Citation
The labor of love and bread : professionalized and volunteer activism in the Sao Paulo women’s health movement

Material Information

Title:
The labor of love and bread : professionalized and volunteer activism in the Sao Paulo women’s health movement
Creator:
Lebon, Nathalie
Publication Date:
Language:
English

Subjects

Subjects / Keywords:
Nonprofit organizations ( jstor )
Political movements ( jstor )
Professional associations ( jstor )
Scattered disk objects ( jstor )
Social activism ( jstor )
Social movements ( jstor )
Volunteerism ( jstor )
Women ( jstor )
Womens rights movements ( jstor )
Womens studies ( jstor )

Record Information

Holding Location:
University of Florida
Rights Management:
Copyright [name of dissertation author]. Permission granted to the University of Florida to digitize, archive and distribute this item for non-profit research and educational purposes. Any reuse of this item in excess of fair use or other copyright exemptions requires permission of the copyright holder.
Resource Identifier:
29548096 ( ALEPH )
41328686 ( OCLC )

Downloads

This item has the following downloads:


Full Text










THE LABOR OF LOVE AND BREAD: PROFESSIONALIZED AND
VOLUNTEER ACTIVISM IN THE SAO PAULO WOMEN'S HEALTH MOVEMENT














By

NATHALIE LEBON













A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT
OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY UNIVERSITY OF FLORIDA 1998






















Copyright 1998

by

Nathalie Lebon






























Dedicated to the vibrant Sdo Paulo women activists without whom this work would not have seen the light of day.














ACKNOWLEDGMENTS

My first expressions of gratitude go to my mother and my father for always having believed in me and supporting my plans without a wink and for having instilled in me their genuine concern for social justice and equity. My deepest gratitude goes to the women who so generously dedicated their time so that I could conduct this research and without whom this study would not have seen the light of day. It is their tenacious commitment to bettering women's lives which has given birth to the Sio Paulo women's health movement and hence to this study. They taught me about the reality of social movements and organizations, about commitment and activism, about feminism in all its forms, and about myself It would be impossible for me to list here the names of all the women I interviewed and interacted with. In particular, I would like to thank the groups who opened their doors to my inquisitive eyes. In these pages, they have been renamed Feministas & Saude, Sazde Para Todas, The Casa da Mulher, Mulheres Unidas, Movimento Mulher e Satide, Grupo de Mulheres da Zona Leste, and Sande. Thank you as well to the F6rum de Mulheres de Sao Paulo para Avaliagdo da D&cada and to the Rede Nacional Feminista de Saude e Direitos Reprodutivos for allowing me to participate in their activities. A number of women offered me their friendship and spent time with me outside the "research setting:" Muitas saudades to Amelinha, Bel, Cassia, Cleide, Estella, Firmina, Fatima, Jacira, Liege, Maria, Melodie, Nalu, Regina and Teresinha, and especially to Flavia, Matilde, Lurdinha, Denise, GlAucia and Teresa. Thank you as well to the



iv









Association of Brazilian NGOs (ABONG) and in particular to Rosangela Dias 0. da Paz, for patiently answering all of my questions and sending me material even after I was back in the US.

In Sdo Paulo, the Carlos Chagas Foundation was particularly generous with institutional and logistical support, notably a vital email link, and a very fiendly staff. However, I also want to extend my warmest thanks to the researchers of their gender research group: Danielle Ardaillon, Cristina Bruschini, Teresa Citeli and Albertina de Oliveira Costa for innumerable supportive chats and stimulating conversations about feminism, the women's movement, and Brazilian life and politics.

I am deeply indebted to my committee for the support I have received throughout this endeavor. Helen Safa, as chair of my committee, was always present and supportive, providing essential guidance and inspiration, prodding me to give my very best, and concerned with my well-being as a human being. Marianne Schmink deserves my highest gratitude for crucial pep-talks and strategic advice, for her insights on institutional development issues, and for countless hours spent at straightening and fine-tuning my thoughts and sentences. I feel very fortunate to have met Sonia Alvarez, whose long-term insider knowledge and understanding of the issues at hand and of the Brazilian women's movement have been a blessing. During my stay in the field and throughout write-up she opened the way for a close collaboration which was essential in strengthening my arguments and boosting my confidence. Philip Williams' comments and knowledge of social movement theory and democratization issues were most welcome. So were his friendly support, encouragements and insightful suggestions during write-up. Throughout my years at Florida, Maxine Margolis offered me her unconditional support, which made



v








my first trip to Brazil a reality. I thank her for her astute comments on my work, and for partaking with me in her remarkable knowledge of and love for all things Brazilian. Tony Oliver-Smith was essential in helping me find my marks within the moving terrain of social and anthropological theory. His enlightening reading suggestions and stimulating conversations were critical in refining my view of the role of culture which led to my understanding of the relationship between culture, politics and democratization.

I was fortunate to meet, along my trips to foreign lands, great people to help

quench my thirst for home: the Matera-Castro family in Rio de Janeiro and the Romitelli family in Sdo Paulo both hosted and pampered me as their own. My dear friends Claudia Castro and Silvia Romitelli provided the link.

My "expatriate" friends in the field Bertha French, Ann Mische, and most

especially Sara Nelson, were an inestimable source of research discussion, fieldwork survival tips and vital play time. My closest friends in Gainesville Karla Slocum, Karen Hjerpe, Cristina Espinosa, Vicki Michener, Laura Kozuch, Bryan Byrne and Peter Cronkleton shared research and writing experiences, and provided countless advice and encouragements, as well as opportunities for having a good time over the years. Finally, I want to thank my companion, Scott Hill, for his encouragements, for lively and stimulating "anthropological" conversations and comments on my work, for having stuck through thick and thin during this sometimes painful delivery, as well as for constantly reminding me that there is life beyond academia... and for delicious dinners.









vi














TABLE OF CONTENTS

PAM

ACKN OW LED GEM EN TS ........................................................................ I.- ............... iv

LIST OF TABLES ...... ...................................... ........................................................... xi

ABSTRA CT ....................................................................................................... .......... xii

CHAPTERS

I INTRODUCTION ..................................................................................................... I

Social M ovem ents and the D eepening of D emocracy ................................................. I
M ethods and Fieldw ork Experience ........................................................................... 5
The Politics of Representation and the Ethnography of A ctivism ............................... 9
Setting the Stage ...................................................................................................... I I
Sdo Paulo in Facts ............................................ ................................................. I I
H ealth Situation in Brazil ................................................................................... 15
The Brazilian Public Health Care System ........................................................... 16
Outline of Chapters .................................................................................................. 17

2 SOCIAL MOVEMENT RESEARCH AND ANTHROPOLOGY ............................ 20

In tro d u ctio n ....................................................................................................... ..... 2 0
Resource Mobilization Theory and New Social Movement Theory ........................ 21
Bridging the Gap In Social M ovem ent Research ............................................. ........ 25
D isruption versus Integration in the Political System .......................................... 28
Social M ovem ent Fields ........................ ............................................................ 29
Organizations and the Formalization, Institutionalization and
Professionalization of Social M ovem ents ................................................................. 30
Form alization and Institutionalization ................................................................ 30
Professional ization ............................. .................................................... .......... 34
Consequences of Professionalization ......................................... ............................. 37
The Role of Funding ..................................... .......................................................... 40
Anthropology and Social M ovem ent Research ..................... ................................... 43
Culture, Agency and Social M ovem ents ............................................................. 43
Social M ovem ent Heterogeneity ........................................................................ 49
Importance of Practice in Collective Action ................................. ................ .... 51
How Organizational Forms Influence Collective Identity and Solidarity ............ 53
C o n c lu sio n ................................................................................................. ............ 5 7


vii









3 NONGOVERNMENTAL ORGANIZATIONS AND THE WOMEN'S
M O V E M E N T ....................................................................................... ....... .......... 59

In tro d u ctio n .................................... ........................................................................ 5 9
The Social Construction of a New Political Actor: Nongovernmental
O rg an izatio n s .................................................... ......................... ........................... 6 1
The Origins: Popular Education Centers and the Dictatorship ............................ 61
NGOs in the Time of Democratization- Building Civil Society ................... ...... 64
"NGOs? What Kind of Beast is This?" NGOs Born Out of a Social Movement ....... 67
The Story of the Brazilian Women's Movement ................................................. 69
The "Takeover" by Issue-Specific Groups and Networks ................................... 78
Feminist NGOs: A Contested Definition .............................................................. ... 88
Funding as a Defining Criterion? Are Aid Agencies Straight-Jacketing
N G O s? ... ........................................................................................................... 8 8
R elationship to the M ovem ent ........................................................................... 90
A n H ybrid Identity ................................................ ............................................ 92
Relation to the State and the Development Apparatus: "From Subversion
to S u bv entio n ? .. ................................................................................. .............. 9 6
The Women's Movement as a Social Movement Field.. ......................................... 102

4 FACING THE DREAM OF "SISTERHOOD" AND THE PRAGMATICS OF
GETTING THINGS DONE ............................................................ ..................... 105

In tro d u ctio n ........................................................................................................... 10 5
Snapshots of E ncounters ............................. .......................................................... 107
Democratization and NGOs'InternaI Dynamics ...... .............................................. III
Social Control: General Assemblies and Boards of Directors ........................... 113
Internal Dynamics: The Challenges of Participatory Democracy ...................... 115
Professional ization and the Homogeneization of Members ............................... 120
Division of Labor: Technical Team and Administrative Team .......................... 124
Introducing Elements of Instrumentality ................ ............................................... 129
Role Specialization among NGOs'Technical Staff .......................................... 129
Feminist Identity and Administrative Staff .............................. ........................ 134
Collective Versus Individual Incentives and Rewards and the Logic of
Id e n tity ........................................................................... ................................ 13 6
Why A More Formalized, Segmented Organizational Structure? ........ .................. 138
Volunteer Groups' Administrative Challenges .................................................. 138
The "Logic of Projects" and Management of Grant Money .............................. 143
C o n c lu sio n ......................... ................................. ................................ ............... 14 6

5 THE LABOR OF LOVE AND BREAD: ORGANIZATIONAL PRACTICES,
INDIVIDUAL AND COLLECTIVE IDENTITIES ............................................... 148

In tro d u ctio n .......................................................................................... ................ 14 8
From "Militancia" to "Work" and Back: The Meaning of Working in a
F em in ist N G O ....................................................................................................... 15 0
Individual Activist History and Moment of Entry in NGO .................. ............ 153


viii









M oney versus Belonging .................................................................................. 155
Solidarity and Self-Interest .................................................................................... 157
The Labor of Love and Bread ................... ............................................................ 162
Collective Identity: From Direct Action Movement to Advocacy Group ................ 163
M ulheres Unidas: It's Like a Train ... at the Rhythm of the M ovement ............... 164
Feminists e Safide: A Respected Health Policy-Centered NGO ...................... 166
Planning versus "Colar a Realidade" (Stick to Conjuncture) ............................. 169
Conflicting Time Schedules ... ................... ................................................. ... 173
"Feminism of the Other .. ................................................................................. 174
C o n c lu sio n ............................ ..................................... ......... ............................. 17 6

6 ENCOUNTERS AND MISENCOUNTERS: "CITY" AND
"NEIGHBORHOOD" FEMINISTS ....................................................................... 180

How Different are Neighborhood W omen? ............................................................ 182
Cultural Differences ......................................................................................... 185
Differences in Interests and Needs ................................................................... 188
W hen Diversity M eans Trouble ...................... ............ ......... ............................ 191
Get to the Point: Time Constraints Hinder Participation ................................... 194
"Big Groups" and "Small Groups .. ................................................................... 194
The Rule of Homogamy ................................................................................... 195
W here Did All the "City" Feminists Go? ..................... .................... .................... 198
A Feeling of Abandonment .............................................................................. 199
The View from the Other Side ............................................ ............................ 201
Looking for Explanations ....... .............................................................................. 205
A New Political Environment .............................................. ........................... 205
Specificity of the M ovement in Sao Paulo ........................................................ 206
The Desk and the Street ................................................................................... 210
Professional ization Accelerates these Processes .... ........................................ 211
"The Feminists Are Still the Others .. ............ ................................................. 216
Unraveling a Paradox ........................ ................................................................... 219
Group-Capacity Building ..................................................................... ........... 220
The Characteristics of Projects ......................................................................... 221
C o n c lu sio n ............................................................................................................ 2 2 6

7 PUTTING ON THE ROOF BEFORE LAYING THE FOUNDATIONS?
FEMINIST NGOs, THE UNITED NATIONS AND THE STATE ........................ 228

In tro d u ctio n ......... ......... ................................................... ............... ................... 2 2 8
A M ove Away from Local and Street Activities ..................................................... 231
Different Dynamics in M ass Events ................................ ...................................... 232
Relations of Local, National and Supranational Agendas ......................... ............. 236
Representation at the National and International Levels ................... ..................... 241
Institutions Push for Hierarchization ... ............................................ ................ 242
The M ovement Resists ..................................................... ............................... 243
P ow er D ifferentials ................................................................ ......................... 24 6
Relations with the State ............... ................................. __ ........................... ........ 253


ix









Conclusion- Bridging the Local/International and the Political/Cultural ................. 261

8 UP THE PURSE'S STRINGS: NGO RELATIONS WITH DONOR
A G E N C IE S ........................................................................................................... 2 6 5

Donor Agencies: A Diverse Community ................................................................ 266
Latin American NGOs in Crisis ........................................................... ................. 269
Shift in Funding Policies of European Nongovernmental Donors ..................... 270
The Shock of the "Plano Real ........................................................................... 271
Change in Organizational Culture in European Agencies ................................. 272
Bitter Consequences for NGOs .............................................................................. 276
M ore M arket-Like Dynamics ................................................................. ............... 278
Objectives of International Agencies ..................................................................... 282
From Effi ciency to Empowerment ................................................................... 283
L ib eral G o a ls ................................................................................................... 2 8 7
The Population Control Issue ........................................................................... 288
Fostering Already Established Organizations with an Advocacy Focus .................. 290
Contributing to Formalization and Hierarchization ......... .......................... ...... 291
Contributing to Institutionalization and Hierarchization ................... ............... 293
"Let's Stand-up and Denounce" is Out: Influencing Policy-Makers Is In .......... 295
How W omen View and Resist International Agencies ........................................... 302
NGOs'Resistance ............................................................................................ 306
Noticeable Problems ........................................................................................ 308
C o n c lu sio n ............................................................................................................ 3 1 1

9 CONCLUSION ..................................................................... .................. ............ 315
Relationship NGOs/Social M ovement ................................................. ................. 315
Impact of Practices on Collective Identity .......................... ................ .................. 317
Keeping the Balance between Policy Formulation and Mobilizing/Cultural
C h a n g e .................................................................................................................. 3 1 8
Getting the Best of Both W orlds ............................................................................ 321

APPENDICES

A ORIGINAL OF QUOTES IN PORTUGUESE ............ ........................................ 328

B DESCRIPTION OF M EM BERS'ACTIVITIES ................................................... 366

REFERENCES ............................................................................................................ 369

BIOGRAPHICAL SKETCH ....................................................................................... 388









x














LIST OF TABLES

Table pM,e

3-1 Characteristics of Feminist NGOs Members of ABONG ....................................... 86

4-1 Socioeconomic Profile: Summary by Organization ............ ................................. 125

4-2 Socioeconomic Profile and Political Participation of Members (Support Groups) 126 4-3 Organizational Characteristics of Volunteer and Professionalized Groups ........... 139

6-1 Socioeconomic Profile and Political Participation of Neighborhood Activists ...... 184 6-2 Change in ABONG Members' Spatial Scales of Action ....................................... 199

7-1 1994 Budget of Sdo Paulo Feminist Support Groups ......................... ............... 249

8-1 Types of Financing for some Brazilian Women's NGOs ....................................... 267

8-2 Groups' Sources of Financing in 1995 ................................................................. 269

8-3 Ford Foundation. Grants Awarded to Brazilian Organizations under their
Reproductive Health and Population Program, 1994 ...................................... 296

8-4 MacArthur Foundation. Grants Awarded to Brazilian Organizations under
their Population Program 1994 .................................................................... 296

8-5 MacArthur Foundation. Grants Awarded to Brazilian Organizations under
their Population Program 1996 ................................................................ ... 297

8-6 SPT Projection of Budget for 1993-1996 ............................................................ 297











xi














Abstract of Dissertation Presented to the Graduate School
of the University of Florida in Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy

THlE LABOR OF LOVE AND BREAD: PROFES SIGNALIZED ANT)
VOLUNTEER ACTIVISM IN THE SAG PAULO WOMEN'S HEALTH MOVEMENT By

Nathalie Lebon

August 1998


Chairman: Dr. Helen I. Safa
Major Department: Department of Anthropology

In the past 10 years, many professionalized organizations, also referred to as nongovernmental organizations (NGOs), have been formed in the Brazilian women's movement. This study examines the origins of this trend, linked to the boom of NGOs worldwide, to the return of formal democracy in Brazil in 1985, and to the still limited absorption by the international development establishment of part of the women's movement agenda, as well as to changes internal to the movement. Based on ethnographic research, this study compares the collective identity, practices and internal dynamics of two professionalized and two volunteer groups dealing with women's health in Sdo Paulo. This study demonstrates that the women's movement is best understood as a social movement field with heterogeneous participants. Feminist NGOs are one of them. Yet, their organizational characteristics distinguish NGOs from classic social movement organizations. In search of the efficiency and management capability required by the logic



xli








of projects financed by donor agencies, NGOs have a more formalized and differentiated internal structure, less permeable for neighborhood women. The presence of extrinsic rewards alters the meaning of members' participation in feminist NGOs which becomes simultaneously a commitment for gendered social change and a means for earning a living. NGOs have an hybrid identity. Their emphasis on planning, linked to accountability to donors for funded projects, tends to steer NGOs away from, and to limit their potential for, consciousness-raising and mobilization. Yet, it stimulates publications, research activities and advocacy in policy-making arenas, a shift already promoted by the transition towards formal democracy. As a result, professionalized feminists have tended to reduce their involvement with Sdo Paulo neighborhood women's groups. With professionalization, the movement also faces new challenges in terms of increased power differentials.

Professionalized activist organizations and their associated institutional strategies do contribute to social change. Yet, a two-pronged strategy with a vibrant movement involved in cultural/micro-level change is essential for true democratization and gendered equity. Strategies increasing NGOs downward accountability to their constituency would greatly enhance the balancing act between their advocacy and their micro-level culture change projects.













xiii















CHAPTER 1
INTRODUCTION


Social Movements and the Deepening of Democracy


The other day I was asking somebody who belongs to a women's group:
Your organization, is it an NGO or is it the movement? She replied: It is the
movement! I said: But what do you mean? you' re structured like an NGO. She
said: No, for us it is the same thing, there is no difference. We are an
organization at the service of the movement.
This can't be! An NGO is an NGO! A social movement is a social movement!
NGOs, in principle, are only accountable to financing agencies. The movement is accountable to those it represents! What kind of siniility is there here? I think
that if we do not make this point very clear, we will not contribute to
redemocratization. It is fundamentally linked to a truly democratic order in this
country! [Volunteer feminist activist from Rio de Janeiro]'


This is how it all started. This Brazilian feminist activist, back in the summer of 1992, had planted the seed that would become this dissertation. Her questioning was about the nature of social movements and of NGOs, about the relationship between the two and about their contribution to the democratization of Brazilian society and politics, as well as about the role played by financing agencies in this story. I decided to find out more about these issues.

In 1985, a formnal democratic system was reinstituted in Brazil after two decades of military rule. As in other Latin American countries, the women's movement along with other social movements and grassroots organizations have a been significant participants in this redemocratization process. However, Brazilian society has been and still remains characterized



All quotes translated from Portuguese by author.


1






2


by social authoritarianism: hierarchy and inequality pervade the cultural practices through which people relate to each other in everyday life (Weinstein 1994; Da Matta 1987). This pattern is reflected in severe economic, racial and gender inequalities (Dagnino 1994a; Lovell 1993). True forms of cultural, economic and social democratization remain to be achieved for a "deepening of democracy" (Alvarez 1993). Beyond battling social authoritarianismr, a deepening of democracy would entail creating "channels and strategies that increase nonelite access to policy-making and implementation" (Alvarez 1993: 212).

This study focuses on the role the Brazilian women's movement can play in these

processes, using the Sdo Paulo women's health movement as a case study. In the past 10- 15 years, the women's movement has undergone partial professionaliztion --strictly speaking, the process by which activists come to be remunerated for their movement activities-- through the creation of nongovernmental organizations (NGOs). Generally, NGOs are defined as legally sanctioned civil organizations providing services and support to local grassroots groups in disadvantaged communities and/or engaging in research and advocacy activities, a concept derived from Carroll's Grassroots Support Organizations (1992:11). Maintaining the balance between these two poles of activity (advocacy and support) has been a challenge for many NUOs, including for women's NGOs, due to the political opening in Brazil, as well as to their own history and nature as members of an identity-based movement. NGOs have a permanent, paid staff and are accountable to some degree to their donors, most often international agencies or private foundations, for the research, consulting, service-providing projects or support to local women's groups for which they are granted funding. Their structure is fairly formalized, usually with a coordination heading the organization, and a division of labor, especially between administrative tasks and the "technical" work done by specialized staff. However,









NGOs differ according to organizational histories and the political and personal characteristics of their members.

Some volunteer feminist groups perform similar activities as do NGOs, although in a more spontaneous manner, responding to demands as they arise rather than following projects. They have a voluntary, fluctuating membership of activists. They are more likely to be accountable to their constituency, or to grassroots groups since they do not depend on donor money for their organizational survival and have smaller budgets. They also dedicate some activities to the needs of the members of the group itself

Both feminist NGOs and volunteer feminist groups engage in coalition work of the women's movement and in advocacy for greater gender equity. They consider themselves feminist. In that sense feminist NGOs differ from other NGOs which also work with women but do not generally participate in the women's movement and do not identify, themselves as feminist. I will use the terms NGO, professionalized organization and professionalized group interchangeably in this dissertation. I sometimes refer to professionalized feminist groups and volunteer feminist groups collectively as support groups, for want of a better label, when I wish to distinguish them fr-om the neighborhood women's groups with which they interact. As I have just mentioned, this term is not very satisfactory since many of these groups have reduced the support they were offering to neighborhood women's groups. I also sometimes refer to volunteer groups as volunteer support groups, again to distinguish them from neighborhood women's groups, all of which are also volunteer. To complicate matters flither some of these neighborhood women's groups consider themselves feminist, a phenomenon known as popular feminism, which I will discuss in chapter 6.






4


The purpose of this dissertation is to understand the origins of the trend towards professionalization of the women's movement, via the creation of NGOs, considering the internal and external factors that have contributed to this process. It is also to examine the impact of professsionalization on the internal dynamics of the groups, as well as on their collective identity and strategies, on their relationship to the neighborhood women's organizations they offer support to and sometimes get to represent. I will also consider the groups' position vis-A-vis the national and international power structure and their relations to international donor agencies. One of my concerns, throughout this work, has been to highlight the trade-offs of professionalization with regard to the potential of the movement to bring about a deepening of democracy within the women's movement and in the larger society.

I hoped, when I started this work that it could be of use to movement activists. John Burdick made a cogent argument for the role ethnography can play in illuminating diversity within a movement and hence in helping the movement identify, its challenges and potential for growth. He aptly sees applied anthropology as a strong base f-rm which to launch this kind of work, provided we shift the focus of much of the subdiscipline from "agency or state-initiated projects of social change" (1995: 363) to these grassroots efforts. Yet, this type of ethnography is not without challenges: throughout the research and write-up process I have wondered what gave me the right --not only as an outsider but a neophyte who has not even participated in any of their struggles-- to question some of their practices when these women have dedicated their lives to matters of feminism. Leilah Landi who worked for an NGO and wrote her dissertation based on this experience, puts it in these terms: "to write a sociology of agents who consider themselves as "at the service of others" is still an issue fraught with ambiguity and






5

questioning"(fazer uma sociologia de agentes que se querem 'a servico' ainda e questdo carregada de ambiguidades e questionamentos) (1993 a: 19).

Beyond this immediate, applied dimension of my work, it is important for

anthropologists, who have until recently neglected the study of social movements, to take a closer look at these nonkin forms of social organization. Burdick reminds us that "a generation ago, Richard Clemmer [...] declared that a sustained commitment by anthropologists to the study of organized popular attempts to bring about social change would "provide anthropology with a much more balanced and useful body of theory" (1995:36 1).

Finally, although nongovernmental organizations (NGOs) have become ubiquitous in the literature, especially on development and transnational activism, and have prompted many declarations of faith, few first-hand ethnographic studies are available of their power dynamics and relationships to the grassroots and to the State (Fisher 1997). Such studies could also illuminate "changes in the nature of local and global forms of collective action" (Fisher 1997:44 1). The strength of the international women's movement, of which Brazilian feminists are noted participants, is undeniable. Yet, we need to assess how it affects local organizing and processes of democratization.


Methods and Fieldwork Experience


I decided to focus on the issue of NGOization (a Ongizagdo) of the feminist movement as a result of a preliminary research trip in July and August of 1992, when I conducted semistructured interviews with 21 women activists, primarily in Rio de Janeiro. Questions relative to the professionalization of the movement examined in this dissertation were starting to raise eyebrows among activists, as the quote at the beginning of this introduction denotes. A review








of the literature at the time revealed practically no discussion of these issues. My dissertation topic was decided.

I went back to Brazil from September 1994 until November 1995, this time mainly to Sdo Paulo. I did travel to Rio de Janeiro for national events such as the national conference in preparation for the IV UN conference on Women. This fieldwork consisted of two phaseS2. During the first phase, which lasted from September to December 1994, 1 surveyed the existing women's health groups in Sdo Paulo in order to select a sample for the larger project. My original research design called for identifying two volunteer groups and two professionalized groups that otherwise would be as similar as possible in terms of size, members socioeconomic profile and racial/ethnic identity, and activities. conducted. Once on the ground, however, I realized that, although there was some overlap, the structure, members' composition, collective identity and the activities engaged in by the two types of groups were in fact quite different and that this was an important issue to look into. I therefore chose 4 groups which represented different trajectories, although they all consider themselves as feminist and work on health issues.

The second phase lasted from January to November 1995. During this stage of the

research I learned more about the different types of groups through participant observation and semi-structured interviews. More specifically, I conducted interviews with each of the members


2 The first phase was financed by the North-South Center through their Short-term Field Research Grant Program on Poverty and Urban Violence. The second and longest phase was financed by The John D. and Catherine T. MacArthur Foundation through their Program on Peace and International Cooperation, by the College of Liberal Arts and Sciences at the University of Florida through their Dissertation Fellowship, and by the National Science Foundation through their Dissertation Improvement Program for Anthropology. The Carlos Chagas Foundation kindly granted me institutional and logistical support during my stay in Sao Paulo.






7


of the four support organizations to learn about the socio-economic profile of the members, how they had changed in participating in this organization, what they understood as the goals of the organization, and what they thought about the professionalization of the women's movement. I participated in workshops and other activities organized by the support groups and spent one week in the headquarters of each organization doing participant observation of their daily activities and interactions.

Starting at the end of November 1994 I followed the process of preparation and

mobilization for the UN international conference on women to be held in Beijing in September 1995. I conducted participant observation in the bi-weekly preparation meetings, in the three seminars organized in Sao Paulo, and in the state and the national conferences held in June 1995. I conducted participant observation on the process of organization for the street demonstration on the 8th March (International Women's Day) and participated in various other events celebrating this event.

The objective in participating in these movement-wide activities was to observe points of consensus and conflict between professionalized and volunteer members. With the same objective I also participated, in May, in the annual meeting of the Rede Nacional Feminista de Sa,~de e Dire u'os Reprodutvos (National Feminist Network for Health and Reproductive Rights), in Rio de Janeiro. The Network brings together 70 organizations from all over Brazil who work with women's health. The four support groups I have been working with are members of this network. After this meeting I also participated in the monthly meeting of the Sdo Paulo section of the Network. Again, I wanted to understand better what part was played by different actors and the interaction between them.





8


From August to October 1995, 1 interviewed the members of three grassroots groups who receive support from the four groups I had been working with in order to understand better their relationship to support groups, to assess their level of gender, race and class consciousness, as well as their level of dependency on the support group. I conducted participant observation in the activities that these groups organized, including workshops, meetings, and a street campaign for gynecological cancer prevention.

Before leaving, I scheduled meetings with each of the support and grassroots groups I worked with in order to discuss with them my preliminary findings. This feedback proved very informative and useful. During this last month I also interviewed representatives from six financing agencies who finance women's groups. I participated in a seminar held in Recife, in the Northeast of Brazil, about international cooperation and gender policies, which brought together representatives of women's groups and financing agencies.

Looking back I found that four groups were too many with which to conduct as thorough a participant observation as I would have liked. This was compounded by the fact that I had to spend several hours a day on the public transportation system: Sao Paulo is the largest city in the world in terms of surface area (1700 km2) (Medina 1991:13) and its public transportation system relies mainly on buses, not on subways, which greatly lengthens time of travel (Santos 1994-13). However, managing good relations with all groups simultaneously, while remaining true to myself and being comfortable expressing my reservations on some issues proved to be, by far, the most challenging part of my experience with Slo Paulo women's groups.








The Politics of Rppresentation and the EthnogLaphy of Activism


Issues related to authority in ethnographic work and to the politics of representation have been debated for more than a decade in anthropology, since Marcus and Fisher's seminal work (1986). My work proved particularly challenging in this regard as I was working with highly politicized informants, aware of the power issues present between me, as researcher, and them. I was repeatedly warned that I should not be one more researcher who would come, do my thing and then leave without ever again giving sign of fife. One group allowed me to conduct participant observation only on the condition that they see my work before it is published. These are logical and natural requests. Yet, in practical terms, it was not an easy task since I have been writing my dissertation in the United States and in English.

The meetings I had with each of the groups before leaving Brazi] to present my preliminary findings, were thus crucial in fine-tuning our agreements. This was a difficult exercise, however, since I felt uncomfortable launching into this exposition without having gone through a thorough analysis of the data, as well as uncertain as to the reaction of the women. In all cases, lively discussions did follow. NGOs routinely perform such feedback sessions (which they call devolu(06) at the end of their research projects, following a more participatory approach to research. As my consultant and friend Deise suggested, time and resources should have been allocated for feedback activities in my research proposal, as well as for activities which the groups participating in the research would like to see me do. I wish my research had been more participatory and realize that questions I raise in terms of some NGO practices are valid criticisms of my own research. Although I have tried to give voice to various positions within the movement, the ultimate choice of how they would be represented, of what





10


is included or not, rested with me. In fact, the work of NGO activists and engaged academics share a number of characteristics which I will discuss along the way.

Looking back, I realize how important these feedback meetings were. Academia and social movements work on such different time schedules! It took me more than two years to write-up this dissertation. Always this minutiae of analysis, and making sure to find the right words, to be fair to all. In the meantime, the groups have moved on. Their reality is already changed. I apologize for the delay. It might just reinforce the love-hate relationship that NGOs often have towards academics, who they sometimes see as "hermnetic", "stuck-up intellectuals" in their "ivory tower" ("intelectuaispedantes" "herme~icos"' "cki torre de marfimt" (Landimn 1993a:-44)).

Being as explicit as possible with the groups proved quite a challenge because I highly value the work of organized groups and because, like my consultants, I was ill-at-ease with situations of conflict and would have liked to see myself in complete harmony with them. This, of course, was totally naive and unrealistic considering the disagreements existing between the groups themselves. David Kertzer (1980) confided his difficulties in maintaining rapport with ideologically or politically opposed groups, in his case Communists and Catholics in an Italian city. My problems were minor compared to his. After all, the activists I worked with all considered themselves to be part of the feminist movement. Some women took it to heart to make me understand their point of view, to justify their course of action. Others, mostly volunteer neighborhood women, encouraged me to voice my questioning because it mirrored theirs. They felt it would do good to the movement to air out some issues. I guess, with time, I came to see the situation this way too. I wanted to provide constructive criticism because I cared, to be a "comm-itted critic" to use John Burdick's phrase (1995:3 62). However, at times









it was hard to convince myself that my ethnography could indeed "serv[e] as a means of ongoing movement self-evaluation" and "help refine debates and self-critiques within social movements" (1995-363). These were my stated goals, but I was afraid at times to be just adding fuel to the flames of an already raging debate.

Burdick reflects upon the politics of his own fedexperience in these terms:

the effort to represent is never politically neutral, especially inside the movement itself.
In any kind of research setting, discussing ethnographic findings with subjects requires the ethnographer to consider his or her own sympathies with one or another faction at
work in the studied situation. These issues become especially acute in highly politicized
settings. (1995:373)

I personally was quite aware of my sympathy for a grassroots-based radical democratic strategy for social change, a "basista" position, as it would be called in Brazil. Despite my constant vigilance to the contrary, this is likely to have influenced my reading of the situation. I am convinced that change from the bottom-up is essential in securing the implementation of laws that are the fruit of the labor of institutionalized feminists. I hope I did justice to all.


Setting The Stage


Sdo Paulo in Facts


The city of Sdo Paulo, capital of the State of Sao Paulo, is the second largest city in the world (Santos 1994:13). Like most third world cities it grew rapidly, without much planning: at the beginning of this century Sdo Paulo counted 300 000 inhabitants (Medina 1991:13); it now has 17 million (Santos 1994:13). Its population is still increasing although at reduced rates: its annual growth rate went down from 5.2% in 1940-1950 (Medina 1991:14) to 4.46%






12


in 1970-1980 and 1.88% in 1980-1991 (IBGE 1996:33). In fact, surrounding cities are now growing faster than Sdo Paulo itself (Rolnik et al 1990).

Sdo Paulo city remains the industrial, financial and intellectual heart of Brazil (Santos 1994), although some regions of Brazil, in particular the southern states, have shown more dynamism in recent years. For example, Sdo Paulo's share of the national industrial output is declining. The trend is towards greater homogenization of the country. Despite this new trend, Sdo Paulo remains the industrial center of the country but it is also increasingly a financial and commercial center (Rolnik et al. 1990). In 1992, Sdo Paulo state still produced 43.36% of the industrial output of Brazil (percentage of Brazil's secondary sector GDP) and 35% of Brazilian exports (SEADE 1994:70, 102). In terms of the labor market, the share of industrial occupations in Sdo Paulo (which compared to service-related occupations offer relatively better paid jobs) went down from 3 5.4% of the economically active population in 1976 (Brant et al 1988: 45) to 29.2% in 1981 and 27.9% in 1990 (SEADE 1994:17). In the meantime the share of service-related occupations went up f-rm 3 6.3 % in 1981 to 4 1. 0% in 1990 (SEADE 1994:17).

If Sdo Paulo has a large working class population, it is also the third world city which offers the most numerous opportunities ofjobs of an intellectual nature and which has the largest middle class (Santos 1994:14). Administrators and professionals represent 1/4 of the total work force (Andrews 1991:157). Unfortunately, this strengthening of the middle class has not prevented poverty from increasing.

Pauperization of the population has indeed occurred during the 80s to the point where that decade has been called the "decade more than lost" (a d&ada mais do que perdida) (Rolnik et al. 1990:52). Families under the threshold of poverty (i.e. earning up to one






13


minimum salary) represented 34.7% of all families in the larger Sdo Paulo agglomeration in 198 1. This percentage went up to 42.1 in 1987 (Source PNAD --National Research on Home Sample-- in Lopes, Juarez Branddo and Gottschalk, Andrea 1990 cited in Rolnik et al. 1990: 52). 45% of the greater Sdo Paulo households were considered at poverty or below poverty level in 1995 (with a yearly household buying power of US$ 4,53 1), while the richest

3.0% of its population enjoyed a US$ 159,199 yearly buying power per household (Latin American Market Planning Report 1997:66).

With a sad and tenacious predictability, Brazilian urban households headed by AfroBrazilians represented, in 1989, 68% of extremely poor households and 57% of poor households, when they make up only 4 1% of all urban households (Lopes 1994:8). 1 did not find recent data on Sdo Paulo in particular. Racial discrimination which is present in the everyday fife of all Paulistanos of African descent is also apparent in the political and social life of the city: It counted only one black municipal legislator (vereador) and one black judge as of 1995 (Turra and Venturi 1995: 39, 5 1).

Similarly, young female heads of households had, in 1989, almost a 60% probability of being poor compared to 33.54% for the general Brazilian population (ibid:9). Female heads of household for urban areas of the state of Sdo Paulo went up from 13.84% in 1980 to 17.50% in 1991 (IB3GE 1996:33).

Pauperization has had an effect on the geographic distribution of social classes in the city. Sdo Paulo had developed on a model of concentric circles with the upper and middleincome classes living in the center areas whereas the lower-income population lived in the outer circles. This model of segregation was blurred but not overturned in the 80s- Low-income families no longer able to rent a house in the periphery have had to move into the expanding





14


cortjos? in the center of the city or tofavelas, the Brazilian shantytowns. In the meantime middle-class families living in central neighborhoods were pushed out by declining living standards towards less expensive peripheral neighborhoods (Rolnik et a]. 1990:13). The growth of corti~os has been spectacular indeed. They housed 820,000 persons at the beginning of the 80s (or 8% of the city's population) while they represented 28% of that population at the end of the decade, that is, a full 3 million people (Medina 1991:17). Favelas sheltered 6% of the Paulistana population in 1980 and 8% at the end of the decade (Rolnik et a]. 1990:59). All those living in cortigos, favelas or occupying their residential plot illegally add up to 7.7 million people, that is 65% of Sdo Paulo's inhabitants (Medina 1991:19). Even if class segregation has been somewhat attenuated there is still a strong value attached by the middle-class to living in the central areas. When they heard where I was going to work, middle-class Brazilians, including some feminist activists, often exclaimed "Estd longepara caramnba!" meaning "this is so far away!" This expression revealed not only a judgment on the physical distance but also on the social and cultural distance middle-class urbanites feel there is between them and the periphery.

The low-income population in Sao Paulo is heavily dependent on government services in order to obtain basic education, health, transportation and urban infrastructure. However, the State has been responding inadequately to these needs, so inadequately that it drove Caccia Bava to refer to "the administration's contempt for its citizen" (1990:62). In the area of health, this public neglect is particularly blatant and is unfortunately growing, as neoliberal policies are being implemented both by the local, state and federal governments.



3A cortigo is an old inner-city building which has been subdivided into individual rooms for rent. Entire families ive in these rooms in very crowded and unsanitary conditions.





15


1 chose to focus this research on women's groups who work with health and

reproductive rights issues because this is an area where a large array of groups are active and have been active for a long time. The women's health movement is particularly wefl-structured. It has created a national network which pufls together more than 70 groups nationwide. A broad overview of the health situation in Brazil seems in order: Health Situation in Brazil


An epidemiological transition occurred between the 1960s and the 1980s in Brazil. Between 1960 and 1980 death rates due to infectious and parasitic diseases went down by 701/o and infant mortality went down by 40% (Briscoe 1990:11). The new threats to Brazilians' health are occupational hazards, air pollution, traffic accidents, crime, alcohol and tobacco consumption, and cardiovascular diseases, for which incidence rates in the cities of the southeast of the country are the highest in the world! (Briscoe 1990:12). A privileged section of the Brazilian population enjoys a quality of He and of health care similar to that of industrialized nations and suffers from the same diseases, whereas the less wefl-off majority is still struggling with unsanitary living conditions, incredibly low incomes and poor nutrition, little access to health care, and suffers from gastrointestinal and pulmonary infections (Cohn 1993). This is disputed by Briscoe (1990) who argues that the poor are also the ones who suffer most from cardiovascular and other non-communicable diseases.

The health situation of the lower classes has deteriorated due to land deprivation in rural areas which led to massive migration, an extremely rapid urbanization and industrialization, predatory labor practices, and a skewed distribution of medical doctors and medical facilities favoring the richer areas of big cities (Cohn 1993). The government






16


agricultural policies encouraging cash crops for export at the expense of basic food staples generated very high food prices (Macedo 1988; Scheper-Hughes 1992). For example, more than double as much work time was needed in 1974 (end of the Brazilian economic 'm-iracle') as in 1959 to earn wages sufficient to purchase the same food basket (Kowarick 1985:77). The acute economic crisis of the 80s has worsened the situation. Prices for basic food items increased by 400% in 1983, while general inflation raged at 22 1% (Barroso and Amado 1987:62). As a result, workers had to spend 262.3 hours a month, i.e. more than the monthly maximum, in October 1983, compared to 120 hours in 198 1, to earn enough money to buy the same basket of food (Barroso & Amado 1987:62). Under such circumstances, one can expect malnutrition to take its toll, and indeed, as Carmen Barroso and Tina Amado put it, with reducedd incomes to pay for more expensive food: the solution for poorer families was to eat less" (1987:62).

The ensuing structural policies (Wirth et al. 1987), and the more recent recession, aggravated since 1989 by the economic adjustment policies of the first elected president, Fernando Collor de Mello, and his successors, have meant further dwindling of public funding, privatization of social programs and a sharp increase in poverty levels, although paradoxically some social indicators seem to have slightly improved (Faria 1994; IIBASE 1991; Lopes 1994). The Brazilian Public Health Care Syste


The Brazilian Constitution of 1988 (Article 196) states that health is a right for

everyone and that it is the State's duty to maintain and improve the population's health. It also stipulates that the public health system should be integrated, decentralized, and controlled by organized civil society --through the creation of the SUS, Sistema Unico de Saride (Article






17


198) (CNDM 1989). Yet, the Brazilian system is still highly dichotomized and inegalitarian: 25% of the Brazilian population have access to health insurance plans either through their formal sector job or through individual policies and they, in fact, absorbed 88 percent of the total Health Ministry annual budget in 1994. The other 75 percent of the population rely solely on the free public health system, and hence on the meager remainder of the Health Ministry budget (Berqu6 1995:7). This segment of the population is increasing as people are pushed out of the formnal sector by the economic recession (Cohn 1994). Moreover, the share of prevention and basic health services in total health spending decreased from 64 percent in 1965 to 15 percent in 1980 (Briscoe 1990:12) while there was an explosive growth in technologyoriented curative services to satisfy' the middle and upper class (Cohn 1994:98).

Altogether the lack of public investment has led to a deterioration of the health care system in general over the last two decades (Cohn 1994:109). Structural adjustment measures implemented to curb inflation and reduce Brazil's debt have also affected the health system as the federal government cut its health spending fr-om 11. 3 to 7.5 billion dollars between 1989 and 1993. This amounts to per capita spending of 48 dollars in 1993 down from 80 dollars in 1989 (Berqu6 1995:7). Sdo Paulo State and municipal governments have also been reducing their spending on health. The consequences of this bleak situation for women's health and how this was conducive to the emergence of a women's health movement will be detailed in this work.






18


Outline of Chapters


This dissertation is composed of nine chapters. Chapter 2 reviews the theoretical issues pertaining to the nature of social movements, the consequences of the professionalization of social movements and the role of organizations within social movements. It also considers the contributions anthropologists and practice theory can make to the study of social movements. Chapter 3 narrows this theoretical discussion to the emergence of nongovernmental organizations in recent years globally, in Brazil and finally within the Brazilian women's movement. It considers the role played in this emergence by the transition and consolidation of formal democracy in Brazil. It examines the areas of contestation of the definition of NGOs, their hybrid nature in identity-based movements, as well as the concerned questioning these organizations have raised in the literature and among activists.

Chapter 4 shifts the focus to the internal organizational structure, dynamics and practices of NGOs and volunteer feminist groups. It examines the reasons why NGOs' practices are more formalized and instrumental and what the consequences are in terms of internal democracy. Chapter 5 considers the consequences of these organizational changes on the individual identity and commitment of professionalized activists, as well as on the collective identity of the groups, showing how they deter professionalized activists from engaging in direct action and stimulate institutional work and advocacy. Chapter 6 confirms the greater heterogeneity the feminist movement has achieved, due to the inclusion, as self-proclaimed feminists, of a number of neighborhood women. It discusses the challenges this poses for the movement in terms of ensuring participation and democratic processes. Paradoxaly, it examines the reasons for the current reduction of the involvement of feminists with





19


neighborhood women's groups in Sdo Paulo and the role played by professionalization and other factors in this recent trend.

Chapter 7 looks at the other side of the coin, namely the increased participation of Sdo Paulo feminists in State and international policy-making arenas. This institutionalization has ensured numerous benefits for women, which would not have been secured otherwise. However, it is not without trade-offs. This chapter will consider the challenges in terms of representativity, solidarity and crystallization of hierarchies within the movement these new strategies also raise. Chapter 8 examines the role played by financing agencies in the institutionalization of the movement, in some cases through their political priorities and, unintentionally, through their funding practices. The final chapter returns to issues of the relationship of NGOs and social movements, of institutionalization and professionalization, and sums up the lessons learned regarding social change and deepening of democracy.














CHAPTER 2
SOCIAL MOVEMENT RESEARCH AND ANTHROPOLOGY


Introduction


The broader social actor which is the focus of this dissertation is the Brazilian women's movement. It is important to situate this study within the body of social movement theory to understand the contribution of social movements in general, and the women's movement in particular, to the democratization process, as well as the position and role of Nongovernmental Organizations in relation to the movement. This is what I hope to do in this chapter.

A detailed and lengthy overview and critique of the two main schools of social

movement theory, namely New Social Movement (NSM) and Resource Mobilization Theory (RMT), has been undertaken by Joe Foweraker (1995) who also discusses the relevance of these different theories for Latin America. I will limit myself with discussing how the two can and should be articulated. I believe, as Foweraker does and before him Escobar & Alvarez (1992), that a cross-pollination of these two theoretical approaches can further our understanding of social movements and collective action because they broadly focus on the how and why of social movements: in other words, why social movements emerge and exist (NSM) and how they are organized and function (RMT). The concept of social movement fields and its emphasis on movement heterogeneity is particularly useful to this study.

I I then delve into the heart of the matter- the professionafization and institutionalization of social movements and the role played by organizations in the lives of social movements.


20





21


Various theories have dealt with these processes but there is no consensus on what their origins and their consequences for social change are. The second part of this chapter points at some areas where anthropologists, who have tended to focus on individual everyday resistance, can contribute to social movement research, notably in terms of their heterogeneity, and of the relationship between movement practices and their collective identity and potential growth.


Resource Mobilization Theo1y and New Social Movement Theo


The classical theories about social movements which don-driated until the early 70s

were social-psychological in nature (mass-society approach and collective behavior approach). They considered social movements as irrational. Concentrating at the individual level, they explored character traits and states of mind that favored participation in rebellions. They also focused on movement emergence and explained individual participation by looking at discontent as responses to rapid social change (For overviews see Cohen 1985; Eckstein 1989; McAdam et al. 1988; and Zald 1992). In response to these earlier theories, two major approaches towards social movements developed, one mainly in the United States, the other in Western Europe. The latter has also been used and modified in Latin America.

