing rules.

steven: Yeah, it does help Cam, and as I said that, that, that’s obvi­ous­ly what we’re refer­ring to then that par­tic­u­lar rule around ana­lyst fore­cast, if the com­pa­ny’s not giv­ing guid­ance and, and while it does­n’t state the num­ber, I believe the under­stand­ing or the impli­ca­tion is around 10% when the, when the num­ber diverges more either direc­tion than about 10%.

Is, is what? The rea­son­able per­son or the rea­son­able investor is, uh, con­sid­er­ing mate­r­i­al. So whether that’s com­plete­ly accu­rate at ASX lev­el, I don’t know, but it, it, you know, his­tor­i­cal­ly at least it sounds like it’s been around 10% when the, uh, the, the let­ters have been sent out. Is, is our under­stand­ing.

TK: Yeah, look, my only com­ment is it’s very gen­er­al. It’s a lawyer’s pic­nic and you try and pros­e­cute on this kind of thing because who’s a rea­son­able per­son? What do they expect? [00:57:00] There’s also oth­er carve outs around, know, did you think the infor­ma­tion was sen­si­tive to your cor­po­ra­tion, et cetera. So, um, some, if it was 10%, I think that would be much more help­ful. Putting some actu­al num­bers and, and hard rules around this would make it, um, much eas­i­er to reg­u­late and, uh, and make it eas­i­er for boards too to, about what they need to do.

steven: Well, that sounds like a per­fect ques­tion to ask the a SX, uh, gm. Why don’t we add a par­tic­u­lar per­cent­age to that list­ing rule? So, we’ll, uh, we’ll send him that one in advance and see if we can get an answer on it.

TK: Thanks, Steve. That’s great. Um, I’ve got a few things to, to go through here, I think. Sor­ry, cam, you’ve got some more to, to add. look like you wan­na speak.

Cameron: Uh, are you still got ques­tions for Steven or are we gonna let him go? ’cause I had some­thing I want­ed to ask him before we let him go.

TK: I’m fin­ished. Thank you.

Cameron: Well Steve, we’ll let you go, but um, I want­ed to jump to after hours ’cause I know you’re a man who has inter­ests in [00:58:00] many cool things, tv, music, film, books. what you got. It’s been a while since you and I have had lunch and I’ve been able to pick your brain.

steven: Yes. Just fin­ished sea­son two of Sev­er­ance with my son and, uh, absolute­ly superb. So, so I love that. Can’t rec­om­mend it high­ly enough. It was, it fan­tas­tic and kept get­ting bet­ter. Um, and also shrink­ing. I real­ly enjoyed shrink­ing, which is, uh, com­e­dy with Har­ri­son Ford.

Uh. About, uh, a, um, psy­chol­o­gist’s office that Har­ri­son Ford’s run­ning, which is also very fun­ny and, uh, you know, a bit of dark humor. So they’ve been my two, uh, star picks of the last, uh, last few months and, and of course, lis­ten­ing to QAV every week as well.

Cameron: All right. Thank you Steve. Good to catch up, mate. Let’s do lunch at some point.

steven: Thanks guys. Real­ly appre­ci­ate it and well done on every­thing you’re doing. It’s great. Talk to you soon.

TK: Thanks Steve. Thanks for com­ing on. We’ll talk to you about, uh, hors­es.

steven: uh, hors­es.

TK: I’ll talk to you about hors­es in the com­ing week. not a great run by [00:59:00] dou­ble mar­ket on the week­end, but a bit, just a bit of a tri­al real­ly.

steven: No, I’m a bit wor­ried. She’s a bit too smart for her own good and she knew it was gonna be hard, so she just treat­ed it as a train­ing run rather than try­ing. So hope­ful­ly that’s not the case and she’s not too smart for us. Any­way, onwards and upwards. Thanks again. Thanks,

TK: Steve.

Cameron: All right, well, we’re, um, well and tru­ly over an hour, uh, even when I edit that down. Do we, do you wan­na draw a line under it there and cov­er the rest of our notes next week?

TK: think we have to, yeah.

Cameron: Alright, well, uh, I was gonna talk about sev­er­ance sea­son two as well. Have, have you been watch­ing that?

TK: I haven’t, no, Jen­ny’s still halfway through sea­son one and I’ve been wait­ing for her to catch up, but, um, I might have to sneak a few in myself ’cause I’ve heard good things about sea­son two.

Cameron: Eh, uh, I won’t, I won’t, uh, won’t ruin the finale then. The boys and I and Chris­sy have talked about it quite a bit. You know, Tay­lor went to the, um. Uh, event, he went to the cast event for it, [01:00:00] um, in LA and he just got him­self an apart­ment in LA By the way, he called me this morn­ing. He’s just tak­en a 12 month lease.

