This without Gina Raimondo, no matter what. And so it was well worth waiting for. So thank you all for being here, and it's great to have this panel. I must say, having watched the program throughout the day, starting with the Prime Minister and going through, we've heard about a lot of different risks and changes and things changing in the world. I think this panel is the one who's going to say what you do about all that. I mean, it's one thing to understand it and think about it. These people actually have to deal with it from a variety. I think it's a great variety of different viewpoints. I mean, from an Indian conglomerate, multinational conglomerate, to the largest investment money management firm in the world, to the leader of number two or number three in the world auto company.
Number two, number three.
The way I was raised, that's what counts. Profit is what counts.
And of course, Gina Raimondo, the honorable. Thank you so much for being here. It's great to see you all. So back when I was running some stuff like ABC and ABC News, I learned the hard way there's a big difference between what's urgent and what's important. And if I didn't look out, if I didn't watch out, I was dealing with the urgent every day. And if I didn't get to the important stuff, then I never got that done. So, having heard all the different things that are changing, whether it's geopolitics, geoeconomics, trade, technology, capital markets, so many things are changing. I'd like to ask each of you, from your perspective, how would you divide up the urgent, important? And I'll pick on you a little bit here, if I could, from the government's point of view, because you sort of spent a fair amount of time in government, in state as well as, of course, federal at the Commerce Department, as you thought about economic policy, regulatory policy. What was urgent and what was important?
Yeah. Well, good afternoon. Good to be back. I hope you're all having an excellent conference. I mean, there's a lot of urgent in the government today. Some are own goals or problems of government's own making, but certainly in terms of the urgent, you know, we are in the middle of a number of conflicts at the moment that are urgent, and I would argue need to be urgently resolved. You know, the conflict in Iran is urgent, with challenges reverberating around the world, driving up energy prices, hurting supply chains. So that's urgent. Ukraine, urgent. You know, so these are things that require immediate attention and hopefully resolution. I think issues with respect to AI safety, and of course, all of these are important, but you know, AI safety, I worry about this one a lot. I think we know now that we have to put in place AI safety standards, and AI, and I'll speak for the US primarily, but it's true worldwide. You know, we need AI safety standards, we need governance, we need enforcement of these standards, and I am worried that that won't happen until after we have a crisis, and depending on what the crisis is, it could be, you know, very devastating.
So those are things that I think need to happen immediately and are vital. When I think about important and maybe a little bit longer term, I think it's important to have an AI economy strategy, which is to say it's not enough to invest in AI and achieve the productivity enhancements, but how will we do that in a way that provides broad prosperity, not concentrated prosperity? How will we do that in a way that makes sure all workers have an opportunity, not just a few? How will we get to an AI agentic economy without a period of destabilizing unemployment? And I'm very focused on that in the economic development bucket because, of course, at the end of the day, I think with AI safety breeds trust, trust breeds adoption, adoption will breed diffusion and more success. And the same is true for unemployment. If we go through a destabilizing, crushing high unemployment, it will slow everything down. So I put that in the important, not urgent bucket because that requires some strategic thinking.
We have to be intentional about that. So I'll stop there. Talk about supply chains. We talk about so many other things, but those are a few things I have on my mind.
So that's terrific on a macro level. So Kumar, let me turn to you at the top of a conglomerate in 40-plus countries.
That's a very interesting question, and thank you for having me. You know, all through the sort of crisis and all through the upheaval, we've been constantly investing as well in our existing and in new businesses because, you know, you can't stop growing. So for me, capital allocation has been a challenge because you have a whole lot of new demands on your capital, which we know about. But at the same time, like I said, you keep growing. You either grow or you go down. You can't be in a state of equilibrium. The other one clearly has been geopolitics because we are a global organization, and you know, when I read about a significant global event in the newspapers, I can be sure that it will impact us somewhere in the business, somewhere in the world, which I may not even sort of understand the full import of when I'm reading it in the papers. So geopolitics is the other one, and I think what's really important, and the lines are blurring now between important and urgent, I think, is people. For us, it's a people-run organization, and constantly keeping people, you know, getting them to keep their chin up, getting them to collaborate and learn from each other, learn from outside, make sense of, you know, joining the dots of what seem very disparate and different events happening across the world. At the end of the day, it's people who make the difference, and I think keeping them going and keeping them enthused and energetic is an equally important task.
So Jose, you're not a big company, manufacturing company the way Kumar does, but it's different in that you're really in a sector, automotive sector, but it's a massive company and you have to make long-term capital investments. At the same time, things are changing every single day. How do you balance out those two things? Particularly, I must say again, from the United States point of view, where the policies change on EVs, for example, it seems like from month to month. How do you balance those two things? Stay agile for the present, but actually be thinking 10, 15 years down the road.