The North American paradigm distinguishes itself from earlier theories because it posits that social movements are based on rational choice exercised by participating individuals. This approach focuses on the organizational factors within social movements and the conditions under which beliefs are transformed into concrete action. It is based on the individualistic, utilitarian logic of the rational actor, although it does not follow rational choice theory blindly. Still, resource mobilization theorists analyze social movements on the basis of the logic of strategic interaction and cost-benefit calculations (Cohen 1985). According to this school of





22


thought social movements are based on conflicts, collective action can be institutional or noninstitutional but social movements are seen as noninstitutional (McAdam et al. 1988). Since grievances are always produced in society, they cannot account for the emergence of groups. Instead, opportunities, availability of resources and organizations explain the formation of movements. According to RMT the success of movements is to be measured by their political recognition or by the material benefits they provide, although Tarrow (1994), in his most recent contribution, also considers that social movements bring less tangible benefits such as permanent "expansions in participation, in popular culture and in ideology"(1994:8).

While the identity-oriented or new social movements paradigm also recognizes that

social movements are not irrational phenomena, it downplays instrumental reason in movement emergence. Alain Touraine and Alberto Melucci have been key scholars in the development of this paradigm. They argue that we are living in a postindustrial era, in which information has replaced production as the main issue. In this society, control over the means of production is less important than "control over the supply and processing of a certain type of data, hence of a way of organizing social life"(Touraine 1981:6). Touraine further argues that "classes struggle not only for accumulation over the products of labor, but also over symbolic products and over historicity (i.e. who will represent society to itself)" (1988:xviii). Touraine hopes to find the social movement which is going to replace the labor movement as the new historical agent. However, he sees the apparatus of technocratic management as the main enemy of the new movements (1981:22).

Latin American scholars who have followed the identity-oriented paradigm may have been influenced more by the work of Alberto Melucci, a student of Tourane, in that they interpret social movements as a form of resistance to the processes of development and to the





23


penetration of the State and the capitalist market into social life (Alvarez & Escobar 1992; Jeli 1990). Indeed, Melucci considers social movements to be a response to the penetration of the structure of domination of postindustrial society in private life and in social relations. Indeed, in the postindustrial mode of production, "control reaches beyond the productive structure into the areas of consumption, services, and social relations" (1980:2 18). Contrary to Touraine, Melucci does not look for the movement which is going to replace the labor movement. In the same line as Touraine, who argued that movements' action is not directed towards a conquest of power from the State but the search for an alternative to the society against which they are fighting (1981:-80), Melucci argues that we cannot speak of success or faure of social movements because their mere existence is already a success. Indeed, their submerged network-like form, especially in their periods of latency, functions as "laboratories of cultural innovations." It is "a possibility of another experience of time, space, interpersonal relations, which opposes the operational rationality of apparatuses" (1984:830). In that sense, their form is not just instrumental but is a goal in itself (ibid.).

The dichotomy between the resource mobilization and the new social movement

paradigms in social movement research corresponds to the schism between explanatory and interpretive social science. Zald (1992) characterizes resource mobilization theory as a natural system theory, with an instrumental and utilitarian approach, which he opposes to the semi otic sciences, that deal with meaning, and to the physical sciences. The new social movement approach deals with issues of meaning construction and subjective experience of identity.

Dichotomies are dear to Western thought (Garcia-Canctini 1993;- Roseberry 1989). In the case of anthropological theory, Roseberry points out the problems of antinomic thinking as it "fortiflies] the appearance of mutual-ly exclusive sets of assumptions and foreclos[es] the






24


possibility of mediation" (Roseberry 1989:3 1). Social movement scholars have earlier expressed skepticism about the possibility of bridging the gap between the neoutilitarian strategy paradigm and the collective identity paradigm (Cohen 1985; Jenkins 1983). Recently, however, mediation has been taking place. This is especially appropriate because the two paradigms are asking complementary questions roughly corresponding to a "how" (do social movements fUnction (RMT)?) and "why" (do social movements emerge (N SM)?) (Escobar 1992; Morris & McClurg Mueller 1992; Foweraker 1995). The introductory chapter to the Morris & McClurg Mueller collection specifically considers the bringing together of the "semniotic and natural sciences of social movement" (1992:5) as one of the goals to be pursued for a reformulation of social movement theory.

Both resource mobilization theory and new social movement theories are usef~ld for my own work since I consider issues of collective identity and solidarity, as well as the culture change process that movements engage in, as key issues when considering social movements in general and the role of NGOs in social movements. On the other hand, I drew on RMT studies which did pay more attention to the issue of movement professionalization and external financing and their impact on movements strategies, tactics and outcomes. I wish to discuss the points of juncture between NSM and RMT which facilitate the rapprochement of the two paradigms for a more complete understanding of social movement dynamics, which I believe is necessary. A focus on the intermediate level of analysis, i.e. at the small group/organization level, is particularly relevant in this regard. It is an essential level of analysis in this study, although the unit of analysis does shift fr-om the individual, to the organization, to the movement.





25


Bridging the Gap in Social Movement Research


As I have noted before, both NSM and RMT share, contrary to earlier approaches, a belief that social movements are rational actors. The concept of conflict is also crucial to both approaches, as recognized by Cohen & Arato (1992 cited in Foweraker 1995:- 2 1) and Diani (1992:8). 1 have discussed elsewhere how, from an emotional/psychological standpoint, conflict eases the reformulation of meaning and the assimilation of social change (Lebon 1993). The conflicts of interest of RMT, and the disruption of people's lives through intrusion by the State and the market posited by NSM, are linked reasons behind the emergence of social movements (Lebon 1993).

From an analytical point of view, a third point ofjuncture between the NSM and RMvT lies in focusing the analysis at the intermediate level, between the individual and structure, i.e. at the level of the organization or group. This is what I have tried to do in this study. Both RMT and NSM theorists have considered this important focus in recent years (McAdam et al 1988; Melucci 1988;- Morris & McClurg Mueller 1992). As McAdam and his colleagues, argue: $owe can no more build social movements from the individual up than down from some broad societal process" (1988:709). Since not all individuals under similar conditions participate, the question is what makes individuals participate in collective action? RMT theorists who so far had not paid much attention to this question have started to do so as I will explain in the coming paragraphs. Melucci (1988) underlines that this question has been a dilemma in Marxist theory whenever one tried to examine the link from class condition to class consciousness. The two solutions proposed were either the Leninist concept of a necessary leading vanguard, or





26


the idea, posited by Rosa Luxemburg, that people have a spontaneous capacity to mobilize in the face of discontent and injustice posited.

We have seen that RMT argues that there are always grievances in a society, therefore a grievance does not explain why individuals engage in collective action. RMT's second step is to argue that what counts in the emergence of collective action; then, is not grievances but the possibilities and constraints on collective action that exist in a given situation. This is where RMT proponents introduce the notions of "structures of opportunity," "discretional resources" and fields of constraints. Thus RMT identifies the need for an intermediate level (between the individual and the structural level). However, it considers that these structures of opportunity and discretional resources are objective when in fact, Melucci (1988) argues, they are socially constructed. Expectations of any type are socially constructed and are a function of people's identity. It is people in small groups, mostly in the private sphere, who develop shared notions of what is problematic and what is possible and what is not and how they will go about changing things. This is the process of collective identity formation posited by NSM. It would probably be labeled formation of class consciousness by Marxists. Hence, collective identity is loan interactive and shared definition produced by several individuals and concerned with the orientations of action and the field of opportunities and constraints in which the action takes place" (Melucci 1988:342). It is on the basis of this collective cognitive fi7amework that actors will calculate the costs and benefits of the action. However, Melucci reminds us, there are elements of participation in collective action which cannot be reduced to instrumental rationality. A sense of belonging and solidarity are essential characteristics of social movements.






27


Recently, RMT theorists (Morris & McClurg Mueller 1992) have studied small

informal groups and their capacity to generate collective fr-ameworks under the label of micromobilization contexts. Others, such as Snow and Benford (1992) are interested in the whole process of redefining the social construction of grievances, opportunities and constraints, which they labeled frame alignments. Hence, they set out to incorporate subjective issues prominent in the new social movement approach, such as the construction of meanings, solidarity and consciousness, into the RMT framework. Sinijlarly, despite the importance he gives to the "external" elements of political opportunity structure, Tarrow (1994) does incorporate the fact that collective action is "culturally inscribed and communicated" (ibid: 19) and that leaders draw on a repertoire of collective action possibilities which is related to the culture in which the movement evolves, as essential elements in the formation and maintenance of social movements. He also considers the importance of "trust and cooperation generated among participants by shared understandings" (ibid:2 1). Thus, he does include both solidarity and collective identity in his framework although they are not central elements to it. In other words, RMT made an effort to incorporate core issues of the identity paradigm. However, the issue is not resolved; rather, some ways have been devised to bring together strategy and identity (McClurg Mueller 1992:5).

This discussion of the intermediate level of analysis might have led to the erroneous conclusion that the creation of a collective identity necessarily precedes social actors' strategizing. In other words, there would be a linear model of development of social movements involving identity formation as a precondition to strategy decisions. As several social movement scholars have pointed out there is no such "dual logic" or liear model (Cohen & Arato 1992; Doimo 1995; Foweraker 1995). Social movements are both expression






28


of group identity and conflict of interest, simultaneously expressive and instrumental, i.e. identity and strategy, simultaneously cultural and political. Foweraker writes: [..] identity cannot simply be conceived as a precondition of strategic action, because the processes of organization and strategic choice contribute crucially to construct and shape this identity" (1995:22).


Disruption versus Integration in the Political System


Just as concerns with identity and strategy are present simultaneously in social

movements, the correlated drives for disruption of the existing order and for inclusion in the political system are also there at the same time. Cohen calls them defensive and offensive movements (cited in Foweraker 1995:22) Ana Maria Doimo (1995), in her noted study of Brazilian popular movements, clearly demonstrates their two faces, one "expressivedisruptive", which searches to delegitimize public authorities, the other "integrativecorporative", which strives for greater social integration and interacts with the State to obtain better services.

Which face of this Janus will take precedence, according to Doimo, depends basically on the political opportunity structure. She shows that the transition to formal democracy in Brazil led to a strengthening of the integrative-corporative side, which, throughout the dictatorship period, had been kept in low profile. This is in lie with Tilly's view of the importance of historical conditions in determining the forms collective action takes (in Foweraker 1995:14) and Tarrow's political process model. In other words, there is no inevitable linear model leading movements from protest to "acquiescence," no inevitable institutionalization.





29


Social Movement Fields


Moving beyond the debate between the identity and strategy paradigms, social

movements have been recently couched in terms of "social movement fields" (Alvarez 1 998a.; Sader 1988). The concept of social movement field' is particularly useful to this study because it directly addresses the issue of movement heterogeneity which has often been overlooked and which is essential to a study of the Sdo Paulo women's movement.

A social movement field can be defined as an ensemble of organizations, individuals, and networks who share key ideas but also have their divergences in goals, methods, and emphasis for struggle. Put otherwise, they share ""a common field of references and differences for collective action and political contestation" (Baierle 1992:19) still informed by a common normative imperative but [wAith] diverse practices and discourses [...]" (,Alvarez 1996:33) The concept of "social movement industry," forged by RlvT theorists, referring to fields of related social movement organizations (SMOs) which compete and cooperate with each other, points in the same direction (McAdam et al. 1988). However, this concept relies unnecessarily on organizational theory and therefore underestimates the importance of nonorganizational forms that a social movement takes (Oliver 1989).












1'A related concept of interest is that of ethical-political field which refers more broadly to a social movement and its network of sympathizers in mainstream institutions and other social movements who share similar ideas and discourses (Dagnino 1998).






30


Organizations and the Formalization, Institutionalization and Professionalization of Social Movements


Brazilian feminist NGOs are organizations within the feminist movement. As such, they deserve to be understood in the light of the budding body of literature on the role of organizations in social movements. No consensus has yet been reached on the issue of how more formal, professional organizations arise within social movements and what their impact is. The discussion involves issues of relationship to the political arena, to the grassroots and, for professionalized organizations, to funding sources.

Suzanne Staggenborg (1988) identifies three processes which should be taken into consideration when looking at the trajectory of social movements and social movement organizations, although they are by no means an inevitable outcome. These are formalization, institutionalization and professionalization. Formalization is the process by which an informal group evolves towards more established rules, stricter membership requirements and higher division of labor. Linked to formalization is the issue of the role of organizations in social movements. Institutionalization is the process by which movements transform fr-om outsiders into participants in mainstream political arenas. Professionalization is the process by which individuals come to be remunerated for their movement activities. A few studies have shown that these processes are complexly interrelated. I will sketch these relations here since they are essential themes in this study.


Formalization and Institutionalization


Earlier approaches considered institutionalization the inevitable outcome of

movements' development, as ever more bureaucratized and oligarchic organizations would





31


bring the movement into the traditional political arena. However, a more flexible model has been offered since then by resource mobilization theorists, which links a social movement more closely to its environment, mainly the State, countermovements and the personal networks of activists.

Starting with the more pessimistic view of the role of organizations in social movements, the Weber-Michels thesis, based on Weber's theory of bureaucracy and routmnization of charisma and on Michels' "iron law of oligarchy" (1959 [1915]) claimed that professionalization and bureaucratization of democratic organizations are inescapable because of the needs arising within the organization and because of its needs to relate to the outer world. Michels argues that the goals, the structure and the tactics of a group are shaped by its organizational survival imperatives and that these tendencies have a conservatizing effect. Moreover, organizations have a tendency to oligarchic rule: leaders become indispensable because of their knowledge about how the bureaucracy works. Thus, they cannot be removed from office even when they no longer represent the ideas of the rank-and-file. Leaders will also tend to try to consolidate their interests within the organization, at times not remaining true to the principles of the base.

Similarly, Piven and Cloward's work (1979) with the workers, civil rights and welfare rights movements in the United States in the 60s gave examples of how the form-al organizations created "on the crest" of these movements limited their disruptive force. They argue that formal organizations are less defiant, and that defiance and disruption are the means by which the less powerful in society can bring change about. The State's co-optation of movement activists through concessions brings the movement into regular politics, thus bringing protesters into the system. Using a similar argument, Tarrow (1994) claims that social





32


movements end up evolving in the sphere of politics because the government responds to their claims in one way or another (either through reform or repression, most often through a combination of the two). Taking a historical vantage point he writes: "For brief periods of history the power in movement seems irresistible; but it disperses rapidly and passes inexorably into more institutional forms of politics" (ibid:- 19 1). He adds that social movements have less influence over the outcome of the struggle in this sphere of politics. Often times, they are not interested in using these tactics. In order to get policy changes, movements may opt for cooperation rather than confrontation; this diminishes their "capacity to inspire supporters and to hold the attention of elites" because they accept compromises (ibid: 113). But he adds, there are also compensations for choosing the institutional domain as more conventional forms of action bring out broader, general support in the population.

Zald and Ash (1987 [1964]) refuted Mchels' claims and argued that an organization evolves in relation with its environment. Its trajectory need not be limited to routinization and oligarchization but can take various directions such as "coalitions with other organizations, organizational disappearance, factional splits, increased rather than decreased radicalism and the like" (ibid: 122). The trajectory outlined by Mchels is only one in many possibilities and it is likely to occur when movements are becalmed, i.e. when they "have found a niche for themselves in the organizational world but their growth has slowed down or ceased" (ibid: 130). According to Zald and Ash dependence on and control of material incentives facilitate oligarchization and conservatism. Oligarchization occurs because leaders have an interest in conserving power for material reasons, and conservatism occurs because radical goals might threaten the niche of the movement by provoking hostility in society. Indeed Mchels' work was based on trade-unions and political parties at the beginning of the 20th





33


century. Studies have shown that his views on oligarchization of organizations do not hold for organizations with idealistic goals such as religious organizations (Carden 1989).

More generally, social movement organizations can take many different forms, different from the "charismatic leader-devoted follower relationship" (Jenkins 1979:226). As Jenkins put it: "oligarchy in movements means that leaders can act independently of members, not that they will inevitably oppose insurgency. Though the conversion of movements into lobby organizations and the subsequent abandonment of insurgent goals is clearly a hazard of formal structure, it is a decision, not an inevitability" (Ibid.).

Some authors go even fUrther and argue for a positive role of organizations in social movement under certain conditions. In one of the few statements about movement development in new social movement theory Melucci argues that 'umbrella organizations" are important to secure the continuity of the movements during periods of latency. These "umbrella organizations" "provide financial and organizational resources" for the activities of the movements and they "translate their claims into political decision-making, while the movements maintain their autonomy" (Melucci 1984:83 1). He created the concept of "intermediate public space" that would fit between the State and "civil society" in which such umbrella organizations would be located (ibid). Similarly, Staggenborg (198 8) also mentions that professional organizations allow the movement to survive the lulls of volunteer mobilization and to seize new opportunities for battle whenever they arise.

This study supports Jenkins' contention that the transformation of movements into lobbying groups is a clear danger when movements formalize but that this is not an inevitable process. It is too early to tell whether the movement organizations of this study will play a





34


remobilizing/organizing role when the time is ripe. In the Brazil of the 90s, the evidence points to their turning away from such classical movement orientation.


Professionalization


RMT, which has focused most on issues of professionalization, considers professional social movement organizations (hereafter PSMOs) as one of the possible forms that SMOs can take, not necessarily as a result of institutionalization (McAdam et al 1988). McCarthy and Zald define the general characteristics of PSMOs as: "(1) a leadership that devotes full time to the movement; (a) a large proportion of resources originating outside of the aggrieved group that the movement claims to represent; (2) a very small or nonexistent membership base or a paper membership (membership implies little more than allowing name to be used upon membership rolls); (3) attempts to impart the image of "speaking for a potential constituency";(4) attempts to influence policy toward that same constituency" (McCarthy and Zald 1987 [1973]:375).

McCarthy and Zald further argue that with professionalization, careers are made

possible, training institutions are established, and national networks of "movement personnel" are created as activists get jobs in various organizations over time, activists also go back and forth between jobs in government agencies, in other institutions and in movement organizations (ibid.: 372).. In a country such as Brazil, such a career remain highly unstable, although some activists do get subsequent positions with various organizations.

Based on the results of this research, I mostly agree with their definition, although their assertion that professionalized social movement organizations attempt to impart the image of speaking for a political constituency must be mitigated in the case at hand by the role the





35


authorities have played in calling upon such professionalized organizations to represent the movement.

A number of factors have been identified which can lead to the professionalization of social movements. New Social Movement theory has not paid much attention to the issue of professionalization. For Melucci, it is the success of movements in the political arena which leads to professionalization and bureaucratization of part of a movement, as it weakens and becomes fragmented, while some splinter groups become more radical (1984:831). Similarly, the earlier collective behavior theorists did not discuss the issue of professional activists at any length. They assumed that funding for the remuneration of these activists originated internally to the movement. As Lenin did, they considered that these individuals should be drawn from the base, and belonged to the more experienced, more committed activists who had an interest in being involved fill-time in movement activities (Oliver 1983).

McCarthy and Zald (1987 [1973]) challenged these ideas when they focused on the trend towards professionalization of social movement organizations in the United States in the 60s (noticed by other authors at the time, see Oliver 1983:134). They identified the availability of funding through churches, foundations and government agencies as the primary factor for the emergence of "full-time careers" in social movements, while movement leaders became "social movement entrepreneurs" (McCarthy and Zald 1987 [1973]:374). RMT views paid activists as individuals being drawn to the movement by these material incentives. They are less committed than volunteers because volunteers have only purposive incentives to participate as opposed to both purposive and material incentives for remunerated activists (empirically confirmed by some studies, e.g. Wilson 1973). Professionalized organizations become more inclusive, rather than exclusive. This means that they require "partial commitment and relatively





36


little in the way of requirements" (McCarthy and Zald 1987: 373), thus changing the meaning of membership to the group (ibid: 370). Professionalized activists are also viewed as more divorced from the community. However, RMT scholars were forced to acknowledge dimensions of professional activism which reflect a strong commitment on the part of paid activists: some mention the "sacrifice" made by activists who receive a wage much below what they would earn outside the movement. Even McCarthy and Zald (1987 [1973 ]) recognize that movement participants do search for ways to be remunerated for their activities in the movement (Oliver 1983).

Oliver's own work showed that aspects of both collective behavior theory and resource mobilization theory were needed to understand how a movement professionalizes: In her research among activists from the US neighborhood movement, she showed that paid activists did grew out fr-om among movement volunteers, were no less committed and no less divorced from the community than volunteers. However, the availability of funding for social movements in the 1960s definitely allowed the emergence of a cohort of activists, who coming of age at that time, were able to make the choice of building their career within the movement (Oliver 1983). This study will explore issues such as where professionalized activists come from, and how committed and how close they are to the grassroots in the case of the Slo Paulo women's movement

Other elements identified as conducive to the creation of a professionalized

organization are the failure to mobilize a membership base (Cable 1984) or to sustain a movement (McCarthy and Zald 1987 [1973]). Staggenborg (1988) showed that the formalization of the US pro-choice movement deepened as the movement was pushed into institutionalized arenas by changing environmental conditions (mainly the legalization of






37


abortion in 1973). In the case of the Brazilian women's movement, I will also consider changes in the political opportunity structure, namely the process of transition to and consolidation of formal democracy.


Consequences of Professionalization


As I have mentioned earlier, formnalization, professionalization and institutionalization are interrelated. According to Staggenborg (1988), professionalization is linked to formalization because financing agencies prefer groups that have a certain logistical structure which allows permanent contacts as well as accounting services and a minimum division of labor. Professional staff will want the organization to form-alize in order to obtain financial stability and a "division of labor that allows them to use and develop their organizational skills" (p.603). In reverse, more structured organizations have an easier time searching and obtaining funding and hence for continuing to hire professionals.

The relationship between formalization and institutionalization is that, Staggenborg argues, more formal, professional groups are likely to enter the arena of institutional politics and forgo more disruptive forms of protest. They do so in part because their structure allows them to engage in such tactics (they have on-going contacts, the necessary division of labor and their working hours fit with those of institutional politics) and in part because they like it better because such activities are more compatible with regular working hours, they can be scheduled in advance and expenses can be planned. In part they do not want to threaten the survival of their entity by engaging in protest action (McCarthy and Zald 1987 [1973]). Again, these tendencies are clear dangers of professionalized organizations, including in the case at hand. Yet, they are not inescapable but are linked to the political opportunity structure, in our case,





38


the transition to formal democracy and changes in donor agencies' funding policies and practices. Indeed, some professionalized organizations, such as Greenpeace, have managed to combine disruptive and lobbying tactics. We also need to consider the consequences of processionalization of social movements on the cultural struggle that they engage in. This will be discussed in the second part of this chapter dealing with culture and democratization.

An essential issue to consider when dealing with the professionalization of social

movements is its impact on, or relationship to, volunteer activism, central to this dissertation. Professionalism should be considered as a complex concept since organizations rely to varying degrees on professional activists and on outside funding, and have different positions for remunerated activists or staff with different interests (Kleidman 1994; Oliver 1983; Staggenborg 1988).

Kleidman (1994) examined the issue of the impact of paid activism on voluntarism in detail. His typology of outcome parallels the discussion on the role of organizations in social movements and it is threefold: inhibition, substitution, and facilitation. His inhibition model groups together all the theories which argue that professionalization erodes volunteer activism. Most of them argue for a change in tactics accompanying professionalization which is a switch from mobilizing volunteers, i.e. citizens, to lobbying, work through the media or publishing. This change in tactics is attributed either to the efforts of leaders to maximize their career choices as in the Weber-Michels' thesis, to a paid staff more easily vulnerable to cooptation as in Piven and Cloward's work, or to the influence of elite funding (Jenkins 1987, 1979; McCarthy and Zald 1987[1973]).

The second model of impact of professionalization on volunteer activism that has been suggested is that professional organizations substitute for volunteer activists (Kleidman 1994).





39


Some resource mobilization theorists have used such a model which sees professional social movement organizations as representing the interests of deprived constituencies. Indeed, professionalization has been chosen as a solution when a mass base could not be mobilized (Cable 1984).

Kleidman's last model is the facilitation model: we have already mentioned that some scholars consider that organizations are necessary to mobilize people to protest and the role of "umbrella organizations" can play during periods of reflux of movements by carrying over the goals and ideals of the movement. Staggenborg argues (1988), professionalized organizations and social movements with a large number of professional organizations are likely to live longer. Staggenborg's work shows that if professionalized groups engage more in institutionalized politics, they do not necessarily cease to recruit volunteers, some professionals are in fact "organizers" so that their task is to bring in more participants. Other arguments in favor of professional organizations is that they have the capacity to train and organize volunteers and coordinate their activities, thus improving the chances of a positive outcome. They also facilitate joint actions among organizations as professionalized organizations can afford to have a permanent representative in the coalition and can dedicate more hours to the job (Staggenborg 1988).

Kleidman's point is that, contrary to earlier scholars who have emphasized either inhibition, substitution or facilitation, a combination of the three is more likely to occur (Kleidman 1994). The factors influencing the combination are elements of political opportunity, the level of mobilization in civil society and the strategies and values of the professional activists involved. His empirical work shows that over the last fifty years, three professional organizations from the US peace movement used different strategies regarding volunteer





40


activism deliberately expanding it or reducing its influence in the movement. In the case of the peace movement he studied, separate campaigning organizations were created by peace organizations. My study shows that, in the case of the Brazilian women's movement, after approximately 10 years of a professionalizing trend, the latter has indeed inhibited volunteer activism. I do agree with Meidman, however, that it could be different if the groups deliberately chose to promote mobilization and, maybe more importantly, had the unconditional support of donor agencies in this endeavour. This is however, not currently the case.


The Role of Fundin


Pam Oliver (1983) identified three main forms of financing for social movements: internal, external market and external sponsor financing. The NGOs I worked with rely on what she called external sponsor financing. This means funding by large institutions such as churches, foundations, governments or corporations, or less frequently by wealthy individuals. Indeed, no more than 20 percent of these NGOs' budgets derived from the other two modes of financing. In fact, part of the professionalization process of feminist NGOs has involved reducing their reliance on internal financing while increasing that of external sponsor financingInternal financing involved such activities as sales of T-shirts or other goods and

services produced by participants, as well as fairs, games (bingo) etc. NGOs no longer engage in this type of fund-raising activities while the volunteer organizations I worked with still do, although they too now rely mostly on grant moneys fi7om donor agencies. The difference lies in the amount received and in the fact that volunteer groups, do not remunerate their participants ,%kith this money. External market financing is when a movement relies on a large number of small contributions from individuals outside the movement or by selling products or services





41


whose labor has been paid a fair wage (Oliver 1983). NGOs have been pushed by donor agencies to increase their sales of professional services and products in order to boost their selfsustainability. This kind of funding leaves organizations vulnerable to changes in the economy which affect peoples' income and to the instability of resource flows (McCarthy and Zald 1977) and is hardly feasible in a country such as Brazil with high rates of material poverty.

I will expand on the consequences of external sponsor financing, since this is what donor funding to professionalized organizations (NGOs) amounts to. Since we are taBdng about democratization and social change, the issue that comes to mind is that of elite control of movements to ensure a top-down monitored change.

According to McCarthy and Zald who have focused on this issue in the case of the

U.S. civil rights and other movements in the 1960s, the main consequence of external financing is that the base loses control over the leadership of the organization while leaders have to demonstrate their credibility to donors. They write: "outside financial support, indeed, means that a membership in the classical sense is almost dispensable they argue. Outside funding allows a leadership to replace volunteer manpower drawn from the base with paid staff members chosen upon criteria of skills and experience" (1987 [1973]: 3 7 1). Similarly Schwartz and Paul (1992) argue that recruiting money or recruiting people's time entail different strategies. They argue that organizations who receive money from a sponsor do not feel the need to recruit members. On the other hand, outside financial support means that the organization will be able to survive even when beneficiaries' claims have been satisfied.

This dependence on elites for funding and independence fi7om a mass support base increase the possibility of elite social control on professional social movement organizations (McCarthy & Zald 1987 [1973]- 384-385). They believe that established institutional sectors,





42


such as foundations and churches, would not support radical organizations for long periods of time because they are themselves subject to institutional control. They believe that such funding has ameliorative rather than radical purposes and is meant to channel dissent into legitimate channels as elites search to "diffus[e] the radical possibilities of dissent in general" (1987: 3 85) However, some of that support is indirectly diverted to organizations with more radical goals, as when both types of groups engage in coalition work for example. This means that radical groups have more resources available than if there was no effort on the part of the elite to control dissent.

Staggenborg (1988) argues that in the case of the US pro-choice movement, informal groups are the ones who pressured to obtain concessions fi-om the elite and hence to get funding available but it is the formal, professional organizations which benefited fi-om these monies. This reinforces the claim by Haines (1984) of a radical flank effect" theory. Haines argues that the presence of extremist organizations will be beneficial to more moderate organizations 'n the same social movement because they will look more appealing to foundations in order to undermine more radical groups.

Jenkins and Eckert argue that the elite control thesis is mostly correct but somewhat simplistic and prefer the term "channeling" because "the social control effects of patronage, are more subtle and indirect than a simple co-optation" (1986:828). We need to dissociate 11control as the intention of patrons vs. control as the consequence of patronage" (1986:813). They found, in the case of the Black movement in the 1960s, that elite financing did not change movement goals and tactics significantly, protests continued after elite patronage started, although riots stopped due mostly to government repression. On the other hand, elite financing went mostly to moderate, professionalized organizations, and might have accelerated





43


movement decay because it diverted leaders from organizing efforts, exacerbated rivalries and created symbolic gains. I will consider, in Chapter 8, to what extent international donor agencies are controlling, or channeling, intentionally or not, the goals and strategies of feminist NGOs and hence of a substantial segment of the Brazilian women's movement.


Anthropology and Social Movement Research


John Burdick (1995) made a strong case for anthropologists to be involved with social movement research. He argues that the wave of peasant movements' studies in the 1 970s (e.g. Wolf 1969) was followed by a quasi-vacuum in terms of anthropological study of organized popular movements. The tide is rising again though, as a number of works have started filling this vacuum in recent years. In fact, Burdick argues, the ascent of the moral economy and resistance literature has pushed anthropologists towards the study of "everyday," unorganized and mostly noncollective forms of resistance (e.g. Taussig 1980). Burdick sees here the influence on our discipline of Michel Foucault's "power-is-everywhere" model, as well as a general skepticism towards the effectiveness of collective action, as well as anthropology's "penchant for the slow-moving and microscopic" (Burdick 1995:3 61). Yet, anthropologists could contribute significantly to the study of social movements, in particular to understand the way cultural practices/texts informs collective action and to elicit the heterogeneity in social movements, which has often been overlooked by social movement scholars.


Culture. Agency. and Social Movements


Cultural images, symbols, and practices are used and constantly reshaped by the

dominant classes in order to maintain the status quo (Roseberry 1989:76), while others use and





44


transform this cultural baggage in a counterhegemonic fashion (Garcia-Canclini 1993, Kertzer 1988). Garcia-Canclini defines "culture as a particular type of production, whose objective is to understand, reproduce, and transform the social structure and to struggle for hegemony" (1993:1). In gramscian terms, hegemony can be defined as a situation in which "a class [..] is politically dominant and [...] is able to monopolize the cultural symbols and the socialization process of a society" (Kertzer 1980:254).

As Richard Fox puts it, culture is thus 'always in the making' as actors struggle for material and symbolic domination. However, a certain degree of continuity is maintained because "much of daily existence simply follows the path of least social resistance, the way defined by domination, as E.P. Thompson suggests" (Fox 1985:203).

The theory of practice (Bourdieu 1977, 1990) is useful in understanding how culture can change or be maintained. According to Bourdieu, representations and practices are generated by a few underlying, non-explicited, common schemes, which he calls habitus. These schemes are inculcated, during socialization in early childhood, through practices (i.e. in and by the body), and reinforced through repetition and enactment. They are 'learned by body', for some, even before language is available. The fact that they are learned by body, and enacted through the body, by mimetism (i.e. not by simple imitation but by an internalization of the principles), puts these schemes mostly out of reach of consciousness for the actor. They create 'visceral tastes and distastes' as Joan Cassell (1996: 43) brilliantly demonstrates in the case of gender roles. These tastes and distastes are not arbitrary though. They reflect basic social distinctions and power differentials that accompany them (adult/young, male/female, rich/poor, white/black). They of course tend to favor the dominant pole of social distinctions. Bourdieu calls 'doxa' (1977:163) the situation where such schemes and practices are not questioned, not





45


even susceptible of being questioned, because they seem 'natural'. The rules are taken for granted, therefore not challenged, and cultural codes tend to be relatively stable.

However, this state of affkirs is modified through contestation by different groups, which brings in the open these schemes and related practices. According to Bourdieu, this contestation is more likely to happen when there is a political or economic crisis which destroys the fit between the objective conditions and the customary social practices and their underlying schemes. For others, like Fox (1985), inspired by Alain Touraine, this contestation is constantly happening. I agree that contestations are always present but some carry more weight than others and some do not amount to much change until they reach a sufficient number of people. I believe that periods of crisis or of rapid social/econornic change do help unveiling doxic 'truths'and facilitate contestations.

When such contestation occurs, "the specific efficacy of subversive action consists in the power to bring to consciousness, and so modify, the categories of thought which help to orient individual and collective practices and in particular the categories through which distributions are perceived and appreciated" (Bourdieu 1990:14 1). Social movements are cases in which cultural symbols and practices are questioned and thus transformed by a group of individualS.2 Together with a struggle over material goods, social movements also represent "a deliberate, organized, conscious effort by members of a society to construct a more satisfying culture," to use a definition which Wallace (1956:265) ascribed to revitalization movements.

As I have discussed earlier, new social movement theorists have consistently argued that social movements are engaging in this cultural struggle and resource mobilization


2 1 do not wish in this argument to reduce social movements to their cultural dimension. As I have argued earlier they are political in the traditional sense of the term as well.





46


advocates, who used to argue that social movements only represented conflicts of interests over material conditions, now recognize the importance of the cultural production aspect of social movements (Morris & McClurg Mueller 1992; Tarrow 1994). Some political scientists (Alvarez et al. 1998; Alvarez 1993; Dagnino 1994a, 1994b, 1998; Waylen 1994), are moving away from a narrow definition of politics to include microlevel processes within both the public and the private spheres, hence including elements which earlier would have been considered as cultural. Traditionally, politics and democracy were defined in terms of institutions within the public sphere only (Waylen 1994). Democracy is then no longer held to be ensured by the fight to vote and other institutional arrangements. It needs to be "deepened" when "social authoritarianism" permeates all social relations, i.e. when hierarchy and inequality pervade the cultural practices through which people relate to each other in everyday fife as it is the case in Brazil (Dagnino 1994a). Thus, a broader definition of democracy encompasses power distribution in micro-level situations not only along class fines but also along gender, race, age and other dimensions. Feminist activists have long understood the relationship between culture and politics as they expressed in their slogan "the personal is political".

In Brazil, social movements and grassroots organizations have played an important part in the return to formal democracy. Many scholars have documented the long-term potential of social movements and grassroots organizations to bring about such democratizing social change Qaquette 1994; Escobar and Alvarez 1992; Safa 1990; Slater 1985). It is now generally accepted that the social movement literature, especially in the 1970s/1980s, was characterized by a celebratory mood sometimes romanticizing social movements as harbingers of social and political change, probably expecting too much from these movements in terms of changes in the political arena, disregarding their internal difficulties and other limitations. The pendulum





47


started to shift in the late 80s, maybe even too far in the opposite direction, as a number of writings focused on the decline, and difficulties of social and popular movements (see review articles by Haber 1996, Roberts 1997 on literature of Latin American social movements). Again, a more sober look at the democratizing potential and internal dynamics of movements was indeed in order, however as Kathryn Hochstetler argues, social movements' "recent decline gains dimension from the height of [...] past hopes" (1997:25). Ton Salman (1994:26) also warns against such disillusioned overreaction.

There is no doubt that the unifying goal of toppling down the military dictatorship disappeared in 1985, and that allegiances to different political parties not only divided movement activists but also siphoned off some of the movements' energy into the political sphere, notably political parties. Moreover, with the consolidation of formal democracy, traditional political actors regained more control over the situation, limiting the institutional changes that radical movements could achieve. The economic difficulties experienced by the poor as a result of neoliberal policies and the dire consequences of the retreat of Christian Base Communities (CEBs) which had been crucial mobilizing spaces for popular movements in the 70s and 80s can also not be ignored. There is also no doubt that social movements strategic innovations after 1985 have "push[ed] the limits of many conventional definitions and expectations of social movements" (Hochstetler 1997:14) thus leading many to believe in their "decline. Four such new participatory strategies she identifies are nongovernmental organizations, participation on government councils, international networking and land occupations (ibid.). As Hochsteder herself points out, these strategies are by far more problematic, more ambiguous, as democratizing agents than protest, mass-based, Plautonomous" movements, whose potential is believed to stem from their participatory nature,






48


from microlevel changes they entail for participants, and from their relative autonomy from mainstream institutions (Carroll 1992; Hellman 1992). In fact, this study hopes to assess two such participatory strategies, namely NGOs within the feminist movement and their international linkages. As Hochstetler further argues, we should not overlook that new movements, in the classical sense of the term, with street protests and mass mobilizations, have also appeared on the scene, such as the successful campaign for the impeachment of President Collor in 1992 or the Landless Movement (Movimento dos Trabaliadores Rurais Sem-Terra MSJ).

From a different point of view, the "decline" of social movements in Brazil after 1985 can be partially attributed to the focus on institutional outcome of many observers, and hence, going back to our original topic of the relationship between culture and politics, to a narrow understanding of what constitutes politics and of the constitutive role of culture in politics (Dagnino 1998). Even Ton Salman's insightful discussion of women's empowerment yet limited political learning3 as participants of urban popular organizations in Chile's shantytowns, reveals an emphasis on the institutional impact of these organizations, despite his acknowledgement that "More profoundly than in the past [ ... ], social and local relations will support political a well as pragmatic, everyday aspirations" and that "focusing on changing identities, gradually shifting habitus, and the acquisition of competences provides a more tedious but also a more concrete anchor for understanding change" (Salman 1994:24).





'He writes that "these processes [of empowerment linked to participation in movements] did not alter their inability to challenge the patterns of politics they identified as alienating, oppressing, excluding, or power focused" (Salman 1994:17). They did not enter the political arena in the strict sense of the term.





49


The latest contribution by Alvarez, Dagnino and Escobar (1998) provides the fink between the micro and the macro, politics and culture, via the cultural politics of social movements and political culture. Evelina Dagnino (1998) demonstrates how urban popular movements have helped redefine the notion of citizenship and fights, how they have transformed the perception of social needs as rights thus undermining clientelistic political practices. She shows that this has clear consequences for electoral politics and the control over elected representatives. Popular movement activists, she argues, are challenging the boundaries of the political by including the need to end social discrimination (race-based, class-based or otherwise) in their struggle for citizenship. They do not consider that the presence of political parties and electoral processes is sufficient to define a democracy. In that sense, social movements have been playing a considerable role in changing political culture. Social Movements Heteromenei


Social movements participate in the production of culture, and conversely, the forms collective action takes are related to the cultural matrix fi-om which they are arising. This is a domain where anthropologists can make a difference, examining how already existing cultural practices/texts "can serve as a springboard for community organizing and collective action" (Burdick 1993 3 0). Indeed, collective action is not "born out of organizers' heads but is culturally inscribed and communicated. The learned conventions of collective action are part of a society's public culture" writes Sydney Tarrow (1994:18). Collective action and organizational forms are also historically inscribed: 19th century Parisians innovated with barricades, factory workers formed trade unions and went on strike, Gandhi innovated with non-violent protest (Kertzer 1988; Tarrow 1994). Similarly, organizational forms are





50


influenced by the social characteristics of their participants, such as class, gender, race, and age. As a result, social movements reflect the heterogeneity of the culture and participants they emerge from.

Social movement scholars have tended to gloss over the heterogeneity of social

movements' mobilized and unmobflized constituencies (Burdick 1993; Wiener 1994). Yet, paying attention to heterogeneity would give an invaluable insight into a movement's potential for dynamism or the reasons for its mobilizational problems (Burdick 1993). Burdick further argues that this is where anthropologists should step in since they are particularly weUequipped to explore local patterns of social heterogeneity using the ethnographic method and through the concept of culture in the making as defined earlier.

June Nash (1992) exemplifies how anthropologists can explore the heterogeneity of social movements. In her study of the resistance of Bolivian mining communities against structural adjustment measures imposed by the International Monetary Fund, she listened to the miners, the peasants, the students and the women involved, but also to the leaders of the resistance movement and to the base and contrasted their strategies, tactics and ideas. She also elicited the different meanings that different categories of participants gave to the movement and to the events underway and how this is related to their practices and strategies.

Similarly, my study hopes to draw on the voices of several sectors of the women's

health movement in Sdo Paulo, its leaders, its professionalized activists, its volunteer activists, as weH as members of middle class and popular feminist groups and of different age and ethnic groups to draw a picture of the impact of professionalization for these different actors.






51


Importance of Practice in Collective Action


The cultural transformation that social movements engage in, this struggle for a more democratic social order in everyday life, takes place through actions and practices, as well as through attitudinal changes. In fact, Nash argues that "in trying to understand social movements, we must abandon the analytic distinction between social behavior and culturally encoded symbolic form" (1992:29 1). She reaffirms the link between meaning and action.

Rational choice theory starts with the premise that action or behavior folows people's attitudes or preferences (Ferree 1992:3 5)--This takes us back to our discussion of a nonlinear model of development of social movements fr-om identity to strategy--. However, beliefs and preferences are neither stable, nor consistent, they are oftentimes shifting and in conflict with one another in people's minds (Ferree 1992; Kertzer 1988:68). Therefore, it is important to also consider practices. In fact, people have shown a great ability to syncretize different symbolic systems, i.e. to deal with contradictory or conflicting ideas (Kertzer 1980:255) so that consistencyy comes through common action" (Kertzer 1988:68).

Going one step further, some scholars have argued that "getting people to act can, under some conditions, literally change what and how they see" and that activists have long known and used this knowledge (Ferree 1992:35). Hirsch stated that "action mobilization is frequently used to create consensus mobilization rather than the reverse" (Hirsch 1986 in Ferree 1992:3 5). Fantasia (1988) demonstrated clearly that collective action and interaction have an effect on people's consciousness and notably that people's consciousness was





52


substantially raised by collective action and interaction4. Fantasia (1988) labeled this concept "consciousness in action".

The reasons why people's actions are not only indicative or reinforcing what they think but also constitutive of what they think are to be searched for at the individual/psychological level, as well as at the social level. Practice theory helps us understand how people's actions are influencing people's minds. I have discussed how customary social practices express underlying principles without explicitly referring to them. It follows that body and language have the disposition to "function as depositories of deferred thoughts" (Bourdieu1990:69). So that "replacing the body in an overall posture [...I recalls the associated thoughts and feelings, in one of the inductive states of the body which, as actors know, give rise to states of mind" ibidd).

Moreover, people's actions are necessarily more public than their thoughts. When

participants in a movement engage in collective action, i.e. demonstrate, strike, protest, they act publicly according to the rules of the organization. These acts "provide public statements of acceptance of a groups's position" (Kertzer 1988:68), hence reinforcing one's identity with and one's commitment to the movement. Similarly, relating with one group identifies a person with that group so that it is difficult for participants of an organization/movement to interact with people from the opposite camp: "mixing and matching can be untenable" as Kertzer showed in the case of the relations between Communists and Catholics in Italy (Kertzer 1980:255). Kertzer goes so far as to say that "socially and politically speaking, we are what we do, not what we think." (ibid), although this is too strictly behaviorist a statement for me to endorse.




4 He showed that workers' stated limited willingness to strike and discontent with management and owners before collective action was underway, was unable to predict the strike that immediately followed.





53


How Organizational Forms Influence Collective Identi1y and Solidari1y.


Although issues of solidarity and collective identity have been explored since initial work by the early social scientists, especially Durkheim (1974 [1906]), the issue of how organization influences solidarity and collective identity remains a frontier in social movement theory (Morris & McClurg Mueller 1992).

Before going any further, I shall briefly outline my understanding of collective identity and solidarity. Collective identity is "the shared definition of a group that derives from members' common interests, experiences and solidarity" (Taylor & Whittier 1992:105). Collective identity is at least partially empirically observable. It can be derived from the meaning people give to labels and other cultural symbols, in particular to what salient characteristics members of a group believe differentiate them, as a group, from the wider society and what their understanding of the group's actions is. Collective identity is also manifested through the language and symbols by which it is publicly expressed (Gamson 1992:60).

The alternative social and cultural framework of a social movement organization is

reflected in its collective identity, in its programs, and embodied in its everyday practices and its organizational structure (Garrison 1992). Observing how collective identity and solidarity are expressed in daily behaviors and actions is just as essential as recording attitudinal statements. Style of headquarters, forms of address, behaviors denoting the nature of the rapport between support and grassroots groups' members, behaviors during interactions with public authorities, etc. all embody the collective identity and the level of solidarity of the group, and inter-groups.






54


1 would define solidarity as "the relationships of affection, trust, reciprocity and moral obligation between human beings" (Boswell 1990:17). 1 consider that the type of solidarity encountered in social movements is closer to Durkheim's mechanical solidarity, that is the solidairty which arise from a sense of identity and commonness with other group members.

New social movement scholars have tended to pay attention mainly to grievances that led to movement emergence and need to consider the associational and organizational arrangements, the institutions and practices of social movements. New social movement theorist Alberto Melucci (1984) considers the form of social movements as being a goal in itself since it is a "challenge to the dominant patterns", opposing "the operational rationality of apparatuses" (1984:830): movements' informal network-Eike forms,,with multiple leaderships, submerged in society, embody the anti-hierarchy, anti-bureaucratic principles of their participants, as they redefine and practice new forms of sociability.

Resource mobilization advocates have spent more time at examining different

organizational forms but they do not consider the influence these different arrangements bear on collective identity, solidarity and ideology (MacAdam et al. 1988). Yet, organizational arrangements, institutions and practices are likely to influence the collective identity of the group, the consciousness and the solidarity of members as well as the group's actions (Fantasia 1988; Tarrow 1992). Consensual decision-making, in particular, an organizational feature essential to participatory organization has been shown to heighten group members' commitment to the decisions made, and hence to increase solidarity (Hechter 1987; Uphoff 1986). Kertzer also mentions participatory decision-making as a ritual of legitimation to give the appearance of including everybody in the decision-making process (1988:42).