Well, it was about to sign a 12 month lease for an apart­ment in LA with, uh, one of his guys. Adam, he just rang me up to, it’s fun­ny, he rang me up. He goes, I just want, I just want you to talk this through with me, make sure it’s not a stu­pid deci­sion. And I hear his girl­friend, Amy, in the back­ground, go, is that Mark? I said, no. He is talk­ing to his actu­al father, not,

TK: I,

Cameron: not rud­dy, his, uh, not rud­dy his oth­er dad that he asks advice from. Geez,

TK: oth­er dad Rud­dy, from now on.

Cameron: yeah. Um, So that’s cool. But yeah, so they went to it and, uh, there was, uh, uh, there was some fun­ny stuff that hap­pened there, which I won’t tell you ’cause if you haven’t seen the finale, it won’t make sense.

TK: okay.

Cameron: He was at a thing tonight. He texted me. He was at anoth­er sh uh, for anoth­er show. Oh, it’s a Seth Rogan show that’s just come out called The Stu­dio [01:01:00] where he pays a movie pro­duc­er or some­thing big cast. Oh, no. Good. Yeah. Well, he said Bri­an Cranston was at the event that they went to tonight. He gr Bri­an Cranston walked past him.

So as big fans of Break­ing Bad and, and also, um, what­ev­er his com­e­dy was. What was the com­e­dy before that? Um,

TK: in the mid­dle.

Cameron: Mal­colm In the Mid­dle. Yeah, the Boys and, and, and we’re all big fans of Mal­colm In The Mid­dle was a great show. Even Fox­es watched the whole thing. Fox binged the whole thing.

TK: I’ll have

Cameron: While back. Yeah.

Yeah.

TK: thought it was very ano­dyne, um, sit­com.

Cameron: no, it’s, it’s very, it’s very good. Yeah. Yeah. It’s very good. It holds up well too. you know, any­way, I’ve been read­ing the IP Cret file about halfway through that. Enjoy­ing it.

TK: isn’t it?

Cameron: enjoy­ing it. Real­ly enjoy­ing it, and I’ve been lis­ten­ing to a lot of Ital­ian hip hop this week when I’m not lis­ten­ing to Shostakovich, I’m lis­ten­ing to Ital­ian hip hop as part of my [01:02:00]immersion in Ital­ian lan­guage. Lots of Ital­ian hip hop, which is cool. What about you?

TK: you’ve been see­ing those arti­cles. I keep get­ting arti­cles every now and then on my, on my stream. Spain, you can buy a house in Italy for a dol­lar as long as you ren­o­vate it and go and live in the vil­lage after every­one’s left it. Have you thought

Cameron: Yeah. Uh, I’ve thought about ask­ing you to buy me a house in Italy.

TK: a

Cameron: You can come and stay when­ev­er you want.

TK: do it up. Yeah.

Cameron: I’ll do it up. Sure. I got noth­ing else to do. Yeah.

TK: What about me? Well,

Cameron: else?

TK: I’ve been, I just fin­ished source code. Took me a lit­tle while to read it, but real­ly enjoyed it. Um, the ear­ly Microsoft, well, ear­ly days of Bill Gates, but the last half of the book was the machi­na­tions about get­ting Microsoft off the ground and uh, you know, malfea­sance with their part­ners and doing deals.

And it was actu­al­ly a real­ly good breed. So I enjoyed that.

Cameron: What’s your take on Bill Gates?[01:03:00]

TK: Ooh, that’s a hard one. Real­ly smart guy, nerdy guy. Um, you know, for, going back maybe 20 or 30 years, but for a long while there he was the Elon Musk of his day, um, yeah, sort of a lit­tle bit too much pow­er in the hands of a rich per­son per­haps, but, I was always, um, influ­enced by Buf­fet who thought.

Gates was a smart fel­low and good enough, enough to put on his board. So I kind of, um, watered down my view of gates and, and, um, soft­ened towards him over the years when, when I read more about how Buf­fett thought about him.

Cameron: I had nev­er thought about that before, but you’re right. If he’s good enough for Buf­fet,

TK: Hmm.

Cameron: if Buf­fet respects him and his integri­ty and his char­ac­ter, that says a lot. If you think that Buf­fet’s a good judge of char­ac­ter and a good guy as we do, and an hon­est guy, I’ve always, you know, I’ve been a fan of Bill [01:04:00] since, you know. The nine, uh, the eight­ies, um, and then worked there for a long time. And, you know, I hear lots of bad stuff about Bill, and I’ve nev­er been able to sort of pass it with my con­nec­tion with him and, and sort of, you know, I won’t say rela­tion­ship with him, but, you know, met him a cou­ple of times. know, I think he was, um, in the eight­ies, nineties, just a, a very, very ambi­tious autis­tic nerd

TK: Mm-hmm.

