Are you a researcher, financial analyst or fund manager looking for new ways to investigate companies?
Are you doing due diligence on a potential purchase for a private equity firm and want to know how many widgets a target company's factory can actually manufacture?
Do you have accounting chops but want to learn how exactly a Scope 3 carbon inventory is calculated?
Perhaps you're eyeing an arbitrage opportunity involving both NOx emissions credits and ERCOT offsets in Texas for a newly developed peaker power plant.
I think I can help.
About five years ago, I realized I had a fairly unique skill set. I could pull public information from permits, surveys, filings, and databases and then transform that data into an actionable leads, trends and conclusion. No one else was doing this on a wide scale. Five years later and... they still aren't.
I'll teach you a whole new way to do research.
There is so much data available in the public sphere. Some of it might require a Freedom Of Information Act (FOIA) request or asking the right government employee the right question. However, most of it is right out there in the open, free for anyone to download at their leisure. Incredibly useful information is available can be found in places like the EPA's criminally underused ECHO database, a county Fire Marshal's office, or available in an American Petroleum Institute publication.
Historically, most company specific analysis required crunching accounting numbers, doing labor intensive channel checks, or relying heavily on insiders to selectively leak useful information. Company specific reports on the sell side are labor intensive, expensive, and rely on subjective opinions from highly compensated subject matter experts. These methods are all still valuable, but another shiny new tool in the kit is right at your fingertips.
Nearly a decade ago, I was working for a Big Oil firm. On top of doing internal operations and compliance audits and investigations, I was heavily involved in developing the company's Environmental, Society and Governance (ESG) program.
Bottom-up reporting for accounting numbers is and was a reasonably standardized task. Money is fungible and exchangeable. ESG data is a whole different beast. Collating OSHA injury rates, Permit Violations, Wastewater volumes, Hazardous waste, Employee demographics, and Carbon emissions involves data that comes in all shapes and sizes. Work hours, gallons, tons, and population distributions aren't just dollars and cents. This data is collected, manipulated, and rolled up into metrics that management can present to investors.
The idea that ESG is just "wokeism" is beyond silly. ESG metrics directly impact (and are impacted by) company operations. Legendary short seller Jim Chanos, who is a forensic accountant by trade, famously looks at executive turnover as one of his critical signs of a company in distress. That's not a hard, fraudulent line item on the balance sheet. It's a soft sign of a company with poor governance and lousy internal controls.
I started blogging under the handle ESG Hound just over a year ago. The goal was neither to sell ESG Marketing services or rage against the absurdity of ESG 0-100 scores handed out by credit agencies (though I did do a bit of that). I wanted to demonstrate how the different data that goes into things like ESG reporting can shine the light on companies deceptively selling phony green ideas to make executive stock grants go higher. I strived to ask some hard questions about industry and government policy choices. While mine is fundamentally a cynical take on ESG, I think the reporting of ESG metrics is a useful exercise. It gives the public another insight into how companies operate and allows investors to weigh what their priorities are in deploying capital.
In the past few years, I have done numerous "investigations" on behalf of others and myself. To be frank, most of these results confirm public claims or widely held beliefs. This doesn't make a sexy blog post. It makes for just plain due diligence. But the process, of how I answer a question, is where the value comes in. And it shows.
I have a rolodex of investors, academics and investors who ping me on a regular basis. They find my quick gut checks and unusual insights of "where to find XYZ" valuable. So here we are:
ESG Hound Pro is not an ESG Course. We'll absolutely cover some ESG topics, such as Carbon accounting. The SEC has highlighted accurate disclosure of these metrics as an area of emphasis, so material misstatements present a real operational risk.
Broadly, however, I want to teach others a new way to do research to answer specific prompts. Prompts such as:
- How many new gas wells in Coastal South Texas would be need to be drilled to provide sufficient gas for a 250 Megawatt Power Plant?
- Would placing a natural gas pipeline into New England offset more carbon emissions than a decade worth of solar deployments by virtue of eliminating the use of fuel oils?
- Is this claim by a small biofuels startup that their jet fuel is carbon negative total bullshit?
- How much natural gas will Tesla's new factory in Germany burn per year? Can they even get the supply needed?
- Is Danimer Scientific's biodegradable plastic economical or good for the environment?
- How many facilities in the US are at risk for litigation over Ethylene Oxide (a known carcinogen) use in urban areas?
- Are there sufficient water supplies to start several proposed lithium mines in the western US?
- What are the environmental compliance costs for Aluminum smelting in the US, EU and China and how does it compare to labor costs?
The answers to 1-3 were in my previously published work, and are respectively:
- At least 196 wells every five years
- Yes, New England's nation leading carbon intensity is driven by its reliance on fuel oils
- Yes, Negative Carbon fuels are nonsense
Topics 4-8 are some of the first I plan to cover in ESG Hound Pro.
Here is what will be included in a subscription:
-Two or three seminars per month, formatted as live video training with Q&As. Videos will be posted for all subs.
-Weekly office hours twice per week. Ask me anything. I'll tell you where to look. This feature should be highly valuable.
-ESG Hound Slack Server access
-You choose the prompts! Because I want this service to be valuable to you, I'll take suggested topics from my subs and run with it.
What's the Price?
I don't know yet. That's part of the reason I am doing a "Beta" run of the service. I want to balance my time and yours. I also want to make sure that it's worth it for me financially.
I'll strive to keep things smallish at first. But the beta is free! No strings attached and no payment on file is required. I currently have 20 or so slots available. Please shoot me an email at ESG.Hound@gmail.com and tell me why you think it will be valuable to you.
I look forward to hearing from y'all.