55


Other practices linked to the internal structure of the group may alter the collective

identity and solidarity of a group: indeed, some scholars have shown that certain organizational forms are related to the instrumental (or formal) rationality, motivated by self-interest, driving western capitalist society, whereas other forms are more attuned with value (or substantive) rationality, in the Weberian sense (i.e. when individuals' behaviors are driven by moral commitments other than self-interest) (Ferree 1992:33). Perrow (1986) showed that certain characteristics of capitalist firms, such as the measurement of individual contributions, the possibility of accumulating advantages, the creation of stable and hierarchical authority structures and minimized interactions, will encourage self-interest. On the other hand, Rothschild-Whitt (1979) identified the characteristics of collectivist-democratic organizations which oppose them to bureaucracies and encourage solidarity and other values. Such characteristics are authority based in the collective without hierarchical structure; homogeneity used as a method of social control, i.e. to limit potential conflicts; holistic and affective rather than segmented, role-based and instrumental social relationships among members; an incentive structure relying on purposive and solidary incentives, such as participating for "the cause", or for the sake of the collective, rather than on material incentives; minimal stratification in terms of pay and decision-making; minimal differentiation ofjobs thus demystifying specialized knowledge.

How are professionalized organizations with their distinction between administrative and technical work, their clearer division of labor and the constraints imposed by financing agencies in reporting and accounting terms able to maintain a strong solidary collective identity? Especially when collective work is no longer construed solely as "a labor of love" as Rothschild-Whitt (1979:515) puts it, but "as a labor of love and bread". How is their alternative






56


framework affected by these organizational changes? These are questions which I will address in this work.

Another specific set of practices, rituals, have been shown to impinge on solidarity and commitment to a group (Kertzer 1988). Kertzer defines ritual in a very broad manner as "symbolic behavior that is socially standardized and repetitive" (1988:8). Drawing on the work of Blumer (1974) he includes "mass meetings, rallies, large demonstrations, and commemorative ceremonies" as rituals in the case of social movements (1988:72). Kertzer's theoretical approach follows Durkheim's who believed that since people are "dependent on others for their existence, [they] need to be reassured of the goodness of society. This "need for social communion" they obtain through common action. Only by periodically assembling together and jointly participating in such symbolic action can the collective ideas and sentiments be propagated" (Kertzer 1988:62).

According to Kertzer, ritual is particularly important for producing solidarity in the

absence of consensus because the symbols used in rituals are ambiguous and can be interpreted differently by different participants, but on the other hand they have an emotional impact on people (Kertzer 1988:66). 1 would argue that there is a minimum of consensus necessary for solidarity to build up. But certainly there is space for an array of positions to be represented. The strong emotional dimension of rituals, and hence of certain collective action practices, influences participants' solidarity. For example participating in a demonstration emotionally impacts people as they jointly participate with so many other people in a particular struggle (Kertzer 1988:119). Participating with a large number of people boosts people's sense of selfimportance, as participants are "on parade" (Kertzer 1988:68). This is particularly strong for women especially in societies where they have traditionally been confined to the private sphere.





57


It also engenders feelings of belonging reinforced by the "paraphernalia of ritual", i.e. "slogans, songs, cheers, expressive gestures, and uniforms" that symbolize "feelings of common identity and sympathy" the movement fosters (Blumer 1974:9-11 in Kertzer 1988:72).

As professionalized organizations are turning more towards lobbying and research activities than towards micro-level conscientization or protest activities, as they are moving away from "atividades de rua" (street activities), they might lose some of this solidarity building element which eases the maintenance of a strong social base for the movement which would allow for further democratization. Chapter 7 will address these issues.


Conclusion


A full understanding of social movement dynamics requires combining resource mobilization theory (focusing on strategy) and new social movement theory (focusing on identity), not only because RMT has focused more on how social movements function and NSM has focused on why they emerge, but also because the collective identity of a group and its preferred strategies, tactics and practices are intimately linked and influence each other. Indeed, social movements are both expression of group identity and conflict of interest, simultaneously expressive and instrumental, simultaneously cultural and political. Moreover, while new social movement theory provided me with insights on issues of solidarity and collective identity which are essential when dealing with the maintenance of social movements, resource mobilization-based studies have analyzed issues of professionalization and of the impact of funding on social movements (albeit mostly in the US) in a very detailed fashion. Suzanne Staggenborg's (1988) study of the professionalization of the US pro-choice movement, and her distinction between professionalization, formalization and






58


institutionalization, as well as the feedback mechanisms among them provided my study with a great point of departure and of comparison. Jenkins and Eckert's (1986) notion of channeling of social movements by elite funding also proved very useful.

The following chapter will turn to the specifics of the case at hand, namely the Brazilian women's movement and its partial formalization/professionalization through the creation of nongovernmental organizations (NGOs).














CHAPTER 3
NONGOVERNMENTAL ORGANIZATIONS AND THE WOMEN'S MOVEMENT

I believe that NGOs are the face of social movements in the 90s. I think that the distinction made between movement and NGO is often artificial. [ ... ] Women's
NGOs for example, today, I think that they are not really support organizations for
the women's movement. They ar the women's movement. The women's
movement today is made up of women's NGOs and a few associations [leader of a
feminist professionalized organization].

What is the basic difference between an NGO in Brazil and a social movement
organization? It is that, in the end, in the very end, an NGO is a micro or a
medium-sized firm. [ ...]I You [professional feminists] have a place in our hearts, you are legitimate members of this movement.., but you're not the boss [active
member of a volunteer feminist organization]


Introduction


At the close of the 80s, the term nongovernmental organization (NGO) was hardly ever heard among Brazilian feminist activists. There were feminist groups of various sorts but no NGOs. Yet, by 1992, when I conducted my preliminary field research, the term was out and tensions were starting to build up between NGO and volunteer feminists. And by the time I returned to Brazil, in September 1994, I heard complaints of fuill-blown ongiza~do (NGOization) of the movement. What happened in the meantime is what I will try to sketch out in this chapter.

Before launching into the specifics of the Latin American situation, it is important to recall that the emergence of NGOs on the continent is part and parcel of a worldwide process, of a global "associational revolution" (Salomon & Anheier 1996:xi), linked to the widespreadd loss of confidence in the State, expanding communications, the emergence of a



59






60

more vibrant commercial and professional middle class, and increased demands for a wide range of specialized services"(Salomon & Anheier 1996:129). From a more strictly political point of view, the end of the cold war is also understood as a major event which gave NGOs a chance to be more active in countries other than their own, without being accused of interference. They also were able to shine on the international political scene, namely at the United Nations, where security and nuclear threats receded to leave space for "low politics" in which NGOs had accumulated knowledge and experience (Gordenker & Weiss 1996). This chapter will present the specifics of the process of the emergence of NGOs in Brazil.

In chapter 2, 1 reviewed the lack of consensus concerning the relationship between organizations and social movements. The situation is even more confused when we deal with NGOs and their relationship to social movements in the Latin American context. This is all the more true in that the term NGO covers an incredible range of organizational realities. As a result, on the one hand, the very Association of Brazilian NGOs (ABONG), as well as a number of theorists in the field, argue that NGOs are not social movements (Foweraker 1995; Gordenker & Weiss 1996), while others argue that NGOs represent the new face of social movements given the new political make-up of Latin American fledgling democracies (Doimo 1995; Hochstetler 1997).

The landscape is murky indeed, even more so for the women's movement and other identity-based movements, such as the black movement, as I will argue further in this chapter. I will start by exploring the origins of this new social and political actor, the NGO, that emerged with the transition to formal democracy. I will then turn my focus onto the women's movement and how NGOs emerged within this movement. I will then consider the areas of fuzziness of the definition of NGOs among feminist activists and the ensuing






61

tensions, which correspond to criticisms or problematic issues raised by the academic literature on NGOs. In the end my understanding is that feminist NGOs are indeed part of the women's movement, although they are the most institutionalized and policy arenaoriented face of this movement.


The Social Construction of a New Political Actor: Nongovernmental Organizations


The Origins: Popular Education Centers and the Dictatorship


The first Brazilian nongovernmental organizations, like most southern NGOs, emerged in the 60s from a shift of northern NGOs' funding policies towards indigenous efforts, based on new thinking by Third World intellectuals on development theory and practices, and from the influence of Liberation Theology, both of which emphasized the need to work from the ground up. The removal or resignation of professionals from the public sector after government policy changes by authoritarian governments, also played a part (Caroll 1992; Clark 1991; Landim 1993a). However, these groups did not call themselves NGOs at the time; they were known as popular education centers (cenb-os de educaopopular) of variants thereof Neither did they assume the advocacy role that we now associate with NGOs. Advocacy was hardly a choice with a repressive, conservative regime.

First, it is worth noting that aid to the third world transferred through American,

Canadian and European nongovernmental agencies increased by 68% between 1960-1980 (Landim 1993 a: 13). An increasingly sizable portion of these moneys come from governmental subsidies (through the European Economic Community or the OECD for example) to Northern nongovernmental organizations such as Oxfam (ibid). In 1990,






62

according to UNDP data, NGO transfers from the north to the south represented the equivalent of 13% of official governmental aid (Fernandes 1994:83). In 1995, about 25% of US foreign aid was channeled through NGOs (Gordenker & Weiss 1996:25).

In the 60s, the Northern NGOs which financed Latin American organizations were largely linked to churches,1I mostly European at that point, and had developed a critical view of their governments' international policies (Landimn 1993 a:2 1). This encouraged them to finance groups with similar ideas to their own in countries of the South. Latin American political exiles participated in European NGOs, and hence altered the way these organizations saw Latin American reality and what their action should be (Landim 1993 a; Doimo 1994:5).

Meanwhile, in Brazil, criticism was mounting against community development

practices which evolved in the 50s/60s from US positivist sociology. Or rather, the need was felt for a politicization of these practices, unveiling the class and power relations at the root of community problems (Landim I1993a:235). Paulo Freire's methodology for adult education and literacy provided essential additional ideological and methodological support for these popular education centers which were later to become NGOs (Doimo 1994:5).

With the beginning of the crisis of Marxism, especially in its 'democratic centralist' form and discovering Gramsci in the 70s, Latin American intellectuals started to value micro-transformations in daily spaces and interpersonal relations (Doimo 1994:5). The dictatorship period fostered the implementation of these ideas since any highly visible political work would have been prohibited: leftists worked at micro-level transformations, often under the protective arm of the Catholic Church.






63

In fact, members of the progressive Catholic Church, and to a lesser extent other churches, were paramount in the creation of the first centers for popular education, which defined themselves entirely as support organizations for localized popular movements. They provided support for popular movements (assessoria aos movimentospopudares) (Landim 1993a, Doimo 1994). The term assessoria (support), although widely used, is itself ambiguous and defines more a type of relationship than a particular activity. It is "related to the transmission of some sort of competence and knowledge which involves mutual trust and some degree of affinity of goals" (Fernandes & Carneiro 1991:8). According to Fernandes & Carneiro's survey (1991:6), as many as 60 percent of NGO leaders in Brazil identify themselves with Liberation Theology and the Church's pastorals. In the 70s, Marxists, whose parties were illegal, increasingly joined these centers in order to be able to do some sort of political work. Whereas they intensified the politicization of the community work done by the centers, they learned from progressive Christians how to put Marxism into practice in community work (Landim 1993a). One of the feminists who later founded SOSCorpo, and who had been a member of one of these centers in Recife told Leilah Landim:

I already had Marxism. But the method, the focus on process and on the popular sectors as subjects of their history, this I learnt with them (the Jesuits of CEAS in
Pernambuco). The refined translation of Marxism to its practice, of how to translate
it into a method .... In terms of intervention I learned a lot. (quoted in Landim
1993 a: 262).

From Liberation Theology and community development, the centers and then NGOs inherited their participatory ethos (Landim 1993a: 193). From Liberation Theology, they also inherited the anti-intellectualism, rejection of market principles, and emphasis on direct




'Still in 1991, 70% of the Brazilian NGOs interviewed in Fernandes & Carneiro's survey were financed principally by church-linked agencies (Fernandes & Carneiro 1991).





64


democracy which are constitutive of the political culture of Christian Base Communities (Fernandes 1994:40).

A strong sentiment against anything institutional or centralizing was the fruit of the influence of progressive Catholicism, as well as of self-criticism on the Left. Like social and popular movements, NGOs believed in "o povo como sujeito de suapr6pia hist6ria" (Doimo 1994:7). Autonomy and direct democracy were the ethical and political principles that guided them (ibid:7). NGOs thus became markedly anti-assistencialist and strengthened their identity in opposition to traditional philanthropic enterprises (Landim 1993 a).

At that stage, NGOs, like social and popular movements, did not trust traditional

forms of political representation (Doimo 1994:13), much less the State and other institutions such as universities. Yet, since the beginning, NGOs have always had a modernizing project. In Leilah Landim's words:

There is a modernizing project, in the sense that they take to popular groups the
underlying assumptions of universalistic rationalism, the logic of equality, autonomy, individualism, participation, dialogue -- of citizenship. (Landim
1993a:219)


NGOs in the Time of Democratization: Building Civil Society


Originally, popular education centers considered their role to be to facilitate the emergence of and to support popular movements. As time passed by, the movements became a reality and the political scene in Brazil changed with the return of formal democracy in the mid-80s. This allowed proponents of social change to have a more public, visible role.

NGOs emerged as a political and social actor with a voice of its own. As Leilah

Landim (1993a) brilliantly demonstrated, the "centers" redefined who they were and what





65


their role was through coming together in new arenas such as national associations/fora (one of the most recent is the Brazilian Association of NGOs (ABONG) created in 1992), or regional networks. Financing agencies also facilitated the emergence of an NGO identity by bringing their 'partners' from the South into contact with one another.

However, this process has been slow and contested, since not all centers which give assessoria (support) agreed with the redefinition of their role, even if they have taken on the NO label. The fact that a host of new entities, with varied origins and goals, including people coming from universities, governmental organizations and activist circles jumped on the band-wagon and created their own NGO might have helped in the redefinition of the pioneering organizations: 60 percent of ABONG members were legally founded after 1985 (44.1 percent between 1985-1989) (Landim 1996a:XI).

In the new context of Brazilian formal democracy, NGOs, as well as other groups within civil society, softened their stance against institutionality and started working within the realm of institutional politics (Doimo 1994, Scherer-Warren 1994). The process that led to the 1988 constitution in which numerous organized constituencies participated certainly intensified this dynamic. In this new political and economic context, NGOs have seen their role no longer so much as a support for popular movements, but rather as builders of "civil society" in their struggle for citizenship (a lutapela cidadania) along with popular and social movements. Again, they are claiming their own voice.

The phrase "civil society" itself has a long history with changing meanings (SchererWarren 1994). 1 will restrict my overview to the concept of civil society as it is used in recent years in the context of social movement research. Civil society has been defined in two different ways, either in opposition to the State alone, or as a third sector, in opposition






66

to both the State and the Market (Scherer-Warren 1994). According to the first school, civil society represents all forms of mobilization, organization and association outside of state institutions. The second trend considers civil society to be not only nongovernmental, but also nonprofit; i.e. it does not obey the laws of the market system (ibid). Among the latter, some scholars consider the third sector to refer to all voluntary/philanthropic nongovernmental, nonprofit organized endeavors, while the term "civil society" is restricted to those endeavors that struggle for citizenship and democratization. Other scholars, the most prominent of which is Alan Wolfe, do not distinguish between the third sector and civil soc iety, in which they include all forms of mutual help, solidary actions at the community and the family level (ibid). Landimn (1993b) has shown that philanthropy and NGOs do share some common ground, although NGOs in their attempt to create their own identity have rejected traditional philanthropy. However, the dimension of working for others, of the public good and altruism are very present in the work of both .

The new emphasis on "building civil society," rather than "strengthening popular movements," is part of the positive, less anti-institutional stance of NGOs in the new political context (Doimo 1994:17). Landim also noted that NGOs are dropping the term "popular" from their names and activities and wonders whether it is the result of the general pull towards liberalism (1993a:359).





2 The best example of how struggle for citizenship and more emergency-oriented philanthropy can be linked is the Campaign against Hunger and for Citizenship (Campanha contra afome e para a cidadania) launched by the Rio-based NGO, ]]BASE. This campaign responds to the immediate need to satisfy the need of the hungry but is set within the larger framework of a struggle for citizenship for all, in that it aims to conscientize both individual donors and recipients on the structural causes of poverty and hunger (Landim 1 993b; Scherer-Warren 1994).






67


We can say that Brazilian NGOs have multiplied in the 80s due to (1) the expansion of international financial and political cooperation; (2) the emphasis on privatization by neoliberal governments, kicked off by Reagan's speech "the magic of the market" delivered at the North-South conference in Canciin in 1981 (Escobar 1995-93). This resulted in a move away from the financing of government efforts towards the financing of the private sector by multilateral agencies; (3) the internal redefinition of their political role by proponents of social change in response to changing political circumstances in democratizing Brazil; Other factors that need to be taken into account are (4) the return of exiles; and (5) the economic crisis which left numerous middle-class professionals with limited job options.


"NGOs? What Kind of Beast is This?":
NGOs Born Out of a Social Movement


Although the term "Non-Governmental Organization" was coined by the United Nations in the 40s to designate groups which could serve as consultants, the classificatory term "NGO" has been used only recently to identify support/advocacy organizations. This new label and its associated roles did not come into vogue for no reason. As Gordenker and Weiss (1996) have pointed out changes in the international political scene, as well as new communication technologies, have increased the role sectors of civil society could play in the policy-fonnulation process. The term NGO was also imported into Latin America via financing agencies to designate the intermediary organizations which implement their projects with grassroots organizations (Scherer-Warren 1994:8). This is yet another example




3In Portuguese: "Ongs? Que Bicho]E Esse?







68

of how Northern institutions have retained the power to name and hence partly to define reality in this part of the world.

In Brazil, it was the United Nations conference on Environment and Development (UNCED) held in 1992 in Rio de Janeiro and commonly known as Eco-92, which brought the term NGO into public purview, through the media (Landim 1993a; Scherer-Warren 1994:8). This shows once again the importance of the international dimension for these transnational actors. The acronym NGO became ubiquitous and it has acquired an increasingly positive symbolic value, despite some gross misrepresentations in the media. It is "in" to be an NGO. However, the definition of an NGO circulating in the sectors involved, as well as in the larger public, is far from precise because it spans widely differing realities.4 I will start with the definition of the Brazilian Association of NGOs, ABONG, which have been involved in the construction of NGOs as a new political actor. The association defines an NGO as "a nonprofit entity whose fundamental objective is to develop a democratic society, that is, a society based on democratic values: freedom, equality, diversity, participation and solidarity" (da Souza 1995: 3). The association had 210 NGO members as of January 1995.

With regard to its membership criteria, ABONGs monthly newsletter, o Jomnal da ABONG announces that "the association welcomes organizations which 1) are autonomous from the State, churches, political parties and social movements [my emphasis]; 2) are committed to the building of a democratic society, which includes respect for diversity and pluralism; 3) have a public character in terms of the actions they are involved in; 4) are




4For typologies of NGOs see:- from an international politics point of view Gordenker and Weiss (1996) and from an international development aid perspective Carroll (1992).








recognized as a legal entity ("tempersonalidadejuridicapr6pia") with nonprofit motives; 5) can justify at least 2 years of experience" (Jornal da ABONG, January 9, 1995, p. 2).

These membership criteria reinforce the idea that NGOs are defined mainly in

opposition to other institutions. They are nonprofit and they are nongovernmental. They also distinguish themselves from traditional philanthropic institutions and their assistentialism. These criteria do not mention the privileged relations of NGOs to popular movements but strictly draw the line between NGOs and social movements, reflecting the changing relations of NGOs with popular movements.

ABONG's criteria are quite specific. However, the acronym NGO "carries the trademark of polysemy and therefore of the possibility of differentiated use by various groups" (traz a marca da polissemia e portanto da possibilidade do uso dyfferenciado por grupos diversos) (Landim 1993a:6 1), which means that different groups will use it with different meanings in different circumstances. I agree with Landim (1993a:296) that this is in part due to the fact that the boundaries of the NGO social field with adjacent fields are not well-defined, so that groups play with their identity according to the context. Feminist NGOs are a case in point, as the introductory quotes to this section hint at. Of particular interest to me is the boundary between women's NGOs and the women's movement. I will now sketch the story of the women's movement in Brazil and the emergence of these professionalized entities within it.


The Story of the Brazilian Women's Movement


The Brazilian women's movement, like other women's movements in Latin America, reflects the great diversity of the country in terms of race, class, sexual orientation,






70


generation and regional origin. It has brought together self-declared feminists, originally mostly well-educated, white middle class women adopting a long range strategy focusing on gender equality, and women who do not refer to themselves as feminists, from the poor and working class, who organized around family and community survival issues or in urban and rural trade unions, etc. The boundaries between feminism and other components of the women's movement are not clear-cut as some of the issues dealt with by "non-feminist" neighborhood women, such as contraception and child care, already addressed gender inequality (Radcliffe and Westwood 1993). Moreover, Amrita Basu (1995) warns us not to limit our reading of feminism to its middle class Western expression, or to fail to recognize it when women for one reason or another refute the label but not the ideas or the practices. The distinction has become even more blurred as a number of women from all walks of life have started to acknowledge their feminist identity, oftentimes radically redefining what it entails (Alvarez 1994; Soares et a]. 1995). Overcoming the theoretical notion of a "urutary woman" has started to become, although still timidly, a practical reality for Brazilian feminism. It has 'gone plural' as Sonia Alvarez (1998a) cogently puts it.

Starting from the beginning, some two decades ago, the story of the Brazilian women's movement and its different components would run as follows:

By the late 70s it had become evident that the Brazilian military regime had failed to transform the "economic miracle" into a reality for all Brazilians (Fishlow 1989). Grassroots organizations and popular movements sprang up in a collective effort to deal with the increasing difficulties of the working masses and to oppose the repressive regime (Alvarez 1990; Kowarick 1985). By now it has been acknowledged that women represent the majority of participants in many of these grassroots movements not only in Brazil but in






71

Latin America in general (Caldeira 1990). In Brazil, as throughout Latin America, women organized around their identities as mothers and wives to resist the authoritarian military regimes, with the help of the Catholic Church and leftist-oriented parties (Alvarez 1990; Fisher 1993; Jelin 1990; Safa 1990). Brazilian women have also taken to the streets to defend the well-being of their families as the wage-squeezing development strategy of the military caused a severe decline in purchasing power for the low income strata. In Sdo Paulo city, more than twice as much work was needed in 1974 (end of the Brazilian economic "miracle") than in 1959 to obtain the same basic food basket (Kowarick 1985:77). The situation worsened considerably with the economic crisis of the early 80s when national prices for basic food items increased by 400% (Barroso and Amado 1987:62). The ensuing structural policies (Wirth et al. 1987), and the more recent recession, aggravated after 1989 by the economic adjustment policies of the first elected president, Fernando Collor de Mello, and his successors, have meant further dwindling of public funding, privatization of social programs, and a sharp increase in poverty levels, although paradoxically some social indicators seem to have slightly improved (Faria 1994; ]BASE 1991; Lopes 1994). Women have been especially affected by these hardships. As studies have shown, they bore most of the negative consequences of structural adjustment programs which cut public services linked to areas of social reproduction (such as health and education), for which women have traditionally been responsible (Barroso and Amado 1987; Beneria and Feldman 1992; Nash 1990). Health care is a case in point as I will demonstrate later.

The link between the level of hardships endured and the level of mobilization is not a linear one though, as attested by the fact that the level of mobilization today is lower than it used to be, despite continuing and at times worsening conditions. Belief in prospects for






72

success of collective action and the supporting role of other sectors of civil society, or even of institutions, also play their part.

As for the Brazilian feminist movement, Alvarez (1990) attributes its emergence to the questioning of inequalities experienced on the job by educated, working middle-class women, as well as to the deterioration of their standard of living as a consequence of the economic crisis. Contradictions between the traditional gender ideology of the military regime, which ascribed nurturing roles to women as mothers and wives, and its strong state capitalist development strategy, which prevented women from fulfilling these ascribed roles, fueled the growth of the movement. In addition to these structural conditions, she believes "conjunctural conditions", such as the human rights discourse, the international feminist discourse, especially after the UN -sponsored International Women's Decade from 19751985, and the discrimination suffered by women within the sexist and male-dominant political organizations of the Left, have brought crucial ideological and organizational support to the creation of an autonomous feminist movement. The period of liberalization of the military regime after the mid-70s, known as Abertura, and the ensuing strengthened hope for successful protest, also favored growth of hte feminist movement (Alvarez 1990; Schmink 1981).

Finally, the encroachment of the authoritarian state and the market into the private sphere, which is largely a women's domain, "comprising religion, the family, relations with kinfolk and social dynamics" (Arizpe 1990:xviii), left women "empty-handed [with] few children, small families, fewer social ceremonies and religious rites, highly formalized urban customs and programmed social practices" (ibid:xv). The need arose for women to reconstruct an identity, which middle-class women did in part through their feminist groups.






73

Women needed to "create a democratic public space for their collective identities and demands" (Cohen 1985:670).

1 discussed in Chapter 2 the necessity to intertwine the two main schools of social movement theory because social movements are simultaneously expressions of group identity and conflicts of interest, and because these two dimensions impinge on each other. Similarly, we just observed that in the case of the Brazilian women's movement, both new social movement theory and resource mobilization theory are needed to explain its emergence.- Fighting for their rights/needs (strategy), helped women to deal with the disruption of women's traditional gender roles and to forge new roles for themselves (identity).


Emergence of women's health movement

As I mentioned in my introductory chapter, the Brazilian health care system is highly dichotomized and inegalitarian. Since women in Brazil, as well as globally, are responsible for the care of the sick, the young and the elderly, their burden became heavier as malnutrition (Barroso & Amado 1987), and unsanitary and crowded housing conditions increasingly affected family health. The situation was aggravated by diminishing government investment and further privatization of public services throughout the 80s (Briscoe 1990; Cohn 1994). As a result, low-income women have had to travel longer distances and wait longer to obtain health services of poor quality for themselves or their family. Between 1989 and 1993, federal health expenditures plummeted from 11.3 to T5 billion dollars (Berqu6 1995:7).

These drastic reductions in public spending coupled with the increasing

impoverishment of the population, the failure to implement a universal health care system







74

and reproductive health programs, neutralized the possible positive impact of the major decline in the fecundity rate, from 5.6 (children per woman) in 1970 to 2.5 in 1991 (ibid: 1). Indeed, maternal mortality rates never declined as fast as the fecundity rate, and were stable at 134.7 per 1,000 live births in 1988 (ibid: 19-20). Many of these deaths could be easily prevented but even in Sdo Paulo city, one of the most privileged areas in the country, lowincome women visit an average of three hospitals before they can find a maternity bed (ibid: 14).

In other words, the fact that women have less children did not liberate more

resources for those who do, or for other women's health issues. Brazilian women have less children partly as a result of the high sterilization rate. Lack of information about or availability of other contraception methods5 is leaving women with little choice, and sterilization is increasingly common, including among young women and especially among poor women. Further, due to racial inequality in living standards, and to at times barely veiled racist leanings on the part of public authorities, a disproportionate number of AfroBrazilian women are being sterilized. This, of course, has been an important struggle for Afro-Brazilian women's groups (Roland and Carneiro 1990:208).

Extremely high rates of cesarean sections, and reproductive tract cancers, which are responsible for 30% of all total cancer deaths in Brazil are other reproductive health problems faced by Brazilian women (Berqu6 1995:23). Again, many such deaths are easily



'The oral contraceptive is the other widely used contraception method in Brazil. In Sdo Paulo, it is slightly more common than sterilization (respectively 3 8.6% and 36. 1% of women who use contraception in 1992). In the Northeast of the country these figures are reversed (62.9% for sterilization and 23.0% for the pill) (Berqu6, 1995:9). High-dose pills are still common. Pills are relatively expensive but since they are available over-thecounter many women self-prescribe, which leads to serious side-effects, such as strokes (see Briscoe 1990:46).






75

preventable but the rates of pap smear exams for the detection of cervical cancer are very low- even in Sdo Paulo, only 4% of women get a pap smear (ibid-24). Obviously, women's health should not be limited to their reproductive health but it is the area that receives the most attention from the authorities, and the bleak picture provided above gives an idea of how neglected other women's health issues might be.

Given this grim situation of health care for the large majority of Brazilians, and

especially for low-income women, it is understandable that people have been organizing to make claims on the State for better services. Women also have searched for ways to make the medical establishment respectful of women's rights and needs and to give women more control over their own bodies and health. This was originally more a concern of middle class feminist groups than of low-income women's groups, whose priority was to obtain health posts and hospitals in their neighborhoods.

At the federal level, pressure from feminist activists led to the elaboration of

PAISM, the "Integrated Women's Health Program," which was proposed in 1984 by the Nfinistry of Health and started to be implemented by the social security agencies, in 1986, after alterations in response to feminist demands. The objectives of PAISM are to guarantee women's access to care and to address all their health needs in the various phases of their life, with an emphasis on prenatal, birth and puerperium complications, prevention of cancers of the reproductive tract, clinical gynecological attendance, improvement of breastfeeding, control of sexually transmitted diseases, and education on conception and contraception. PAISM aims at organizing and updating the equipment of health services, at providing professional training, and women's education. Unfortunately, it is being implemented only slowly (Teles 1993: 150-152).






76


Feminist groups have been working with low-income women in health movements, offering them ideological and logistical support. The nature of this relationship has been changing as some feminist organizations have professionalized. This trend is part of the larger phenomenon of emergence of NGOs in the South as described in the first part of this chapter.


Transition politics: A taste of the institutional arena

Social movements are not born in a vacuum but are embedded in their cultural and political matrix. Just as institutions such as the Catholic Church and leftist political parties played a role in the emergence of women's movements, the movements changed under the new political circumstances of the period of transition from authoritarian to democratic rule in the mid-80s. Channels of expression were reopened and repression was no longer to be feared. At the same time, the movements' rejection of institutionality gradually weakened. For feminists, as for other groups in organized society, this meant the possibility to take a more visible role in the public arena, as I have described earlier for NGOs. Advocacy became a possibility. Feminists increased their presence in political parties, which rendered political platforms more gender-sensitive and when parties came into power, translated into new institutions to monitor the implementation of these policies, such as the Sdo Paulo Conseiho Estadual ai Condi~do Feminina (CECF) or State Council on Women's Condition, the first of its kind in the country, created in 1983. Two years later, when Jose Samney took office as the first civilian president in more than 20 years, the Conseiho Nacional dos Dire itos da Muiher (CNDM) or National Council for Women's Rights was instituted at the federal level.






77

These Councils had significant participation of feminists with strong ties to women's groups and thanks to their positioning within the State, enabled undeniable advances which the movement would not have been able to secure on its own, such as a commission on reproductive rights within the Sao Paulo Ministry of Health, or the Delegacia dci Muiher (DDM), the special women's police stations (Nelson 1996). In part, the Councils' success was a result of the pressure enacted by feminists outside the State which strengthened the councils' position vis-i-vis the government and helped to limit co-optation (See Alvarez 1994: 3 7-44 for more on the creation, achievements and limitations of these councils).

As the political scene consolidated in this new democratic phase, and as more

conservative governments took power, in 1986 in the State of Sao Paulo and in 1989 at the federal level (administration of F. Collor de Mello), the Councils turned into partisan puppets with limited ties to the women's movement and strongly reduced political clout within the government. In 1995, the Sao Paulo CECF was moved away from the city's main commercial artery to a building in the run-down inner-city. It has been hampered by political partisanship (Nelson 1997, chapter 2).

Another crucial experience with state institutions for feminists was in the Workers' Party (PT) municipal administrations -The PT was born in the late 70s from the processes of organization of popular movements, unions, and organic intellectuals, and shared their ideals of direct, participatory democracy. Some PT feminists, including five who are members of the groups I worked with, participated in Luiza Erundina's PT government after she was elected mayor of Sao Paulo city in 1989. They were members of the Coordenadoria Especial daiMuiher, an institution designed as an "explicitly executive organ" whose employees would formulate and follow policies (Alvarez 1994:45). Although the






78

Coordenadoria and women's issues were not given as much attention as they deserved by the government, it did obtain notable successes, such as the abortion services delivered at the Jabaquara Municipal Hospital for women victims of rape, incest or in cases of lifethreatening pregnancies. These are the three situations in which abortion is legal in Brazil. This service remained up to the end of my fieldwork the only one of its kind in Latin America. Similar services were instituted in Brasilia and in Recife in 1996 (Redde Saludde las Mujeres Latinoamericanas y del Caribe 1996).

What is essential in our NGO/professionalization story is that working within these councils and other state organs provided experience to some women who were then ready to create their own organization when a conservative government came back into office. This was true for former council members: in 1990 the former President of the CNDM cofounded CEPIA (Citizenship, Studies, Research, Information and Action) an NGO located in Rio de Janeiro. Several women former members of the CNDM created, in Brasilia, an NGO (CFEMEA) which has specialized in monitoring and pressuring the Brazilian Congress on gender-related legislation in 1989. In Sao Paulo, Geled6s Instituto da Muiher Negra, one of the first black feminist NGOs in Brazil, was born after several of its members left the Black women's commission of CECF or the CNDM, and rather than going back to work in their original state agencies for a conservative municipal government where they would have been constrained, decided to create their own organization. The "Takeover" by Issue-Specific Groups and Networks


The first Brazilian feminist groups were multipurpose (Costa 1987), mainly grupos de reflexdo (consciousness-raising groups) addressing issues as they appeared and focusing






79


in large part on the experience of their own members. Issue-specific organizations appeared in the early 1980s. Alvarez recounts that the Sdo Paulo statewide feminist meeting held in Valinhos in 1980 marked a watershed in this regard, as feminists started dealing in particular with domestic violence, reproductive fights and the feminist alternative press (Alvarez 1994:32). These issue-focused organizations seemed to have weathered better the increasing political divisions along party lines which appeared with the return to democracy (Alvarez 1994:35).

This shift to issue-specific organizations has been neither a uniform nor a smooth process. Some old time feminists who are not interested in engaging in institutionalized feminism complained about the fact that the movement had abandoned self-reflexive activities, which are still very much needed in their view. Some of them have recently formed a group called Verde Likis, which is meant to function along the lines of the old formula. Nevertheless, at the time I interviewed one of its members, the group wished to give special attention to issues related to women and the environment, as its name indicates (green lilac). Hence, they were already going for some level of specialization.

One volunteer group, the Unido de Mulheres do Municipio de Sdo Paulo, makes a point of not specializing on one issue but instead works on all issues relevant to women. One of its leaders wrote:

The women's question -a macroproblern to be resolved- will not find a solution in a fragmented manner, which is one of the characteristics of academic disciplines and
governmental policies. It cannot be dealt with as a mere technical problem or by
specializing in this or that issue. (Teles 1993:129)

The group is indeed open to any issue. Still, issues of violence against women are their forte.






80

In part as a result of this contested process of specialization and professional ization, the groups involved in the Sdo Paulo women's health movement present varying degrees of specialization and of professional ization, as well as formalization. The most formalized groups tend to be the most specialized and the most professional ized.


Organizational diversity

Today, the women's health movement in Sdo Paulo is characterized not only by regional/geographical diversity but also by a high degree of organizational diversity. Organizational forms range from informal networks of neighborhood women to professional ized organizations (NGOs). Hence, the level of formalization, institutionalization and professionalization of the groups vary widely.

I found loosely structured, informal groups such as women organizing a pharmacy for disadvantaged communities, women participating in a course on health with a women's health component, or women from local Mothers' Clubs mobilizing whenever they deem necessary. These groups do not consider themselves feminists although they work with women's issues and share many feminist ideas. The Catholic Church's Christian Base Communities (CEBs) or its pastoral commission for health are at the root of each of these organizing efforts.

By now there are also a number of neighborhood women's groups focusing on health (six out of the I I visited) in which at least some members identify themselves as feminists. Some of them are fairly informal, others are more formal, some represent an effort by feminist organizations to bring together the leadership of various groups of a region. Two popular groups who acknowledge their feminist identity, are now wellI-establ ished, receiving some international funding which allows them to rent or buy their own space, where they







81


offer workshops either in practical skills or in consciousness-raising. They are not professionalized in the sense that their members are not permanently employed by the organization, although some members receive compensation fees (ajuda de custo). The ideological and logistical support these groups have received from feminist organizations has been essential, in some cases although not in all, in getting them to focus specifically on women's issues, and in some cases even to exist as entity. Most of these neighborhood women were originally active in Church linked organizations.

Sdo Paulo also hosts two federations of women's groups dealing with various gender issues, not limited to health. Both consist of an active, centrally-located group, which brings together the leadership, and of various groups in the periphery of the capital, and in one case in the entire state of Sdo Paulo. These two federations are/were linked to the Communist Party of Brazil (PC do B). One of them was expelled from the party five years ago. Neither one is interested in professionalizing, although the issue creates tensions among members in one of them.

Finally, one finds feminist academics, or former public health care or social workers, most of which with an activist background, organized in professionalized nonprofit organizations (i.e. NGOs) and one semi-professionalized organization. They conduct research, documentation, and training, and publish written and audio-visual support materials on gender and health issues; provide gynecological, juridical or psychological services; influence national and international policies regarding women's health; and provide support to local women's movements.






82




Networks

Ten of the 18 groups I visited during the first phase of my research, those that considered themselves feminists and which had a minimum of formalization, had been participating in an innovative organizational form, a national network, called Rede Nacional Feminista de Sai~de e Direitos Reprodutvos (National Feminist Network for Health and Reproductive Rights) hereafter called Redk.

Networking designates the "nonpermanent collaboration between various

organizations on political issues of joint interest" (Uvin and Miller 1996:349). Faxes, e-mail and other information and communication technologies have facilitated the emergence of such organizational forms. In Brazil, the realization of the United Nations Conference on the Environment and Development (UNCED) in Rio de Janeiro in 1992 was a catalyzing factor for the creation of some NGO federative aggregations, such as ABONG and the Brazilian Forum of NGOs (F6rum Brasileiro de ONGs).

As Ilse Scherer-Warren (1994:11) puts it, these networks mostly reflect the readiness on the part of NGOs to accept and promote the collaboration of heterogeneous sectors of civil society in a given political action.This is a departure from the premium put on the unity of a central oppositional actor in earlier leftist ideologies. I would argue, in the case of the Rede, that class and racial heterogeneity have been achieved to a certain extent, but this diversity has created new challenges, which we will examine in Chapter 6.

Networking is seen as one of the strategies NGOs can use to "scale-up" politically, i.e. "to engage in a conscious strategy to interact with the State so as to address state-level dimensions of local problems. This involves developing strategies to go from the micro to






83


the macro-level with the objective to bring about governmental policy change" (Uvin and Miller 1996-349). 1 shall show how it applies to the National Feminist Network for Health and Reproductive Rights.

The Rede was created in August 1991. According to its own definition it "unites 70 groups and independent activists whose political and professional work focuses on women's health and reproductive rights. This work has two main thrusts: the concept of reproductive rights within the framework of human rights; and the recovery of PAISM (Integrated Women's Health Program) as a reference to improve public health services. ,6 Members of the Rede are women's groups, NGOs, women's studies centers in universities and research institutions, as well as health professionals. Its declared objectives are "to organize the women's health movement around a joint action proposal which guarantees space for feminist ideas within the context of the new world order; and to maximize the potential level of influence of the feminist/women's movement in the design of public and social health policies, at the national, state and municipal levels." It focuses its activities on political networking at the local, national and international levels, to monitor the elaboration of health policies; on participation in State health councils and women's health commissions; on promotion and/or participation in seminars, debates and courses in the field of health and reproductive rights; on organization of public campaigns (AIDS, abortion, maternal mortality, etc.); on media interventions; and on production and exchange of information between members of the Rede, and with sympathizers of the feminist and other social movements, intellectuals, the governmental sphere and the press.


6 This definition as well as most of the following information about the Rede was obtained from a presentation pamphlet distributed at the III national meeting of the Rede, held in Rio de Janeiro in April 1995,






84

The Rede is composed of a Council of Directors, an Executive Secretariat, and a General Assembly. The first two are responsible for the coordination of the Network, and hold periodic meetings to define action proposals. The Executive Secretariat is rotated among member organizations. In 1995, it was passed from SOS-Corpo, located in Recife in the Northeast of the country, to the Coletivo Femninista Sexualidade e Sai~de located in Sao Paulo. It is responsible for the Rede's newsletter, the Jornal da Rede, which is published every four months, and for writing proposals to obtain founding for the functioning of the Network. One problem raised at the second Rede's meeting in October 1994 was that the Executive Secretariat does not possess the infrastructure to accomplish these tasks. Indeed, the Executive Secretariat, apart from some moneys dedicated to communication expenses, relies on the infrastructure of the host organization for its daily functioning. The Assembly defines the broad lines which direct the work of the Coordination. It elects the Executive Secretariat as well as the regional representatives which form the Council. The Rede works through thematic commissions which focus on four basic themes: maternal mortality, pregnancy and childbirth; I-ilV-AIDS; maternity and gender; and communication.

The Sao Paulo chapter of the Rede is strong and influential, capitalizing on the long history of the feminist movement in that region and on the political clout of its participants at the national and international level. The Rede is a member of the Rede de Saude das Muiheres Latino-Americanas e do Caribe which performs similar tasks at the level of the subcontinent. Further specialization is occurring as a few groups working with women and AIDS have been trying to set up a network of organizations working on such issues, although with little success by the end of my fieldwork.







85


For Alvarez (1994:53) "these more fluid forms and forums of feminist organizing and the articulation of a multiplicity of feminist transformational projects in the 1990s appeared to be replacing the more formalistic and tension-ridden movement coordinations of the First and Second Paulista Women's Congresses." However, these networks are not free of tensions or power struggles. This is because their Executive Secretariat and regional representatives do provide a sanctioning of power differentials among groups and in turn endow those chosen for these positions with prestige and symbolic capital, as we will discuss in upcoming chapters.


The origins of feminist professionalized organizations. aka NGOs

By the mid-80s, some feminist organizations had achieved a degree of

specialization, on health issues or domestic violence issues, to name the two major poles of interest. Yet, there was no talk of NGOs. By 1993 however, 17 feminist organizations nationwide were members of ABONG, hence defining themselves, at least in some sense, as NGOs7 (Landim 1996a). The majority were created after 1985 (11 out of 17) (See Table 3-1).

The historical overview of the women's movement hinted at some elements that

participated in the process of emergence of feminist NGOs. We know that the emergence of feminist NGOs was made possible by the new political context of formal democratization, as well as by the "absorption," albeit limited, of feminist ideas by the State (as Sonia Alvarez (1996) labels the process of recognition of the "women's question"), and by the international




7In 1993, 42 percent of ABONG members declared that gender issues were among their top five priorities. However, gender or rather, women, constitute the top priority for only 14 percent of ABONG members (Landim 1 996a:xvi).







86


development apparatus (Escobar 1995:177 ff.). The latter made funding available for

women's projects. This led to the creation ofjobs around such issues.

Table 3-1: Characteristics of feminist NGOs members of ABONG

Name of NGO Date of Size of 1993 budget in US$ Number of
creation* staff volunteers
CACES 1988 12 50,000-100,000 1
Casa da Mulher do Nordeste 1980 8 -50,000 1 intl /2 nat'l
Casa de Passagem 1989 43 300,000-400,000 lint'I /16 nat'I
CEMINA 1990 8 50,000-100,000 0
Centro das Muiheres do Cabo 1984 50 Not available 0
CEPIA 1990 16 500,000-1,000,000 0
CFEMIA 1992 12 100,000-200,000 0
CFSS 1985 11 100,000-200,000 0
Comulher 1985 3 50,000-100,000 2
CURUMIN 1989 5 -50,000 0
ECOS 1990 12 100,000-200,000 0
GELEDES Instituto da Mulher Negra 1988 38 300,000-400,000 Not available
Movto Mulheres do Campo/da Cidade 1978 10 -50,000 5
Rede Mulher 1983 12 100,000-200,000 1 int'l
REDEH 1989 12 100,000-200,000 1 int'l
SOF Sempreviva Org. Feminista 1963 21 200,000-300,000 0
SOS Corpo 1982 24 300,000-400,000 0
Source: Landim & Cotrim (1996) except for Geledes. Geled6s information is based on 1994 interview material.
Note: Legal date of creation

On the part of activists, democratization meant a perception of increased possibilities

of gains for the movement in the institutional sphere of politics. I show in this study that

increased involvement with the national and international political system required a more

formalized structure, which pushed towards professionalization (a process similar to that

discussed by Staggenborg (1988) in the case of the US pro-choice movement).

Formalization and professionalization were also a result of being legally and

administratively able to obtain and manage donor funding as we will see in chapter 8.

Other elements have also contributed to the professionalization of feminist

organizations in the mid to late 80s. One was a severe, protracted economic crisis which






87

prevented middle class women from engaging in activism while holding one or two jobs to make ends meet. This was compounded by the desire for a more stable, less energy-sapping mode of activism on the part of the cohort who started it all in the mid 70s, and last but not least, a strong desire from feminist activists to integrate feminism into their every-day lives through their jobs (Lebon 1993).