You know, first and foremost, thank you for having me, and congratulations on your 30th anniversary in India. You know what? We celebrate tomorrow our 30th anniversary in India, and we're going to make a big announcement in our new plant in Pune, our third one for the group, our second for Hyundai Motor Company. So I think, and I just didn't say this as an advertising element, but just simply it helps answering your question. So when you have important and urgent things, you have big problems, right? And the only way to consistently overcome those is to have long-term actions on a constant basis. So India is an example, right? So not all OEMs are now in a situation to confidently invest in moments which are very critical, right? So in some companies, they focus too much on the quarterly results. In our case, thanks to our executive chair, who is always looking in the long term. So the most important is to stay the course. So for example, most of our competitors have decided to not continue with the electrification. We stay the course, and then we found better solutions like developing robo-taxis. And then here in India, we're going to have about 50% of all our vehicles are going to be electrified by 2030, which is a lot, including CNG, EV, fuel cell, EV, and then hybrids. So you need to stay the course, and then that's why we have decided to make these investments in India. And then this is how we have become a kind of a global player, doing the same type of thing that we learned here in India as a kind of a blueprint, right? So becoming local in all the markets, but we also, as Secretary Raimondo mentioned, have to deal with all these elements. So the tariffs, the IRA that is gone, the war in Ukraine, the war in Iran, which has disturbed the operations a lot, and then the only way to go is to execute on your mid- to long-term consistently. The more you focus on the consistency of the long term, the less hard you have to handle the important and urgent, which I qualify as problems.
Right. So Rob, give us the investor's perspective. I mean, you guys have more than 15 trillion dollars now that you're responsible for investing.
We've been entrusted with over $15 trillion in client assets. But let me start out by saying, I knew I should have gone before you. We have no announcement as part of our session. But importantly, someone once said to me, if you don't know where you're going, every road will take you there. And I think what is urgent is that we are living in a world, you know, I saw there was a session earlier this morning, the end of predictability. I would argue that we're in a new world where it's actually quite predictable. You know, particularly if you're managing a portfolio, you no longer could say there's a base case and then I'll be plus or minus relative to the base case. We're living in a world that's being driven by geopolitical fragmentation, by demographics, by technology, by the way the capital markets are changing, such that the aggregate of this is a world that's much more about discrete outcomes and how do you think through what I would do to manage my portfolio across each of those discrete outcomes. And I think if you look at a company like BlackRock, we've been not only very focused on that from a portfolio perspective, but in terms of actually operating the company, we've grown to recognize, as romantic as it would be to have a slower world, as much fun as it would be to have a slower world, everything is just faster today. And it does go back to people and the ability to make sure that people understand this new pace that you're operating within. And if you think about it through a portfolio lens, many asset owners, in fact, you could argue a standard in terms of how one would approach a portfolio would be to have a strategic asset allocation that they would review every few years. And that asset allocation would be about individual asset classes. And what's clear is that in today's world, the themes that we're talking about, particularly themes like AI, what's happening with regard to the different wars going on, these themes are more important than individual asset classes in portfolios. And these themes don't wait for your next, you know, every three-year meeting that you're going to have. So you just need to continually adapt to make sure that you're keeping up with the pace that the world is changing, and that pace is likely going to continue to get faster and never go back to what it was.
In a world though, Rob, where there are so many possibilities and you have to anticipate a range of them. You can't just say, 'I believe this.' But at the same time, the changes are big enough. You have to make big, forgive me, bets. You can't just say, 'We're going to put a lot of little bets around.' How do you balance those two things? Because in making a big bet, you can give up some flexibility.
Well, it's interesting because you do have to have conviction in something. And if anything, the volatility that we're seeing in the world creates great opportunity in terms of delivering alpha, delivering outperformance relative to benchmarks. But you need to have conviction in something, but you also need to know what the range of outcomes is and what you would do if you're wrong. And just because you have great conviction in something, the best investors will have abilities to understand what is my plan B, my plan C, my plan D. And if anything, what's really becoming more and more apparent is that managing investment portfolios today, just the amount of information processing that goes into it is increasing exponentially. And we're entering a world, and obviously we're preparing our Aladdin platform in anticipation of this, but we're entering a world where no one will make an investment in a company without having a technology, an agent, some technology have done research that will have read everything about that company that's ever been written and have that be part of your thesis. It's just, it's a whole new world that we're living in.