Cameron: who, very super smart, and then got his legs cut off, um, dur­ing the DOJ thing in the ear­ly two thou­sands, and real­ized had­n’t played the game and he sh he had to play the game in terms of polit­i­cal engage­ment and that kind of stuff.

I remem­ber I was there at the time, I remem­ber we had, we had one guy in Wash­ing­ton, like we did­n’t have a team. We did­n’t have a depart­ment. There was one guy whose job was to sort of. Be in [01:05:00]Washington and be there to meet peo­ple and talk to peo­ple. And it was like for where Mike, what Microsoft­’s in the econ­o­my was, and its posi­tion as a tar­get.

It was like com­plete­ly under­staffed and unthought through. And it was a big shock, I think, to Bill when he got hauled over the coals for what he just thought was busi­ness. You know? Yeah. I crushed my com­peti­tors. That’s how we sur­vive, right? It’s a cut­throat indus­try tech, and, you know, we’re just smarter and bet­ter at it than every­one else.

So why is that a crime? And,

TK: So what you’re

Cameron: you know,

TK: was anoth­er Wash­ing­ton shake­down, Hey, you haven’t greased our wheels enough. You haven’t got enough staff over here tak­ing us out to launch, and we’re gonna get you. Yeah.

Cameron: yeah, yeah, yeah. I, I think it was. But um, and then, you know, he always said before then he was gonna spend the first half of his life mak­ing mon­ey and the sec­ond half of it giv­ing, giv­ing it away. And he did it like he did­n’t just, I. Talk about it. He did it. And when you know about his [01:06:00]parents too, and the kind of peo­ple, they were high­ly respect­ed, you know, mem­bers of, you know, waspy com­mu­ni­ty in Seat­tle, but, know, respect­ed lawyers and board exec­u­tives, his moth­er and that kind of stuff.

So I, I’ve always sort of been a sup­port­er of Bil­l’s and he had some mar­riage prob­lems and, know, may have had some, uh, illic­it rela­tion­ships with, uh, women and employ­ees and he’s paid the price for that. Uh, in terms of his mar­riage and his, you know, I don’t think he was as involved in any dirty way with Epstein.

Uh, that just does­n’t track. again, when you take the Buf­fet thing into account, yeah, it just does­n’t, buf­fet would­n’t be asso­ci­at­ed with as close­ly as he has been with Bill. If Bill was that kind of guy, I don’t think,

TK: Yeah, you, you’d expect that. Yeah. But yeah, I mean, remem­ber, oh, way back when War­ren first met Bill, and he, he put a lot of his feel­ings about Bill into [01:07:00] some of the, his writ­ings. Um, and, you know, they were, the smartest guy I’ve ever met. I did­n’t want to meet him. Some­one intro­duced us and then I found out, you know, sort of four hours lat­er we’d been talk­ing non­stop for four hours and he was just impres­sive.

And, and then I’m

Cameron: Mm,

TK: who intro­duced the giv­ing pledge to who, whether Bill intro­duced it to War­ren or War­ren to Bill. But yeah, that’s cer­tain­ly one of the most impres­sive things about War­ren and Bill is that they’re giv­ing away their for­tune. It’s not going to their kids. a lot of it.

some of it is, but most of it’s been giv­en back to the soci­eties that help

Cameron: Hmm. Yeah, I’m pret­ty sure it was Bill that intro­duced it. I mean, it was part of the Bill and Melin­da Gates Foun­da­tion idea, I think, but may have come from some­body to them. I’m, I can’t remem­ber the gen­e­sis of it. ’cause there was some, um, inter­est­ing phil­an­thropists that they got involved with, but. Yeah, that’s inter­est­ing.

TK: And I, I remem­ber, um, I remem­ber when, um, foun­da­tion was being talked about, and [01:08:00]it still stayed with me. I mean, bill was just great at dis­till­ing things down to their core prin­ci­ple. And he, you know, what was, so, he may have been dur­ing an inter­view and some­one said, what’s the phi­los­o­phy behind the and Belin­da Gates Foun­da­tion?

And he said, phi­los­o­phy guid­ing it is that every life is cre­at­ed equal. And when you think about that, you know, you, you, it allows you to then build on that and say, well, where can I have the best bang for my buck? does­n’t have to be in a west­ern coun­try. It can be pre­vent­ing malar­ia in Africa or what­ev­er.

But I just thought that was an amaz­ing way to approach a char­i­ta­ble foun­da­tion was go back to first prin­ci­ples and let that be your guid­ing light.