Let's take a brief look at some cases of Sao Paulo's feminist NGOs. In one case, a group of about 25 members got together in the early 80s, originally meant to be multipurpose, although with an emphasis on health and sexuality. A few years later, with a much reduced crew, it specialized as a women's clinic; it adapted to Brazilian reality the model of a European clinic a leading member of the group had visited. A second group has a history which follows more closely the model of development NGOs. It was originally a family planning clinic, with paternalistic undertones (assitencialista), then became politicized with the participation of left-wing activists in the 70s offering support to organizing activities among low-income population, especially the health movement, as well as services to this population. It finally turned into a feminist support organization in the mid-80s, as it focused on organizing women as such. No need to say there was considerable personnel turnover between these different phases of its life-cycle. Another NGO was the result, in the early 90s, of feminist academic activists looking for more flexibility and more liberty in their work. Yet another NGO was born of the Afro-Brazilian women's movement and the experience these women gained in the councils and their lack of desire to work as public workers for the ultraconservative Paulo Maluf These cases confirm the processes described earlier in more general terms, namely, the specialization of feminist consciousness-rai sing groups, the politicization of development NGOs working with local




Full Text
xml version 1.0 encoding UTF-8
REPORT xmlns http:www.fcla.edudlsmddaitss xmlns:xsi http:www.w3.org2001XMLSchema-instance xsi:schemaLocation http:www.fcla.edudlsmddaitssdaitssReport.xsd
INGEST IEID ELFO15WOF_43NUTS INGEST_TIME 2014-07-29T21:07:37Z PACKAGE AA00022306_00001
AGREEMENT_INFO ACCOUNT UF PROJECT UFDC
FILES



PAGE 1

7+( /$%25 2) /29( $1' %5($' 352)(66,21$/,=(' $1' 92/817((5 $&7,9,60 ,1 7+( 6ƒ2 3$8/2 :20(1f6 +($/7+ 029(0(17 %\ 1$7+$/,( /(%21 $ ',66(57$7,21 35(6(17(' 72 7+( *5$'8$7( 6&+22/ 2) 7+( 81,9(56,7< 2) )/25,'$ ,1 3$57,$/ )8/),//0(17 2) 7+( 5(48,5(0(176 )25 7+( '(*5(( 2) '2&725 2) 3+,/2623+< 81,9(56,7< 2) )/25,'$

PAGE 2

&RS\ULJKW E\ 1DWKDOLH /HERQ

PAGE 3

'HGLFDWHG WR WKH YLEUDQW 6DR 3DXOR ZRPHQ DFWLYLVWV ZLWKRXW ZKRP WKLV ZRUN ZRXOG QRW KDYH VHHQ WKH OLJKW RI GD\

PAGE 4

$&.12:/('*0(176 0\ ILUVW H[SUHVVLRQV RI JUDWLWXGH JR WR P\ PRWKHU DQG P\ IDWKHU IRU DOZD\V KDYLQJ EHOLHYHG LQ PH DQG VXSSRUWLQJ P\ SODQV ZLWKRXW D ZLQN DQG IRU KDYLQJ LQVWLOOHG LQ PH WKHLU JHQXLQH FRQFHUQ IRU VRFLDO MXVWLFH DQG HTXLW\ 0\ GHHSHVW JUDWLWXGH JRHV WR WKH ZRPHQ ZKR VR JHQHURXVO\ GHGLFDWHG WKHLU WLPH VR WKDW FRXOG FRQGXFW WKLV UHVHDUFK DQG ZLWKRXW ZKRP WKLV VWXG\ ZRXOG QRW KDYH VHHQ WKH OLJKW RI GD\ ,W LV WKHLU WHQDFLRXV FRPPLWPHQW WR EHWWHULQJ ZRPHQnV OLYHV ZKLFK KDV JLYHQ ELUWK WR WKH 6DR 3DXOR ZRPHQnV KHDOWK PRYHPHQW DQG KHQFH WR WKLV VWXG\ 7KH\ WDXJKW PH DERXW WKH UHDOLW\ RI VRFLDO PRYHPHQWV DQG RUJDQL]DWLRQV DERXW FRPPLWPHQW DQG DFWLYLVP DERXW IHPLQLVP LQ DOO LWV IRUPV DQG DERXW P\VHOI ,W ZRXOG EH LPSRVVLEOH IRU PH WR OLVW KHUH WKH QDPHV RI DOO WKH ZRPHQ LQWHUYLHZHG DQG LQWHUDFWHG ZLWK ,Q SDUWLFXODU ZRXOG OLNH WR WKDQN WKH JURXSV ZKR RSHQHG WKHLU GRRUV WR P\ LQTXLVLWLYH H\HV ,Q WKHVH SDJHV WKH\ KDYH EHHQ UHQDPHG )HPLQLVWDV t 6DGH 6DGH 3DUD 7RGDV 7KH &DVD GD 0LGKHU 0XOKHUHV 8QLGDV 0RY PHQW 0XOKHU H 6DGH *UXSR GH 0XOKHUHV GD =RQD /HVWH DQG 6DQGH 7KDQN \RX DV ZHOO WR WKH )UXP GH 0XOKHUHV GH 6DR 3DXOR SDUD $YDOLDJ£R GD 'FDGD DQG WR WKH 5HGH 1DFLRQDO )HPLQLVWD GH 6DGH H 'LUHLWRV 5HSURGXWLYRV IRU DOORZLQJ PH WR SDUWLFLSDWH LQ WKHLU DFWLYLWLHV $ QXPEHU RI ZRPHQ RIIHUHG PH WKHLU IULHQGVKLS DQG VSHQW WLPH ZLWK PH RXWVLGH WKH UHVHDUFK VHWWLQJ 0XGDV VDXGDGHV WR $PHOLQKD %HO &£VVLD &OHLGH (VWHOOD )LUPLQD )£WLPD -DFLUD /LJH 0DULD 0HORGLH 1DOX 5HJLQD DQG 7HUHVLQKD DQG HVSHFLDOO\ WR )O£YLD 0DWLOGH /XUGLQKD 'HQLVH *O£XFLD DQG 7HUHVD 7KDQN \RX DV ZHOO WR WKH ,9

PAGE 5

$VVRFLDWLRQ RI %UD]LOLDQ 1*2V $%21*f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n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nV PRYHPHQW KDYH EHHQ D EOHVVLQJ 'XULQJ P\ VWD\ LQ WKH ILHOG DQG WKURXJKRXW ZULWHXS VKH RSHQHG WKH ZD\ IRU D FORVH FROODERUDWLRQ ZKLFK ZDV HVVHQWLDO LQ VWUHQJWKHQLQJ P\ DUJXPHQWV DQG ERRVWLQJ P\ FRQILGHQFH 3KLOLS :LOOLDPVn FRPPHQWV DQG NQRZOHGJH RI VRFLDO PRYHPHQW WKHRU\ DQG GHPRFUDWL]DWLRQ LVVXHV ZHUH PRVW ZHOFRPH 6R ZHUH KLV IULHQGO\ VXSSRUW HQFRXUDJHPHQWV DQG LQVLJKWIXO VXJJHVWLRQV GXULQJ ZULWHXS 7KURXJKRXW P\ \HDUV DW )ORULGD 0D[LQH 0DUJROLV RIIHUHG PH KHU XQFRQGLWLRQDO VXSSRUW ZKLFK PDGH Y

PAGE 6

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

PAGE 7

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

PAGE 8

121*29(510(17$/ 25*$1,=$7,216 $1' 7+( :20(1n6 029(0(17 ,QWURGXFWLRQ 7KH 6RFLDO &RQVWUXFWLRQ RI D 1HZ 3ROLWLFDO $FWRU 1RQJRYHUQPHQWDO 2UJDQL]DWLRQV 7KH 2ULJLQV 3RSXODU (GXFDWLRQ &HQWHUV DQG WKH 'LFWDWRUVKLS 1*2V LQ WKH 7LPH RI 'HPRFUDWL]DWLRQ %XLOGLQJ &LYLO 6RFLHW\ 1*2V" :KDW .LQG RI %HDVW LV 7KLV" 1*2V %RUQ 2XW RI D 6RFLDO 0RYHPHQW 7KH 6WRU\ RI WKH %UD]LOLDQ :RPHQnV 0RYHPHQW 7KH 7DNHRYHU E\ ,VVXH6SHFLILF *URXSV DQG 1HWZRUNV )HPLQLVW 1*2V $ &RQWHVWHG 'HILQLWLRQ )XQGLQJ DV D 'HILQLQJ &ULWHULRQ" $UH $LG $JHQFLHV 6WUDLJKW-DFNHWLQJ 1*2V" 5HODWLRQVKLS WR WKH 0RYHPHQW $Q +\EULG ,GHQWLW\ 5HODWLRQ WR WKH 6WDWH DQG WKH 'HYHORSPHQW $SSDUDWXV )URP 6XEYHUVLRQ WR 6XEYHQWLRQ" 7KH :RPHQnV 0RYHPHQW DV D 6RFLDO 0RYHPHQW )LHOG )$&,1* 7+( '5($0 2) 6,67(5+22'$1' 7+( 35$*0$7,&6 2) *(77,1* 7+,1*6 '21( ,QWURGXFWLRQ 6QDSVKRWV RI (QFRXQWHUV 'HPRFUDWL]DWLRQ DQG 1*2Vn ,QWHUQDO '\QDPLFV 6RFLDO &RQWURO *HQHUDO $VVHPEOLHV DQG %RDUGV RI 'LUHFWRUV ,QWHUQDO '\QDPLFV 7KH &KDOOHQJHV RI 3DUWLFLSDWRU\ 'HPRFUDF\ 3URIHVVLRQDOL]DWLRQ DQG WKH +RPRJHQHL]DWLRQ RI 0HPEHUV 'LYLVLRQ RI /DERU 7HFKQLFDO 7HDP DQG $GPLQLVWUDWLYH 7HDP ,QWURGXFLQJ (OHPHQWV RI ,QVWUXPHQWDOLW\ 5ROH 6SHFLDOL]DWLRQ DPRQJ 1*2Vn 7HFKQLFDO 6WDII )HPLQLVW ,GHQWLW\ DQG $GPLQLVWUDWLYH 6WDII &ROOHFWLYH 9HUVXV ,QGLYLGXDO ,QFHQWLYHV DQG 5HZDUGV DQG WKH /RJLF RI ,GHQWLW\ :K\ $ 0RUH )RUPDOL]HG 6HJPHQWHG 2UJDQL]DWLRQDO 6WUXFWXUH" 9ROXQWHHU *URXSVn $GPLQLVWUDWLYH &KDOOHQJHV 7KH /RJLF RI 3URMHFWV DQG 0DQDJHPHQW RI *UDQW 0RQH\ &RQFOXVLRQ 7+( /$%25 2) /29( $1' %5($' 25*$1,=$7,21$/ 35$&7,&(6 ,1',9,'8$/ $1' &2//(&7,9( ,'(17,7,(6 ,QWURGXFWLRQ )URP 0LOLWDQFLD WR :RUN DQG %DFN 7KH 0HDQLQJ RI :RUNLQJ LQ D )HPLQLVW 1*2 ,QGLYLGXDO $FWLYLVW +LVWRU\ DQG 0RPHQW RI (QWU\ LQ 1*2 YLLL

PAGE 9

0RQH\ YHUVXV %HORQJLQJ 6ROLGDULW\ DQG 6HOI,QWHUHVW 7KH /DERU RI /RYH DQG %UHDG &ROOHFWLYH ,GHQWLW\ )URP 'LUHFW $FWLRQ 0RYHPHQW WR $GYRFDF\ *URXS 0XOKHUHV 8QLGDV ,WnV /LNH D 7UDLQ DW WKH 5K\WKP RI WKH 0RYHPHQW )HPLQLVWDV H 6DGH $ 5HVSHFWHG +HDOWK 3ROLF\&HQWHUHG 1*2 3ODQQLQJ YHUVXV &RODU D 5HDOLGDGH 6WLFN WR &RQMXQFWXUHf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

PAGE 10

&RQFOXVLRQ %ULGJLQJ WKH /RFDO,QWHUQDWLRQDO DQG WKH 3ROLWLFDO&XOWXUDO 83 7+( 3856(n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nV 6WDQGXS DQG 'HQRXQFH LV 2XW ,QIOXHQFLQJ 3ROLF\0DNHUV ,V ,Q +RZ :RPHQ 9LHZ DQG 5HVLVW ,QWHUQDWLRQDO $JHQFLHV 1*2Vn 5HVLVWDQFH 1RWLFHDEOH 3UREOHPV &RQFOXVLRQ &21&/86,21 5HODWLRQVKLS 1*2V6RFLDO 0RYHPHQW ,PSDFW RI 3UDFWLFHV RQ &ROOHFWLYH ,GHQWLW\ .HHSLQJ WKH %DODQFH EHWZHHQ 3ROLF\ )RUPXODWLRQ DQG 0RELOL]LQJ&XOWXUDO &KDQJH *HWWLQJ WKH %HVW RI %RWK :RUOGV $33(1',&(6 $ 25,*,1$/ 2) 4827(6 ,1 32578*8(6( % '(6&5,37,21 2) 0(0%(56n $&7,9,7,(6 5()(5(1&(6 %,2*5$3+,&$/ 6.(7&+ [

PAGE 11

/,67 2) 7$%/(6 7DEOH SDJH &KDUDFWHULVWLFV RI )HPLQLVW 1*2V 0HPEHUV RI $%21* 6RFLRHFRQRPLF 3URILOH 6XPPDU\ E\ 2UJDQL]DWLRQ 6RFLRHFRQRPLF 3URILOH DQG 3ROLWLFDO 3DUWLFLSDWLRQ RI 0HPEHUV 6XSSRUW *URXSVf 2UJDQL]DWLRQDO &KDUDFWHULVWLFV RI 9ROXQWHHU DQG 3URIHVVLRQDOL]HG *URXSV 6RFLRHFRQRPLF 3URILOH DQG 3ROLWLFDO 3DUWLFLSDWLRQ RI 1HLJKERUKRRG $FWLYLVWV &KDQJH LQ $%21* 0HPEHUVn 6SDWLDO 6FDOHV RI $FWLRQ %XGJHW RI 6DR 3DXOR )HPLQLVW 6XSSRUW *URXSV 7\SHV RI )LQDQFLQJ IRU VRPH %UD]LOLDQ :RPHQnV 1*2V *URXSVn 6RXUFHV RI )LQDQFLQJ LQ )RUG )RXQGDWLRQ *UDQWV $ZDUGHG WR %UD]LOLDQ 2UJDQL]DWLRQV XQGHU WKHLU 5HSURGXFWLYH +HDOWK DQG 3RSXODWLRQ 3URJUDP 0DF$UWKXU )RXQGDWLRQ *UDQWV $ZDUGHG WR %UD]LOLDQ 2UJDQL]DWLRQV XQGHU WKHLU 3RSXODWLRQ 3URJUDP 0DF$UWKXU )RXQGDWLRQ *UDQWV $ZDUGHG WR %UD]LOLDQ 2UJDQL]DWLRQV XQGHU WKHLU 3RSXODWLRQ 3URJUDP 637 3URMHFWLRQ RI %XGJHW IRU [L

PAGE 12

$EVWUDFW RI 'LVVHUWDWLRQ 3UHVHQWHG WR WKH *UDGXDWH 6FKRRO RI WKH 8QLYHUVLW\ RI )ORULGD LQ 3DUWLDO )XOILOOPHQW RI WKH 5HTXLUHPHQWV IRU WKH 'HJUHH RI 'RFWRU RI 3KLORVRSK\ 7+( /$%25 2) /29( $1' %5($' 352)(66,21$/,=(' $1' 92/817((5 $&7,9,60 ,1 7+( 6ƒ2 3$8/2 :20(1f6 +($/7+ 029(0(17 %\ 1DWKDOLH /HERQ $XJXVW &KDLUPDQ 'U +HOHQ 6DID 0DMRU 'HSDUWPHQW 'HSDUWPHQW RI $QWKURSRORJ\ ,Q WKH SDVW \HDUV PDQ\ SURIHVVLRQDOL]HG RUJDQL]DWLRQV DOVR UHIHUUHG WR DV QRQJRYHUQPHQWDO RUJDQL]DWLRQV 1*2Vf KDYH EHHQ IRUPHG LQ WKH %UD]LOLDQ ZRPHQnV PRYHPHQW 7KLV VWXG\ H[DPLQHV WKH RULJLQV RI WKLV WUHQG OLQNHG WR WKH ERRP RI 1*2V ZRUOGZLGH WR WKH UHWXUQ RI IRUPDO GHPRFUDF\ LQ %UD]LO LQ DQG WR WKH VWLOO OLPLWHG DEVRUSWLRQ E\ WKH LQWHUQDWLRQDO GHYHORSPHQW HVWDEOLVKPHQW RI SDUW RI WKH ZRPHQnV PRYHPHQW DJHQGD DV ZHOO DV WR FKDQJHV LQWHUQDO WR WKH PRYHPHQW %DVHG RQ HWKQRJUDSKLF UHVHDUFK WKLV VWXG\ FRPSDUHV WKH FROOHFWLYH LGHQWLW\ SUDFWLFHV DQG LQWHUQDO G\QDPLFV RI WZR SURIHVVLRQDOL]HG DQG WZR YROXQWHHU JURXSV GHDOLQJ ZLWK ZRPHQnV KHDOWK LQ 6DR 3DXOR 7KLV VWXG\ GHPRQVWUDWHV WKDW WKH ZRPHQnV PRYHPHQW LV EHVW XQGHUVWRRG DV D VRFLDO PRYHPHQW ILHOG ZLWK KHWHURJHQHRXV SDUWLFLSDQWV )HPLQLVW 1*2V DUH RQH RI WKHP
PAGE 13

RI SURMHFWV ILQDQFHG E\ GRQRU DJHQFLHV 1*2V KDYH D PRUH IRUPDOL]HG DQG GLIIHUHQWLDWHG LQWHUQDO VWUXFWXUH OHVV SHUPHDEOH IRU QHLJKERUKRRG ZRPHQ 7KH SUHVHQFH RI H[WULQVLF UHZDUGV DOWHUV WKH PHDQLQJ RI PHPEHUVn SDUWLFLSDWLRQ LQ IHPLQLVW 1*2V ZKLFK EHFRPHV VLPXOWDQHRXVO\ D FRPPLWPHQW IRU JHQGHUHG VRFLDO FKDQJH DQG D PHDQV IRU HDUQLQJ D OLYLQJ 1*2V KDYH DQ K\EULG LGHQWLW\ 7KHLU HPSKDVLV RQ SODQQLQJ OLQNHG WR DFFRXQWDELOLW\ WR GRQRUV IRU IXQGHG SURMHFWV WHQGV WR VWHHU 1*2V DZD\ IURP DQG WR OLPLW WKHLU SRWHQWLDO IRU FRQVFLRXVQHVVUDLVLQJ DQG PRELOL]DWLRQ
PAGE 14

&+$37(5 ,1752'8&7,21 6RFLDO 0RYHPHQWV DQG WKH 'HHSHQLQJ RI 'HPRFUDF\ 7KH RWKHU GD\ ZDV DVNLQJ VRPHERG\ ZKR EHORQJV WR D ZRPHQnV JURXS 9ROXQWHHU IHPLQLVW DFWLYLVW IURP 5LR GH -DQHLUR@ 7KLV LV KRZ LW DOO VWDUWHG 7KLV %UD]LOLDQ IHPLQLVW DFWLYLVW EDFN LQ WKH VXPPHU RI KDG SODQWHG WKH VHHG WKDW ZRXOG EHFRPH WKLV GLVVHUWDWLRQ +HU TXHVWLRQLQJ ZDV DERXW WKH QDWXUH RI VRFLDO PRYHPHQWV DQG RI 1*2V DERXW WKH UHODWLRQVKLS EHWZHHQ WKH WZR DQG DERXW WKHLU FRQWULEXWLRQ WR WKH GHPRFUDWL]DWLRQ RI %UD]LOLDQ VRFLHW\ DQG SROLWLFV DV ZHOO DV DERXW WKH UROH SOD\HG E\ ILQDQFLQJ DJHQFLHV LQ WKLV VWRU\ GHFLGHG WR ILQG RXW PRUH DERXW WKHVH LVVXHV ,Q D IRUPDO GHPRFUDWLF V\VWHP ZDV UHLQVWLWXWHG LQ %UD]LO DIWHU WZR GHFDGHV RI PLOLWDU\ UXOH $V LQ RWKHU /DWLQ $PHULFDQ FRXQWULHV WKH ZRPHQnV PRYHPHQW DORQJ ZLWK RWKHU VRFLDO PRYHPHQWV DQG JUDVVURRWV RUJDQL]DWLRQV KDYH DOO EHHQ VLJQLILFDQW SDUWLFLSDQWV LQ WKLV UHGHPRFUDWL]DWLRQ SURFHVV +RZHYHU %UD]LOLDQ VRFLHW\ KDV EHHQ DQG VWLOO UHPDLQV FKDUDFWHUL]HG $OO TXRWHV WUDQVODWHG IURP 3RUWXJXHVH E\ DXWKRU L

PAGE 15

E\ VRFLDO DXWKRULWDULDQLVP KLHUDUFK\ DQG LQHTXDOLW\ SHUYDGH WKH FXOWXUDO SUDFWLFHV WKURXJK ZKLFK SHRSOH UHODWH WR HDFK RWKHU LQ HYHU\GD\ OLIH :HLQVWHLQ 'D 0DWWD f 7KLV SDWWHUQ LV UHIOHFWHG LQ VHYHUH HFRQRPLF UDFLDO DQG JHQGHU LQHTXDOLWLHV 'DJQLQR D /RYHOO f 7UXH IRUPV RI FXOWXUDO HFRQRPLF DQG VRFLDO GHPRFUDWL]DWLRQ UHPDLQ WR EH DFKLHYHG IRU D GHHSHQLQJ RI GHPRFUDF\ $OYDUH] f %H\RQG EDWWOLQJ VRFLDO DXWKRULWDULDQLVP D GHHSHQLQJ RI GHPRFUDF\ ZRXOG HQWDLO FUHDWLQJ FKDQQHOV DQG VWUDWHJLHV WKDW LQFUHDVH QRQHOLWH DFFHVV WR SROLF\PDNLQJ DQG LPSOHPHQWDWLRQ $OYDUH] f 7KLV VWXG\ IRFXVHV RQ WKH UROH WKH %UD]LOLDQ ZRPHQnV PRYHPHQW FDQ SOD\ LQ WKHVH SURFHVVHV XVLQJ WKH 6DR 3DXOR ZRPHQnV KHDOWK PRYHPHQW DV D FDVH VWXG\ ,Q WKH SDVW \HDUV WKH ZRPHQnV PRYHPHQW KDV XQGHUJRQH SDUWLDO SURIHVVLRQDOL]DWLRQ f§VWULFWO\ VSHDNLQJ WKH SURFHVV E\ ZKLFK DFWLYLVWV FRPH WR EH UHPXQHUDWHG IRU WKHLU PRYHPHQW DFWLYLWLHVf§ WKURXJK WKH FUHDWLRQ RI QRQJRYHUQPHQWDO RUJDQL]DWLRQV 1*2Vf *HQHUDOO\ 1*2V DUH GHILQHG DV OHJDOO\ VDQFWLRQHG FLYLO RUJDQL]DWLRQV SURYLGLQJ VHUYLFHV DQG VXSSRUW WR ORFDO JUDVVURRWV JURXSV LQ GLVDGYDQWDJHG FRPPXQLWLHV DQGRU HQJDJLQJ LQ UHVHDUFK DQG DGYRFDF\ DFWLYLWLHV D FRQFHSW GHULYHG IURP &DUUROOnV *UDVVURRWV 6XSSRUW 2UJDQL]DWLRQV f 0DLQWDLQLQJ WKH EDODQFH EHWZHHQ WKHVH WZR SROHV RI DFWLYLW\ DGYRFDF\ DQG VXSSRUWf KDV EHHQ D FKDOOHQJH IRU PDQ\ 1*2V LQFOXGLQJ IRU ZRPHQnV 1*2V GXH WR WKH SROLWLFDO RSHQLQJ LQ %UD]LO DV ZHOO DV WR WKHLU RZQ KLVWRU\ DQG QDWXUH DV PHPEHUV RI DQ LGHQWLW\EDVHG PRYHPHQW 1*2V KDYH D SHUPDQHQW SDLG VWDII DQG DUH DFFRXQWDEOH WR VRPH GHJUHH WR WKHLU GRQRUV PRVW RIWHQ LQWHUQDWLRQDO DJHQFLHV RU SULYDWH IRXQGDWLRQV IRU WKH UHVHDUFK FRQVXOWLQJ VHUYLFHSURYLGLQJ SURMHFWV RU VXSSRUW WR ORFDO ZRPHQnV JURXSV IRU ZKLFK WKH\ DUH JUDQWHG IXQGLQJ 7KHLU VWUXFWXUH LV IDLUO\ IRUPDOL]HG XVXDOO\ ZLWK D FRRUGLQDWLRQ KHDGLQJ WKH RUJDQL]DWLRQ DQG D GLYLVLRQ RI ODERU HVSHFLDOO\ EHWZHHQ DGPLQLVWUDWLYH WDVNV DQG WKH WHFKQLFDO ZRUN GRQH E\ VSHFLDOL]HG VWDII +RZHYHU

PAGE 16

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nV PRYHPHQW DQG LQ DGYRFDF\ IRU JUHDWHU JHQGHU HTXLW\ 7KH\ FRQVLGHU WKHPVHOYHV IHPLQLVW ,Q WKDW VHQVH IHPLQLVW 1*2V GLIIHU IURP RWKHU 1*2V ZKLFK DOVR ZRUN ZLWK ZRPHQ EXW GR QRW JHQHUDOO\ SDUWLFLSDWH LQ WKH ZRPHQnV PRYHPHQW DQG GR QRW LGHQWLI\ WKHPVHOYHV DV IHPLQLVW ZLOO XVH WKH WHUPV 1*2 SURIHVVLRQDOL]HG RUJDQL]DWLRQ DQG SURIHVVLRQDOL]HG JURXS LQWHUFKDQJHDEO\ LQ WKLV GLVVHUWDWLRQ VRPHWLPHV UHIHU WR SURIHVVLRQDOL]HG IHPLQLVW JURXSV DQG YROXQWHHU IHPLQLVW JURXSV FROOHFWLYHO\ DV VXSSRUW JURXSV IRU ZDQW RI D EHWWHU ODEHO ZKHQ ZLVK WR GLVWLQJXLVK WKHP IURP WKH QHLJKERUKRRG ZRPHQnV JURXSV ZLWK ZKLFK WKH\ LQWHUDFW $V KDYH MXVW PHQWLRQHG WKLV WHUP LV QRW YHU\ VDWLVIDFWRU\ VLQFH PDQ\ RI WKHVH JURXSV KDYH UHGXFHG WKH VXSSRUW WKH\ ZHUH RIIHULQJ WR QHLJKERUKRRG ZRPHQnV JURXSV DOVR VRPHWLPHV UHIHU WR YROXQWHHU JURXSV DV YROXQWHHU VXSSRUW JURXSV DJDLQ WR GLVWLQJXLVK WKHP IURP QHLJKERUKRRG ZRPHQnV JURXSV DOO RI ZKLFK DUH DOVR YROXQWHHU 7R FRPSOLFDWH PDWWHUV IDWKHU VRPH RI WKHVH QHLJKERUKRRG ZRPHQnV JURXSV FRQVLGHU WKHPVHOYHV IHPLQLVW D SKHQRPHQRQ NQRZQ DV SRSXODU IHPLQLVP ZKLFK ZLOO GLVFXVV LQ FKDSWHU

PAGE 17

7KH SXUSRVH RI WKLV GLVVHUWDWLRQ LV WR XQGHUVWDQG WKH RULJLQV RI WKH WUHQG WRZDUGV SURIHVVLRQDOL]DWLRQ RI WKH ZRPHQnV PRYHPHQW YLD WKH FUHDWLRQ RI 1*2V FRQVLGHULQJ WKH LQWHUQDO DQG H[WHUQDO IDFWRUV WKDW KDYH FRQWULEXWHG WR WKLV SURFHVV ,W LV DOVR WR H[DPLQH WKH LPSDFW RI SURIHVVVLRQDOL]DWLRQ RQ WKH LQWHUQDO G\QDPLFV RI WKH JURXSV DV ZHOO DV RQ WKHLU FROOHFWLYH LGHQWLW\ DQG VWUDWHJLHV RQ WKHLU UHODWLRQVKLS WR WKH QHLJKERUKRRG ZRPHQnV RUJDQL]DWLRQV WKH\ RIIHU VXSSRUW WR DQG VRPHWLPHV JHW WR UHSUHVHQW ZLOO DOVR FRQVLGHU WKH JURXSVn SRVLWLRQ YLV£YLV WKH QDWLRQDO DQG LQWHUQDWLRQDO SRZHU VWUXFWXUH DQG WKHLU UHODWLRQV WR LQWHUQDWLRQDO GRQRU DJHQFLHV 2QH RI P\ FRQFHUQV WKURXJKRXW WKLV ZRUN KDV EHHQ WR KLJKOLJKW WKH WUDGHRIIV RI SURIHVVLRQDOL]DWLRQ ZLWK UHJDUG WR WKH SRWHQWLDO RI WKH PRYHPHQW WR EULQJ DERXW D GHHSHQLQJ RI GHPRFUDF\ ZLWKLQ WKH ZRPHQn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f WR WKHVH JUDVVURRWV HIIRUWV
PAGE 18

TXHVWLRQLQJ\]HU XUQD VRFLRORJD GH DJHQWHV TXH VH TXHUHP nD VHUYLFRn DQGD H TXHVW£R FDUUHJDGD GH DPELJXLGDGHV H TXHVWLRQDPHQWRGf D f %H\RQG WKLV LPPHGLDWH DSSOLHG GLPHQVLRQ RI P\ ZRUN LW LV LPSRUWDQW IRU DQWKURSRORJLVWV ZKR KDYH XQWLO UHFHQWO\ QHJOHFWHG WKH VWXG\ RI VRFLDO PRYHPHQWV WR WDNH D FORVHU ORRN DW WKHVH QRQNLQ IRUPV RI VRFLDO RUJDQL]DWLRQ %XUGLFN UHPLQGV XV WKDW D JHQHUDWLRQ DJR 5LFKDUG &OHPPHU >@ GHFODUHG WKDW D VXVWDLQHG FRPPLWPHQW E\ DQWKURSRORJLVWV WR WKH VWXG\ RI RUJDQL]HG SRSXODU DWWHPSWV WR EULQJ DERXW VRFLDO FKDQJH ZRXOG SURYLGH DQWKURSRORJ\ ZLWK D PXFK PRUH EDODQFHG DQG XVHIXO ERG\ RI WKHRU\ f )LQDOO\ DOWKRXJK QRQJRYHUQPHQWDO RUJDQL]DWLRQV 1*2Vf KDYH EHFRPH XELTXLWRXV LQ WKH OLWHUDWXUH HVSHFLDOO\ RQ GHYHORSPHQW DQG WUDQVQDWLRQDO DFWLYLVP DQG KDYH SURPSWHG PDQ\ GHFODUDWLRQV RI IDLWK IHZ ILUVWKDQG HWKQRJUDSKLF VWXGLHV DUH DYDLODEOH RI WKHLU SRZHU G\QDPLFV DQG UHODWLRQVKLSV WR WKH JUDVVURRWV DQG WR WKH 6WDWH )LVKHU f 6XFK VWXGLHV FRXOG DOVR LOOXPLQDWH FKDQJHV LQ WKH QDWXUH RI ORFDO DQG JOREDO IRUPV RI FROOHFWLYH DFWLRQ )LVKHU f 7KH VWUHQJWK RI WKH LQWHUQDWLRQDO ZRPHQnV PRYHPHQW RI ZKLFK %UD]LOLDQ IHPLQLVWV DUH QRWHG SDUWLFLSDQWV LV XQGHQLDEOH
PAGE 19

RI WKH OLWHUDWXUH DW WKH WLPH UHYHDOHG SUDFWLFDOO\ QR GLVFXVVLRQ RI WKHVH LVVXHV 0\ GLVVHUWDWLRQ WRSLF ZDV GHFLGHG ZHQW EDFN WR %UD]LO IURP 6HSWHPEHU XQWLO 1RYHPEHU WKLV WLPH PDLQO\ WR 6DR 3DXOR GLG WUDYHO WR 5LR GH -DQHLUR IRU QDWLRQDO HYHQWV VXFK DV WKH QDWLRQDO FRQIHUHQFH LQ SUHSDUDWLRQ IRU WKH ,9 81 FRQIHUHQFH RQ :RPHQ 7KLV ILHOGZRUN FRQVLVWHG RI WZR SKDVHV 'XULQJ WKH ILUVW SKDVH ZKLFK ODVWHG IURP 6HSWHPEHU WR 'HFHPEHU VXUYH\HG WKH H[LVWLQJ ZRPHQnV KHDOWK JURXSV LQ 6DR 3DXOR LQ RUGHU WR VHOHFW D VDPSOH IRU WKH ODUJHU SURMHFW 0\ RULJLQDO UHVHDUFK GHVLJQ FDOOHG IRU LGHQWLI\LQJ WZR YROXQWHHU JURXSV DQG WZR SURIHVVLRQDOL]HG JURXSV WKDW RWKHUZLVH ZRXOG EH DV VLPLODU DV SRVVLEOH LQ WHUPV RI VL]H PHPEHUVn VRFLRHFRQRPLF SURILOH DQG UDFLDOHWKQLF LGHQWLW\ DQG DFWLYLWLHV FRQGXFWHG 2QFH RQ WKH JURXQG KRZHYHU UHDOL]HG WKDW DOWKRXJK WKHUH ZDV VRPH RYHUODS WKH VWUXFWXUH PHPEHUVn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

PAGE 20

RI WKH IRXU VXSSRUW RUJDQL]DWLRQV WR OHDP DERXW WKH VRFLRHFRQRPLF SURILOH RI WKH PHPEHUV KRZ WKH\ KDG FKDQJHG LQ SDUWLFLSDWLQJ LQ WKLV RUJDQL]DWLRQ ZKDW WKH\ XQGHUVWRRG DV WKH JRDOV RI WKH RUJDQL]DWLRQ DQG ZKDW WKH\ WKRXJKW DERXW WKH SURIHVVLRQDOL]DWLRQ RI WKH ZRPHQn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nV 'D\f DQG SDUWLFLSDWHG LQ YDULRXV RWKHU HYHQWV FHOHEUDWLQJ WKLV HYHQW 7KH REMHFWLYH LQ SDUWLFLSDWLQJ LQ WKHVH PRYHPHQWZLGH DFWLYLWLHV ZDV WR REVHUYH SRLQWV RI FRQVHQVXV DQG FRQIOLFW EHWZHHQ SURIHVVLRQDOL]HG DQG YROXQWHHU PHPEHUV :LWK WKH VDPH REMHFWLYH DOVR SDUWLFLSDWHG LQ 0D\ LQ WKH DQQXDO PHHWLQJ RI WKH 5HGH 1DFLRQDO )HPLQLVWD GH 6DGH H 'LUHLWRV 5HSURGXWLYRV 1DWLRQDO )HPLQLVW 1HWZRUN IRU +HDOWK DQG 5HSURGXFWLYH 5LJKWVf LQ 5LR GH -DQHLUR 7KH 1HWZRUN EULQJV WRJHWKHU RUJDQL]DWLRQV IURP DOO RYHU %UD]LO ZKR ZRUN ZLWK ZRPHQnV KHDOWK 7KH IRXU VXSSRUW JURXSV KDYH EHHQ ZRUNLQJ ZLWK DUH PHPEHUV RI WKLV QHWZRUN $IWHU WKLV PHHWLQJ DOVR SDUWLFLSDWHG LQ WKH PRQWKO\ PHHWLQJ RI WKH 6DR 3DXOR VHFWLRQ RI WKH 1HWZRUN $JDLQ ZDQWHG WR XQGHUVWDQG EHWWHU ZKDW SDUW ZDV SOD\HG E\ GLIIHUHQW DFWRUV DQG WKH LQWHUDFWLRQ EHWZHHQ WKHP

PAGE 21

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nV JURXSV SDUWLFLSDWHG LQ D VHPLQDU KHOG LQ 5HFLIH LQ WKH 1RUWKHDVW RI %UD]LO DERXW LQWHUQDWLRQDO FRRSHUDWLRQ DQG JHQGHU SROLFLHV ZKLFK EURXJKW WRJHWKHU UHSUHVHQWDWLYHV RI ZRPHQnV JURXSV DQG ILQDQFLQJ DJHQFLHV /RRNLQJ EDFN IRXQG WKDW IRXU JURXSV ZHUH WRR PDQ\ ZLWK ZKLFK WR FRQGXFW DV WKRURXJK D SDUWLFLSDQW REVHUYDWLRQ DV ZRXOG KDYH OLNHG 7KLV ZDV FRPSRXQGHG E\ WKH IDFW WKDW KDG WR VSHQG VHYHUDO KRXUV D GD\ RQ WKH SXEOLF WUDQVSRUWDWLRQ V\VWHP 6DR 3DXOR LV WKH ODUJHVW FLW\ LQ WKH ZRUOG LQ WHUPV RI VXUIDFH DUHD NPf 0HGLQD f DQG LWV SXEOLF WUDQVSRUWDWLRQ V\VWHP UHOLHV PDLQO\ RQ EXVHV QRW RQ VXEZD\V ZKLFK JUHDWO\ OHQJWKHQV WLPH RI WUDYHO 6DQWRV f +RZHYHU PDQDJLQJ JRRG UHODWLRQV ZLWK DOO JURXSV VLPXOWDQHRXVO\ ZKLOH UHPDLQLQJ WUXH WR P\VHOI DQG EHLQJ FRPIRUWDEOH H[SUHVVLQJ P\ UHVHUYDWLRQV RQ VRPH LVVXHV SURYHG WR EH E\ IDU WKH PRVW FKDOOHQJLQJ SDUW RI P\ H[SHULHQFH ZLWK 6DR 3DXOR ZRPHQfV JURXSV

PAGE 22

7KH 3ROLWLFV RI 5HSUHVHQWDWLRQ DQG WKH (WKQRJUDSK\ RI $FWLYLVP ,VVXHV UHODWHG WR DXWKRULW\ LQ HWKQRJUDSKLF ZRUN DQG WR WKH SROLWLFV RI UHSUHVHQWDWLRQ KDYH EHHQ GHEDWHG IRU PRUH WKDQ D GHFDGH LQ DQWKURSRORJ\ VLQFH 0DUFXV DQG )LVKHUfV VHPLQDO ZRUN f 0\ ZRUN SURYHG SDUWLFXODUO\ FKDOOHQJLQJ LQ WKLV UHJDUG DV ZDV ZRUNLQJ ZLWK KLJKO\ SROLWLFL]HG LQIRUPDQWV DZDUH RI WKH SRZHU LVVXHV SUHVHQW EHWZHHQ PH DV UHVHDUFKHU DQG WKHP ZDV UHSHDWHGO\ ZDUQHG WKDW VKRXOG QRW EH RQH PRUH UHVHDUFKHU ZKR ZRXOG FRPH GR P\ WKLQJ DQG WKHQ OHDYH ZLWKRXW HYHU DJDLQ JLYLQJ VLJQ RI OLIH 2QH JURXS DOORZHG PH WR FRQGXFW SDUWLFLSDQW REVHUYDWLRQ RQO\ RQ WKH FRQGLWLRQ WKDW WKH\ VHH P\ ZRUN EHIRUH LW LV SXEOLVKHG 7KHVH DUH ORJLFDO DQG QDWXUDO UHTXHVWV
PAGE 23

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ff %HLQJ DV H[SOLFLW DV SRVVLEOH ZLWK WKH JURXSV SURYHG TXLWH D FKDOOHQJH EHFDXVH KLJKO\ YDOXH WKH ZRUN RI RUJDQL]HG JURXSV DQG EHFDXVH OLNH P\ FRQVXOWDQWV ZDV LOODWHDVH ZLWK VLWXDWLRQV RI FRQIOLFW DQG ZRXOG KDYH OLNHG WR VHH P\VHOI LQ FRPSOHWH KDUPRQ\ ZLWK WKHP 7KLV RI FRXUVH ZDV WRWDOO\ QDLYH DQG XQUHDOLVWLF FRQVLGHULQJ WKH GLVDJUHHPHQWV H[LVWLQJ EHWZHHQ WKH JURXSV WKHPVHOYHV 'DYLG .HUW]HU f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fV SKUDVH f +RZHYHU DW WLPHV

PAGE 24

LW ZDV KDUG WR FRQYLQFH P\VHOI WKDW P\ HWKQRJUDSK\ FRXOG LQGHHG VHUY>H@ DV D PHDQV RI RQJRLQJ PRYHPHQW VHOIHYDOXDWLRQ DQG KHOS UHILQH GHEDWHV DQG VHOIFULWLTXHV ZLWKLQ VRFLDO PRYHPHQWV f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f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f /LNH PRVW WKLUG ZRUOG FLWLHV LW JUHZ UDSLGO\ ZLWKRXW PXFK SODQQLQJ DW WKH EHJLQQLQJ RI WKLV FHQWXU\ 6DR 3DXOR FRXQWHG LQKDELWDQWV 0HGLQD f LW QRZ KDV PLOOLRQ 6DQWRV f ,WV SRSXODWLRQ LV VWLOO LQFUHDVLQJ DOWKRXJK DW UHGXFHG UDWHV LWV DQQXDO JURZWK UDWH ZHQW GRZQ IURP b LQ 0HGLQD f WR b

PAGE 25

LQ DQG b LQ ,%*( f ,Q IDFW VXUURXQGLQJ FLWLHV DUH QRZ JURZLQJ IDVWHU WKDQ 6DR 3DXOR LWVHOI 5ROQLN HW DO f 6DR 3DXOR FLW\ UHPDLQV WKH LQGXVWULDO ILQDQFLDO DQG LQWHOOHFWXDO KHDUW RI %UD]LO 6DQWRV f DOWKRXJK VRPH UHJLRQV RI %UD]LO LQ SDUWLFXODU WKH VRXWKHUQ VWDWHV KDYH VKRZQ PRUH G\QDPLVP LQ UHFHQW \HDUV )RU H[DPSOH 6DR 3DXORnV VKDUH RI WKH QDWLRQDO LQGXVWULDO RXWSXW LV GHFOLQLQJ 7KH WUHQG LV WRZDUGV JUHDWHU KRPRJHQL]DWLRQ RI WKH FRXQWU\ 'HVSLWH WKLV QHZ WUHQG 6DR 3DXOR UHPDLQV WKH LQGXVWULDO FHQWHU RI WKH FRXQWU\ EXW LW LV DOVR LQFUHDVLQJO\ D ILQDQFLDO DQG FRPPHUFLDO FHQWHU 5ROQLN HW DO f ,Q 6DR 3DXOR VWDWH VWLOO SURGXFHG b RI WKH LQGXVWULDO RXWSXW RI %UD]LO SHUFHQWDJH RI %UD]LOnV VHFRQGDU\ VHFWRU *'3f DQG b RI %UD]LOLDQ H[SRUWV 6($'( f ,Q WHUPV RI WKH ODERU PDUNHW WKH VKDUH RI LQGXVWULDO RFFXSDWLRQV LQ 6DR 3DXOR ZKLFK FRPSDUHG WR VHUYLFHUHODWHG RFFXSDWLRQV RIIHU UHODWLYHO\ EHWWHU SDLG MREVf ZHQW GRZQ IURP b RI WKH HFRQRPLFDOO\ DFWLYH SRSXODWLRQ LQ %UDQW HW DO f WR b LQ DQG b LQ 6($'( f ,Q WKH PHDQWLPH WKH VKDUH RI VHUYLFHUHODWHG RFFXSDWLRQV ZHQW XS IURP b LQ WR b LQ 6($'( f ,I 6DR 3DXOR KDV D ODUJH ZRUNLQJ FODVV SRSXODWLRQ LW LV DOVR WKH WKLUG ZRUOG FLW\ ZKLFK RIIHUV WKH PRVW QXPHURXV RSSRUWXQLWLHV RI MREV RI DQ LQWHOOHFWXDO QDWXUH DQG ZKLFK KDV WKH ODUJHVW PLGGOH FODVV 6DQWRV f $GPLQLVWUDWRUV DQG SURIHVVLRQDOV UHSUHVHQW RI WKH WRWDO ZRUN IRUFH $QGUHZV f 8QIRUWXQDWHO\ WKLV VWUHQJWKHQLQJ RI WKH PLGGOH FODVV KDV QRW SUHYHQWHG SRYHUW\ IURP LQFUHDVLQJ 3DXSHUL]DWLRQ RI WKH SRSXODWLRQ KDV LQGHHG RFFXUUHG GXULQJ WKH V WR WKH SRLQW ZKHUH WKDW GHFDGH KDV EHHQ FDOOHG WKH GHFDGH PRUH WKDQ ORVW D GFDGD PDLV GR TXH SHUGLGDf 5ROQLN HW DO f )DPLOLHV XQGHU WKH WKUHVKROG RI SRYHUW\ LH HDUQLQJ XS WR RQH

PAGE 26

PLQLPXP VDODU\f UHSUHVHQWHG b RI DOO IDPLOLHV LQ WKH ODUJHU 6DR 3DXOR DJJORPHUDWLRQ LQ 7KLV SHUFHQWDJH ZHQW XS WR LQ 6RXUFH 31$' f§1DWLRQDO 5HVHDUFK RQ +RPH 6DPSOHf§ LQ /RSHV -XDUH] %UDQG£R DQG *RWWVFKDON $QGUHD FLWHG LQ 5ROQLN HW DO f b RI WKH JUHDWHU 6DR 3DXOR KRXVHKROGV ZHUH FRQVLGHUHG DW SRYHUW\ RU EHORZ SRYHUW\ OHYHO LQ ZLWK D \HDUO\ KRXVHKROG EX\LQJ SRZHU RI 86 f ZKLOH WKH ULFKHVW b RI LWV SRSXODWLRQ HQMR\HG D 86 \HDUO\ EX\LQJ SRZHU SHU KRXVHKROG /DWLQ $PHULFDQ 0DUNHW 3ODQQLQJ 5HSRUW f :LWK D VDG DQG WHQDFLRXV SUHGLFWDELOLW\ %UD]LOLDQ XUEDQ KRXVHKROGV KHDGHG E\ $IUR %UD]LOLDQV UHSUHVHQWHG LQ b RI H[WUHPHO\ SRRU KRXVHKROGV DQG b RI SRRU KRXVHKROGV ZKHQ WKH\ PDNH XS RQO\ b RI DOO XUEDQ KRXVHKROGV /RSHV f GLG QRW ILQG UHFHQW GDWD RQ 6DR 3DXOR LQ SDUWLFXODU 5DFLDO GLVFULPLQDWLRQ ZKLFK LV SUHVHQW LQ WKH HYHU\GD\ OLIH RI DOO 3DXOLVWDQRV RI $IULFDQ GHVFHQW LV DOVR DSSDUHQW LQ WKH SROLWLFDO DQG VRFLDO OLIH RI WKH FLW\ ,W FRXQWHG RQO\ RQH EODFN PXQLFLSDO OHJLVODWRU YHUHDGRUf DQG RQH EODFN MXGJH DV RI 7XUUD DQG 9HQWXUL f 6LPLODUO\ \RXQJ IHPDOH KHDGV RI KRXVHKROGV KDG LQ DOPRVW D b SUREDELOLW\ RI EHLQJ SRRU FRPSDUHG WR b IRU WKH JHQHUDO %UD]LOLDQ SRSXODWLRQ LELGf )HPDOH KHDGV RI KRXVHKROG IRU XUEDQ DUHDV RI WKH VWDWH RI 6DR 3DXOR ZHQW XS IURP b LQ WR b LQ ,%*( f 3DXSHUL]DWLRQ KDV KDG DQ HIIHFW RQ WKH JHRJUDSKLF GLVWULEXWLRQ RI VRFLDO FODVVHV LQ WKH FLW\ 6DR 3DXOR KDG GHYHORSHG RQ D PRGHO RI FRQFHQWULF FLUFOHV ZLWK WKH XSSHU DQG PLGGOH LQFRPH FODVVHV OLYLQJ LQ WKH FHQWHU DUHDV ZKHUHDV WKH ORZHULQFRPH SRSXODWLRQ OLYHG LQ WKH RXWHU FLUFOHV 7KLV PRGHO RI VHJUHJDWLRQ ZDV EOXUUHG EXW QRW RYHUWXUQHG LQ WKH V /RZLQFRPH IDPLOLHV QR ORQJHU DEOH WR UHQW D KRXVH LQ WKH SHULSKHU\ KDYH KDG WR PRYH LQWR WKH H[SDQGLQJ

