Name: PGIM CEO: Our business operates as part of a 'larger social fabric'
Uploaded: 2020-09-21
Duration: 7 min 28 s
Description: David Hunt says the notion of service and giving back is part of the character and culture of the company.

 SUSIE GHARIB: David, thank you so much for joining us. Your company, PGIM, is part of Prudential Financial, the huge insurance company. But many people don't know much about it. So tell us a little bit about what PGIM does. DAVID HUNT: PGIM is the 10th largest asset manager in the world. We manage $1.4 trillion, that's with a T, assets. And we do it across all of the major asset classes. In addition to public fixed income and public equities, we also are the second largest real estate investor in the world. And we have a very large private credit business. In fact, we're the third largest alternative player in the world. So we have a really broad scale of asset classes. In addition, we play very much as a global asset manager. We operate more than 30 offices across 16 countries, and we operate our business very much to serve both institutional and retail customers right around the globe. SUSIE GHARIB: Well, during the pandemic these past six months, you've been writing and talking a lot about the importance of stakeholder capitalism. And you say that one of the silver linings during this dark time is that many companies are stepping up and addressing the interests of their employees, and their customers, their communities that they serve, not just their shareholders. What are some of the changes that you can see? DAVID HUNT: Well, I think one of the really encouraging changes has been the level of investment and care that people have taken with their employees. I think you've seen company CEOs right across America, and indeed, in Europe as well, making sure that through this, their employees are well taken care of, that they have the tools that they need. They've stepped up in a fairly big way on education and helping people get settled in to work from home. And that investment in employee, they haven't viewed as an expense, but they've viewed that as a sign of future productivity in their employees. And I think that's very promising indeed. SUSIE GHARIB: So what else has surprised you as you look back at what some of these companies have been doing these past few months? DAVID HUNT: I've been really pleased to see the level of giving back into local communities that's happened. If I just take Prudential as an example, we've always been a major player in Newark, which has been our hometown for 140 years. But really with the pandemic, we have stepped up in a very big way from everything from contributing masks and protective equipment to actually upping our funding of a lot of minority owned and other businesses in the area. And many other companies have done the same. And I think it's been very heartwarming to see the care that people have taken in their communities. SUSIE GHARIB: Well, I was interested to learn that well before coronavirus hit, PGIM had already been supporting the communities that it serves. How did this all come about? Was this something that evolved naturally or was it intentional, something that you made happen? DAVID HUNT: I think it's been very intentional. It's a very important part of the character and culture of Prudential and of PGIM. The notion of service and the notion of giving back and that we really are here as part of a larger social fabric is very much how we think of ourselves. And so this is not new, but I would say that it's caused us to step up our level of engagement. And I think that that's been very positive. SUSIE GHARIB: Well, actually it seems that there is an expectation these days from employees and also from the public for business leaders to speak up and address social issues. Do you think that the job of CEO has changed? Do you have a moral responsibility to address these social issues? DAVID HUNT: Susie, I'm really glad you raised that, because I think that the expectation has changed. If I look at many of our clients, and many of them are big public pension plans, corporate plans, they're very interested in what our stance is on issues of diversity, issues around climate change, issues around governance. They're very interested in how we employ ESG technology to evaluate investments. And I think that this is a journey that they've been on for a while. But I think it's taken an enormous step forward now with the pandemic. And I expect that will continue. And personally, I welcome that. I think that that will lead to companies that have a broader set of stakeholders in how they actually govern themselves. SUSIE GHARIB: One of these days, the pandemic will come to an end. What's your prediction about the business community's commitment to being a good corporate citizen? Is this a short-term thing or a long-term commitment? DAVID HUNT: So I really do believe, I mean, again, we invest in companies for the long term. And companies that really do have a purpose and companies that do serve a broad range of stakeholders, in general, do better for their shareholders over the long term. And so I believe more and more companies will discover that through this pandemic. And I am very optimistic that the changes we've seen more recently will actually become part of the new normal as we come back out of this pandemic. SUSIE GHARIB: David, looking ahead, let's say two to three years from now, what meaningful changes would you like to see when it comes to the topics that we've been talking about? DAVID HUNT: So I think that the recent focus by many CEOs on social equality has been really, really important. And I have been very pleased to see the broad range of CEOs speaking out very openly and very publicly on taking an anti-racist stance. For ourselves, I'll just give you one specific example. We have for a long time had a very productive emerging managers program, where we invest in small asset managers that are largely minority owned. And these are very talented people who have very good investment track records but aren't getting large enough really to be on an institutional platform. And we work with them in kind of an accelerator fashion to get them to the point where they can get access. And, of course, when we invest in them, that provides a bit of a halo effect as well. And we've been really pleased at the success we've had in helping build more minority firms in asset management, which we desperately need. SUSIE GHARIB: David, that is impressive. And on top of that, it's a good example of your leadership during the nearly 10 years that you've been the CEO of PGIM. And I'm sure that during that time, you really haven't faced a leadership challenge like this global pandemic crisis. In what ways would you say that this crisis has changed or evolved the way you lead the company? DAVID HUNT: I think that the requirement on leaders in this last six months has been very different than normal. So often, we focus on strategic thinking, on some of the harder skills that we're all brought up to believe are critical for CEOs. But I would have said that in the last six months, motivation, empathy, compassion, and resiliency are probably much more. And if I think about how I'm spending my time, it's really with our employees and with our clients listening, making sure that I understand what they're going through, and providing as much support as I can to people who are in, no question, very unusual and difficult circumstances. 

David Hunt says the notion of service and giving back is part of the character and culture of the company.

PGIM CEO: Our business operates as part of a "larger social fabric"

Leadership

David Hunt says giving back is part of the company culture.