Cameron: you know, Chris­sy and I were sort of talk­ing about this dur­ing the week. I’ve been read­ing this biog­ra­phy on s Kovich and. It, it’s sort of an exam­ple of why that’s impor­tant. I mean, okay, so he’s a com­pos­er. He did­n’t cure can­cer, or he did­n’t, he was­n’t Ein­stein or what­ev­er, but gen­er­al­ly [01:09:00]considered one of the great­est com­posers of the 20th cen­tu­ry, if not the great­est, and prob­a­bly one of the great­est com­posers of all time most clas­si­cal music nerds.

Um, and he was born into a poor fam­i­ly his father died when he was very young. Um, just pri­or to the rev­o­lu­tion, his moth­er had to, she had like four or five kids, sin­gle moth­er. Dur­ing the rev­o­lu­tion. The econ­o­my of Rus­sia was wrecked. Um, and, uh, he was a very sick­ly child. Uh, had a lot of, know, med­ical con­di­tions.

Very sick, very weak, and, but he was a prodi­gy, a musi­cal prodi­gy. And so he end­ed up at the Con­ser­va­to­ri­um in St. Peters­burg at 13 and had to get sort of finan­cial sup­port some of the ear­ly, um, Bol­she­vik were [01:10:00] pro­vid­ing finan­cial sup­port for him. The guy the com­pos­er, G Ov, who ran the Con­ser­va­to­ri­um, you know, whee­dled, um, grants out of the gov­ern­ment to give him sup­port. Uh, he had to get a job play­ing piano and silent movie the­aters when he was a teenag­er to help pay for the help for the fam­i­ly. ’cause they had no income and all this kind of stuff. Um, I. But you know, it was this great com­pos­er who, if he had­n’t have got finan­cial sup­port from the state and from friends and patrons around him, would’ve not sur­vived long enough to com­pose all of this great music in the 20th cen­tu­ry. You don’t know where the

TK: Mm-hmm.

Cameron: are in soci­ety. They could come from poor, under­priv­i­leged fam­i­lies, and if we don’t give them, you know, med­ical care and edu­ca­tion and oppor­tu­ni­ties, then all of soci­ety, not just in that case, Russ­ian soci­ety, but glob­al­ly, [01:11:00] we’ve ben­e­fit­ed from him or from an Ein­stein or from a Madam Curie or, you know, pick, take your pick of peo­ple that have, you know, cre­at­ed peni­cillin or cre­at­ed what­ev­er it was, it’s cement, which we can talk about in our next show.

TK: Okay. no, I agree with you a hun­dred per­cent. You dun­no where the the next genius is gonna come from. And tech­nol­o­gy’s a

Cameron: from the rich­est fam­i­lies, you know, the rich­est 1%, you know?

TK: 1%. Yeah. Tech­nol­o­gy plays a big part in that too. You know, that, um, I think it was Col­er who said, you know, with, you can film it, make a film on your phone these days so that he’s look­ing for the next, um, uh, next, uh, cou­ple to come from, you know, a, the slums of Brazil or some­thing like that, that

Cameron: yeah,

TK: cheap tech­nol­o­gy and, and goes to, you know, just goes to town with it and makes a, a, a great movie from it.

Cameron: yeah. [01:12:00] Well, I’m wait­ing for that to come out of AI gen­er­at­ed, uh, stuff too. Like there’s plen­ty of peo­ple now. I saw an ani­mat­ed film just the last day or so. It’s like a five minute ani­mat­ed short about, um, bear. That saves the life of a rac­coon or some­thing. And then they become best friends and they go on this jour­ney togeth­er.

It’s like a Dis­ney

TK: right.

Cameron: thing all made with AI tools, um, by a guy who’s a pro­fes­sion­al ani­ma­tor. said, this would’ve tak­en, this would’ve tak­en a year. I did it in like a week with these ar or hours I think he said, or some­thing like that with, uh, days with these AI tools just, uh, telling it what to cre­ate. Um, so there will be great, um, pieces of art cre­at­ed with these tools that peo­ple could­n’t have done before. ’cause they could­n’t afford the bud­gets for it now. So yeah.

TK: Yeah, no, def­i­nite­ly.

Cameron: Well, apolo­gies if we did­n’t get to ques­tions [01:13:00] this week. We’ll do them next week. I think it was a real­ly, real­ly good con­ver­sa­tion with, uh, Steven Mabb Thank you to Steven for com­ing on again and walk­ing us through the as, a’s view on those things. I look for­ward to his report back in a few months when he has the sit down with the heads of the fires fam­i­lies, uh, Tony and I are gonna go down and do an Amer­i­can show

TK: Yes.

Cameron: Amer­i­cans out there.

TK: Talk. about how impor­tant it is to main­tain, uh, Medicare and Med­ic­aid and aid to peo­ple.

They love that. They love that kind of talk over there. Yeah. Thank you

All right.

Cameron: TK. Have a good week every­one. [01:14:00] [01:15:00]