PAGE 27

FRUWLJRI LQ WKH FHQWHU RI WKH FLW\ RU WR IDYHODV WKH %UD]LOLDQ VKDQW\WRZQV ,Q WKH PHDQWLPH PLGGOHFODVV IDPLOLHV OLYLQJ LQ FHQWUDO QHLJKERUKRRGV ZHUH SXVKHG RXW E\ GHFOLQLQJ OLYLQJ VWDQGDUGV WRZDUGV OHVV H[SHQVLYH SHULSKHUDO QHLJKERUKRRGV 5ROQLN HW DO f 7KH JURZWK RI FRUWLJRV KDV EHHQ VSHFWDFXODU LQGHHG 7KH\ KRXVHG SHUVRQV DW WKH EHJLQQLQJ RI WKH V RU b RI WKH FLW\nV SRSXODWLRQf ZKLOH WKH\ UHSUHVHQWHG b RI WKDW SRSXODWLRQ DW WKH HQG RI WKH GHFDGH WKDW LV D IXOO PLOOLRQ SHRSOH 0HGLQD f )DYHODV VKHOWHUHG b RI WKH 3DXOLVWDQD SRSXODWLRQ LQ DQG b DW WKH HQG RI WKH GHFDGH 5ROQLN HW DO f $OO WKRVH OLYLQJ LQ FRUWLJRV IDYHODV RU RFFXS\LQJ WKHLU UHVLGHQWLDO SORW LOOHJDOO\ DGG XS WR PLOOLRQ SHRSOH WKDW LV b RI 6DR 3DXORnV LQKDELWDQWV 0HGLQD f (YHQ LI FODVV VHJUHJDWLRQ KDV EHHQ VRPHZKDW DWWHQXDWHG WKHUH LV VWLOO D VWURQJ YDOXH DWWDFKHG E\ WKH PLGGOHFODVV WR OLYLQJ LQ WKH FHQWUDO DUHDV :KHQ WKH\ KHDUG ZKHUH ZDV JRLQJ WR ZRUN PLGGOHFODVV %UD]LOLDQV LQFOXGLQJ VRPH IHPLQLVW DFWLYLVWV RIWHQ H[FODLPHG (VW£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nV FRQWHPSW IRU LWV FLWL]HQ f ,Q WKH DUHD RI KHDOWK WKLV SXEOLF QHJOHFW LV SDUWLFXODUO\ EODWDQW DQG LV XQIRUWXQDWHO\ JURZLQJ DV QHROLEHUDO SROLFLHV DUH EHLQJ LPSOHPHQWHG ERWK E\ WKH ORFDO VWDWH DQG IHGHUDO JRYHUQPHQWV $ FRUWLJR LV DQ ROG LQQHUFLW\ EXLOGLQJ ZKLFK KDV EHHQ VXEGLYLGHG LQWR LQGLYLGXDO URRPV IRU UHQW (QWLUH IDPLOLHV OLYH LQ WKHVH URRPV LQ YHU\ FURZGHG DQG XQVDQLWDU\ FRQGLWLRQV

PAGE 28

, FKRVH WR IRFXV WKLV UHVHDUFK RQ ZRPHQnV JURXSV ZKR ZRUN ZLWK KHDOWK DQG UHSURGXFWLYH ULJKWV LVVXHV EHFDXVH WKLV LV DQ DUHD ZKHUH D ODUJH DUUD\ RI JURXSV DUH DFWLYH DQG KDYH EHHQ DFWLYH IRU D ORQJ WLPH 7KH ZRPHQnV KHDOWK PRYHPHQW LV SDUWLFXODUO\ ZHOOVWUXFWXUHG ,W KDV FUHDWHG D QDWLRQDO QHWZRUN ZKLFK SXOOV WRJHWKHU PRUH WKDQ JURXSV QDWLRQZLGH $ EURDG RYHUYLHZ RI WKH KHDOWK VLWXDWLRQ LQ %UD]LO VHHPV LQ RUGHU +HDOWK 6LWXDWLRQ LQ %UD]LO $Q HSLGHPLRORJLFDO WUDQVLWLRQ RFFXUUHG EHWZHHQ WKH V DQG WKH V LQ %UD]LO %HWZHHQ DQG GHDWK UDWHV GXH WR LQIHFWLRXV DQG SDUDVLWLF GLVHDVHV ZHQW GRZQ E\ b DQG LQIDQW PRUWDOLW\ ZHQW GRZQ E\ b %ULVFRH f 7KH QHZ WKUHDWV WR %UD]LOLDQVn KHDOWK DUH RFFXSDWLRQDO KD]DUGV DLU SROOXWLRQ WUDIILF DFFLGHQWV FULPH DOFRKRO DQG WREDFFR FRQVXPSWLRQ DQG FDUGLRYDVFXODU GLVHDVHV IRU ZKLFK LQFLGHQFH UDWHV LQ WKH FLWLHV RI WKH VRXWKHDVW RI WKH FRXQWU\ DUH WKH KLJKHVW LQ WKH ZRUOG %ULVFRH f $ SULYLOHJHG VHFWLRQ RI WKH %UD]LOLDQ SRSXODWLRQ HQMR\V D TXDOLW\ RI OLIH DQG RI KHDOWK FDUH VLPLODU WR WKDW RI LQGXVWULDOL]HG QDWLRQV DQG VXIIHUV IURP WKH VDPH GLVHDVHV ZKHUHDV WKH OHVV ZHOORII PDMRULW\ LV VWLOO VWUXJJOLQJ ZLWK XQVDQLWDU\ OLYLQJ FRQGLWLRQV LQFUHGLEO\ ORZ LQFRPHV DQG SRRU QXWULWLRQ OLWWOH DFFHVV WR KHDOWK FDUH DQG VXIIHUV IURP JDVWURLQWHVWLQDO DQG SXOPRQDU\ LQIHFWLRQV &RKQ f 7KLV LV GLVSXWHG E\ %ULVFRH f ZKR DUJXHV WKDW WKH SRRU DUH DOVR WKH RQHV ZKR VXIIHU PRVW IURP FDUGLRYDVFXODU DQG RWKHU QRQFRPPXQLFDEOH GLVHDVHV 7KH KHDOWK VLWXDWLRQ RI WKH ORZHU FODVVHV KDV GHWHULRUDWHG GXH WR ODQG GHSULYDWLRQ LQ UXUDO DUHDV ZKLFK OHG WR PDVVLYH PLJUDWLRQ DQ H[WUHPHO\ UDSLG XUEDQL]DWLRQ DQG LQGXVWULDOL]DWLRQ SUHGDWRU\ ODERU SUDFWLFHV DQG D VNHZHG GLVWULEXWLRQ RI PHGLFDO GRFWRUV DQG PHGLFDO IDFLOLWLHV IDYRULQJ WKH ULFKHU DUHDV RI ELJ FLWLHV &RKQ f 7KH JRYHUQPHQW

PAGE 29

DJULFXOWXUDO SROLFLHV HQFRXUDJLQJ FDVK FURSV IRU H[SRUW DW WKH H[SHQVH RI EDVLF IRRG VWDSOHV JHQHUDWHG YHU\ KLJK IRRG SULFHV 0DFHGR 6FKHSHU+XJKHV f )RU H[DPSOH PRUH WKDQ GRXEOH DV PXFK ZRUN WLPH ZDV QHHGHG LQ HQG RI WKH %UD]LOLDQ HFRQRPLF nPLUDFOHnf DV LQ WR HDUQ ZDJHV VXIILFLHQW WR SXUFKDVH WKH VDPH IRRG EDVNHW .RZDULFN f 7KH DFXWH HFRQRPLF FULVLV RI WKH V KDV ZRUVHQHG WKH VLWXDWLRQ 3ULFHV IRU EDVLF IRRG LWHPV LQFUHDVHG E\ b LQ ZKLOH JHQHUDO LQIODWLRQ UDJHG DW b %DUURVR DQG $PDGR f $V D UHVXOW ZRUNHUV KDG WR VSHQG KRXUV D PRQWK LH PRUH WKDQ WKH PRQWKO\ PD[LPXP LQ 2FWREHU FRPSDUHG WR KRXUV LQ WR HDUQ HQRXJK PRQH\ WR EX\ WKH VDPH EDVNHW RI IRRG %DUURVR t $PDGR f 8QGHU VXFK FLUFXPVWDQFHV RQH FDQ H[SHFW PDOQXWULWLRQ WR WDNH LWV WROO DQG LQGHHG DV &DUPHQ %DUURVR DQG 7LQD $PDGR SXW LW ZLWK UHGXFHG LQFRPHV WR SD\ IRU PRUH H[SHQVLYH IRRG WKH VROXWLRQ IRU SRRUHU IDPLOLHV ZDV WR HDW OHVV f 7KH HQVXLQJ VWUXFWXUDO SROLFLHV :LUWK HW DO f DQG WKH PRUH UHFHQW UHFHVVLRQ DJJUDYDWHG VLQFH E\ WKH HFRQRPLF DGMXVWPHQW SROLFLHV RI WKH ILUVW HOHFWHG SUHVLGHQW )HUQDQGR &ROORU GH 0HOOR DQG KLV VXFFHVVRUV KDYH PHDQW IXUWKHU GZLQGOLQJ RI SXEOLF IXQGLQJ SULYDWL]DWLRQ RI VRFLDO SURJUDPV DQG D VKDUS LQFUHDVH LQ SRYHUW\ OHYHOV DOWKRXJK SDUDGR[LFDOO\ VRPH VRFLDO LQGLFDWRUV VHHP WR KDYH VOLJKWO\ LPSURYHG )DULD ,% $6( /RSHV f 7KH %UD]LOLDQ 3XEOLF +HDOWK &DUH 6\VWHP 7KH %UD]LOLDQ &RQVWLWXWLRQ RI $UWLFOH f VWDWHV WKDW KHDOWK LV D ULJKW IRU HYHU\RQH DQG WKDW LW LV WKH 6WDWHnV GXW\ WR PDLQWDLQ DQG LPSURYH WKH SRSXODWLRQnV KHDOWK ,W DOVR VWLSXODWHV WKDW WKH SXEOLF KHDOWK V\VWHP VKRXOG EH LQWHJUDWHG GHFHQWUDOL]HG DQG FRQWUROOHG E\ RUJDQL]HG FLYLO VRFLHW\ WKURXJK WKH FUHDWLRQ RI WKH 686 6LVWHPD 8QLFR GH 6DGH $UWLFOH

PAGE 30

f &1'0 f
PAGE 31

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n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n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

PAGE 32

QHLJKERUKRRG ZRPHQf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

PAGE 33

&+$37(5 62&,$/ 029(0(17 5(6($5&+ $1' $17+5232/2*< ,QWURGXFWLRQ 7KH EURDGHU VRFLDO DFWRU ZKLFK LV WKH IRFXV RI WKLV GLVVHUWDWLRQ LV WKH %UD]LOLDQ ZRPHQfV PRYHPHQW ,W LV LPSRUWDQW WR VLWXDWH WKLV VWXG\ ZLWKLQ WKH ERG\ RI VRFLDO PRYHPHQW WKHRU\ WR XQGHUVWDQG WKH FRQWULEXWLRQ RI VRFLDO PRYHPHQWV LQ JHQHUDO DQG WKH ZRPHQfV PRYHPHQW LQ SDUWLFXODU WR WKH GHPRFUDWL]DWLRQ SURFHVV DV ZHOO DV WKH SRVLWLRQ DQG UROH RI 1RQJRYHUQPHQWDO 2UJDQL]DWLRQV LQ UHODWLRQ WR WKH PRYHPHQW 7KLV LV ZKDW KRSH WR GR LQ WKLV FKDSWHU $ GHWDLOHG DQG OHQJWK\ RYHUYLHZ DQG FULWLTXH RI WKH WZR PDLQ VFKRROV RI VRFLDO PRYHPHQW WKHRU\ QDPHO\ 1HZ 6RFLDO 0RYHPHQW 160f DQG 5HVRXUFH 0RELOL]DWLRQ 7KHRU\ 507f KDV EHHQ XQGHUWDNHQ E\ -RH )RZHUDNHU f ZKR DOVR GLVFXVVHV WKH UHOHYDQFH RI WKHVH GLIIHUHQW WKHRULHV IRU /DWLQ $PHULFD ZLOO OLPLW P\VHOI ZLWK GLVFXVVLQJ KRZ WKH WZR FDQ DQG VKRXOG EH DUWLFXODWHG EHOLHYH DV )RZHUDNHU GRHV DQG EHIRUH KLP (VFREDU t $OYDUH] f WKDW D FURVVSROOLQDWLRQ RI WKHVH WZR WKHRUHWLFDO DSSURDFKHV FDQ IXUWKHU RXU XQGHUVWDQGLQJ RI VRFLDO PRYHPHQWV DQG FROOHFWLYH DFWLRQ EHFDXVH WKH\ EURDGO\ IRFXV RQ WKH KRZ DQG ZK\ RI VRFLDO PRYHPHQWV LQ RWKHU ZRUGV ZK\ VRFLDO PRYHPHQWV HPHUJH DQG H[LVW 160f DQG KRZ WKH\ DUH RUJDQL]HG DQG IXQFWLRQ 507f 7KH FRQFHSW RI VRFLDO PRYHPHQW ILHOGV DQG LWV HPSKDVLV RQ PRYHPHQW KHWHURJHQHLW\ LV SDUWLFXODUO\ XVHIXO WR WKLV VWXG\ WKHQ GHOYH LQWR WKH KHDUW RI WKH PDWWHU WKH SURIHVVLRQDOL]DWLRQ DQG LQVWLWXWLRQDOL]DWLRQ RI VRFLDO PRYHPHQWV DQG WKH UROH SOD\HG E\ RUJDQL]DWLRQV LQ WKH OLYHV RI VRFLDO PRYHPHQWV

PAGE 34

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f 7KH\ FRQVLGHUHG VRFLDO PRYHPHQWV DV LUUDWLRQDO &RQFHQWUDWLQJ DW WKH LQGLYLGXDO OHYHO WKH\ H[SORUHG FKDUDFWHU WUDLWV DQG VWDWHV RI PLQG WKDW IDYRUHG SDUWLFLSDWLRQ LQ UHEHOOLRQV 7KH\ DOVR IRFXVHG RQ PRYHPHQW HPHUJHQFH DQG H[SODLQHG LQGLYLGXDO SDUWLFLSDWLRQ E\ ORRNLQJ DW GLVFRQWHQW DV UHVSRQVHV WR UDSLG VRFLDO FKDQJH )RU RYHUYLHZV VHH &RKHQ (FNVWHLQ 0F$GDP HW DO DQG =DOG f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f $FFRUGLQJ WR WKLV VFKRRO RI

PAGE 35

WKRXJKW VRFLDO PRYHPHQWV DUH EDVHG RQ FRQIOLFWV FROOHFWLYH DFWLRQ FDQ EH LQVWLWXWLRQDO RU QRQLQVWLWXWLRQDO EXW VRFLDO PRYHPHQWV DUH VHHQ DV QRQLQVWLWXWLRQDO 0F$GDP HW DO f 6LQFH JULHYDQFHV DUH DOZD\V SURGXFHG LQ VRFLHW\ WKH\ FDQQRW DFFRXQW IRU WKH HPHUJHQFH RI JURXSV ,QVWHDG RSSRUWXQLWLHV DYDLODELOLW\ RI UHVRXUFHV DQG RUJDQL]DWLRQV H[SODLQ WKH IRUPDWLRQ RI PRYHPHQWV $FFRUGLQJ WR 507 WKH VXFFHVV RI PRYHPHQWV LV WR EH PHDVXUHG E\ WKHLU SROLWLFDO UHFRJQLWLRQ RU E\ WKH PDWHULDO EHQHILWV WKH\ SURYLGH DOWKRXJK 7DUURZ f LQ KLV PRVW UHFHQW FRQWULEXWLRQ DOVR FRQVLGHUV WKDW VRFLDO PRYHPHQWV EULQJ OHVV WDQJLEOH EHQHILWV VXFK DV SHUPDQHQW H[SDQVLRQV LQ SDUWLFLSDWLRQ LQ SRSXODU FXOWXUH DQG LQ LGHRORJ\f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f 7RXUDLQH IXUWKHU DUJXHV WKDW FODVVHV VWUXJJOH QRW RQO\ IRU DFFXPXODWLRQ RYHU WKH SURGXFWV RI ODERU EXW DOVR RYHU V\PEROLF SURGXFWV DQG RYHU KLVWRULFLW\ LH ZKR ZLOO UHSUHVHQW VRFLHW\ WR LWVHOIf [YLLLf 7RXUDLQH KRSHV WR ILQG WKH VRFLDO PRYHPHQW ZKLFK LV JRLQJ WR UHSODFH WKH ODERU PRYHPHQW DV WKH QHZ KLVWRULFDO DJHQW +RZHYHU KH VHHV WKH DSSDUDWXV RI WHFKQRFUDWLF PDQDJHPHQW DV WKH PDLQ HQHP\ RI WKH QHZ PRYHPHQWV f /DWLQ $PHULFDQ VFKRODUV ZKR KDYH IROORZHG WKH LGHQWLW\RULHQWHG SDUDGLJP PD\ KDYH EHHQ LQIOXHQFHG PRUH E\ WKH ZRUN RI $OEHUWR 0HOXFFL D VWXGHQW RI 7RXUDLQH LQ WKDW WKH\ LQWHUSUHW VRFLDO PRYHPHQWV DV D IRUP RI UHVLVWDQFH WR WKH SURFHVVHV RI GHYHORSPHQW DQG WR WKH

PAGE 36

SHQHWUDWLRQ RI WKH 6WDWH DQG WKH FDSLWDOLVW PDUNHW LQWR VRFLDO OLIH $OYDUH] t (VFREDU -HOLQ f ,QGHHG 0HOXFFL FRQVLGHUV VRFLDO PRYHPHQWV WR EH D UHVSRQVH WR WKH SHQHWUDWLRQ RI WKH VWUXFWXUH RI GRPLQDWLRQ RI SRVWLQGXVWULD@ VRFLHW\ LQ SULYDWH OLIH DQG LQ VRFLDO UHODWLRQV ,QGHHG LQ WKH SRVWLQGXVWULDO PRGH RI SURGXFWLRQ FRQWURO UHDFKHV EH\RQG WKH SURGXFWLYH VWUXFWXUH LQWR WKH DUHDV RI FRQVXPSWLRQ VHUYLFHV DQG VRFLDO UHODWLRQV f &RQWUDU\ WR 7RXUDLQH 0HOXFFL GRHV QRW ORRN IRU WKH PRYHPHQW ZKLFK LV JRLQJ WR UHSODFH WKH ODERU PRYHPHQW ,Q WKH VDPH OLQH DV 7RXUDLQH ZKR DUJXHG WKDW PRYHPHQWVn DFWLRQ LV QRW GLUHFWHG WRZDUGV D FRQTXHVW RI SRZHU IURP WKH 6WDWH EXW WKH VHDUFK IRU DQ DOWHUQDWLYH WR WKH VRFLHW\ DJDLQVW ZKLFK WKH\ DUH ILJKWLQJ f 0HOXFFL DUJXHV WKDW ZH FDQQRW VSHDN RI VXFFHVV RU IDLOXUH RI VRFLDO PRYHPHQWV EHFDXVH WKHLU PHUH H[LVWHQFH LV DOUHDG\ D VXFFHVV ,QGHHG WKHLU VXEPHUJHG QHWZRUNOLNH IRUP HVSHFLDOO\ LQ WKHLU SHULRGV RI ODWHQF\ IXQFWLRQV DV ODERUDWRULHV RI FXOWXUDO LQQRYDWLRQV ,W LV D SRVVLELOLW\ RI DQRWKHU H[SHULHQFH RI WLPH VSDFH LQWHUSHUVRQDO UHODWLRQV ZKLFK RSSRVHV WKH RSHUDWLRQDO UDWLRQDOLW\ RI DSSDUDWXVHV f ,Q WKDW VHQVH WKHLU IRUP LV QRW MXVW LQVWUXPHQWDO EXW LV D JRDO LQ LWVHOI LELG f 7KH GLFKRWRP\ EHWZHHQ WKH UHVRXUFH PRELOL]DWLRQ DQG WKH QHZ VRFLDO PRYHPHQW SDUDGLJPV LQ VRFLDO PRYHPHQW UHVHDUFK FRUUHVSRQGV WR WKH VFKLVP EHWZHHQ H[SODQDWRU\ DQG LQWHUSUHWLYH VRFLDO VFLHQFH =DOG f FKDUDFWHUL]HV UHVRXUFH PRELOL]DWLRQ WKHRU\ DV D QDWXUDO V\VWHP WKHRU\ ZLWK DQ LQVWUXPHQWDO DQG XWLOLWDULDQ DSSURDFK ZKLFK KH RSSRVHV WR WKH VHPLRWLF VFLHQFHV WKDW GHDO ZLWK PHDQLQJ DQG WR WKH SK\VLFDO VFLHQFHV 7KH QHZ VRFLDO PRYHPHQW DSSURDFK GHDOV ZLWK LVVXHV RI PHDQLQJ FRQVWUXFWLRQ DQG VXEMHFWLYH H[SHULHQFH RI LGHQWLW\ 'LFKRWRPLHV DUH GHDU WR :HVWHUQ WKRXJKW *DUFLD&DQFOLQL 5RVHEHUU\ f ,Q WKH FDVH RI DQWKURSRORJLFDO WKHRU\ 5RVHEHUU\ SRLQWV RXW WKH SUREOHPV RI DQWLQRPLF WKLQNLQJ DV LW IRUWLI>LHV@ WKH DSSHDUDQFH RI PXWXDOO\ H[FOXVLYH VHWV RI DVVXPSWLRQV DQG IRUHFORVHV@ WKH

PAGE 37

SRVVLELOLW\ RI PHGLDWLRQ 5RVHEHUU\ f 6RFLDO PRYHPHQW VFKRODUV KDYH HDUOLHU H[SUHVVHG VNHSWLFLVP DERXW WKH SRVVLELOLW\ RI EULGJLQJ WKH JDS EHWZHHQ WKH QHRXWLOLWDULDQ VWUDWHJ\ SDUDGLJP DQG WKH FROOHFWLYH LGHQWLW\ SDUDGLJP &RKHQ -HQNLQV f 5HFHQWO\ KRZHYHU PHGLDWLRQ KDV EHHQ WDNLQJ SODFH 7KLV LV HVSHFLDOO\ DSSURSULDWH EHFDXVH WKH WZR SDUDGLJPV DUH DVNLQJ FRPSOHPHQWDU\ TXHVWLRQV URXJKO\ FRUUHVSRQGLQJ WR D KRZ GR VRFLDO PRYHPHQWV IXQFWLRQ 507f"f DQG ZK\ GR VRFLDO PRYHPHQWV HPHUJH 160f"f (VFREDU 0RUULV t 0F&OXUJ 0XHOOHU )RZHUDNHU f 7KH LQWURGXFWRU\ FKDSWHU WR WKH 0RUULV t 0F&OXUJ 0XHOOHU FROOHFWLRQ VSHFLILFDOO\ FRQVLGHUV WKH EULQJLQJ WRJHWKHU RI WKH VHPLRWLF DQG QDWXUDO VFLHQFHV RI VRFLDO PRYHPHQW f DV RQH RI WKH JRDOV WR EH SXUVXHG IRU D UHIRUPXODWLRQ RI VRFLDO PRYHPHQW WKHRU\ %RWK UHVRXUFH PRELOL]DWLRQ WKHRU\ DQG QHZ VRFLDO PRYHPHQW WKHRULHV DUH XVHIXO IRU P\ RZQ ZRUN VLQFH FRQVLGHU LVVXHV RI FROOHFWLYH LGHQWLW\ DQG VROLGDULW\ DV ZHOO DV WKH FXOWXUH FKDQJH SURFHVV WKDW PRYHPHQWV HQJDJH LQ DV NH\ LVVXHV ZKHQ FRQVLGHULQJ VRFLDO PRYHPHQWV LQ JHQHUDO DQG WKH UROH RI 1*2V LQ VRFLDO PRYHPHQWV 2Q WKH RWKHU KDQG GUHZ RQ 507 VWXGLHV ZKLFK GLG SD\ PRUH DWWHQWLRQ WR WKH LVVXH RI PRYHPHQW SURIHVVLRQDOL]DWLRQ DQG H[WHUQDO ILQDQFLQJ DQG WKHLU LPSDFW RQ PRYHPHQWV VWUDWHJLHV WDFWLFV DQG RXWFRPHV ZLVK WR GLVFXVV WKH SRLQWV RI MXQFWXUH EHWZHHQ 160 DQG 507 ZKLFK IDFLOLWDWH WKH UDSSURFKHPHQW RI WKH WZR SDUDGLJPV IRU D PRUH FRPSOHWH XQGHUVWDQGLQJ RI VRFLDO PRYHPHQW G\QDPLFV ZKLFK EHOLHYH LV QHFHVVDU\ $ IRFXV RQ WKH LQWHUPHGLDWH OHYHO RI DQDO\VLV LH DW WKH VPDOO JURXSRUJDQL]DWLRQ OHYHO LV SDUWLFXODUO\ UHOHYDQW LQ WKLV UHJDUG ,W LV DQ HVVHQWLDO OHYHO RI DQDO\VLV LQ WKLV VWXG\ DOWKRXJK WKH XQLW RI DQDO\VLV GRHV VKLIW IURP WKH LQGLYLGXDO WR WKH RUJDQL]DWLRQ WR WKH PRYHPHQW

PAGE 38

%ULGJLQJ WKH *DS LQ 6RFLDO 0RYHPHQW 5HVHDUFK $V KDYH QRWHG EHIRUH ERWK 160 DQG 507 VKDUH FRQWUDU\ WR HDUOLHU DSSURDFKHV D EHOLHI WKDW VRFLDO PRYHPHQWV DUH UDWLRQDO DFWRUV 7KH FRQFHSW RI FRQIOLFW LV DOVR FUXFLDO WR ERWK DSSURDFKHV DV UHFRJQL]HG E\ &RKHQ t $UDWR FLWHG LQ )RZHUDNHU f DQG 'LDQL f KDYH GLVFXVVHG HOVHZKHUH KRZ IURP DQ HPRWLRQDOSV\FKRORJLFDO VWDQGSRLQW FRQIOLFW HDVHV WKH UHIRUPXODWLRQ RI PHDQLQJ DQG WKH DVVLPLODWLRQ RI VRFLDO FKDQJH /HERQ f 7KH FRQIOLFWV RI LQWHUHVW RI 507 DQG WKH GLVUXSWLRQ RI SHRSOHfV OLYHV WKURXJK LQWUXVLRQ E\ WKH 6WDWH DQG WKH PDUNHW SRVLWHG E\ 160 DUH OLQNHG UHDVRQV EHKLQG WKH HPHUJHQFH RI VRFLDO PRYHPHQWV /HERQ f )URP DQ DQDO\WLFDO SRLQW RI YLHZ D WKLUG SRLQW RI MXQFWXUH EHWZHHQ WKH 160 DQG 507 OLHV LQ IRFXVLQJ WKH DQDO\VLV DW WKH LQWHUPHGLDWH OHYHO EHWZHHQ WKH LQGLYLGXDO DQG VWUXFWXUH LH DW WKH OHYHO RI WKH RUJDQL]DWLRQ RU JURXS 7KLV LV ZKDW KDYH WULHG WR GR LQ WKLV VWXG\ %RWK 507 DQG 160 WKHRULVWV KDYH FRQVLGHUHG WKLV LPSRUWDQW IRFXV LQ UHFHQW \HDUV 0F$GDP HW DO 0HOXFFL 0RUULV t 0F&OXUJ 0XHOOHU f $V 0F$GDP DQG KLV FROOHDJXHV DUJXH ZH FDQ QR PRUH EXLOG VRFLDO PRYHPHQWV IURP WKH LQGLYLGXDO XS WKDQ GRZQ IURP VRPH EURDG VRFLHWDO SURFHVV f 6LQFH QRW DOO LQGLYLGXDOV XQGHU VLPLODU FRQGLWLRQV SDUWLFLSDWH WKH TXHVWLRQ LV ZKDW PDNHV LQGLYLGXDOV SDUWLFLSDWH LQ FROOHFWLYH DFWLRQ" 507 WKHRULVWV ZKR VR IDU KDG QRW SDLG PXFK DWWHQWLRQ WR WKLV TXHVWLRQ KDYH VWDUWHG WR GR VR DV ZLOO H[SODLQ LQ WKH FRPLQJ SDUDJUDSKV 0HOXFFL f XQGHUOLQHV WKDW WKLV TXHVWLRQ KDV EHHQ D GLOHPPD LQ 0DU[LVW WKHRU\ ZKHQHYHU RQH WULHG WR H[DPLQH WKH OLQN IURP FODVV FRQGLWLRQ WR FODVV FRQVFLRXVQHVV 7KH WZR VROXWLRQV SURSRVHG ZHUH HLWKHU WKH /HQLQLVW FRQFHSW RI D QHFHVVDU\ OHDGLQJ YDQJXDUG RU

PAGE 39

WKH LGHD SRVLWHG E\ 5RVD /X[HPEXUJ WKDW SHRSOH KDYH D VSRQWDQHRXV FDSDFLW\ WR PRELOL]H LQ WKH IDFH RI GLVFRQWHQW DQG LQMXVWLFH SRVLWHG :H KDYH VHHQ WKDW 507 DUJXHV WKDW WKHUH DUH DOZD\V JULHYDQFHV LQ D VRFLHW\ WKHUHIRUH D JULHYDQFH GRHV QRW H[SODLQ ZK\ LQGLYLGXDOV HQJDJH LQ FROOHFWLYH DFWLRQ 507nV VHFRQG VWHS LV WR DUJXH WKDW ZKDW FRXQWV LQ WKH HPHUJHQFH RI FROOHFWLYH DFWLRQ WKHQ LV QRW JULHYDQFHV EXW WKH SRVVLELOLWLHV DQG FRQVWUDLQWV RQ FROOHFWLYH DFWLRQ WKDW H[LVW LQ D JLYHQ VLWXDWLRQ 7KLV LV ZKHUH 507 SURSRQHQWV LQWURGXFH WKH QRWLRQV RI VWUXFWXUHV RI RSSRUWXQLW\ GLVFUHWLRQDO UHVRXUFHV DQG ILHOGV RI FRQVWUDLQWV 7KXV 507 LGHQWLILHV WKH QHHG IRU DQ LQWHUPHGLDWH OHYHO EHWZHHQ WKH LQGLYLGXDO DQG WKH VWUXFWXUDO OHYHOf +RZHYHU LW FRQVLGHUV WKDW WKHVH VWUXFWXUHV RI RSSRUWXQLW\ DQG GLVFUHWLRQDO UHVRXUFHV DUH REMHFWLYH ZKHQ LQ IDFW 0HOXFFL f DUJXHV WKH\ DUH VRFLDOO\ FRQVWUXFWHG ([SHFWDWLRQV RI DQ\ W\SH DUH VRFLDOO\ FRQVWUXFWHG DQG DUH D IXQFWLRQ RI SHRSOHn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f ,W LV RQ WKH EDVLV RI WKLV FROOHFWLYH FRJQLWLYH IUDPHZRUN WKDW DFWRUV ZLOO FDOFXODWH WKH FRVWV DQG EHQHILWV RI WKH DFWLRQ +RZHYHU 0HOXFFL UHPLQGV XV WKHUH DUH HOHPHQWV RI SDUWLFLSDWLRQ LQ FROOHFWLYH DFWLRQ ZKLFK FDQQRW EH UHGXFHG WR LQVWUXPHQWDO UDWLRQDOLW\ $ VHQVH RI EHORQJLQJ DQG VROLGDULW\ DUH HVVHQWLDO FKDUDFWHULVWLFV RI VRFLDO PRYHPHQWV

PAGE 40

5HFHQWO\ 507 WKHRULVWV 0RUULV t 0F&OXUJ 0XHOOHU f KDYH VWXGLHG VPDOO LQIRUPDO JURXSV DQG WKHLU FDSDFLW\ WR JHQHUDWH FROOHFWLYH IUDPHZRUNV XQGHU WKH ODEHO RI PLFURn PRELOL]DWLRQ FRQWH[WV 2WKHUV VXFK DV 6QRZ DQG %HQIRUG f DUH LQWHUHVWHG LQ WKH ZKROH SURFHVV RI UHGHILQLQJ WKH VRFLDO FRQVWUXFWLRQ RI JULHYDQFHV RSSRUWXQLWLHV DQG FRQVWUDLQWV ZKLFK WKH\ ODEHOHG IUDPH DOLJQPHQWV +HQFH WKH\ VHW RXW WR LQFRUSRUDWH VXEMHFWLYH LVVXHV SURPLQHQW LQ WKH QHZ VRFLDO PRYHPHQW DSSURDFK VXFK DV WKH FRQVWUXFWLRQ RI PHDQLQJV VROLGDULW\ DQG FRQVFLRXVQHVV LQWR WKH 507 IUDPHZRUN 6LPLODUO\ GHVSLWH WKH LPSRUWDQFH KH JLYHV WR WKH H[WHUQDO HOHPHQWV RI SROLWLFDO RSSRUWXQLW\ VWUXFWXUH 7DUURZ f GRHV LQFRUSRUDWH WKH IDFW WKDW FROOHFWLYH DFWLRQ LV FXOWXUDOO\ LQVFULEHG DQG FRPPXQLFDWHG LELG f DQG WKDW OHDGHUV GUDZ RQ D UHSHUWRLUH RI FROOHFWLYH DFWLRQ SRVVLELOLWLHV ZKLFK LV UHODWHG WR WKH FXOWXUH LQ ZKLFK WKH PRYHPHQW HYROYHV DV HVVHQWLDO HOHPHQWV LQ WKH IRUPDWLRQ DQG PDLQWHQDQFH RI VRFLDO PRYHPHQWV +H DOVR FRQVLGHUV WKH LPSRUWDQFH RI WUXVW DQG FRRSHUDWLRQ JHQHUDWHG DPRQJ SDUWLFLSDQWV E\ VKDUHG XQGHUVWDQGLQJV LELGf 7KXV KH GRHV LQFOXGH ERWK VROLGDULW\ DQG FROOHFWLYH LGHQWLW\ LQ KLV IUDPHZRUN DOWKRXJK WKH\ DUH QRW FHQWUDO HOHPHQWV WR LW ,Q RWKHU ZRUGV 507 PDGH DQ HIIRUW WR LQFRUSRUDWH FRUH LVVXHV RI WKH LGHQWLW\ SDUDGLJP +RZHYHU WKH LVVXH LV QRW UHVROYHG UDWKHU VRPH ZD\V KDYH EHHQ GHYLVHG WR EULQJ WRJHWKHU VWUDWHJ\ DQG LGHQWLW\ 0F&OXUJ 0XHOOHU f 7KLV GLVFXVVLRQ RI WKH LQWHUPHGLDWH OHYHO RI DQDO\VLV PLJKW KDYH OHG WR WKH HUURQHRXV FRQFOXVLRQ WKDW WKH FUHDWLRQ RI D FROOHFWLYH LGHQWLW\ QHFHVVDULO\ SUHFHGHV VRFLDO DFWRUVn VWUDWHJL]LQJ ,Q RWKHU ZRUGV WKHUH ZRXOG EH D OLQHDU PRGHO RI GHYHORSPHQW RI VRFLDO PRYHPHQWV LQYROYLQJ LGHQWLW\ IRUPDWLRQ DV D SUHFRQGLWLRQ WR VWUDWHJ\ GHFLVLRQV $V VHYHUDO VRFLDO PRYHPHQW VFKRODUV KDYH SRLQWHG RXW WKHUH LV QR VXFK GXDO ORJLF RU OLQHDU PRGHO &RKHQ t $UDWR 'RLPR )RZHUDNHU f 6RFLDO PRYHPHQWV DUH ERWK H[SUHVVLRQ

PAGE 41

RI JURXS LGHQWLW\ DQG FRQIOLFW RI LQWHUHVW VLPXOWDQHRXVO\ H[SUHVVLYH DQG LQVWUXPHQWDO L H LGHQWLW\ DQG VWUDWHJ\ VLPXOWDQHRXVO\ FXOWXUDO DQG SROLWLFDO )RZHUDNHU ZULWHV >@ LGHQWLW\ FDQQRW VLPSO\ EH FRQFHLYHG DV D SUHFRQGLWLRQ RI VWUDWHJLF DFWLRQ EHFDXVH WKH SURFHVVHV RI RUJDQL]DWLRQ DQG VWUDWHJLF FKRLFH FRQWULEXWH FUXFLDOO\ WR FRQVWUXFW DQG VKDSH WKLV LGHQWLW\ f 'LVUXSWLRQ YHUVXV ,QWHJUDWLRQ LQ WKH 3ROLWLFDO 6\VWHP -XVW DV FRQFHUQV ZLWK LGHQWLW\ DQG VWUDWHJ\ DUH SUHVHQW VLPXOWDQHRXVO\ LQ VRFLDO PRYHPHQWV WKH FRUUHODWHG GULYHV IRU GLVUXSWLRQ RI WKH H[LVWLQJ RUGHU DQG IRU LQFOXVLRQ LQ WKH SROLWLFDO V\VWHP DUH DOVR WKHUH DW WKH VDPH WLPH &RKHQ FDOOV WKHP GHIHQVLYH DQG RIIHQVLYH PRYHPHQWV FLWHG LQ )RZHUDNHU f $QD 0DULD 'RLPR f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fV YLHZ RI WKH LPSRUWDQFH RI KLVWRULFDO FRQGLWLRQV LQ GHWHUPLQLQJ WKH IRUPV FROOHFWLYH DFWLRQ WDNHV LQ )RZHUDNHU f DQG 7DUURZfV SROLWLFDO SURFHVV PRGHO ,Q RWKHU ZRUGV WKHUH LV QR LQHYLWDEOH OLQHDU PRGHO OHDGLQJ PRYHPHQWV IURP SURWHVW WR DFTXLHVFHQFH QR LQHYLWDEOH LQVWLWXWLRQDOL]DWLRQ

PAGE 42

6RFLDO 0RYHPHQW )LHOGV 0RYLQJ EH\RQG WKH GHEDWH EHWZHHQ WKH LGHQWLW\ DQG VWUDWHJ\ SDUDGLJPV VRFLDO PRYHPHQWV KDYH EHHQ UHFHQWO\ FRXFKHG LQ WHUPV RI VRFLDO PRYHPHQW ILHOGV $OYDUH] D 6DGHU f 7KH FRQFHSW RI VRFLDO PRYHPHQW ILHOG LV SDUWLFXODUO\ XVHIXO WR WKLV VWXG\ EHFDXVH LW GLUHFWO\ DGGUHVVHV WKH LVVXH RI PRYHPHQW KHWHURJHQHLW\ ZKLFK KDV RIWHQ EHHQ RYHUORRNHG DQG ZKLFK LV HVVHQWLDO WR D VWXG\ RI WKH 6DR 3DXOR ZRPHQfV PRYHPHQW $ VRFLDO PRYHPHQW ILHOG FDQ EH GHILQHG DV DQ HQVHPEOH RI RUJDQL]DWLRQV LQGLYLGXDOV DQG QHWZRUNV ZKR VKDUH NH\ LGHDV EXW DOVR KDYH WKHLU GLYHUJHQFHV LQ JRDOV PHWKRGV DQG HPSKDVLV IRU VWUXJJOH 3XW RWKHUZLVH WKH\ VKDUH D FRPPRQ ILHOG RI UHIHUHQFHV DQG GLIIHUHQFHV IRU FROOHFWLYH DFWLRQ DQG SROLWLFDO FRQWHVWDWLRQ %DLHUOH f VWLOO LQIRUPHG E\ D FRPPRQ QRUPDWLYH LPSHUDWLYH EXW >ZLWK@ GLYHUVH SUDFWLFHV DQG GLVFRXUVHV >@ $OYDUH] f 7KH FRQFHSW RI VRFLDO PRYHPHQW LQGXVWU\ IRUJHG E\ 507 WKHRULVWV UHIHUULQJ WR ILHOGV RI UHODWHG VRFLDO PRYHPHQW RUJDQL]DWLRQV 602Vf ZKLFK FRPSHWH DQG FRRSHUDWH ZLWK HDFK RWKHU SRLQWV LQ WKH VDPH GLUHFWLRQ 0F$GDP HW DO f +RZHYHU WKLV FRQFHSW UHOLHV XQQHFHVVDULO\ RQ RUJDQL]DWLRQDO WKHRU\ DQG WKHUHIRUH XQGHUHVWLPDWHV WKH LPSRUWDQFH RI QRQRUJDQL]DWLRQDO IRUPV WKDW D VRFLDO PRYHPHQW WDNHV 2OLYHU f $ UHODWHG FRQFHSW RI LQWHUHVW LV WKDW RI HWKLFDOSROLWLFDO ILHOG ZKLFK UHIHUV PRUH EURDGO\ WR D VRFLDO PRYHPHQW DQG LWV QHWZRUN RI V\PSDWKL]HUV LQ PDLQVWUHDP LQVWLWXWLRQV DQG RWKHU VRFLDO PRYHPHQWV ZKR VKDUH VLPLODU LGHDV DQG GLVFRXUVHV 'DJQLQR f

PAGE 43

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f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n GHYHORSPHQW DV HYHU PRUH EXUHDXFUDWL]HG DQG ROLJDUFKLF RUJDQL]DWLRQV ZRXOG

PAGE 44

EULQJ WKH PRYHPHQW LQWR WKH WUDGLWLRQDO SROLWLFDO DUHQD +RZHYHU D PRUH IOH[LEOH PRGHO KDV EHHQ RIIHUHG VLQFH WKHQ E\ UHVRXUFH PRELOL]DWLRQ WKHRULVWV ZKLFK OLQNV D VRFLDO PRYHPHQW PRUH FORVHO\ WR LWV HQYLURQPHQW PDLQO\ WKH 6WDWH FRXQWHUPRYHPHQWV DQG WKH SHUVRQDO QHWZRUNV RI DFWLYLVWV 6WDUWLQJ ZLWK WKH PRUH SHVVLPLVWLF YLHZ RI WKH UROH RI RUJDQL]DWLRQV LQ VRFLDO PRYHPHQWV WKH :HEHU0LFKHOV WKHVLV EDVHG RQ :HEHUnV WKHRU\ RI EXUHDXFUDF\ DQG URXWLQL]DWLRQ RI FKDULVPD DQG RQ 0LFKHOVn LURQ ODZ RI ROLJDUFK\ >@f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nV ZRUN f ZLWK WKH ZRUNHUV FLYLO ULJKWV DQG ZHOIDUH ULJKWV PRYHPHQWV LQ WKH 8QLWHG 6WDWHV LQ WKH V JDYH H[DPSOHV RI KRZ WKH IRUPDO RUJDQL]DWLRQV FUHDWHG RQ WKH FUHVW RI WKHVH PRYHPHQWV OLPLWHG WKHLU GLVUXSWLYH IRUFH 7KH\ DUJXH WKDW IRUPDO RUJDQL]DWLRQV DUH OHVV GHILDQW DQG WKDW GHILDQFH DQG GLVUXSWLRQ DUH WKH PHDQV E\ ZKLFK WKH OHVV SRZHUIXO LQ VRFLHW\ FDQ EULQJ FKDQJH DERXW 7KH 6WDWHnV FRRSWDWLRQ RI PRYHPHQW DFWLYLVWV WKURXJK FRQFHVVLRQV EULQJV WKH PRYHPHQW LQWR UHJXODU SROLWLFV WKXV EULQJLQJ SURWHVWHUV LQWR WKH V\VWHP 8VLQJ D VLPLODU DUJXPHQW 7DUURZ f FODLPV WKDW VRFLDO

PAGE 45

PRYHPHQWV HQG XS HYROYLQJ LQ WKH VSKHUH RI SROLWLFV EHFDXVH WKH JRYHUQPHQW UHVSRQGV WR WKHLU FODLPV LQ RQH ZD\ RU DQRWKHU HLWKHU WKURXJK UHIRUP RU UHSUHVVLRQ PRVW RIWHQ WKURXJK D FRPELQDWLRQ RI WKH WZRf 7DNLQJ D KLVWRULFDO YDQWDJH SRLQW KH ZULWHV )RU EULHI SHULRGV RI KLVWRU\ WKH SRZHU LQ PRYHPHQW VHHPV LUUHVLVWLEOH EXW LW GLVSHUVHV UDSLGO\ DQG SDVVHV LQH[RUDEO\ LQWR PRUH LQVWLWXWLRQDO IRUPV RI SROLWLFV LELG f +H DGGV WKDW VRFLDO PRYHPHQWV KDYH OHVV LQIOXHQFH RYHU WKH RXWFRPH RI WKH VWUXJJOH LQ WKLV VSKHUH RI SROLWLFV 2IWHQ WLPHV WKH\ DUH QRW LQWHUHVWHG LQ XVLQJ WKHVH WDFWLFV ,Q RUGHU WR JHW SROLF\ FKDQJHV PRYHPHQWV PD\ RSW IRU FRRSHUDWLRQ UDWKHU WKDQ FRQIURQWDWLRQ WKLV GLPLQLVKHV WKHLU FDSDFLW\ WR LQVSLUH VXSSRUWHUV DQG WR KROG WKH DWWHQWLRQ RI HOLWHV EHFDXVH WKH\ DFFHSW FRPSURPLVHV LELG f %XW KH DGGV WKHUH DUH DOVR FRPSHQVDWLRQV IRU FKRRVLQJ WKH LQVWLWXWLRQDO GRPDLQ DV PRUH FRQYHQWLRQDO IRUPV RI DFWLRQ EULQJ RXW EURDGHU JHQHUDO VXSSRUW LQ WKH SRSXODWLRQ =DOG DQG $VK >@f UHIXWHG 0LFKHOVn FODLPV DQG DUJXHG WKDW DQ RUJDQL]DWLRQ HYROYHV LQ UHODWLRQ ZLWK LWV HQYLURQPHQW ,WV WUDMHFWRU\ QHHG QRW EH OLPLWHG WR URXWLQL]DWLRQ DQG ROLJDUFKL]DWLRQ EXW FDQ WDNH YDULRXV GLUHFWLRQV VXFK DV FRDOLWLRQV ZLWK RWKHU RUJDQL]DWLRQV RUJDQL]DWLRQDO GLVDSSHDUDQFH IDFWLRQDO VSOLWV LQFUHDVHG UDWKHU WKDQ GHFUHDVHG UDGLFDOLVP DQG WKH OLNH LELG f 7KH WUDMHFWRU\ RXWOLQHG E\ 0LFKHOV LV RQO\ RQH LQ PDQ\ SRVVLELOLWLHV DQG LW LV OLNHO\ WR RFFXU ZKHQ PRYHPHQWV DUH EHFDOPHG LH ZKHQ WKH\ KDYH IRXQG D QLFKH IRU WKHPVHOYHV LQ WKH RUJDQL]DWLRQDO ZRUOG EXW WKHLU JURZWK KDV VORZHG GRZQ RU FHDVHG LELG f $FFRUGLQJ WR =DOG DQG $VK GHSHQGHQFH RQ DQG FRQWURO RI PDWHULDO LQFHQWLYHV IDFLOLWDWH ROLJDUFKL]DWLRQ DQG FRQVHUYDWLVP 2OLJDUFKL]DWLRQ RFFXUV EHFDXVH OHDGHUV KDYH DQ LQWHUHVW LQ FRQVHUYLQJ SRZHU IRU PDWHULDO UHDVRQV DQG FRQVHUYDWLVP RFFXUV EHFDXVH UDGLFDO JRDOV PLJKW WKUHDWHQ WKH QLFKH RI WKH PRYHPHQW E\ SURYRNLQJ KRVWLOLW\ LQ VRFLHW\ ,QGHHG 0LFKHOVn ZRUN ZDV EDVHG RQ WUDGHXQLRQV DQG SROLWLFDO SDUWLHV DW WKH EHJLQQLQJ RI WKH WK

PAGE 46

FHQWXU\ 6WXGLHV KDYH VKRZQ WKDW KLV YLHZV RQ ROLJDUFKL]DWLRQ RI RUJDQL]DWLRQV GR QRW KROG IRU RUJDQL]DWLRQV ZLWK LGHDOLVWLF JRDOV VXFK DV UHOLJLRXV RUJDQL]DWLRQV &DUGHQ f 0RUH JHQHUDOO\ VRFLDO PRYHPHQW RUJDQL]DWLRQV FDQ WDNH PDQ\ GLIIHUHQW IRUPV GLIIHUHQW IURP WKH FKDULVPDWLF OHDGHUGHYRWHG IROORZHU UHODWLRQVKLS -HQNLQV f $V -HQNLQV SXW LW ROLJDUFK\ LQ PRYHPHQWV PHDQV WKDW OHDGHUV FDQ DFW LQGHSHQGHQWO\ RI PHPEHUV QRW WKDW WKH\ ZLOO LQHYLWDEO\ RSSRVH LQVXUJHQF\ 7KRXJK WKH FRQYHUVLRQ RI PRYHPHQWV LQWR OREE\ RUJDQL]DWLRQV DQG WKH VXEVHTXHQW DEDQGRQPHQW RI LQVXUJHQW JRDOV LV FOHDUO\ D KD]DUG RI IRUPDO VWUXFWXUH LW LV D GHFLVLRQ QRW DQ LQHYLWDELOLW\ ,ELG f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f +H FUHDWHG WKH FRQFHSW RI LQWHUPHGLDWH SXEOLF VSDFH WKDW ZRXOG ILW EHWZHHQ WKH 6WDWH DQG FLYLO VRFLHW\ LQ ZKLFK VXFK XPEUHOOD RUJDQL]DWLRQV ZRXOG EH ORFDWHG LELGf 6LPLODUO\ 6WDJJHQERUJ f DOVR PHQWLRQV WKDW SURIHVVLRQDO RUJDQL]DWLRQV DOORZ WKH PRYHPHQW WR VXUYLYH WKH OXOOV RI YROXQWHHU PRELOL]DWLRQ DQG WR VHL]H QHZ RSSRUWXQLWLHV IRU EDWWOH ZKHQHYHU WKH\ DULVH 7KLV VWXG\ VXSSRUWV -HQNLQVn FRQWHQWLRQ WKDW WKH WUDQVIRUPDWLRQ RI PRYHPHQWV LQWR OREE\LQJ JURXSV LV D FOHDU GDQJHU ZKHQ PRYHPHQWV IRUPDOL]H EXW WKDW WKLV LV QRW DQ LQHYLWDEOH SURFHVV ,W LV WRR HDUO\ WR WHOO ZKHWKHU WKH PRYHPHQW RUJDQL]DWLRQV RI WKLV VWXG\ ZLOO SOD\ D

PAGE 47

UHPRELOL]LQJRUJDQL]LQJ UROH ZKHQ WKH WLPH LV ULSH ,Q WKH %UD]LO RI WKH V WKH HYLGHQFH SRLQWV WR WKHLU WXUQLQJ DZD\ IURP VXFK FODVVLFDO PRYHPHQW RULHQWDWLRQ 3URIHVVLRQDOL]DWLRQ 507 ZKLFK KDV IRFXVHG PRVW RQ LVVXHV RI SURIHVVLRQDOL]DWLRQ FRQVLGHUV SURIHVVLRQDO VRFLDO PRYHPHQW RUJDQL]DWLRQV KHUHDIWHU 3602Vf DV RQH RI WKH SRVVLEOH IRUPV WKDW 602V FDQ WDNH QRW QHFHVVDULO\ DV D UHVXOW RI LQVWLWXWLRQDOL]DWLRQ 0F$GDP HW DO f 0F&DUWK\ DQG =DOG GHILQH WKH JHQHUDO FKDUDFWHULVWLFV RI 3602V DV f D OHDGHUVKLS WKDW GHYRWHV IXOO WLPH WR WKH PRYHPHQW Df D ODUJH SURSRUWLRQ RI UHVRXUFHV RULJLQDWLQJ RXWVLGH RI WKH DJJULHYHG JURXS WKDW WKH PRYHPHQW FODLPV WR UHSUHVHQW f D YHU\ VPDOO RU QRQH[LVWHQW PHPEHUVKLS EDVH RU D SDSHU PHPEHUVKLS PHPEHUVKLS LPSOLHV OLWWOH PRUH WKDQ DOORZLQJ QDPH WR EH XVHG XSRQ PHPEHUVKLS UROOVf f DWWHPSWV WR LPSDUW WKH LPDJH RI VSHDNLQJ IRU D SRWHQWLDO FRQVWLWXHQF\ f DWWHPSWV WR LQIOXHQFH SROLF\ WRZDUG WKDW VDPH FRQVWLWXHQF\ 0F&DUWK\ DQG =DOG >@f 0F&DUWK\ DQG =DOG IXUWKHU DUJXH WKDW ZLWK SURIHVVLRQDOL]DWLRQ FDUHHUV DUH PDGH SRVVLEOH WUDLQLQJ LQVWLWXWLRQV DUH HVWDEOLVKHG DQG QDWLRQDO QHWZRUNV RI PRYHPHQW SHUVRQQHO DUH FUHDWHG DV DFWLYLVWV JHW MREV LQ YDULRXV RUJDQL]DWLRQV RYHU WLPH DFWLYLVWV DOVR JR EDFN DQG IRUWK EHWZHHQ MREV LQ JRYHUQPHQW DJHQFLHV LQ RWKHU LQVWLWXWLRQV DQG LQ PRYHPHQW RUJDQL]DWLRQV LELG f ,Q D FRXQWU\ VXFK DV %UD]LO VXFK D FDUHHU UHPDLQ KLJKO\ XQVWDEOH DOWKRXJK VRPH DFWLYLVWV GR JHW VXEVHTXHQW SRVLWLRQV ZLWK YDULRXV RUJDQL]DWLRQV %DVHG RQ WKH UHVXOWV RI WKLV UHVHDUFK PRVWO\ DJUHH ZLWK WKHLU GHILQLWLRQ DOWKRXJK WKHLU DVVHUWLRQ WKDW SURIHVVLRQDOL]HG VRFLDO PRYHPHQW RUJDQL]DWLRQV DWWHPSW WR LPSDUW WKH LPDJH RI VSHDNLQJ IRU D SROLWLFDO FRQVWLWXHQF\ PXVW EH PLWLJDWHG LQ WKH FDVH DW KDQG E\ WKH UROH WKH

PAGE 48

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f 6LPLODUO\ WKH HDUOLHU FROOHFWLYH EHKDYLRU WKHRULVWV GLG QRW GLVFXVV WKH LVVXH RI SURIHVVLRQDO DFWLYLVWV DW DQ\ OHQJWK 7KH\ DVVXPHG WKDW IXQGLQJ IRU WKH UHPXQHUDWLRQ RI WKHVH DFWLYLVWV RULJLQDWHG LQWHUQDOO\ WR WKH PRYHPHQW $V /HQLQ GLG WKH\ FRQVLGHUHG WKDW WKHVH LQGLYLGXDOV VKRXOG EH GUDZQ IURP WKH EDVH DQG EHORQJHG WR WKH PRUH H[SHULHQFHG PRUH FRPPLWWHG DFWLYLVWV ZKR KDG DQ LQWHUHVW LQ EHLQJ LQYROYHG IXOOWLPH LQ PRYHPHQW DFWLYLWLHV 2OLYHU f 0F&DUWK\ DQG =DOG >@f FKDOOHQJHG WKHVH LGHDV ZKHQ WKH\ IRFXVHG RQ WKH WUHQG WRZDUGV SURIHVVLRQDOL]DWLRQ RI VRFLDO PRYHPHQW RUJDQL]DWLRQV LQ WKH 8QLWHG 6WDWHV LQ WKH V QRWLFHG E\ RWKHU DXWKRUV DW WKH WLPH VHH 2OLYHU f 7KH\ LGHQWLILHG WKH DYDLODELOLW\ RI IXQGLQJ WKURXJK FKXUFKHV IRXQGDWLRQV DQG JRYHUQPHQW DJHQFLHV DV WKH SULPDU\ IDFWRU IRU WKH HPHUJHQFH RI IXOOWLPH FDUHHUV LQ VRFLDO PRYHPHQWV ZKLOH PRYHPHQW OHDGHUV EHFDPH VRFLDO PRYHPHQW HQWUHSUHQHXUV 0F&DUWK\ DQG =DOG >@f 507 YLHZV SDLG DFWLYLVWV DV LQGLYLGXDOV EHLQJ GUDZQ WR WKH PRYHPHQW E\ WKHVH PDWHULDO LQFHQWLYHV 7KH\ DUH OHVV FRPPLWWHG WKDQ YROXQWHHUV EHFDXVH YROXQWHHUV KDYH RQO\ SXUSRVLYH LQFHQWLYHV WR SDUWLFLSDWH DV RSSRVHG WR ERWK SXUSRVLYH DQG PDWHULDO LQFHQWLYHV IRU UHPXQHUDWHG DFWLYLVWV HPSLULFDOO\ FRQILUPHG E\ VRPH VWXGLHV H J :LOVRQ f 3URIHVVLRQDOL]HG RUJDQL]DWLRQV EHFRPH PRUH LQFOXVLYH UDWKHU WKDQ H[FOXVLYH 7KLV PHDQV WKDW WKH\ UHTXLUH SDUWLDO FRPPLWPHQW DQG UHODWLYHO\

PAGE 49

OLWWOH LQ WKH ZD\ RI UHTXLUHPHQWV 0F&DUWK\ DQG =DOG f WKXV FKDQJLQJ WKH PHDQLQJ RI PHPEHUVKLS WR WKH JURXS LELG f 3URIHVVLRQDOL]HG DFWLYLVWV DUH DOVR YLHZHG DV PRUH GLYRUFHG IURP WKH FRPPXQLW\ +RZHYHU 507 VFKRODUV ZHUH IRUFHG WR DFNQRZOHGJH GLPHQVLRQV RI SURIHVVLRQDO DFWLYLVP ZKLFK UHIOHFW D VWURQJ FRPPLWPHQW RQ WKH SDUW RI SDLG DFWLYLVWV VRPH PHQWLRQ WKH VDFULILFH PDGH E\ DFWLYLVWV ZKR UHFHLYH D ZDJH PXFK EHORZ ZKDW WKH\ ZRXOG HDUQ RXWVLGH WKH PRYHPHQW (YHQ 0F&DUWK\ DQG =DOG >@f UHFRJQL]H WKDW PRYHPHQW SDUWLFLSDQWV GR VHDUFK IRU ZD\V WR EH UHPXQHUDWHG IRU WKHLU DFWLYLWLHV LQ WKH PRYHPHQW 2OLYHU f 2OLYHUn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f 7KLV VWXG\ ZLOO H[SORUH LVVXHV VXFK DV ZKHUH SURIHVVLRQDOL]HG DFWLYLVWV FRPH IURP DQG KRZ FRPPLWWHG DQG KRZ FORVH WKH\ DUH WR WKH JUDVVURRWV LQ WKH FDVH RI WKH 6DR 3DXOR ZRPHQfV PRYHPHQW 2WKHU HOHPHQWV LGHQWLILHG DV FRQGXFLYH WR WKH FUHDWLRQ RI D SURIHVVLRQDOL]HG RUJDQL]DWLRQ DUH WKH IDLOXUH WR PRELOL]H D PHPEHUVKLS EDVH &DEOH f RU WR VXVWDLQ D PRYHPHQW 0F&DUWK\ DQG =DOG >@f 6WDJJHQERUJ f VKRZHG WKDW WKH IRUPDOL]DWLRQ RI WKH 86 SURFKRLFH PRYHPHQW GHHSHQHG DV WKH PRYHPHQW ZDV SXVKHG LQWR LQVWLWXWLRQDOL]HG DUHQDV E\ FKDQJLQJ HQYLURQPHQWDO FRQGLWLRQV PDLQO\ WKH OHJDOL]DWLRQ RI

PAGE 50

DERUWLRQ LQ f ,Q WKH FDVH RI WKH %UD]LOLDQ ZRPHQfV PRYHPHQW ZLOO DOVR FRQVLGHU FKDQJHV LQ WKH SROLWLFDO RSSRUWXQLW\ VWUXFWXUH QDPHO\ WKH SURFHVV RI WUDQVLWLRQ WR DQG FRQVROLGDWLRQ RI IRUPDO GHPRFUDF\ &RQVHTXHQFHV RI 3URIHVVLRQDOL]DWLRQ $V KDYH PHQWLRQHG HDUOLHU IRUPDOL]DWLRQ SURIHVVLRQDOL]DWLRQ DQG LQVWLWXWLRQDOL]DWLRQ DUH LQWHUUHODWHG $FFRUGLQJ WR 6WDJJHQERUJ f SURIHVVLRQDOL]DWLRQ LV OLQNHG WR IRUPDOL]DWLRQ EHFDXVH ILQDQFLQJ DJHQFLHV SUHIHU JURXSV WKDW KDYH D FHUWDLQ ORJLVWLFDO VWUXFWXUH ZKLFK DOORZV SHUPDQHQW FRQWDFWV DV ZHOO DV DFFRXQWLQJ VHUYLFHV DQG D PLQLPXP GLYLVLRQ RI ODERU 3URIHVVLRQDO VWDII ZLOO ZDQW WKH RUJDQL]DWLRQ WR IRUPDOL]H LQ RUGHU WR REWDLQ ILQDQFLDO VWDELOLW\ DQG D GLYLVLRQ RI ODERU WKDW DOORZV WKHP WR XVH DQG GHYHORS WKHLU RUJDQL]DWLRQDO VNLOOV S f ,Q UHYHUVH PRUH VWUXFWXUHG RUJDQL]DWLRQV KDYH DQ HDVLHU WLPH VHDUFKLQJ DQG REWDLQLQJ IXQGLQJ DQG KHQFH IRU FRQWLQXLQJ WR KLUH SURIHVVLRQDOV 7KH UHODWLRQVKLS EHWZHHQ IRUPDOL]DWLRQ DQG LQVWLWXWLRQDOL]DWLRQ LV WKDW 6WDJJHQERUJ DUJXHV PRUH IRUPDO SURIHVVLRQDO JURXSV DUH OLNHO\ WR HQWHU WKH DUHQD RI LQVWLWXWLRQDO SROLWLFV DQG IRUJR PRUH GLVUXSWLYH IRUPV RI SURWHVW 7KH\ GR VR LQ SDUW EHFDXVH WKHLU VWUXFWXUH DOORZV WKHP WR HQJDJH LQ VXFK WDFWLFV WKH\ KDYH RQJRLQJ FRQWDFWV WKH QHFHVVDU\ GLYLVLRQ RI ODERU DQG WKHLU ZRUNLQJ KRXUV ILW ZLWK WKRVH RI LQVWLWXWLRQDO SROLWLFVf DQG LQ SDUW EHFDXVH WKH\ OLNH LW EHWWHU EHFDXVH VXFK DFWLYLWLHV DUH PRUH FRPSDWLEOH ZLWK UHJXODU ZRUNLQJ KRXUV WKH\ FDQ EH VFKHGXOHG LQ DGYDQFH DQG H[SHQVHV FDQ EH SODQQHG ,Q SDUW WKH\ GR QRW ZDQW WR WKUHDWHQ WKH VXUYLYDO RI WKHLU HQWLW\ E\ HQJDJLQJ LQ SURWHVW DFWLRQ 0F&DUWK\ DQG =DOG >@f $JDLQ WKHVH WHQGHQFLHV DUH FOHDU GDQJHUV RI SURIHVVLRQDOL]HG RUJDQL]DWLRQV LQFOXGLQJ LQ WKH FDVH DW KDQG
PAGE 51

WKH WUDQVLWLRQ WR IRUPDO GHPRFUDF\ DQG FKDQJHV LQ GRQRU DJHQFLHVn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f .OHLGPDQ f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n WKHVLV WR D SDLG VWDII PRUH HDVLO\ YXOQHUDEOH WR FRRSWDWLRQ DV LQ 3LYHQ DQG &ORZDUGnV ZRUN RU WR WKH LQIOXHQFH RI HOLWH IXQGLQJ -HQNLQV 0F&DUWK\ DQG =DOG > @f 7KH VHFRQG PRGHO RI LPSDFW RI SURIHVVLRQDOL]DWLRQ RQ YROXQWHHU DFWLYLVP WKDW KDV EHHQ VXJJHVWHG LV WKDW SURIHVVLRQDO RUJDQL]DWLRQV VXEVWLWXWH IRU YROXQWHHU DFWLYLVWV .OHLGPDQ f

PAGE 52

6RPH UHVRXUFH PRELOL]DWLRQ WKHRULVWV KDYH XVHG VXFK D PRGHO ZKLFK VHHV SURIHVVLRQDO VRFLDO PRYHPHQW RUJDQL]DWLRQV DV UHSUHVHQWLQJ WKH LQWHUHVWV RI GHSULYHG FRQVWLWXHQFLHV ,QGHHG SURIHVVLRQDOL]DWLRQ KDV EHHQ FKRVHQ DV D VROXWLRQ ZKHQ D PDVV EDVH FRXOG QRW EH PRELOL]HG &DEOH f .OHLGPDQnV ODVW PRGHO LV WKH IDFLOLWDWLRQ PRGHO ZH KDYH DOUHDG\ PHQWLRQHG WKDW VRPH VFKRODUV FRQVLGHU WKDW RUJDQL]DWLRQV DUH QHFHVVDU\ WR PRELOL]H SHRSOH WR SURWHVW DQG WKH UROH RI XPEUHOOD RUJDQL]DWLRQV FDQ SOD\ GXULQJ SHULRGV RI UHIOX[ RI PRYHPHQWV E\ FDUU\LQJ RYHU WKH JRDOV DQG LGHDOV RI WKH PRYHPHQW 6WDJJHQERUJ DUJXHV f SURIHVVLRQDOL]HG RUJDQL]DWLRQV DQG VRFLDO PRYHPHQWV ZLWK D ODUJH QXPEHU RI SURIHVVLRQDO RUJDQL]DWLRQV DUH OLNHO\ WR OLYH ORQJHU 6WDJJHQERUJn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f .OHLGPDQnV SRLQW LV WKDW FRQWUDU\ WR HDUOLHU VFKRODUV ZKR KDYH HPSKDVL]HG HLWKHU LQKLELWLRQ VXEVWLWXWLRQ RU IDFLOLWDWLRQ D FRPELQDWLRQ RI WKH WKUHH LV PRUH OLNHO\ WR RFFXU .OHLGPDQ f 7KH IDFWRUV LQIOXHQFLQJ WKH FRPELQDWLRQ DUH HOHPHQWV RI SROLWLFDO RSSRUWXQLW\ WKH OHYHO RI PRELOL]DWLRQ LQ FLYLO VRFLHW\ DQG WKH VWUDWHJLHV DQG YDOXHV RI WKH SURIHVVLRQDO DFWLYLVWV LQYROYHG +LV HPSLULFDO ZRUN VKRZV WKDW RYHU WKH ODVW ILIW\ \HDUV WKUHH SURIHVVLRQDO RUJDQL]DWLRQV IURP WKH 86 SHDFH PRYHPHQW XVHG GLIIHUHQW VWUDWHJLHV UHJDUGLQJ YROXQWHHU

PAGE 53

DFWLYLVP GHOLEHUDWHO\ H[SDQGLQJ LW RU UHGXFLQJ LWV LQIOXHQFH LQ WKH PRYHPHQW ,Q WKH FDVH RI WKH SHDFH PRYHPHQW KH VWXGLHG VHSDUDWH FDPSDLJQLQJ RUJDQL]DWLRQV ZHUH FUHDWHG E\ SHDFH RUJDQL]DWLRQV 0\ VWXG\ VKRZV WKDW LQ WKH FDVH RI WKH %UD]LOLDQ ZRPHQnV PRYHPHQW DIWHU DSSUR[LPDWHO\ \HDUV RI D SURIHVVLRQDOL]LQJ WUHQG WKH ODWWHU KDV LQGHHG LQKLELWHG YROXQWHHU DFWLYLVP GR DJUHH ZLWK .OHLGPDQ KRZHYHU WKDW LW FRXOG EH GLIIHUHQW LI WKH JURXSV GHOLEHUDWHO\ FKRVH WR SURPRWH PRELOL]DWLRQ DQG PD\EH PRUH LPSRUWDQWO\ KDG WKH XQFRQGLWLRQDO VXSSRUW RI GRQRU DJHQFLHV LQ WKLV HQGHDYRXU 7KLV LV KRZHYHU QRW FXUUHQWO\ WKH FDVH 7KH 5ROH RI )XQGLQJ 3DP 2OLYHU f LGHQWLILHG WKUHH PDLQ IRUPV RI ILQDQFLQJ IRU VRFLDO PRYHPHQWV LQWHUQDO H[WHUQDO PDUNHW DQG H[WHUQDO VSRQVRU ILQDQFLQJ 7KH 1*2V ZRUNHG ZLWK UHO\ RQ ZKDW VKH FDOOHG H[WHUQDO VSRQVRU ILQDQFLQJ 7KLV PHDQV IXQGLQJ E\ ODUJH LQVWLWXWLRQV VXFK DV FKXUFKHV IRXQGDWLRQV JRYHUQPHQWV RU FRUSRUDWLRQV RU OHVV IUHTXHQWO\ E\ ZHDOWK\ LQGLYLGXDOV ,QGHHG QR PRUH WKDQ SHUFHQW RI WKHVH 1*2Vf EXGJHWV GHULYHG IURP WKH RWKHU WZR PRGHV RI ILQDQFLQJ ,Q IDFW SDUW RI WKH SURIHVVLRQDOL]DWLRQ SURFHVV RI IHPLQLVW 1*2V KDV LQYROYHG UHGXFLQJ WKHLU UHOLDQFH RQ LQWHUQDO ILQDQFLQJ ZKLOH LQFUHDVLQJ WKDW RI H[WHUQDO VSRQVRU ILQDQFLQJ ,QWHUQDO ILQDQFLQJ LQYROYHG VXFK DFWLYLWLHV DV VDOHV RI 7VKLUWV RU RWKHU JRRGV DQG VHUYLFHV SURGXFHG E\ SDUWLFLSDQWV DV ZHOO DV IDLUV JDPHV ELQJRf HWF 1*2V QR ORQJHU HQJDJH LQ WKLV W\SH RI IXQGUDLVLQJ DFWLYLWLHV ZKLOH WKH YROXQWHHU RUJDQL]DWLRQV ZRUNHG ZLWK VWLOO GR DOWKRXJK WKH\ WRR QRZ UHO\ PRVWO\ RQ JUDQW PRQH\V IURP GRQRU DJHQFLHV 7KH GLIIHUHQFH OLHV LQ WKH DPRXQW UHFHLYHG DQG LQ WKH IDFW WKDW YROXQWHHU JURXSV GR QRW UHPXQHUDWH WKHLU SDUWLFLSDQWV ZLWK WKLV PRQH\ ([WHUQDO PDUNHW ILQDQFLQJ LV ZKHQ D PRYHPHQW UHOLHV RQ D ODUJH QXPEHU RI VPDOO FRQWULEXWLRQV IURP LQGLYLGXDOV RXWVLGH WKH PRYHPHQW RU E\ VHOOLQJ SURGXFWV RU VHUYLFHV

PAGE 54

ZKRVH ODERU KDV EHHQ SDLG D IDLU ZDJH 2OLYHU f 1*2V KDYH EHHQ SXVKHG E\ GRQRU DJHQFLHV WR LQFUHDVH WKHLU VDOHV RI SURIHVVLRQDO VHUYLFHV DQG SURGXFWV LQ RUGHU WR ERRVW WKHLU VHOI VXVWDLQDELOLW\ 7KLV NLQG RI IXQGLQJ OHDYHV RUJDQL]DWLRQV YXOQHUDEOH WR FKDQJHV LQ WKH HFRQRP\ ZKLFK DIIHFW SHRSOHVn LQFRPH DQG WR WKH LQVWDELOLW\ RI UHVRXUFH IORZV 0F&DUWK\ DQG =DOG f DQG LV KDUGO\ IHDVLEOH LQ D FRXQWU\ VXFK DV %UD]LO ZLWK KLJK UDWHV RI PDWHULDO SRYHUW\ ZLOO H[SDQG RQ WKH FRQVHTXHQFHV RI H[WHUQDO VSRQVRU ILQDQFLQJ VLQFH WKLV LV ZKDW GRQRU IXQGLQJ WR SURIHVVLRQDOL]HG RUJDQL]DWLRQV 1*2Vf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f 6LPLODUO\ 6FKZDUW] DQG 3DXO f DUJXH WKDW UHFUXLWLQJ PRQH\ RU UHFUXLWLQJ SHRSOHnV WLPH HQWDLO GLIIHUHQW VWUDWHJLHV 7KH\ DUJXH WKDW RUJDQL]DWLRQV ZKR UHFHLYH PRQH\ IURP D VSRQVRU GR QRW IHHO WKH QHHG WR UHFUXLW PHPEHUV 2Q WKH RWKHU KDQG RXWVLGH ILQDQFLDO VXSSRUW PHDQV WKDW WKH RUJDQL]DWLRQ ZLOO EH DEOH WR VXUYLYH HYHQ ZKHQ EHQHILFLDULHVn FODLPV KDYH EHHQ VDWLVILHG 7KLV GHSHQGHQFH RQ HOLWHV IRU IXQGLQJ DQG LQGHSHQGHQFH IURP D PDVV VXSSRUW EDVH LQFUHDVH WKH SRVVLELOLW\ RI HOLWH VRFLDO FRQWURO RQ SURIHVVLRQDO VRFLDO PRYHPHQW RUJDQL]DWLRQV 0F&DUWK\ t =DOG >@ f 7KH\ EHOLHYH WKDW HVWDEOLVKHG LQVWLWXWLRQDO VHFWRUV

PAGE 55

VXFK DV IRXQGDWLRQV DQG FKXUFKHV ZRXOG QRW VXSSRUW UDGLFDO RUJDQL]DWLRQV IRU ORQJ SHULRGV RI WLPH EHFDXVH WKH\ DUH WKHPVHOYHV VXEMHFW WR LQVWLWXWLRQDO FRQWURO 7KH\ EHOLHYH WKDW VXFK IXQGLQJ KDV DPHOLRUDWLYH UDWKHU WKDQ UDGLFDO SXUSRVHV DQG LV PHDQW WR FKDQQHO GLVVHQW LQWR OHJLWLPDWH FKDQQHOV DV HOLWHV VHDUFK WR GLIILLV>H@ WKH UDGLFDO SRVVLELOLWLHV RI GLVVHQW LQ JHQHUDO f +RZHYHU VRPH RI WKDW VXSSRUW LV LQGLUHFWO\ GLYHUWHG WR RUJDQL]DWLRQV ZLWK PRUH UDGLFDO JRDOV DV ZKHQ ERWK W\SHV RI JURXSV HQJDJH LQ FRDOLWLRQ ZRUN IRU H[DPSOH 7KLV PHDQV WKDW UDGLFDO JURXSV KDYH PRUH UHVRXUFHV DYDLODEOH WKDQ LI WKHUH ZDV QR HIIRUW RQ WKH SDUW RI WKH HOLWH WR FRQWURO GLVVHQW 6WDJJHQERUJ f DUJXHV WKDW LQ WKH FDVH RI WKH 86 SURFKRLFH PRYHPHQW LQIRUPDO JURXSV DUH WKH RQHV ZKR SUHVVXUHG WR REWDLQ FRQFHVVLRQV IURP WKH HOLWH DQG KHQFH WR JHW IXQGLQJ DYDLODEOH EXW LW LV WKH IRUPDO SURIHVVLRQDO RUJDQL]DWLRQV ZKLFK EHQHILWHG IURP WKHVH PRQLHV 7KLV UHLQIRUFHV WKH FODLP E\ +DLQHV f RI D UDGLFDO IODQN HIIHFW WKHRU\ +DLQHV DUJXHV WKDW WKH SUHVHQFH RI H[WUHPLVW RUJDQL]DWLRQV ZLOO EH EHQHILFLDO WR PRUH PRGHUDWH RUJDQL]DWLRQV LQ WKH VDPH VRFLDO PRYHPHQW EHFDXVH WKH\ ZLOO ORRN PRUH DSSHDOLQJ WR IRXQGDWLRQV LQ RUGHU WR XQGHUPLQH PRUH UDGLFDO JURXSV -HQNLQV DQG (FNHUW DUJXH WKDW WKH HOLWH FRQWURO WKHVLV LV PRVWO\ FRUUHFW EXW VRPHZKDW VLPSOLVWLF DQG SUHIHU WKH WHUP FKDQQHOLQJ EHFDXVH WKH VRFLDO FRQWURO HIIHFWV RI SDWURQDJH DUH PRUH VXEWOH DQG LQGLUHFW WKDQ D VLPSOH FRRSWDWLRQ f :H QHHG WR GLVVRFLDWH FRQWURO DV WKH LQWHQWLRQ RI SDWURQV YV FRQWURO DV WKH FRQVHTXHQFH RI SDWURQDJH f 7KH\ IRXQG LQ WKH FDVH RI WKH %ODFN PRYHPHQW LQ WKH V WKDW HOLWH ILQDQFLQJ GLG QRW FKDQJH PRYHPHQW JRDOV DQG WDFWLFV VLJQLILFDQWO\ SURWHVWV FRQWLQXHG DIWHU HOLWH SDWURQDJH VWDUWHG DOWKRXJK ULRWV VWRSSHG GXH PRVWO\ WR JRYHUQPHQW UHSUHVVLRQ 2Q WKH RWKHU KDQG HOLWH ILQDQFLQJ ZHQW PRVWO\ WR PRGHUDWH SURIHVVLRQDOL]HG RUJDQL]DWLRQV DQG PLJKW KDYH DFFHOHUDWHG

PAGE 56

PRYHPHQW GHFD\ EHFDXVH LW GLYHUWHG OHDGHUV IURP RUJDQL]LQJ HIIRUWV H[DFHUEDWHG ULYDOULHV DQG FUHDWHG V\PEROLF JDLQV ZLOO FRQVLGHU LQ &KDSWHU WR ZKDW H[WHQW LQWHUQDWLRQDO GRQRU DJHQFLHV DUH FRQWUROOLQJ RU FKDQQHOLQJ LQWHQWLRQDOO\ RU QRW WKH JRDOV DQG VWUDWHJLHV RI IHPLQLVW 1*2V DQG KHQFH RI D VXEVWDQWLDO VHJPHQW RI WKH %UD]LOLDQ ZRPHQfV PRYHPHQW $QWKURSRORJ\ DQG 6RFLDO 0RYHPHQW 5HVHDUFK -RKQ %XUGLFN f PDGH D VWURQJ FDVH IRU DQWKURSRORJLVWV WR EH LQYROYHG ZLWK VRFLDO PRYHPHQW UHVHDUFK +H DUJXHV WKDW WKH ZDYH RI SHDVDQW PRYHPHQWVn VWXGLHV LQ WKH V H J :ROI f ZDV IROORZHG E\ D TXDVLYDFXXP LQ WHUPV RI DQWKURSRORJLFDO VWXG\ RI RUJDQL]HG SRSXODU PRYHPHQWV 7KH WLGH LV ULVLQJ DJDLQ WKRXJK DV D QXPEHU RI ZRUNV KDYH VWDUWHG ILOOLQJ WKLV YDFXXP LQ UHFHQW \HDUV ,Q IDFW %XUGLFN DUJXHV WKH DVFHQW RI WKH PRUDO HFRQRP\ DQG UHVLVWDQFH OLWHUDWXUH KDV SXVKHG DQWKURSRORJLVWV WRZDUGV WKH VWXG\ RI HYHU\GD\ XQRUJDQL]HG DQG PRVWO\ QRQFROOHFWLYH IRUPV RI UHVLVWDQFH H J 7DXVVLJ f %XUGLFN VHHV KHUH WKH LQIOXHQFH RQ RXU GLVFLSOLQH RI 0LFKHO )RXFDXOWfV SRZHULVHYHU\ZKHUH PRGHO DV ZHOO DV D JHQHUDO VNHSWLFLVP WRZDUGV WKH HIIHFWLYHQHVV RI FROOHFWLYH DFWLRQ DV ZHOO DV DQWKURSRORJ\nV SHQFKDQW IRU WKH VORZPRYLQJ DQG PLFURVFRSLF %XUGLFN f
PAGE 57

WUDQVIRUP WKLV FXOWXUDO EDJJDJH LQ D FRXQWHUKHJHPRQLF IDVKLRQ *DUFLD&DQFOLQL .HUW]HU f *DUFLD&DQFOLQL GHILQHV FXOWXUH DV D SDUWLFXODU W\SH RI SURGXFWLRQ ZKRVH REMHFWLYH LV WR XQGHUVWDQG UHSURGXFH DQG WUDQVIRUP WKH VRFLDO VWUXFWXUH DQG WR VWUXJJOH IRU KHJHPRQ\ f ,Q JUDPVFLDQ WHUPV KHJHPRQ\ FDQ EH GHILQHG DV D VLWXDWLRQ LQ ZKLFK D FODVV >@ LV SROLWLFDOO\ GRPLQDQW DQG >@ LV DEOH WR PRQRSROL]H WKH FXOWXUDO V\PEROV DQG WKH VRFLDOL]DWLRQ SURFHVV RI D VRFLHW\ .HUW]HU f $V 5LFKDUG )R[ SXWV LW FXOWXUH LV WKXV nDOZD\V LQ WKH PDNLQJn DV DFWRUV VWUXJJOH IRU PDWHULDO DQG V\PEROLF GRPLQDWLRQ +RZHYHU D FHUWDLQ GHJUHH RI FRQWLQXLW\ LV PDLQWDLQHG EHFDXVH PXFK RI GDLO\ H[LVWHQFH VLPSO\ IROORZV WKH SDWK RI OHDVW VRFLDO UHVLVWDQFH WKH ZD\ GHILQHG E\ GRPLQDWLRQ DV (3 7KRPSVRQ VXJJHVWV )R[ f 7KH WKHRU\ RI SUDFWLFH %RXUGLHX f LV XVHIXO LQ XQGHUVWDQGLQJ KRZ FXOWXUH FDQ FKDQJH RU EH PDLQWDLQHG $FFRUGLQJ WR %RXUGLHX UHSUHVHQWDWLRQV DQG SUDFWLFHV DUH JHQHUDWHG E\ D IHZ XQGHUO\LQJ QRQH[SOLFLWHG FRPPRQ VFKHPHV ZKLFK KH FDOOV KDELWXV 7KHVH VFKHPHV DUH LQFXOFDWHG GXULQJ VRFLDOL]DWLRQ LQ HDUO\ FKLOGKRRG WKURXJK SUDFWLFHV LH LQ DQG E\ WKH ERG\f DQG UHLQIRUFHG WKURXJK UHSHWLWLRQ DQG HQDFWPHQW 7KH\ DUH nOHDUQHG E\ ERG\n IRU VRPH HYHQ EHIRUH ODQJXDJH LV DYDLODEOH 7KH IDFW WKDW WKH\ DUH OHDUQHG E\ ERG\ DQG HQDFWHG WKURXJK WKH ERG\ E\ PLPHWLVP LH QRW E\ VLPSOH LPLWDWLRQ EXW E\ DQ LQWHUQDOL]DWLRQ RI WKH SULQFLSOHVf SXWV WKHVH VFKHPHV PRVWO\ RXW RI UHDFK RI FRQVFLRXVQHVV IRU WKH DFWRU 7KH\ FUHDWH nYLVFHUDO WDVWHV DQG GLVWDVWHVn DV -RDQ &DVVHOO f EULOOLDQWO\ GHPRQVWUDWHV LQ WKH FDVH RI JHQGHU UROHV 7KHVH WDVWHV DQG GLVWDVWHV DUH QRW DUELWUDU\ WKRXJK 7KH\ UHIOHFW EDVLF VRFLDO GLVWLQFWLRQV DQG SRZHU GLIIHUHQWLDOV WKDW DFFRPSDQ\ WKHP DGXOW\RXQJ PDOHIHPDOH ULFKSRRU ZKLWHEODFNf 7KH\ RI FRXUVH WHQG WR IDYRU WKH GRPLQDQW SROH RI VRFLDO GLVWLQFWLRQV %RXUGLHX FDOOV nGR[Dn f WKH VLWXDWLRQ ZKHUH VXFK VFKHPHV DQG SUDFWLFHV DUH QRW TXHVWLRQHG QRW

PAGE 58

HYHQ VXVFHSWLEOH RI EHLQJ TXHVWLRQHG EHFDXVH WKH\ VHHP nQDWXUDOn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f LQVSLUHG E\ $ODLQ 7RXUDLQH WKLV FRQWHVWDWLRQ LV FRQVWDQWO\ KDSSHQLQJ DJUHH WKDW FRQWHVWDWLRQV DUH DOZD\V SUHVHQW EXW VRPH FDUU\ PRUH ZHLJKW WKDQ RWKHUV DQG VRPH GR QRW DPRXQW WR PXFK FKDQJH XQWLO WKH\ UHDFK D VXIILFLHQW QXPEHU RI SHRSOH EHOLHYH WKDW SHULRGV RI FULVLV RU RI UDSLG VRFLDOHFRQRPLF FKDQJH GR KHOS XQYHLOLQJ GR[LF nWUXWKVn DQG IDFLOLWDWH FRQWHVWDWLRQV :KHQ VXFK FRQWHVWDWLRQ RFFXUV WKH VSHFLILF HIILFDF\ RI VXEYHUVLYH DFWLRQ FRQVLVWV LQ WKH SRZHU WR EULQJ WR FRQVFLRXVQHVV DQG VR PRGLI\ WKH FDWHJRULHV RI WKRXJKW ZKLFK KHOS WR RULHQW LQGLYLGXDO DQG FROOHFWLYH SUDFWLFHV DQG LQ SDUWLFXODU WKH FDWHJRULHV WKURXJK ZKLFK GLVWULEXWLRQV DUH SHUFHLYHG DQG DSSUHFLDWHG %RXUGLHX f 6RFLDO PRYHPHQWV DUH FDVHV LQ ZKLFK FXOWXUDO V\PEROV DQG SUDFWLFHV DUH TXHVWLRQHG DQG WKXV WUDQVIRUPHG E\ D JURXS RI LQGLYLGXDOV 7RJHWKHU ZLWK D VWUXJJOH RYHU PDWHULDO JRRGV VRFLDO PRYHPHQWV DOVR UHSUHVHQW D GHOLEHUDWH RUJDQL]HG FRQVFLRXV HIIRUW E\ PHPEHUV RI D VRFLHW\ WR FRQVWUXFW D PRUH VDWLVI\LQJ FXOWXUH WR XVH D GHILQLWLRQ ZKLFK :DOODFH f DVFULEHG WR UHYLWDOL]DWLRQ PRYHPHQWV $V KDYH GLVFXVVHG HDUOLHU QHZ VRFLDO PRYHPHQW WKHRULVWV KDYH FRQVLVWHQWO\ DUJXHG WKDW VRFLDO PRYHPHQWV DUH HQJDJLQJ LQ WKLV FXOWXUDO VWUXJJOH DQG UHVRXUFH PRELOL]DWLRQ GR QRW ZLVK LQ WKLV DUJXPHQW WR UHGXFH VRFLDO PRYHPHQWV WR WKHLU FXOWXUDO GLPHQVLRQ $V KDYH DUJXHG HDUOLHU WKH\ DUH SROLWLFDO LQ WKH WUDGLWLRQDO VHQVH RI WKH WHUP DV ZHOO

PAGE 59

DGYRFDWHV ZKR XVHG WR DUJXH WKDW VRFLDO PRYHPHQWV RQO\ UHSUHVHQWHG FRQIOLFWV RI LQWHUHVWV RYHU PDWHULDO FRQGLWLRQV QRZ UHFRJQL]H WKH LPSRUWDQFH RI WKH FXOWXUDO SURGXFWLRQ DVSHFW RI VRFLDO PRYHPHQWV 0RUULV t 0F&OXUJ 0XHOOHU 7DUURZ f 6RPH SROLWLFDO VFLHQWLVWV $OYDUH] HW DO $OYDUH] 'DJQLQR D E :D\OHQ f DUH PRYLQJ DZD\ IURP D QDUURZ GHILQLWLRQ RI SROLWLFV WR LQFOXGH PLFUROHYHO SURFHVVHV ZLWKLQ ERWK WKH SXEOLF DQG WKH SULYDWH VSKHUHV KHQFH LQFOXGLQJ HOHPHQWV ZKLFK HDUOLHU ZRXOG KDYH EHHQ FRQVLGHUHG DV FXOWXUDO 7UDGLWLRQDOO\ SROLWLFV DQG GHPRFUDF\ ZHUH GHILQHG LQ WHUPV RI LQVWLWXWLRQV ZLWKLQ WKH SXEOLF VSKHUH RQO\ :D\OHQ f 'HPRFUDF\ LV WKHQ QR ORQJHU KHOG WR EH HQVXUHG E\ WKH ULJKW WR YRWH DQG RWKHU LQVWLWXWLRQDO DUUDQJHPHQWV ,W QHHGV WR EH GHHSHQHG ZKHQ VRFLDO DXWKRULWDULDQLVP SHUPHDWHV DOO VRFLDO UHODWLRQV LH ZKHQ KLHUDUFK\ DQG LQHTXDOLW\ SHUYDGH WKH FXOWXUDO SUDFWLFHV WKURXJK ZKLFK SHRSOH UHODWH WR HDFK RWKHU LQ HYHU\GD\ OLIH DV LW LV WKH FDVH LQ %UD]LO 'DJQLQR Df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f ,W LV QRZ JHQHUDOO\ DFFHSWHG WKDW WKH VRFLDO PRYHPHQW OLWHUDWXUH HVSHFLDOO\ LQ WKH VV ZDV FKDUDFWHUL]HG E\ D FHOHEUDWRU\ PRRG VRPHWLPHV URPDQWLFL]LQJ VRFLDO PRYHPHQWV DV KDUELQJHUV RI VRFLDO DQG SROLWLFDO FKDQJH SUREDEO\ H[SHFWLQJ WRR PXFK IURP WKHVH PRYHPHQWV LQ WHUPV RI FKDQJHV LQ WKH SROLWLFDO DUHQD GLVUHJDUGLQJ WKHLU LQWHUQDO GLIILFXOWLHV DQG RWKHU OLPLWDWLRQV 7KH SHQGXOXP

PAGE 60

VWDUWHG WR VKLIW LQ WKH ODWH V PD\EH HYHQ WRR IDU LQ WKH RSSRVLWH GLUHFWLRQ DV D QXPEHU RI ZULWLQJV IRFXVHG RQ WKH GHFOLQH DQG GLIILFXOWLHV RI VRFLDO DQG SRSXODU PRYHPHQWV VHH UHYLHZ DUWLFOHV E\ +DEHU 5REHUWV RQ OLWHUDWXUH RI /DWLQ $PHULFDQ VRFLDO PRYHPHQWVf $JDLQ D PRUH VREHU ORRN DW WKH GHPRFUDWL]LQJ SRWHQWLDO DQG LQWHUQDO G\QDPLFV RI PRYHPHQWV ZDV LQGHHG LQ RUGHU KRZHYHU DV .DWKU\Q +RFKVWHWOHU DUJXHV VRFLDO PRYHPHQWVn UHFHQW GHFOLQH JDLQV GLPHQVLRQ IURP WKH KHLJKW RI >@ SDVW KRSHV f 7RQ 6DOPDQ f DOVR ZDUQV DJDLQVW VXFK GLVLOOXVLRQQHG RYHUUHDFWLRQ 7KHUH LV QR GRXEW WKDW WKH XQLI\LQJ JRDO RI WRSSOLQJ GRZQ WKH PLOLWDU\ GLFWDWRUVKLS GLVDSSHDUHG LQ DQG WKDW DOOHJLDQFHV WR GLIIHUHQW SROLWLFDO SDUWLHV QRW RQO\ GLYLGHG PRYHPHQW DFWLYLVWV EXW DOVR VLSKRQHG RII VRPH RI WKH PRYHPHQWVn HQHUJ\ LQWR WKH SROLWLFDO VSKHUH QRWDEO\ SROLWLFDO SDUWLHV 0RUHRYHU ZLWK WKH FRQVROLGDWLRQ RI IRUPDO GHPRFUDF\ WUDGLWLRQDO SROLWLFDO DFWRUV UHJDLQHG PRUH FRQWURO RYHU WKH VLWXDWLRQ OLPLWLQJ WKH LQVWLWXWLRQDO FKDQJHV WKDW UDGLFDO PRYHPHQWV FRXOG DFKLHYH 7KH HFRQRPLF GLIILFXOWLHV H[SHULHQFHG E\ WKH SRRU DV D UHVXOW RI QHROLEHUDO SROLFLHV DQG WKH GLUH FRQVHTXHQFHV RI WKH UHWUHDW RI &KULVWLDQ %DVH &RPPXQLWLHV &(%Vf ZKLFK KDG EHHQ FUXFLDO PRELOL]LQJ VSDFHV IRU SRSXODU PRYHPHQWV LQ WKH V DQG V FDQ DOVR QRW EH LJQRUHG 7KHUH LV DOVR QR GRXEW WKDW VRFLDO PRYHPHQWV VWUDWHJLF LQQRYDWLRQV DIWHU KDYH SXVK>HG@ WKH OLPLWV RI PDQ\ FRQYHQWLRQDO GHILQLWLRQV DQG H[SHFWDWLRQV RI VRFLDO PRYHPHQWV +RFKVWHWOHU f WKXV OHDGLQJ PDQ\ WR EHOLHYH LQ WKHLU GHFOLQH )RXU VXFK QHZ SDUWLFLSDWRU\ VWUDWHJLHV VKH LGHQWLILHV DUH QRQJRYHUQPHQWDO RUJDQL]DWLRQV SDUWLFLSDWLRQ RQ JRYHUQPHQW FRXQFLOV LQWHUQDWLRQDO QHWZRUNLQJ DQG ODQG RFFXSDWLRQV LELG f $V +RFKVWHWOHU KHUVHOI SRLQWV RXW WKHVH VWUDWHJLHV DUH E\ IDU PRUH SUREOHPDWLF PRUH DPELJXRXV DV GHPRFUDWL]LQJ DJHQWV WKDQ SURWHVW PDVVEDVHG DXWRQRPRXV PRYHPHQWV ZKRVH SRWHQWLDO LV EHOLHYHG WR VWHP IURP WKHLU SDUWLFLSDWRU\ QDWXUH

PAGE 61

IURP PLFUROHYHO FKDQJHV WKH\ HQWDLO IRU SDUWLFLSDQWV DQG IURP WKHLU UHODWLYH DXWRQRP\ IURP PDLQVWUHDP LQVWLWXWLRQV &DUUROO +HLOPDQ f ,Q IDFW WKLV VWXG\ KRSHV WR DVVHVV WZR VXFK SDUWLFLSDWRU\ VWUDWHJLHV QDPHO\ 1*2V ZLWKLQ WKH IHPLQLVW PRYHPHQW DQG WKHLU LQWHUQDWLRQDO OLQNDJHV $V +RFKVWHWOHU IXUWKHU DUJXHV ZH VKRXOG QRW RYHUORRN WKDW QHZ PRYHPHQWV LQ WKH FODVVLFDO VHQVH RI WKH WHUP ZLWK VWUHHW SURWHVWV DQG PDVV PRELOL]DWLRQV KDYH DOVR DSSHDUHG RQ WKH VFHQH VXFK DV WKH VXFFHVVIXO FDPSDLJQ IRU WKH LPSHDFKPHQW RI 3UHVLGHQW &ROORU LQ RU WKH /DQGOHVV 0RYHPHQW 0RYLPHQWR GRV 7UDEDOKDGRUHV 5XUDLV 6HP7HUUD 067` )URP D GLIIHUHQW SRLQW RI YLHZ WKH GHFOLQH RI VRFLDO PRYHPHQWV LQ %UD]LO DIWHU FDQ EH SDUWLDOO\ DWWULEXWHG WR WKH IRFXV RQ LQVWLWXWLRQDO RXWFRPH RI PDQ\ REVHUYHUV DQG KHQFH JRLQJ EDFN WR RXU RULJLQDO WRSLF RI WKH UHODWLRQVKLS EHWZHHQ FXOWXUH DQG SROLWLFV WR D QDUURZ XQGHUVWDQGLQJ RI ZKDW FRQVWLWXWHV SROLWLFV DQG RI WKH FRQVWLWXWLYH UROH RI FXOWXUH LQ SROLWLFV 'DJQLQR f (YHQ 7RQ 6DOPDQnV LQVLJKWIXO GLVFXVVLRQ RI ZRPHQnV HPSRZHUPHQW \HW OLPLWHG SROLWLFDO OHDUQLQJ DV SDUWLFLSDQWV RI XUEDQ SRSXODU RUJDQL]DWLRQV LQ &KLOHnV VKDQW\WRZQV UHYHDOV DQ HPSKDVLV RQ WKH LQVWLWXWLRQDO LPSDFW RI WKHVH RUJDQL]DWLRQV GHVSLWH KLV DFNQRZOHGJHPHQW WKDW 0RUH SURIRXQGO\ WKDQ LQ WKH SDVW >@ VRFLDO DQG ORFDO UHODWLRQV ZLOO VXSSRUW SROLWLFDO D ZHOO DV SUDJPDWLF HYHU\GD\ DVSLUDWLRQV DQG WKDW IRFXVLQJ RQ FKDQJLQJ LGHQWLWLHV JUDGXDOO\ VKLIWLQJ KDELWXV DQG WKH DFTXLVLWLRQ RI FRPSHWHQFHV SURYLGHV D PRUH WHGLRXV EXW DOVR D PRUH FRQFUHWH DQFKRU IRU XQGHUVWDQGLQJ FKDQJH 6DOPDQ f +H ZULWHV WKDW WKHVH SURFHVVHV >RI HPSRZHUPHQW OLQNHG WR SDUWLFLSDWLRQ LQ PRYHPHQWV@ GLG QRW DOWHU WKHLU LQDELOLW\ WR FKDOOHQJH WKH SDWWHUQV RI SROLWLFV WKH\ LGHQWLILHG DV DOLHQDWLQJ RSSUHVVLQJ H[FOXGLQJ RU SRZHU IRFXVHG 6DOPDQ f 7KH\ GLG QRW HQWHU WKH SROLWLFDO DUHQD LQ WKH VWULFW VHQVH RI WKH WHUP

PAGE 62

7KH ODWHVW FRQWULEXWLRQ E\ $OYDUH] 'DJQLQR DQG (VFREDU f SURYLGHV WKH OLQN EHWZHHQ WKH PLFUR DQG WKH PDFUR SROLWLFV DQG FXOWXUH YLD WKH FXOWXUDO SROLWLFV RI VRFLDO PRYHPHQWV DQG SROLWLFDO FXOWXUH (YHOLQD 'DJQLQR f GHPRQVWUDWHV KRZ XUEDQ SRSXODU PRYHPHQWV KDYH KHOSHG UHGHILQH WKH QRWLRQ RI FLWL]HQVKLS DQG ULJKWV KRZ WKH\ KDYH WUDQVIRUPHG WKH SHUFHSWLRQ RI VRFLDO QHHGV DV ULJKWV WKXV XQGHUPLQLQJ FOLHQWHOLVWLF SROLWLFDO SUDFWLFHV 6KH VKRZV WKDW WKLV KDV FOHDU FRQVHTXHQFHV IRU HOHFWRUDO SROLWLFV DQG WKH FRQWURO RYHU HOHFWHG UHSUHVHQWDWLYHV 3RSXODU PRYHPHQW DFWLYLVWV VKH DUJXHV DUH FKDOOHQJLQJ WKH ERXQGDULHV RI WKH SROLWLFDO E\ LQFOXGLQJ WKH QHHG WR HQG VRFLDO GLVFULPLQDWLRQ UDFHEDVHG FODVVEDVHG RU RWKHUZLVHf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f ,QGHHG FROOHFWLYH DFWLRQ LV QRW ERP RXW RI RUJDQL]HUVn KHDGV EXW LV FXOWXUDOO\ LQVFULEHG DQG FRPPXQLFDWHG 7KH OHDUQHG FRQYHQWLRQV RI FROOHFWLYH DFWLRQ DUH SDUW RI D VRFLHW\nV SXEOLF FXOWXUH ZULWHV 6\GQH\ 7DUURZ f &ROOHFWLYH DFWLRQ DQG RUJDQL]DWLRQDO IRUPV DUH DOVR KLVWRULFDOO\ LQVFULEHG WK FHQWXU\ 3DULVLDQV LQQRYDWHG ZLWK EDUULFDGHV IDFWRU\ ZRUNHUV IRUPHG WUDGH XQLRQV DQG ZHQW RQ VWULNH *DQGKL LQQRYDWHG ZLWK QRQYLROHQW SURWHVW .HUW]HU 7DUURZ f 6LPLODUO\ RUJDQL]DWLRQDO IRUPV DUH

PAGE 63

LQIOXHQFHG E\ WKH VRFLDO FKDUDFWHULVWLFV RI WKHLU SDUWLFLSDQWV VXFK DV FODVV JHQGHU UDFH DQG DJH $V D UHVXOW VRFLDO PRYHPHQWV UHIOHFW WKH KHWHURJHQHLW\ RI WKH FXOWXUH DQG SDUWLFLSDQWV WKH\ HPHUJH IURP 6RFLDO PRYHPHQW VFKRODUV KDYH WHQGHG WR JORVV RYHU WKH KHWHURJHQHLW\ RI VRFLDO PRYHPHQWVn PRELOL]HG DQG XQPRELOL]HG FRQVWLWXHQFLHV %XUGLFN :LHQHU f
PAGE 64

,PSRUWDQFH RI 3UDFWLFH LQ &ROOHFWLYH $FWLRQ 7KH FXOWXUDO WUDQVIRUPDWLRQ WKDW VRFLDO PRYHPHQWV HQJDJH LQ WKLV VWUXJJOH IRU D PRUH GHPRFUDWLF VRFLDO RUGHU LQ HYHU\GD\ OLIH WDNHV SODFH WKURXJK DFWLRQV DQG SUDFWLFHV DV ZHOO DV WKURXJK DWWLWXGLQDO FKDQJHV ,Q IDFW 1DVK DUJXHV WKDW LQ WU\LQJ WR XQGHUVWDQG VRFLDO PRYHPHQWV ZH PXVW DEDQGRQ WKH DQDO\WLF GLVWLQFWLRQ EHWZHHQ VRFLDO EHKDYLRU DQG FXOWXUDOO\ HQFRGHG V\PEROLF IRUP f 6KH UHDIILUPV WKH OLQN EHWZHHQ PHDQLQJ DQG DFWLRQ 5DWLRQDO FKRLFH WKHRU\ VWDUWV ZLWK WKH SUHPLVH WKDW DFWLRQ RU EHKDYLRU IROORZV SHRSOHnV DWWLWXGHV RU SUHIHUHQFHV )HUUHH ff§7KLV WDNHV XV EDFN WR RXU GLVFXVVLRQ RI D QRQOLQHDU PRGHO RI GHYHORSPHQW RI VRFLDO PRYHPHQWV IURP LGHQWLW\ WR VWUDWHJ\f§ +RZHYHU EHOLHIV DQG SUHIHUHQFHV DUH QHLWKHU VWDEOH QRU FRQVLVWHQW WKH\ DUH RIWHQWLPHV VKLIWLQJ DQG LQ FRQIOLFW ZLWK RQH DQRWKHU LQ SHRSOHnV PLQGV )HUUHH .HUW]HU f 7KHUHIRUH LW LV LPSRUWDQW WR DOVR FRQVLGHU SUDFWLFHV ,Q IDFW SHRSOH KDYH VKRZQ D JUHDW DELOLW\ WR V\QFUHWL]H GLIIHUHQW V\PEROLF V\VWHPV LH WR GHDO ZLWK FRQWUDGLFWRU\ RU FRQIOLFWLQJ LGHDV .HUW]HU f VR WKDW FRQVLVWHQF\ FRPHV WKURXJK FRPPRQ DFWLRQ .HUW]HU f *RLQJ RQH VWHS IXUWKHU VRPH VFKRODUV KDYH DUJXHG WKDW JHWWLQJ SHRSOH WR DFW FDQ XQGHU VRPH FRQGLWLRQV OLWHUDOO\ FKDQJH ZKDW DQG KRZ WKH\ VHH DQG WKDW DFWLYLVWV KDYH ORQJ NQRZQ DQG XVHG WKLV NQRZOHGJH )HUUHH f +LUVFK VWDWHG WKDW DFWLRQ PRELOL]DWLRQ LV IUHTXHQWO\ XVHG WR FUHDWH FRQVHQVXV PRELOL]DWLRQ UDWKHU WKDQ WKH UHYHUVH +LUVFK LQ )HUUHH f )DQWDVLD f GHPRQVWUDWHG FOHDUO\ WKDW FROOHFWLYH DFWLRQ DQG LQWHUDFWLRQ KDYH DQ HIIHFW RQ SHRSOHnV FRQVFLRXVQHVV DQG QRWDEO\ WKDW SHRSOHnV FRQVFLRXVQHVV ZDV

PAGE 65

VXEVWDQWLDOO\ UDLVHG E\ FROOHFWLYH DFWLRQ DQG LQWHUDFWLRQ )DQWDVLD f ODEHOHG WKLV FRQFHSW FRQVFLRXVQHVV LQ DFWLRQ 7KH UHDVRQV ZK\ SHRSOHnV DFWLRQV DUH QRW RQO\ LQGLFDWLYH RU UHLQIRUFLQJ ZKDW WKH\ WKLQN EXW DOVR FRQVWLWXWLYH RI ZKDW WKH\ WKLQN DUH WR EH VHDUFKHG IRU DW WKH LQGLYLGXDOSV\FKRORJLFDO OHYHO DV ZHOO DV DW WKH VRFLDO OHYHO 3UDFWLFH WKHRU\ KHOSV XV XQGHUVWDQG KRZ SHRSOHnV DFWLRQV DUH LQIOXHQFLQJ SHRSOHnV PLQGV KDYH GLVFXVVHG KRZ FXVWRPDU\ VRFLDO SUDFWLFHV H[SUHVV XQGHUO\LQJ SULQFLSOHV ZLWKRXW H[SOLFLWO\ UHIHUULQJ WR WKHP ,W IROORZV WKDW ERG\ DQG ODQJXDJH KDYH WKH GLVSRVLWLRQ WR IXQFWLRQ DV GHSRVLWRULHV RI GHIHUUHG WKRXJKWV %RXUGLHX f 6R WKDW UHn SODFLQJ WKH ERG\ LQ DQ RYHUDOO SRVWXUH > @ UHFDOOV WKH DVVRFLDWHG WKRXJKWV DQG IHHOLQJV LQ RQH RI WKH LQGXFWLYH VWDWHV RI WKH ERG\ ZKLFK DV DFWRUV NQRZ JLYH ULVH WR VWDWHV RI PLQG LELGf 0RUHRYHU SHRSOHnV DFWLRQV DUH QHFHVVDULO\ PRUH SXEOLF WKDQ WKHLU WKRXJKWV :KHQ SDUWLFLSDQWV LQ D PRYHPHQW HQJDJH LQ FROOHFWLYH DFWLRQ LH GHPRQVWUDWH VWULNH SURWHVW WKH\ DFW SXEOLFO\ DFFRUGLQJ WR WKH UXOHV RI WKH RUJDQL]DWLRQ 7KHVH DFWV SURYLGH SXEOLF VWDWHPHQWV RI DFFHSWDQFH RI D JURXSVnV SRVLWLRQ .HUW]HU f KHQFH UHLQIRUFLQJ RQHnV LGHQWLW\ ZLWK DQG RQHnV FRPPLWPHQW WR WKH PRYHPHQW 6LPLODUO\ UHODWLQJ ZLWK RQH JURXS LGHQWLILHV D SHUVRQ ZLWK WKDW JURXS VR WKDW LW LV GLIILFXOW IRU SDUWLFLSDQWV RI DQ RUJDQL]DWLRQPRYHPHQW WR LQWHUDFW ZLWK SHRSOH IURP WKH RSSRVLWH FDPS PL[LQJ DQG PDWFKLQJ FDQ EH XQWHQDEOH DV .HUW]HU VKRZHG LQ WKH FDVH RI WKH UHODWLRQV EHWZHHQ &RPPXQLVWV DQG &DWKROLFV LQ ,WDO\ .HUW]HU f .HUW]HU JRHV VR IDU DV WR VD\ WKDW VRFLDOO\ DQG SROLWLFDOO\ VSHDNLQJ ZH DUH ZKDW ZH GR QRW ZKDW ZH WKLQN LELGf DOWKRXJK WKLV LV WRR VWULFWO\ EHKDYLRULVW D VWDWHPHQW IRU PH WR HQGRUVH +H VKRZHG WKDW ZRUNHUVn VWDWHG OLPLWHG ZLOOLQJQHVV WR VWULNH DQG GLVFRQWHQW ZLWK PDQDJHPHQW DQG RZQHUV EHIRUH FROOHFWLYH DFWLRQ ZDV XQGHUZD\ ZDV XQDEOH WR SUHGLFW WKH VWULNH WKDW LPPHGLDWHO\ IROORZHG

PAGE 66

+RZ 2UJDQL]DWLRQDO )RUPV ,QIOXHQFH &ROOHFWLYH ,GHQWLW\ DQG 6ROLGDULW\ $OWKRXJK LVVXHV RI VROLGDULW\ DQG FROOHFWLYH LGHQWLW\ KDYH EHHQ H[SORUHG VLQFH LQLWLDO ZRUN E\ WKH HDUO\ VRFLDO VFLHQWLVWV HVSHFLDOO\ 'XUNKHLP >@f WKH LVVXH RI KRZ RUJDQL]DWLRQ LQIOXHQFHV VROLGDULW\ DQG FROOHFWLYH LGHQWLW\ UHPDLQV D IURQWLHU LQ VRFLDO PRYHPHQW WKHRU\ 0RUULV t 0F&OXUJ 0XHOOHU f %HIRUH JRLQJ DQ\ IXUWKHU VKDOO EULHIO\ RXWOLQH P\ XQGHUVWDQGLQJ RI FROOHFWLYH LGHQWLW\ DQG VROLGDULW\ &ROOHFWLYH LGHQWLW\ LV WKH VKDUHG GHILQLWLRQ RI D JURXS WKDW GHULYHV IURP PHPEHUVn FRPPRQ LQWHUHVWV H[SHULHQFHV DQG VROLGDULW\ 7D\ORU t :KLWWLHU f &ROOHFWLYH LGHQWLW\ LV DW OHDVW SDUWLDOO\ HPSLULFDOO\ REVHUYDEOH ,W FDQ EH GHULYHG IURP WKH PHDQLQJ SHRSOH JLYH WR ODEHOV DQG RWKHU FXOWXUDO V\PEROV LQ SDUWLFXODU WR ZKDW VDOLHQW FKDUDFWHULVWLFV PHPEHUV RI D JURXS EHOLHYH GLIIHUHQWLDWH WKHP DV D JURXS IURP WKH ZLGHU VRFLHW\ DQG ZKDW WKHLU XQGHUVWDQGLQJ RI WKH JURXSnV DFWLRQV LV &ROOHFWLYH LGHQWLW\ LV DOVR PDQLIHVWHG WKURXJK WKH ODQJXDJH DQG V\PEROV E\ ZKLFK LW LV SXEOLFO\ H[SUHVVHG *DPVRQ f 7KH DOWHUQDWLYH VRFLDO DQG FXOWXUDO IUDPHZRUN RI D VRFLDO PRYHPHQW RUJDQL]DWLRQ LV UHIOHFWHG LQ LWV FROOHFWLYH LGHQWLW\ LQ LWV SURJUDPV DQG HPERGLHG LQ LWV HYHU\GD\ SUDFWLFHV DQG LWV RUJDQL]DWLRQDO VWUXFWXUH *DPVRQ f 2EVHUYLQJ KRZ FROOHFWLYH LGHQWLW\ DQG VROLGDULW\ DUH H[SUHVVHG LQ GDLO\ EHKDYLRUV DQG DFWLRQV LV MXVW DV HVVHQWLDO DV UHFRUGLQJ DWWLWXGLQDO VWDWHPHQWV 6W\OH RI KHDGTXDUWHUV IRUPV RI DGGUHVV EHKDYLRUV GHQRWLQJ WKH QDWXUH RI WKH UDSSRUW EHWZHHQ VXSSRUW DQG JUDVVURRWV JURXSVn PHPEHUV EHKDYLRUV GXULQJ LQWHUDFWLRQV ZLWK SXEOLF DXWKRULWLHV HWF DOO HPERG\ WKH FROOHFWLYH LGHQWLW\ DQG WKH OHYHO RI VROLGDULW\ RI WKH JURXS DQG LQWHUJURXSV

PAGE 67

, ZRXOG GHILQH VROLGDULW\ DV WKH UHODWLRQVKLSV RI DIIHFWLRQ WUXVW UHFLSURFLW\ DQG PRUDO REOLJDWLRQ EHWZHHQ KXPDQ EHLQJV %RVZHOO f FRQVLGHU WKDW WKH W\SH RI VROLGDULW\ HQFRXQWHUHG LQ VRFLDO PRYHPHQWV LV FORVHU WR 'XUNKHLPnV PHFKDQLFDO VROLGDULW\ WKDW LV WKH VROLGDLUW\ ZKLFK DULVH IURP D VHQVH RI LGHQWLW\ DQG FRPPRQQHVV ZLWK RWKHU JURXS PHPEHUV 1HZ VRFLDO PRYHPHQW VFKRODUV KDYH WHQGHG WR SD\ DWWHQWLRQ PDLQO\ WR JULHYDQFHV WKDW OHG WR PRYHPHQW HPHUJHQFH DQG QHHG WR FRQVLGHU WKH DVVRFLDWLRQDO DQG RUJDQL]DWLRQDO DUUDQJHPHQWV WKH LQVWLWXWLRQV DQG SUDFWLFHV RI VRFLDO PRYHPHQWV 1HZ VRFLDO PRYHPHQW WKHRULVW $OEHUWR 0HOXFFL f FRQVLGHUV WKH IRUP RI VRFLDO PRYHPHQWV DV EHLQJ D JRDO LQ LWVHOI VLQFH LW LV D FKDOOHQJH WR WKH GRPLQDQW SDWWHUQV RSSRVLQJ WKH RSHUDWLRQDO UDWLRQDOLW\ RI DSSDUDWXVHV f PRYHPHQWVn LQIRUPDO QHWZRUNOLNH IRUPV ZLWK PXOWLSOH OHDGHUVKLSV VXEPHUJHG LQ VRFLHW\ HPERG\ WKH DQWLKLHUDUFK\ DQWLEXUHDXFUDWLF SULQFLSOHV RI WKHLU SDUWLFLSDQWV DV WKH\ UHGHILQH DQG SUDFWLFH QHZ IRUPV RI VRFLDELOLW\ 5HVRXUFH PRELOL]DWLRQ DGYRFDWHV KDYH VSHQW PRUH WLPH DW H[DPLQLQJ GLIIHUHQW RUJDQL]DWLRQDO IRUPV EXW WKH\ GR QRW FRQVLGHU WKH LQIOXHQFH WKHVH GLIIHUHQW DUUDQJHPHQWV EHDU RQ FROOHFWLYH LGHQWLW\ VROLGDULW\ DQG LGHRORJ\ 0DF$GDP HW DO f
PAGE 68

2WKHU SUDFWLFHV OLQNHG WR WKH LQWHUQDO VWUXFWXUH RI WKH JURXS PD\ DOWHU WKH FROOHFWLYH LGHQWLW\ DQG VROLGDULW\ RI D JURXS LQGHHG VRPH VFKRODUV KDYH VKRZQ WKDW FHUWDLQ RUJDQL]DWLRQDO IRUPV DUH UHODWHG WR WKH LQVWUXPHQWDO RU IRUPDOf UDWLRQDOLW\ PRWLYDWHG E\ VHOILQWHUHVW GULYLQJ ZHVWHUQ FDSLWDOLVW VRFLHW\ ZKHUHDV RWKHU IRUPV DUH PRUH DWWXQHG ZLWK YDOXH RU VXEVWDQWLYHf UDWLRQDOLW\ LQ WKH :HEHULDQ VHQVH LH ZKHQ LQGLYLGXDOVn EHKDYLRUV DUH GULYHQ E\ PRUDO FRPPLWPHQWV RWKHU WKDQ VHOILQWHUHVWf )HUUHH f 3HUURZ f VKRZHG WKDW FHUWDLQ FKDUDFWHULVWLFV RI FDSLWDOLVW ILUPV VXFK DV WKH PHDVXUHPHQW RI LQGLYLGXDO FRQWULEXWLRQV WKH SRVVLELOLW\ RI DFFXPXODWLQJ DGYDQWDJHV WKH FUHDWLRQ RI VWDEOH DQG KLHUDUFKLFDO DXWKRULW\ VWUXFWXUHV DQG PLQLPL]HG LQWHUDFWLRQV ZLOO HQFRXUDJH VHOILQWHUHVW 2Q WKH RWKHU KDQG 5RWKVFKLOG:KLWW f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f SXWV LW EXW DV D ODERU RI ORYH DQG EUHDG +RZ LV WKHLU DOWHUQDWLYH

PAGE 69

IUDPHZRUN DIIHFWHG E\ WKHVH RUJDQL]DWLRQDO FKDQJHV" 7KHVH DUH TXHVWLRQV ZKLFK ZLOO DGGUHVV LQ WKLV ZRUN $QRWKHU VSHFLILF VHW RI SUDFWLFHV ULWXDOV KDYH EHHQ VKRZQ WR LPSLQJH RQ VROLGDULW\ DQG FRPPLWPHQW WR D JURXS .HUW]HU f .HUW]HU GHILQHV ULWXDO LQ D YHU\ EURDG PDQQHU DV V\PEROLF EHKDYLRU WKDW LV VRFLDOO\ VWDQGDUGL]HG DQG UHSHWLWLYH f 'UDZLQJ RQ WKH ZRUN RI %OXPHU f KH LQFOXGHV PDVV PHHWLQJV UDOOLHV ODUJH GHPRQVWUDWLRQV DQG FRPPHPRUDWLYH FHUHPRQLHV DV ULWXDOV LQ WKH FDVH RI VRFLDO PRYHPHQWV f .HUW]HUnV WKHRUHWLFDO DSSURDFK IROORZV 'XUNKHLPnV ZKR EHOLHYHG WKDW VLQFH SHRSOH DUH GHSHQGHQW RQ RWKHUV IRU WKHLU H[LVWHQFH >WKH\@ QHHG WR EH UHDVVXUHG RI WKH JRRGQHVV RI VRFLHW\ 7KLV QHHG IRU VRFLDO FRPPXQLRQ WKH\ REWDLQ WKURXJK FRPPRQ DFWLRQ 2QO\ E\ SHULRGLFDOO\ DVVHPEOLQJ WRJHWKHU DQG MRLQWO\ SDUWLFLSDWLQJ LQ VXFK V\PEROLF DFWLRQ FDQ WKH FROOHFWLYH LGHDV DQG VHQWLPHQWV EH SURSDJDWHG .HUW]HU f $FFRUGLQJ WR .HUW]HU ULWXDO LV SDUWLFXODUO\ LPSRUWDQW IRU SURGXFLQJ VROLGDULW\ LQ WKH DEVHQFH RI FRQVHQVXV EHFDXVH WKH V\PEROV XVHG LQ ULWXDOV DUH DPELJXRXV DQG FDQ EH LQWHUSUHWHG GLIIHUHQWO\ E\ GLIIHUHQW SDUWLFLSDQWV EXW RQ WKH RWKHU KDQG WKH\ KDYH DQ HPRWLRQDO LPSDFW RQ SHRSOH .HUW]HU f ZRXOG DUJXH WKDW WKHUH LV D PLQLPXP RI FRQVHQVXV QHFHVVDU\ IRU VROLGDULW\ WR EXLOG XS %XW FHUWDLQO\ WKHUH LV VSDFH IRU DQ DUUD\ RI SRVLWLRQV WR EH UHSUHVHQWHG 7KH VWURQJ HPRWLRQDO GLPHQVLRQ RI ULWXDOV DQG KHQFH RI FHUWDLQ FROOHFWLYH DFWLRQ SUDFWLFHV LQIOXHQFHV SDUWLFLSDQWVn VROLGDULW\ )RU H[DPSOH SDUWLFLSDWLQJ LQ D GHPRQVWUDWLRQ HPRWLRQDOO\ LPSDFWV SHRSOH DV WKH\ MRLQWO\ SDUWLFLSDWH ZLWK VR PDQ\ RWKHU SHRSOH LQ D SDUWLFXODU VWUXJJOH .HUW]HU f 3DUWLFLSDWLQJ ZLWK D ODUJH QXPEHU RI SHRSOH ERRVWV SHRSOHnV VHQVH RI VHOI LPSRUWDQFH DV SDUWLFLSDQWV DUH RQ SDUDGH .HUW]HU f 7KLV LV SDUWLFXODUO\ VWURQJ IRU ZRPHQ HVSHFLDOO\ LQ VRFLHWLHV ZKHUH WKH\ KDYH WUDGLWLRQDOO\ EHHQ FRQILQHG WR WKH SULYDWH VSKHUH

PAGE 70

,W DOVR HQJHQGHUV IHHOLQJV RI EHORQJLQJ UHLQIRUFHG E\ WKH SDUDSKHUQDOLD RI ULWXDO LH VORJDQV VRQJV FKHHUV H[SUHVVLYH JHVWXUHV DQG XQLIRUPV WKDW V\PEROL]H IHHOLQJV RI FRPPRQ LGHQWLW\ DQG V\PSDWK\ WKH PRYHPHQW IRVWHUV %OXPHU LQ .HUW]HU f $V SURIHVVLRQDOL]HG RUJDQL]DWLRQV DUH WXUQLQJ PRUH WRZDUGV OREE\LQJ DQG UHVHDUFK DFWLYLWLHV WKDQ WRZDUGV PLFUROHYHO FRQVFLHQWL]DWLRQ RU SURWHVW DFWLYLWLHV DV WKH\ DUH PRYLQJ DZD\ IURP DWLYLGDGHV GH UXD VWUHHW DFWLYLWLHVf WKH\ PLJKW ORVH VRPH RI WKLV VROLGDULW\ EXLOGLQJ HOHPHQW ZKLFK HDVHV WKH PDLQWHQDQFH RI D VWURQJ VRFLDO EDVH IRU WKH PRYHPHQW ZKLFK ZRXOG DOORZ IRU IXUWKHU GHPRFUDWL]DWLRQ &KDSWHU ZLOO DGGUHVV WKHVH LVVXHV &RQFOXVLRQ $ IXOO XQGHUVWDQGLQJ RI VRFLDO PRYHPHQW G\QDPLFV UHTXLUHV FRPELQLQJ UHVRXUFH PRELOL]DWLRQ WKHRU\ IRFXVLQJ RQ VWUDWHJ\f DQG QHZ VRFLDO PRYHPHQW WKHRU\ IRFXVLQJ RQ LGHQWLW\f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f LQ D YHU\ GHWDLOHG IDVKLRQ 6X]DQQH 6WDJJHQERUJnV f VWXG\ RI WKH SURIHVVLRQDOL]DWLRQ RI WKH 86 SURFKRLFH PRYHPHQW DQG KHU GLVWLQFWLRQ EHWZHHQ SURIHVVLRQDOL]DWLRQ IRUPDOL]DWLRQ DQG

PAGE 71

LQVWLWXWLRQDOL]DWLRQ DV ZHOO DV WKH IHHGEDFN PHFKDQLVPV DPRQJ WKHP SURYLGHG P\ VWXG\ ZLWK D JUHDW SRLQW RI GHSDUWXUH DQG RI FRPSDULVRQ -HQNLQV DQG (FNHUWnV f QRWLRQ RI FKDQQHOLQJ RI VRFLDO PRYHPHQWV E\ HOLWH IXQGLQJ DOVR SURYHG YHU\ XVHIXO 7KH IROORZLQJ FKDSWHU ZLOO WXUQ WR WKH VSHFLILFV RI WKH FDVH DW KDQG QDPHO\ WKH %UD]LOLDQ ZRPHQnV PRYHPHQW DQG LWV SDUWLDO IRUPDOL]DWLRQSURIHVVLRQDOL]DWLRQ WKURXJK WKH FUHDWLRQ RI QRQJRYHUQPHQWDO RUJDQL]DWLRQV 1*2Vf

PAGE 72

&+$37(5 121*29(510(17$/ 25*$1,=$7,216 $1' 7+( :20(1f6 029(0(17 EHOLHYH WKDW 1*2V DUH WKH IDFH RI VRFLDO PRYHPHQWV LQ WKH V WKLQN WKDW WKH GLVWLQFWLRQ PDGH EHWZHHQ PRYHPHQW DQG 1*2 LV RIWHQ DUWLILFLDO >@ :RPHQfV 1*2V IRU H[DPSOH WRGD\ WKLQN WKDW WKH\ DUH QRW UHDOO\ VXSSRUW RUJDQL]DWLRQV IRU WKH ZRPHQfV PRYHPHQW 7KH\ DUH WKH ZRPHQfV PRYHPHQW 7KH ZRPHQfV PRYHPHQW WRGD\ LV PDGH XS RI ZRPHQfV 1*2V DQG D IHZ DVVRFLDWLRQV >OHDGHU RI D IHPLQLVW SURIHVVLRQDOL]HG RUJDQL]DWLRQ@ :KDW LV WKH EDVLF GLIIHUHQFH EHWZHHQ DQ 1*2 LQ %UD]LO DQG D VRFLDO PRYHPHQW RUJDQL]DWLRQ" ,W LV WKDW LQ WKH HQG LQ WKH YHU\ HQG DQ 1*2 LV D PLFUR RU D PHGLXPVL]HG ILUP >@ SURIHVVLRQDO IHPLQLVWV@ KDYH D SODFH LQ RXU KHDUWV \RX DUH OHJLWLPDWH PHPEHUV RI WKLV PRYHPHQW EXW \RXfUH QRW WKH ERVV >DFWLYH PHPEHU RI D YROXQWHHU IHPLQLVW RUJDQL]DWLRQ@ ,QWURGXFWLRQ $W WKH FORVH RI WKH V WKH WHUP QRQJRYHUQPHQWDO RUJDQL]DWLRQ 1*2f ZDV KDUGO\ HYHU KHDUG DPRQJ %UD]LOLDQ IHPLQLVW DFWLYLVWV 7KHUH ZHUH IHPLQLVW JURXSV RI YDULRXV VRUWV EXW QR 1*2V
PAGE 73

PRUH YLEUDQW FRPPHUFLDO DQG SURIHVVLRQDO PLGGOH FODVV DQG LQFUHDVHG GHPDQGV IRU D ZLGH UDQJH RI VSHFLDOL]HG VHUYLFHV6DORPRQ t $QKHLHU f )URP D PRUH VWULFWO\ SROLWLFDO SRLQW RI YLHZ WKH HQG RI WKH FROG ZDU LV DOVR XQGHUVWRRG DV D PDMRU HYHQW ZKLFK JDYH 1*2V D FKDQFH WR EH PRUH DFWLYH LQ FRXQWULHV RWKHU WKDQ WKHLU RZQ ZLWKRXW EHLQJ DFFXVHG RI LQWHUIHUHQFH 7KH\ DOVR ZHUH DEOH WR VKLQH RQ WKH LQWHUQDWLRQDO SROLWLFDO VFHQH QDPHO\ DW WKH 8QLWHG 1DWLRQV ZKHUH VHFXULW\ DQG QXFOHDU WKUHDWV UHFHGHG WR OHDYH VSDFH IRU ORZ SROLWLFV LQ ZKLFK 1*2V KDG DFFXPXODWHG NQRZOHGJH DQG H[SHULHQFH *RUGHQNHU t :HLVV f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f DV ZHOO DV D QXPEHU RI WKHRULVWV LQ WKH ILHOG DUJXH WKDW 1*2V DUH QRW VRFLDO PRYHPHQWV )RZHUDNHU *RUGHQNHU t :HLVV f ZKLOH RWKHUV DUJXH WKDW 1*2V UHSUHVHQW WKH QHZ IDFH RI VRFLDO PRYHPHQWV JLYHQ WKH QHZ SROLWLFDO PDNHXS RI /DWLQ $PHULFDQ IOHGJOLQJ GHPRFUDFLHV 'RLPR +RFKVWHWOHU f 7KH ODQGVFDSH LV PXUN\ LQGHHG HYHQ PRUH VR IRU WKH ZRPHQfV PRYHPHQW DQG RWKHU LGHQWLW\EDVHG PRYHPHQWV VXFK DV WKH EODFN PRYHPHQW DV ZLOO DUJXH IXUWKHU LQ WKLV FKDSWHU ZLOO VWDUW E\ H[SORULQJ WKH RULJLQV RI WKLV QHZ VRFLDO DQG SROLWLFDO DFWRU WKH 1*2 WKDW HPHUJHG ZLWK WKH WUDQVLWLRQ WR IRUPDO GHPRFUDF\ ZLOO WKHQ WXUQ P\ IRFXV RQWR WKH ZRPHQfV PRYHPHQW DQG KRZ 1*2V HPHUJHG ZLWKLQ WKLV PRYHPHQW ZLOO WKHQ FRQVLGHU WKH DUHDV RI IX]]LQHVV RI WKH GHILQLWLRQ RI 1*2V DPRQJ IHPLQLVW DFWLYLVWV DQG WKH HQVXLQJ

PAGE 74

WHQVLRQV ZKLFK FRUUHVSRQG WR FULWLFLVPV RU SUREOHPDWLF LVVXHV UDLVHG E\ WKH DFDGHPLF OLWHUDWXUH RQ 1*2V ,Q WKH HQG P\ XQGHUVWDQGLQJ LV WKDW IHPLQLVW 1*2V DUH LQGHHG SDUW RI WKH ZRPHQnV PRYHPHQW DOWKRXJK WKH\ DUH WKH PRVW LQVWLWXWLRQDOL]HG DQG SROLF\ DUHQD RULHQWHG IDFH RI WKLV PRYHPHQW 7KH 6RFLDO &RQVWUXFWLRQ RI D 1HZ 3ROLWLFDO $FWRU 1RQJRYHUQPHQWDO 2UJDQL]DWLRQV 7KH 2ULJLQV 3RSXODU (GXFDWLRQ &HQWHUV DQG WKH 'LFWDWRUVKLS 7KH ILUVW %UD]LOLDQ QRQJRYHUQPHQWDO RUJDQL]DWLRQV OLNH PRVW VRXWKHUQ 1*2V HPHUJHG LQ WKH V IURP D VKLIW RI QRUWKHUQ 1*2Vn IXQGLQJ SROLFLHV WRZDUGV LQGLJHQRXV HIIRUWV EDVHG RQ QHZ WKLQNLQJ E\ 7KLUG :RUOG LQWHOOHFWXDOV RQ GHYHORSPHQW WKHRU\ DQG SUDFWLFHV DQG IURP WKH LQIOXHQFH RI /LEHUDWLRQ 7KHRORJ\ ERWK RI ZKLFK HPSKDVL]HG WKH QHHG WR ZRUN IURP WKH JURXQG XS 7KH UHPRYDO RU UHVLJQDWLRQ RI SURIHVVLRQDOV IURP WKH SXEOLF VHFWRU DIWHU JRYHUQPHQW SROLF\ FKDQJHV E\ DXWKRULWDULDQ JRYHUQPHQWV DOVR SOD\HG D SDUW &DUROO &ODUN /DQGLP Df +RZHYHU WKHVH JURXSV GLG QRW FDOO WKHPVHOYHV 1*2V DW WKH WLPH WKH\ ZHUH NQRZQ DV SRSXODU HGXFDWLRQ FHQWHUV FHQWURV GH HGXFDQGR SRSXODUf RI YDULDQWV WKHUHRI 1HLWKHU GLG WKH\ DVVXPH WKH DGYRFDF\ UROH WKDW ZH QRZ DVVRFLDWH ZLWK 1*2V $GYRFDF\ ZDV KDUGO\ D FKRLFH ZLWK D UHSUHVVLYH FRQVHUYDWLYH UHJLPH )LUVW LW LV ZRUWK QRWLQJ WKDW DLG WR WKH WKLUG ZRUOG WUDQVIHUUHG WKURXJK $PHULFDQ &DQDGLDQ DQG (XURSHDQ QRQJRYHUQPHQWDO DJHQFLHV LQFUHDVHG E\ b EHWZHHQ /DQGLP D f $Q LQFUHDVLQJO\ VL]DEOH SRUWLRQ RI WKHVH PRQH\V FRPH IURP JRYHUQPHQWDO VXEVLGLHV WKURXJK WKH (XURSHDQ (FRQRPLF &RPPXQLW\ RU WKH 2(&' IRU H[DPSOHf WR 1RUWKHUQ QRQJRYHUQPHQWDO RUJDQL]DWLRQV VXFK DV 2[IDP LELGf ,Q

PAGE 75

DFFRUGLQJ WR 81'3 GDWD 1*2 WUDQVIHUV IURP WKH QRUWK WR WKH VRXWK UHSUHVHQWHG WKH HTXLYDOHQW RI b RI RIILFLDO JRYHUQPHQWDO DLG )HUQDQGHV f ,Q DERXW b RI 86 IRUHLJQ DLG ZDV FKDQQHOHG WKURXJK 1*2V *RUGHQNHU t :HLVV f ,Q WKH V WKH 1RUWKHUQ 1*2V ZKLFK ILQDQFHG /DWLQ $PHULFDQ RUJDQL]DWLRQV ZHUH ODUJHO\ OLQNHG WR FKXUFKHV PRVWO\ (XURSHDQ DW WKDW SRLQW DQG KDG GHYHORSHG D FULWLFDO YLHZ RI WKHLU JRYHUQPHQWVn LQWHUQDWLRQDO SROLFLHV /DQGLP Df 7KLV HQFRXUDJHG WKHP WR ILQDQFH JURXSV ZLWK VLPLODU LGHDV WR WKHLU RZQ LQ FRXQWULHV RI WKH 6RXWK /DWLQ $PHULFDQ SROLWLFDO H[LOHV SDUWLFLSDWHG LQ (XURSHDQ 1*2V DQG KHQFH DOWHUHG WKH ZD\ WKHVH RUJDQL]DWLRQV VDZ /DWLQ $PHULFDQ UHDOLW\ DQG ZKDW WKHLU DFWLRQ VKRXOG EH /DQGLP D 'RLPR f 0HDQZKLOH LQ %UD]LO FULWLFLVP ZDV PRXQWLQJ DJDLQVW FRPPXQLW\ GHYHORSPHQW SUDFWLFHV ZKLFK HYROYHG LQ WKH VV IURP 86 SRVLWLYLVW VRFLRORJ\ 2U UDWKHU WKH QHHG ZDV IHOW IRU D SROLWLFL]DWLRQ RI WKHVH SUDFWLFHV XQYHLOLQJ WKH FODVV DQG SRZHU UHODWLRQV DW WKH URRW RI FRPPXQLW\ SUREOHPV /DQGLP Df 3DXOR )UHLUHnV PHWKRGRORJ\ IRU DGXOW HGXFDWLRQ DQG OLWHUDF\ SURYLGHG HVVHQWLDO DGGLWLRQDO LGHRORJLFDO DQG PHWKRGRORJLFDO VXSSRUW IRU WKHVH SRSXODU HGXFDWLRQ FHQWHUV ZKLFK ZHUH ODWHU WR EHFRPH 1*2V 'RLPR f :LWK WKH EHJLQQLQJ RI WKH FULVLV RI 0DU[LVP HVSHFLDOO\ LQ LWV nGHPRFUDWLF FHQWUDOLVWn IRUP DQG GLVFRYHULQJ *UDPVFL LQ WKH V /DWLQ $PHULFDQ LQWHOOHFWXDOV VWDUWHG WR YDOXH PLFURWUDQVIRUPDWLRQV LQ GDLO\ VSDFHV DQG LQWHUSHUVRQDO UHODWLRQV 'RLPR f 7KH GLFWDWRUVKLS SHULRG IRVWHUHG WKH LPSOHPHQWDWLRQ RI WKHVH LGHDV VLQFH DQ\ KLJKO\ YLVLEOH SROLWLFDO ZRUN ZRXOG KDYH EHHQ SURKLELWHG OHIWLVWV ZRUNHG DW PLFUROHYHO WUDQVIRUPDWLRQV RIWHQ XQGHU WKH SURWHFWLYH DUP RI WKH &DWKROLF &KXUFK

PAGE 76

,Q IDFW PHPEHUV RI WKH SURJUHVVLYH &DWKROLF &KXUFK DQG WR D OHVVHU H[WHQW RWKHU FKXUFKHV ZHUH SDUDPRXQW LQ WKH FUHDWLRQ RI WKH ILUVW FHQWHUV IRU SRSXODU HGXFDWLRQ ZKLFK GHILQHG WKHPVHOYHV HQWLUHO\ DV VXSSRUW RUJDQL]DWLRQV IRU ORFDOL]HG SRSXODU PRYHPHQWV 7KH\ SURYLGHG VXSSRUW IRU SRSXODU PRYHPHQWV DVVHVVRULD DRV PRYLPHQWRV SRSXODUHVf /DQGLP D 'RLPR f 7KH WHUP DVVHVVRULD VXSSRUWf DOWKRXJK ZLGHO\ XVHG LV LWVHOI DPELJXRXV DQG GHILQHV PRUH D W\SH RI UHODWLRQVKLS WKDQ D SDUWLFXODU DFWLYLW\ ,W LV UHODWHG WR WKH WUDQVPLVVLRQ RI VRPH VRUW RI FRPSHWHQFH DQG NQRZOHGJH ZKLFK LQYROYHV PXWXDO WUXVW DQG VRPH GHJUHH RI DIILQLW\ RI JRDOV )HUQDQGHV t &DUQHLUR f $FFRUGLQJ WR )HUQDQGHV t &DUQHLURnV VXUYH\ f DV PDQ\ DV SHUFHQW RI1*2 OHDGHUV LQ %UD]LO LGHQWLI\ WKHPVHOYHV ZLWK /LEHUDWLRQ 7KHRORJ\ DQG WKH &KXUFKnV SDVWRUDOV ,Q WKH V 0DU[LVWV ZKRVH SDUWLHV ZHUH LOOHJDO LQFUHDVLQJO\ MRLQHG WKHVH FHQWHUV LQ RUGHU WR EH DEOH WR GR VRPH VRUW RI SROLWLFDO ZRUN :KHUHDV WKH\ LQWHQVLILHG WKH SROLWLFL]DWLRQ RI WKH FRPPXQLW\ ZRUN GRQH E\ WKH FHQWHUV WKH\ OHDUQHG IURP SURJUHVVLYH &KULVWLDQV KRZ WR SXW 0DU[LVP LQWR SUDFWLFH LQ FRPPXQLW\ ZRUN /DQGLP Df 2QH RI WKH IHPLQLVWV ZKR ODWHU IRXQGHG 626 &RUSR DQG ZKR KDG EHHQ D PHPEHU RI RQH RI WKHVH FHQWHUV LQ 5HFLIH WROG /HLODK /DQGLP DOUHDG\ KDG 0DU[LVP %XW WKH PHWKRG WKH IRFXV RQ SURFHVV DQG RQ WKH SRSXODU VHFWRUV DV VXEMHFWV RI WKHLU KLVWRU\ WKLV OHDUQW ZLWK WKHP WKH -HVXLWV RI &($6 LQ 3HUQDPEXFRf 7KH UHILQHG WUDQVODWLRQ RI 0DU[LVP WR LWV SUDFWLFH RI KRZ WR WUDQVODWH LW LQWR D PHWKRG ,Q WHUPV RI LQWHUYHQWLRQ OHDUQHG D ORW TXRWHG LQ /DQGLP Df )URP /LEHUDWLRQ 7KHRORJ\ DQG FRPPXQLW\ GHYHORSPHQW WKH FHQWHUV DQG WKHQ 1*2V LQKHULWHG WKHLU SDUWLFLSDWRU\ HWKRV /DQGLP D f )URP /LEHUDWLRQ 7KHRORJ\ WKH\ DOVR LQKHULWHG WKH DQWLLQWHOOHFWXDOLVP UHMHFWLRQ RI PDUNHW SULQFLSOHV DQG HPSKDVLV RQ GLUHFW 6WLOO LQ b RI WKH %UD]LOLDQ 1*2V LQWHUYLHZHG LQ )HUQDQGHV t &DUQHLURnV VXUYH\ ZHUH ILQDQFHG SULQFLSDOO\ E\ FKXUFKOLQNHG DJHQFLHV )HUQDQGHV t &DUQHLUR f

PAGE 77

GHPRFUDF\ ZKLFK DUH FRQVWLWXWLYH RI WKH SROLWLFDO FXOWXUH RI &KULVWLDQ %DVH &RPPXQLWLHV )HUQDQGHV f $ VWURQJ VHQWLPHQW DJDLQVW DQ\WKLQJ LQVWLWXWLRQDO RU FHQWUDOL]LQJ ZDV WKH IUXLW RI WKH LQIOXHQFH RI SURJUHVVLYH &DWKROLFLVP DV ZHOO DV RI VHOIFULWLFLVP RQ WKH /HIW /LNH VRFLDO DQG SRSXODU PRYHPHQWV 1*2V EHOLHYHG LQ RSRYR FRPR VXMHLWR GH VXDSURSLD KLVWRULD 'RLPR f $XWRQRP\ DQG GLUHFW GHPRFUDF\ ZHUH WKH HWKLFDO DQG SROLWLFDO SULQFLSOHV WKDW JXLGHG WKHP LELGf 1*2V WKXV EHFDPH PDUNHGO\ DQWLDVVLVWHQFLDOLVW DQG VWUHQJWKHQHG WKHLU LGHQWLW\ LQ RSSRVLWLRQ WR WUDGLWLRQDO SKLODQWKURSLF HQWHUSULVHV /DQGLP Df $W WKDW VWDJH 1*2V OLNH VRFLDO DQG SRSXODU PRYHPHQWV GLG QRW WUXVW WUDGLWLRQDO IRUPV RI SROLWLFDO UHSUHVHQWDWLRQ 'RLPR f PXFK OHVV WKH 6WDWH DQG RWKHU LQVWLWXWLRQV VXFK DV XQLYHUVLWLHV
PAGE 78

WKHLU UROH ZDV WKURXJK FRPLQJ WRJHWKHU LQ QHZ DUHQDV VXFK DV QDWLRQDO DVVRFLDWLRQVIRUD RQH RI WKH PRVW UHFHQW LV WKH %UD]LOLDQ $VVRFLDWLRQ RI 1*2V $%21*f FUHDWHG LQ f RU UHJLRQDO QHWZRUNV )LQDQFLQJ DJHQFLHV DOVR IDFLOLWDWHG WKH HPHUJHQFH RI DQ 1*2 LGHQWLW\ E\ EULQJLQJ WKHLU nSDUWQHUVn IURP WKH 6RXWK LQWR FRQWDFW ZLWK RQH DQRWKHU +RZHYHU WKLV SURFHVV KDV EHHQ VORZ DQG FRQWHVWHG VLQFH QRW DOO FHQWHUV ZKLFK JLYH DVVHVVRULD VXSSRUWf DJUHHG ZLWK WKH UHGHILQLWLRQ RI WKHLU UROH HYHQ LI WKH\ KDYH WDNHQ RQ WKH 1*2 ODEHO 7KH IDFW WKDW D KRVW RI QHZ HQWLWLHV ZLWK YDULHG RULJLQV DQG JRDOV LQFOXGLQJ SHRSOH FRPLQJ IURP XQLYHUVLWLHV JRYHUQPHQWDO RUJDQL]DWLRQV DQG DFWLYLVW FLUFOHV MXPSHG RQ WKH EDQGZDJRQ DQG FUHDWHG WKHLU RZQ 1*2 PLJKW KDYH KHOSHG LQ WKH UHGHILQLWLRQ RI WKH SLRQHHULQJ RUJDQL]DWLRQV SHUFHQW RI $%21* PHPEHUV ZHUH OHJDOO\ IRXQGHG DIWHU SHUFHQW EHWZHHQ f /DQGLP D;,f ,Q WKH QHZ FRQWH[W RI %UD]LOLDQ IRUPDO GHPRFUDF\ 1*2V DV ZHOO DV RWKHU JURXSV ZLWKLQ FLYLO VRFLHW\ VRIWHQHG WKHLU VWDQFH DJDLQVW LQVWLWXWLRQDOLW\ DQG VWDUWHG ZRUNLQJ ZLWKLQ WKH UHDOP RI LQVWLWXWLRQDO SROLWLFV 'RLPR 6FKHUHU:DUUHQ f 7KH SURFHVV WKDW OHG WR WKH FRQVWLWXWLRQ LQ ZKLFK QXPHURXV RUJDQL]HG FRQVWLWXHQFLHV SDUWLFLSDWHG FHUWDLQO\ LQWHQVLILHG WKLV G\QDPLF ,Q WKLV QHZ SROLWLFDO DQG HFRQRPLF FRQWH[W 1*2V KDYH VHHQ WKHLU UROH QR ORQJHU VR PXFK DV D VXSSRUW IRU SRSXODU PRYHPHQWV EXW UDWKHU DV EXLOGHUV RI FLYLO VRFLHW\ LQ WKHLU VWUXJJOH IRU FLWL]HQVKLS D OXD SHOD FLGDGFX£f DORQJ ZLWK SRSXODU DQG VRFLDO PRYHPHQWV $JDLQ WKH\ DUH FODLPLQJ WKHLU RZQ YRLFH 7KH SKUDVH FLYLO VRFLHW\ LWVHOI KDV D ORQJ KLVWRU\ ZLWK FKDQJLQJ PHDQLQJV 6FKHUHU :DUUHQ f ZLOO UHVWULFW P\ RYHUYLHZ WR WKH FRQFHSW RI FLYLO VRFLHW\ DV LW LV XVHG LQ UHFHQW \HDUV LQ WKH FRQWH[W RI VRFLDO PRYHPHQW UHVHDUFK &LYLO VRFLHW\ KDV EHHQ GHILQHG LQ WZR GLIIHUHQW ZD\V HLWKHU LQ RSSRVLWLRQ WR WKH 6WDWH DORQH RU DV D WKLUG VHFWRU LQ RSSRVLWLRQ

PAGE 79

WR ERWK WKH 6WDWH DQG WKH 0DUNHW 6FKHUHU:DUUHQ f $FFRUGLQJ WR WKH ILUVW VFKRRO FLYLO VRFLHW\ UHSUHVHQWV DOO IRUPV RI PRELOL]DWLRQ RUJDQL]DWLRQ DQG DVVRFLDWLRQ RXWVLGH RI VWDWH LQVWLWXWLRQV 7KH VHFRQG WUHQG FRQVLGHUV FLYLO VRFLHW\ WR EH QRW RQO\ QRQJRYHUQPHQWDO EXW DOVR QRQSURILW LH LW GRHV QRW REH\ WKH ODZV RI WKH PDUNHW V\VWHP LELGf $PRQJ WKH ODWWHU VRPH VFKRODUV FRQVLGHU WKH WKLUG VHFWRU WR UHIHU WR DOO YROXQWDU\SKLODQWKURSLF QRQJRYHUQPHQWDO QRQSURILW RUJDQL]HG HQGHDYRUV ZKLOH WKH WHUP FLYLO VRFLHW\ LV UHVWULFWHG WR WKRVH HQGHDYRUV WKDW VWUXJJOH IRU FLWL]HQVKLS DQG GHPRFUDWL]DWLRQ 2WKHU VFKRODUV WKH PRVW SURPLQHQW RI ZKLFK LV $ODQ :ROIH GR QRW GLVWLQJXLVK EHWZHHQ WKH WKLUG VHFWRU DQG FLYLO VRF LHW\ LQ ZKLFK WKH\ LQFOXGH DOO IRUPV RI PXWXDO KHOS VROLGDU\ DFWLRQV DW WKH FRPPXQLW\ DQG WKH IDPLO\ OHYHO LELGf /DQGLP Ef KDV VKRZQ WKDW SKLODQWKURS\ DQG 1*2V GR VKDUH VRPH FRPPRQ JURXQG DOWKRXJK 1*2V LQ WKHLU DWWHPSW WR FUHDWH WKHLU RZQ LGHQWLW\ KDYH UHMHFWHG WUDGLWLRQDO SKLODQWKURS\ +RZHYHU WKH GLPHQVLRQ RI ZRUNLQJ IRU RWKHUV RI WKH SXEOLF JRRG DQG DOWUXLVP DUH YHU\ SUHVHQW LQ WKH ZRUN RI ERWK 7KH QHZ HPSKDVLV RQ EXLOGLQJ FLYLO VRFLHW\ UDWKHU WKDQ VWUHQJWKHQLQJ SRSXODU PRYHPHQWV LV SDUW RI WKH SRVLWLYH OHVV DQWLLQVWLWXWLRQDO VWDQFH RI 1*2V LQ WKH QHZ SROLWLFDO FRQWH[W 'RLPR f /DQGLP DOVR QRWHG WKDW 1*2V DUH GURSSLQJ WKH WHUP SRSXODU IURP WKHLU QDPHV DQG DFWLYLWLHV DQG ZRQGHUV ZKHWKHU LW LV WKH UHVXOW RI WKH JHQHUDO SXOO WRZDUGV OLEHUDOLVP Df 7KH EHVW H[DPSOH RI KRZ VWUXJJOH IRU FLWL]HQVKLS DQG PRUH HPHUJHQF\RULHQWHG SKLODQWKURS\ FDQ EH OLQNHG LV WKH &DPSDLJQ DJDLQVW +XQJHU DQG IRU &LWL]HQVKLS &DPSDQKD FRQWUD D IRPH H SDUD D FLGDGDQLDf ODXQFKHG E\ WKH 5LREDVHG 1*2 ,%$6( 7KLV FDPSDLJQ UHVSRQGV WR WKH LPPHGLDWH QHHG WR VDWLVI\ WKH QHHG RI WKH KXQJU\ EXW LV VHW ZLWKLQ WKH ODUJHU IUDPHZRUN RI D VWUXJJOH IRU FLWL]HQVKLS IRU DOO LQ WKDW LW DLPV WR FRQVFLHQWL]H ERWK LQGLYLGXDO GRQRUV DQG UHFLSLHQWV RQ WKH VWUXFWXUDO FDXVHV RI SRYHUW\ DQG KXQJHU /DQGLP E 6FKHUHU:DUUHQ f

PAGE 80

:H FDQ VD\ WKDW %UD]LOLDQ 1*2V KDYH PXOWLSOLHG LQ WKH V GXH WR f WKH H[SDQVLRQ RI LQWHUQDWLRQDO ILQDQFLDO DQG SROLWLFDO FRRSHUDWLRQ f WKH HPSKDVLV RQ SULYDWL]DWLRQ E\ QHROLEHUDO JRYHUQPHQWV NLFNHG RII E\ 5HDJDQnV VSHHFK WKH PDJLF RI WKH PDUNHW GHOLYHUHG DW WKH 1RUWK6RXWK FRQIHUHQFH LQ &DQFQ LQ (VFREDU f 7KLV UHVXOWHG LQ D PRYH DZD\ IURP WKH ILQDQFLQJ RI JRYHUQPHQW HIIRUWV WRZDUGV WKH ILQDQFLQJ RI WKH SULYDWH VHFWRU E\ PXOWLODWHUDO DJHQFLHV f WKH LQWHUQDO UHGHILQLWLRQ RI WKHLU SROLWLFDO UROH E\ SURSRQHQWV RI VRFLDO FKDQJH LQ UHVSRQVH WR FKDQJLQJ SROLWLFDO FLUFXPVWDQFHV LQ GHPRFUDWL]LQJ %UD]LO 2WKHU IDFWRUV WKDW QHHG WR EH WDNHQ LQWR DFFRXQW DUH f WKH UHWXUQ RI H[LOHV DQG f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f KDYH SRLQWHG RXW FKDQJHV LQ WKH LQWHUQDWLRQDO SROLWLFDO VFHQH DV ZHOO DV QHZ FRPPXQLFDWLRQ WHFKQRORJLHV KDYH LQFUHDVHG WKH UROH VHFWRUV RI FLYLO VRFLHW\ FRXOG SOD\ LQ WKH SROLF\IRUPXODWLRQ SURFHVV 7KH WHUP 1*2 ZDV DOVR LPSRUWHG LQWR /DWLQ $PHULFD YLD ILQDQFLQJ DJHQFLHV WR GHVLJQDWH WKH LQWHUPHGLDU\ RUJDQL]DWLRQV ZKLFK LPSOHPHQW WKHLU SURMHFWV ZLWK JUDVVURRWV RUJDQL]DWLRQV 6FKHUHU:DUUHQ f 7KLV LV \HW DQRWKHU H[DPSOH ,Q 3RUWXJXHVH 2QJV" 2QH %LFKR ‹ (VVH"

PAGE 81

RI KRZ 1RUWKHUQ LQVWLWXWLRQV KDYH UHWDLQHG WKH SRZHU WR QDPH DQG KHQFH SDUWO\ WR GHILQH UHDOLW\ LQ WKLV SDUW RI WKH ZRUOG ,Q %UD]LO LW ZDV WKH 8QLWHG 1DWLRQV FRQIHUHQFH RQ (QYLURQPHQW DQG 'HYHORSPHQW 81&('f KHOG LQ LQ 5LR GH -DQHLUR DQG FRPPRQO\ NQRZQ DV (FR ZKLFK EURXJKW WKH WHUP 1*2 LQWR SXEOLF SXUYLHZ WKURXJK WKH PHGLD /DQGLP D 6FKHUHU:DUUHQ f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f 7KH DVVRFLDWLRQ KDG 1*2 PHPEHUV DV RI -DQXDU\ :LWK UHJDUG WR LWV PHPEHUVKLS FULWHULD $%21*nV PRQWKO\ QHZVOHWWHU R -RUQDO GD $%21* DQQRXQFHV WKDW WKH DVVRFLDWLRQ ZHOFRPHV RUJDQL]DWLRQV ZKLFK f DUH DXWRQRPRXV IURP WKH 6WDWH FKXUFKHV SROLWLFDO SDUWLHV DQG VRFLDO PRYHPHQWV >P\ HPSKDVLV@ f DUH FRPPLWWHG WR WKH EXLOGLQJ RI D GHPRFUDWLF VRFLHW\ ZKLFK LQFOXGHV UHVSHFW IRU GLYHUVLW\ DQG SOXUDOLVP f KDYH D SXEOLF FKDUDFWHU LQ WHUPV RI WKH DFWLRQV WKH\ DUH LQYROYHG LQ f DUH )RU W\SRORJLHV RI 1*2V VHH IURP DQ LQWHUQDWLRQDO SROLWLFV SRLQW RI YLHZ *RUGHQNHU DQG :HLVV f DQG IURP DQ LQWHUQDWLRQDO GHYHORSPHQW DLG SHUVSHFWLYH &DUUROO f

PAGE 82

UHFRJQL]HG DV D OHJDO HQWLW\ WHUQ SHUVRXDOLGDGH MXUGLFD SURSLDnnf ZLWK QRQSURILW PRWLYHV f FDQ MXVWLI\ DW OHDVW \HDUV RI H[SHULHQFH -RUQDO GD $%21* -DQXDU\ S f 7KHVH PHPEHUVKLS FULWHULD UHLQIRUFH WKH LGHD WKDW 1*2V DUH GHILQHG PDLQO\ LQ RSSRVLWLRQ WR RWKHU LQVWLWXWLRQV 7KH\ DUH QRQSURILW DQG WKH\ DUH QRQJRYHUQPHQWDO 7KH\ DOVR GLVWLQJXLVK WKHPVHOYHV IURP WUDGLWLRQDO SKLODQWKURSLF LQVWLWXWLRQV DQG WKHLU DVVLVWHQWLDOLVP 7KHVH FULWHULD GR QRW PHQWLRQ WKH SULYLOHJHG UHODWLRQV RI 1*2V WR SRSXODU PRYHPHQWV EXW VWULFWO\ GUDZ WKH OLQH EHWZHHQ 1*2V DQG VRFLDO PRYHPHQWV UHIOHFWLQJ WKH FKDQJLQJ UHODWLRQV RI 1*2V ZLWK SRSXODU PRYHPHQWV $%21*nV FULWHULD DUH TXLWH VSHFLILF +RZHYHU WKH DFURQ\P 1*2 FDUULHV WKH WUDGHPDUN RI SRO\VHP\ DQG WKHUHIRUH RI WKH SRVVLELOLW\ RI GLIIHUHQWLDWHG XVH E\ YDULRXV JURXSV WUD] D PDUFD GD SROLVVHPLD H SRUWDQWR GD SRVVLELOLGDGH GR XVR GLIIHUHQFLDGR SRU JUXSRV GLYHUVRVf /DQGLP Df ZKLFK PHDQV WKDW GLIIHUHQW JURXSV ZLOO XVH LW ZLWK GLIIHUHQW PHDQLQJV LQ GLIIHUHQW FLUFXPVWDQFHV DJUHH ZLWK /DQGLP Df WKDW WKLV LV LQ SDUW GXH WR WKH IDFW WKDW WKH ERXQGDULHV RI WKH 1*2 VRFLDO ILHOG ZLWK DGMDFHQW ILHOGV DUH QRW ZHOOGHILQHG VR WKDW JURXSV SOD\ ZLWK WKHLU LGHQWLW\ DFFRUGLQJ WR WKH FRQWH[W )HPLQLVW 1*2V DUH D FDVH LQ SRLQW DV WKH LQWURGXFWRU\ TXRWHV WR WKLV VHFWLRQ KLQW DW 2I SDUWLFXODU LQWHUHVW WR PH LV WKH ERXQGDU\ EHWZHHQ ZRPHQnV 1*2V DQG WKH ZRPHQnV PRYHPHQW ZLOO QRZ VNHWFK WKH VWRU\ RI WKH ZRPHQfV PRYHPHQW LQ %UD]LO DQG WKH HPHUJHQFH RI WKHVH SURIHVVLRQDOL]HG HQWLWLHV ZLWKLQ LW 7KH 6WRU\ RI WKH %UD]LOLDQ :RPHQnV 0RYHPHQW 7KH %UD]LOLDQ ZRPHQnV PRYHPHQW OLNH RWKHU ZRPHQfV PRYHPHQWV LQ /DWLQ $PHULFD UHIOHFWV WKH JUHDW GLYHUVLW\ RI WKH FRXQWU\ LQ WHUPV RI UDFH FODVV VH[XDO RULHQWDWLRQ

PAGE 83

JHQHUDWLRQ DQG UHJLRQDO RULJLQ ,W KDV EURXJKW WRJHWKHU VHOIGHFODUHG IHPLQLVWV RULJLQDOO\ PRVWO\ ZHOOHGXFDWHG ZKLWH PLGGOH FODVV ZRPHQ DGRSWLQJ D ORQJ UDQJH VWUDWHJ\ IRFXVLQJ RQ JHQGHU HTXDOLW\ DQG ZRPHQ ZKR GR QRW UHIHU WR WKHPVHOYHV DV IHPLQLVWV IURP WKH SRRU DQG ZRUNLQJ FODVV ZKR RUJDQL]HG DURXQG IDPLO\ DQG FRPPXQLW\ VXUYLYDO LVVXHV RU LQ XUEDQ DQG UXUDO WUDGH XQLRQV HWF 7KH ERXQGDULHV EHWZHHQ IHPLQLVP DQG RWKHU FRPSRQHQWV RI WKH ZRPHQnV PRYHPHQW DUH QRW FOHDUFXW DV VRPH RI WKH LVVXHV GHDOW ZLWK E\ QRQIHPLQLVW QHLJKERUKRRG ZRPHQ VXFK DV FRQWUDFHSWLRQ DQG FKLOG FDUH DOUHDG\ DGGUHVVHG JHQGHU LQHTXDOLW\ 5DGFOLIIH DQG :HVWZRRG f 0RUHRYHU $PULWD %DVX f ZDUQV XV QRW WR OLPLW RXU UHDGLQJ RI IHPLQLVP WR LWV PLGGOH FODVV :HVWHUQ H[SUHVVLRQ RU WR IDLO WR UHFRJQL]H LW ZKHQ ZRPHQ IRU RQH UHDVRQ RU DQRWKHU UHIXWH WKH ODEHO EXW QRW WKH LGHDV RU WKH SUDFWLFHV 7KH GLVWLQFWLRQ KDV EHFRPH HYHQ PRUH EOXUUHG DV D QXPEHU RI ZRPHQ IURP DOO ZDONV RI OLIH KDYH VWDUWHG WR DFNQRZOHGJH WKHLU IHPLQLVW LGHQWLW\ RIWHQWLPHV UDGLFDOO\ UHGHILQLQJ ZKDW LW HQWDLOV $OYDUH] 6RDUHV HW DO f 2YHUFRPLQJ WKH WKHRUHWLFDO QRWLRQ RI D XQLWDU\ ZRPDQ KDV VWDUWHG WR EHFRPH DOWKRXJK VWLOO WLPLGO\ D SUDFWLFDO UHDOLW\ IRU %UD]LOLDQ IHPLQLVP ,W KDV nJRQH SOXUDOn DV 6RQLD $OYDUH] Df FRJHQWO\ SXWV LW 6WDUWLQJ IURP WKH EHJLQQLQJ VRPH WZR GHFDGHV DJR WKH VWRU\ RI WKH %UD]LOLDQ ZRPHQnV PRYHPHQW DQG LWV GLIIHUHQW FRPSRQHQWV ZRXOG UXQ DV IROORZV %\ WKH ODWH V LW KDG EHFRPH HYLGHQW WKDW WKH %UD]LOLDQ PLOLWDU\ UHJLPH KDG IDLOHG WR WUDQVIRUP WKH HFRQRPLF PLUDFOH LQWR D UHDOLW\ IRU DOO %UD]LOLDQV )LVKORZ f *UDVVURRWV RUJDQL]DWLRQV DQG SRSXODU PRYHPHQWV VSUDQJ XS LQ D FROOHFWLYH HIIRUW WR GHDO ZLWK WKH LQFUHDVLQJ GLIILFXOWLHV RI WKH ZRUNLQJ PDVVHV DQG WR RSSRVH WKH UHSUHVVLYH UHJLPH $OYDUH] .RZDULFN f %\ QRZ LW KDV EHHQ DFNQRZOHGJHG WKDW ZRPHQ UHSUHVHQW WKH PDMRULW\ RI SDUWLFLSDQWV LQ PDQ\ RI WKHVH JUDVVURRWV PRYHPHQWV QRW RQO\ LQ %UD]LO EXW LQ

PAGE 84

/DWLQ $PHULFD LQ JHQHUDO &DOGHLUD f ,Q %UD]LO DV WKURXJKRXW /DWLQ $PHULFD ZRPHQ RUJDQL]HG DURXQG WKHLU LGHQWLWLHV DV PRWKHUV DQG ZLYHV WR UHVLVW WKH DXWKRULWDULDQ PLOLWDU\ UHJLPHV ZLWK WKH KHOS RI WKH &DWKROLF &KXUFK DQG OHIWLVWRULHQWHG SDUWLHV $OYDUH] )LVKHU -HOLQ 6DID f %UD]LOLDQ ZRPHQ KDYH DOVR WDNHQ WR WKH VWUHHWV WR GHIHQG WKH ZHOOEHLQJ RI WKHLU IDPLOLHV DV WKH ZDJHVTXHH]LQJ GHYHORSPHQW VWUDWHJ\ RI WKH PLOLWDU\ FDXVHG D VHYHUH GHFOLQH LQ SXUFKDVLQJ SRZHU IRU WKH ORZ LQFRPH VWUDWD ,Q 6DR 3DXOR FLW\ PRUH WKDQ WZLFH DV PXFK ZRUN ZDV QHHGHG LQ HQG RI WKH %UD]LOLDQ HFRQRPLF PLUDFOHf WKDQ LQ WR REWDLQ WKH VDPH EDVLF IRRG EDVNHW .RZDULFN f 7KH VLWXDWLRQ ZRUVHQHG FRQVLGHUDEO\ ZLWK WKH HFRQRPLF FULVLV RI WKH HDUO\ V ZKHQ QDWLRQDO SULFHV IRU EDVLF IRRG LWHPV LQFUHDVHG E\ b %DUURVR DQG $PDGR f 7KH HQVXLQJ VWUXFWXUDO SROLFLHV :LUWK HW DO f DQG WKH PRUH UHFHQW UHFHVVLRQ DJJUDYDWHG DIWHU E\ WKH HFRQRPLF DGMXVWPHQW SROLFLHV RI WKH ILUVW HOHFWHG SUHVLGHQW )HUQDQGR &ROORU GH 0HOOR DQG KLV VXFFHVVRUV KDYH PHDQW IXUWKHU GZLQGOLQJ RI SXEOLF IXQGLQJ SULYDWL]DWLRQ RI VRFLDO SURJUDPV DQG D VKDUS LQFUHDVH LQ SRYHUW\ OHYHOV DOWKRXJK SDUDGR[LFDOO\ VRPH VRFLDO LQGLFDWRUV VHHP WR KDYH VOLJKWO\ LPSURYHG )DULD ,% $6( /RSHV f :RPHQ KDYH EHHQ HVSHFLDOO\ DIIHFWHG E\ WKHVH KDUGVKLSV $V VWXGLHV KDYH VKRZQ WKH\ ERUH PRVW RI WKH QHJDWLYH FRQVHTXHQFHV RI VWUXFWXUDO DGMXVWPHQW SURJUDPV ZKLFK FXW SXEOLF VHUYLFHV OLQNHG WR DUHDV RI VRFLDO UHSURGXFWLRQ VXFK DV KHDOWK DQG HGXFDWLRQf IRU ZKLFK ZRPHQ KDYH WUDGLWLRQDOO\ EHHQ UHVSRQVLEOH %DUURVR DQG $PDGR %HQHULD DQG )HOGPDQ 1DVK f +HDOWK FDUH LV D FDVH LQ SRLQW DV ZLOO GHPRQVWUDWH ODWHU 7KH OLQN EHWZHHQ WKH OHYHO RI KDUGVKLSV HQGXUHG DQG WKH OHYHO RI PRELOL]DWLRQ LV QRW D OLQHDU RQH WKRXJK DV DWWHVWHG E\ WKH IDFW WKDW WKH OHYHO RI PRELOL]DWLRQ WRGD\ LV ORZHU WKDQ LW XVHG WR EH GHVSLWH FRQWLQXLQJ DQG DW WLPHV ZRUVHQLQJ FRQGLWLRQV %HOLHI LQ SURVSHFWV IRU

PAGE 85

VXFFHVV RI FROOHFWLYH DFWLRQ DQG WKH VXSSRUWLQJ UROH RI RWKHU VHFWRUV RI FLYLO VRFLHW\ RU HYHQ RI LQVWLWXWLRQV DOVR SOD\ WKHLU SDUW $V IRU WKH %UD]LOLDQ IHPLQLVW PRYHPHQW $OYDUH] f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nV 'HFDGH IURP DQG WKH GLVFULPLQDWLRQ VXIIHUHG E\ ZRPHQ ZLWKLQ WKH VH[LVW DQG PDOHGRPLQDQW SROLWLFDO RUJDQL]DWLRQV RI WKH /HIW KDYH EURXJKW FUXFLDO LGHRORJLFDO DQG RUJDQL]DWLRQDO VXSSRUW WR WKH FUHDWLRQ RI DQ DXWRQRPRXV IHPLQLVW PRYHPHQW 7KH SHULRG RI OLEHUDOL]DWLRQ RI WKH PLOLWDU\ UHJLPH DIWHU WKH PLGV NQRZQ DV $EHUWXUD DQG WKH HQVXLQJ VWUHQJWKHQHG KRSH IRU VXFFHVVIXO SURWHVW DOVR IDYRUHG JURZWK RI KWH IHPLQLVW PRYHPHQW $OYDUH] 6FKPLQN f )LQDOO\ WKH HQFURDFKPHQW RI WKH DXWKRULWDULDQ VWDWH DQG WKH PDUNHW LQWR WKH SULYDWH VSKHUH ZKLFK LV ODUJHO\ D ZRPHQnV GRPDLQ FRPSULVLQJ UHOLJLRQ WKH IDPLO\ UHODWLRQV ZLWK NLQIRON DQG VRFLDO G\QDPLFV $UL]SH [YLLLf OHIW ZRPHQ HPSW\KDQGHG >ZLWK@ IHZ FKLOGUHQ VPDOO IDPLOLHV IHZHU VRFLDO FHUHPRQLHV DQG UHOLJLRXV ULWHV KLJKO\ IRUPDOL]HG XUEDQ FXVWRPV DQG SURJUDPPHG VRFLDO SUDFWLFHV LELG[Yf 7KH QHHG DURVH IRU ZRPHQ WR UHFRQVWUXFW DQ LGHQWLW\ ZKLFK PLGGOHFODVV ZRPHQ GLG LQ SDUW WKURXJK WKHLU IHPLQLVW JURXSV

PAGE 86

:RPHQ QHHGHG WR FUHDWH D GHPRFUDWLF SXEOLF VSDFH IRU WKHLU FROOHFWLYH LGHQWLWLHV DQG GHPDQGV &RKHQ f GLVFXVVHG LQ &KDSWHU WKH QHFHVVLW\ WR LQWHUWZLQH WKH WZR PDLQ VFKRROV RI VRFLDO PRYHPHQW WKHRU\ EHFDXVH VRFLDO PRYHPHQWV DUH VLPXOWDQHRXVO\ H[SUHVVLRQV RI JURXS LGHQWLW\ DQG FRQIOLFWV RI LQWHUHVW DQG EHFDXVH WKHVH WZR GLPHQVLRQV LPSLQJH RQ HDFK RWKHU 6LPLODUO\ ZH MXVW REVHUYHG WKDW LQ WKH FDVH RI WKH %UD]LOLDQ ZRPHQnV PRYHPHQW ERWK QHZ VRFLDO PRYHPHQW WKHRU\ DQG UHVRXUFH PRELOL]DWLRQ WKHRU\ DUH QHHGHG WR H[SODLQ LWV HPHUJHQFH )LJKWLQJ IRU WKHLU ULJKWVQHHGV VWUDWHJ\f KHOSHG ZRPHQ WR GHDO ZLWK WKH GLVUXSWLRQ RI ZRPHQnV WUDGLWLRQDO JHQGHU UROHV DQG WR IRUJH QHZ UROHV IRU WKHPVHOYHV LGHQWLW\f (PHUJHQFH RI ZRPHQnV KHDOWK PRYHPHQW $V PHQWLRQHG LQ P\ LQWURGXFWRU\ FKDSWHU WKH %UD]LOLDQ KHDOWK FDUH V\VWHP LV KLJKO\ GLFKRWRPL]HG DQG LQHJDOLWDULDQ 6LQFH ZRPHQ LQ %UD]LO DV ZHOO DV JOREDOO\ DUH UHVSRQVLEOH IRU WKH FDUH RI WKH VLFN WKH \RXQJ DQG WKH HOGHUO\ WKHLU EXUGHQ EHFDPH KHDYLHU DV PDOQXWULWLRQ %DUURVR t $PDGR f DQG XQVDQLWDU\ DQG FURZGHG KRXVLQJ FRQGLWLRQV LQFUHDVLQJO\ DIIHFWHG IDPLO\ KHDOWK 7KH VLWXDWLRQ ZDV DJJUDYDWHG E\ GLPLQLVKLQJ JRYHUQPHQW LQYHVWPHQW DQG IXUWKHU SULYDWL]DWLRQ RI SXEOLF VHUYLFHV WKURXJKRXW WKH V %ULVFRH &RKQ f $V D UHVXOW ORZLQFRPH ZRPHQ KDYH KDG WR WUDYHO ORQJHU GLVWDQFHV DQG ZDLW ORQJHU WR REWDLQ KHDOWK VHUYLFHV RI SRRU TXDOLW\ IRU WKHPVHOYHV RU WKHLU IDPLO\ %HWZHHQ DQG IHGHUDO KHDOWK H[SHQGLWXUHV SOXPPHWHG IURP WR ELOOLRQ GROODUV %HUTX f 7KHVH GUDVWLF UHGXFWLRQV LQ SXEOLF VSHQGLQJ FRXSOHG ZLWK WKH LQFUHDVLQJ LPSRYHULVKPHQW RI WKH SRSXODWLRQ WKH IDLOXUH WR LPSOHPHQW D XQLYHUVDO KHDOWK FDUH V\VWHP

PAGE 87

DQG UHSURGXFWLYH KHDOWK SURJUDPV QHXWUDOL]HG WKH SRVVLEOH SRVLWLYH LPSDFW RI WKH PDMRU GHFOLQH LQ WKH IHFXQGLW\ UDWH IURP FKLOGUHQ SHU ZRPDQf LQ WR LQ LELG f ,QGHHG PDWHUQDO PRUWDOLW\ UDWHV QHYHU GHFOLQHG DV IDVW DV WKH IHFXQGLW\ UDWH DQG ZHUH VWDEOH DW SHU OLYH ELUWKV LQ LELG f 0DQ\ RI WKHVH GHDWKV FRXOG EH HDVLO\ SUHYHQWHG EXW HYHQ LQ 6DR 3DXOR FLW\ RQH RI WKH PRVW SULYLOHJHG DUHDV LQ WKH FRXQWU\ ORZ LQFRPH ZRPHQ YLVLW DQ DYHUDJH RI WKUHH KRVSLWDOV EHIRUH WKH\ FDQ ILQG D PDWHUQLW\ EHG LELG f ,Q RWKHU ZRUGV WKH IDFW WKDW ZRPHQ KDYH OHVV FKLOGUHQ GLG QRW OLEHUDWH PRUH UHVRXUFHV IRU WKRVH ZKR GR RU IRU RWKHU ZRPHQnV KHDOWK LVVXHV %UD]LOLDQ ZRPHQ KDYH OHVV FKLOGUHQ SDUWO\ DV D UHVXOW RI WKH KLJK VWHULOL]DWLRQ UDWH /DFN RI LQIRUPDWLRQ DERXW RU DYDLODELOLW\ RI RWKHU FRQWUDFHSWLRQ PHWKRGVn LV OHDYLQJ ZRPHQ ZLWK OLWWOH FKRLFH DQG VWHULOL]DWLRQ LV LQFUHDVLQJO\ FRPPRQ LQFOXGLQJ DPRQJ \RXQJ ZRPHQ DQG HVSHFLDOO\ DPRQJ SRRU ZRPHQ )XUWKHU GXH WR UDFLDO LQHTXDOLW\ LQ OLYLQJ VWDQGDUGV DQG WR DW WLPHV EDUHO\ YHLOHG UDFLVW OHDQLQJV RQ WKH SDUW RI SXEOLF DXWKRULWLHV D GLVSURSRUWLRQDWH QXPEHU RI $IIR %UD]LOLDQ ZRPHQ DUH EHLQJ VWHULOL]HG 7KLV RI FRXUVH KDV EHHQ DQ LPSRUWDQW VWUXJJOH IRU $IUR%UD]LOLDQ ZRPHQnV JURXSV 5RODQG DQG &DUQHLUR f ([WUHPHO\ KLJK UDWHV RI FHVDUHDQ VHFWLRQV DQG UHSURGXFWLYH WUDFW FDQFHUV ZKLFK DUH UHVSRQVLEOH IRU b RI DOO WRWDO FDQFHU GHDWKV LQ %UD]LO DUH RWKHU UHSURGXFWLYH KHDOWK SUREOHPV IDFHG E\ %UD]LOLDQ ZRPHQ %HUTX f $JDLQ PDQ\ VXFK GHDWKV DUH HDVLO\ 7KH RUDO FRQWUDFHSWLYH LV WKH RWKHU ZLGHO\ XVHG FRQWUDFHSWLRQ PHWKRG LQ %UD]LO ,Q 6DR 3DXOR LW LV VOLJKWO\ PRUH FRPPRQ WKDQ VWHULOL]DWLRQ UHVSHFWLYHO\ b DQG b RI ZRPHQ ZKR XVH FRQWUDFHSWLRQ LQ f ,Q WKH 1RUWKHDVW RI WKH FRXQWU\ WKHVH ILJXUHV DUH UHYHUVHG b IRU VWHULOL]DWLRQ DQG b IRU WKH SLOOf %HUTX f +LJKGRVH SLOOV DUH VWLOO FRPPRQ 3LOOV DUH UHODWLYHO\ H[SHQVLYH EXW VLQFH WKH\ DUH DYDLODEOH RYHUWKH FRXQWHU PDQ\ ZRPHQ VHOISUHVFULEH ZKLFK OHDGV WR VHULRXV VLGHHIIHFWV VXFK DV VWURNHV VHH %ULVFRH f

PAGE 88

SUHYHQWDEOH EXW WKH UDWHV RI SDS VPHDU H[DPV IRU WKH GHWHFWLRQ RI FHUYLFDO FDQFHU DUH YHU\ ORZ HYHQ LQ 6DR 3DXOR RQO\ b RI ZRPHQ JHW D SDS VPHDU LELGf 2EYLRXVO\ ZRPHQnV KHDOWK VKRXOG QRW EH OLPLWHG WR WKHLU UHSURGXFWLYH KHDOWK EXW LW LV WKH DUHD WKDW UHFHLYHV WKH PRVW DWWHQWLRQ IURP WKH DXWKRULWLHV DQG WKH EOHDN SLFWXUH SURYLGHG DERYH JLYHV DQ LGHD RI KRZ QHJOHFWHG RWKHU ZRPHQnV KHDOWK LVVXHV PLJKW EH *LYHQ WKLV JULP VLWXDWLRQ RI KHDOWK FDUH IRU WKH ODUJH PDMRULW\ RI %UD]LOLDQV DQG HVSHFLDOO\ IRU ORZLQFRPH ZRPHQ LW LV XQGHUVWDQGDEOH WKDW SHRSOH KDYH EHHQ RUJDQL]LQJ WR PDNH FODLPV RQ WKH 6WDWH IRU EHWWHU VHUYLFHV :RPHQ DOVR KDYH VHDUFKHG IRU ZD\V WR PDNH WKH PHGLFDO HVWDEOLVKPHQW UHVSHFWIXO RI ZRPHQnV ULJKWV DQG QHHGV DQG WR JLYH ZRPHQ PRUH FRQWURO RYHU WKHLU RZQ ERGLHV DQG KHDOWK 7KLV ZDV RULJLQDOO\ PRUH D FRQFHUQ RI PLGGOH FODVV IHPLQLVW JURXSV WKDQ RI ORZLQFRPH ZRPHQnV JURXSV ZKRVH SULRULW\ ZDV WR REWDLQ KHDOWK SRVWV DQG KRVSLWDOV LQ WKHLU QHLJKERUKRRGV $W WKH IHGHUDO OHYHO SUHVVXUH IURP IHPLQLVW DFWLYLVWV OHG WR WKH HODERUDWLRQ RI 3$,60 WKH ,QWHJUDWHG :RPHQnV +HDOWK 3URJUDP ZKLFK ZDV SURSRVHG LQ E\ WKH 0LQLVWU\ RI +HDOWK DQG VWDUWHG WR EH LPSOHPHQWHG E\ WKH VRFLDO VHFXULW\ DJHQFLHV LQ DIWHU DOWHUDWLRQV LQ UHVSRQVH WR IHPLQLVW GHPDQGV 7KH REMHFWLYHV RI 3$,60 DUH WR JXDUDQWHH ZRPHQnV DFFHVV WR FDUH DQG WR DGGUHVV DOO WKHLU KHDOWK QHHGV LQ WKH YDULRXV SKDVHV RI WKHLU OLIH ZLWK DQ HPSKDVLV RQ SUHQDWDO ELUWK DQG SXHUSHULXP FRPSOLFDWLRQV SUHYHQWLRQ RI FDQFHUV RI WKH UHSURGXFWLYH WUDFW FOLQLFDO J\QHFRORJLFDO DWWHQGDQFH LPSURYHPHQW RI EUHDVWn IHHGLQJ FRQWURO RI VH[XDOO\ WUDQVPLWWHG GLVHDVHV DQG HGXFDWLRQ RQ FRQFHSWLRQ DQG FRQWUDFHSWLRQ 3$,60 DLPV DW RUJDQL]LQJ DQG XSGDWLQJ WKH HTXLSPHQW RI KHDOWK VHUYLFHV DW SURYLGLQJ SURIHVVLRQDO WUDLQLQJ DQG ZRPHQnV HGXFDWLRQ 8QIRUWXQDWHO\ LW LV EHLQJ LPSOHPHQWHG RQO\ VORZO\ 7HOHV f

PAGE 89

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fV PRYHPHQWV WKH PRYHPHQWV FKDQJHG XQGHU WKH QHZ SROLWLFDO FLUFXPVWDQFHV RI WKH SHULRG RI WUDQVLWLRQ IURP DXWKRULWDULDQ WR GHPRFUDWLF UXOH LQ WKH PLGV &KDQQHOV RI H[SUHVVLRQ ZHUH UHRSHQHG DQG UHSUHVVLRQ ZDV QR ORQJHU WR EH IHDUHG $W WKH VDPH WLPH WKH PRYHPHQWVn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f RU 6WDWH &RXQFLO RQ :RPHQnV &RQGLWLRQ WKH ILUVW RI LWV NLQG LQ WKH FRXQWU\ FUHDWHG LQ 7ZR \HDUV ODWHU ZKHQ -RV 6DUQH\ WRRN RIILFH DV WKH ILUVW FLYLOLDQ SUHVLGHQW LQ PRUH WKDQ \HDUV WKH &RQVHOKR 1DFLRQDO GRV 'LUHLWRV GD0LGKHU &1'0f RU 1DWLRQDO &RXQFLO IRU :RPHQnV 5LJKWV ZDV LQVWLWXWHG DW WKH IHGHUDO OHYHO

PAGE 90

7KHVH &RXQFLOV KDG VLJQLILFDQW SDUWLFLSDWLRQ RI IHPLQLVWV ZLWK VWURQJ WLHV WR ZRPHQnV JURXSV DQG WKDQNV WR WKHLU SRVLWLRQLQJ ZLWKLQ WKH 6WDWH HQDEOHG XQGHQLDEOH DGYDQFHV ZKLFK WKH PRYHPHQW ZRXOG QRW KDYH EHHQ DEOH WR VHFXUH RQ LWV RZQ VXFK DV D FRPPLVVLRQ RQ UHSURGXFWLYH ULJKWV ZLWKLQ WKH 6DR 3DXOR 0LQLVWU\ RI +HDOWK RU WKH 'HOHJDGD GD 0XOKHU ''0f WKH VSHFLDO ZRPHQnV SROLFH VWDWLRQV 1HOVRQ f ,Q SDUW WKH &RXQFLOVn VXFFHVV ZDV D UHVXOW RI WKH SUHVVXUH HQDFWHG E\ IHPLQLVWV RXWVLGH WKH 6WDWH ZKLFK VWUHQJWKHQHG WKH FRXQFLOVn SRVLWLRQ YLVDYLV WKH JRYHUQPHQW DQG KHOSHG WR OLPLW FRRSWDWLRQ 6HH $OYDUH] IRU PRUH RQ WKH FUHDWLRQ DFKLHYHPHQWV DQG OLPLWDWLRQV RI WKHVH FRXQFLOVf $V WKH SROLWLFDO VFHQH FRQVROLGDWHG LQ WKLV QHZ GHPRFUDWLF SKDVH DQG DV PRUH FRQVHUYDWLYH JRYHUQPHQWV WRRN SRZHU LQ LQ WKH 6WDWH RI 6DR 3DXOR DQG LQ DW WKH IHGHUDO OHYHO DGPLQLVWUDWLRQ RI ) &ROORU GH 0HOORf WKH &RXQFLOV WXUQHG LQWR SDUWLVDQ SXSSHWV ZLWK OLPLWHG WLHV WR WKH ZRPHQnV PRYHPHQW DQG VWURQJO\ UHGXFHG SROLWLFDO FORXW ZLWKLQ WKH JRYHUQPHQW ,Q WKH 6DR 3DXOR &(&) ZDV PRYHG DZD\ IURP WKH FLW\nV PDLQ FRPPHUFLDO DUWHU\ WR D EXLOGLQJ LQ WKH UXQGRZQ LQQHUFLW\ ,W KDV EHHQ KDPSHUHG E\ SROLWLFDO SDUWLVDQVKLS 1HOVRQ FKDSWHU f $QRWKHU FUXFLDO H[SHULHQFH ZLWK VWDWH LQVWLWXWLRQV IRU IHPLQLVWV ZDV LQ WKH :RUNHUVf 3DUW\ 37f PXQLFLSDO DGPLQLVWUDWLRQV f§7KH 37 ZDV ERUQ LQ WKH ODWH V IURP WKH SURFHVVHV RI RUJDQL]DWLRQ RI SRSXODU PRYHPHQWV XQLRQV DQG RUJDQLF LQWHOOHFWXDOV DQG VKDUHG WKHLU LGHDOV RI GLUHFW SDUWLFLSDWRU\ GHPRFUDF\ 6RPH 37 IHPLQLVWV LQFOXGLQJ ILYH ZKR DUH PHPEHUV RI WKH JURXSV ZRUNHG ZLWK SDUWLFLSDWHG LQ /XL]D (UXQGLQDfV 37 JRYHUQPHQW DIWHU VKH ZDV HOHFWHG PD\RU RI 6DR 3DXOR FLW\ LQ 7KH\ ZHUH PHPEHUV RI WKH &RRUGHQDGRULD (VSHFLDO GD 0XOKHU DQ LQVWLWXWLRQ GHVLJQHG DV DQ H[SOLFLWO\ H[HFXWLYH RUJDQ ZKRVH HPSOR\HHV ZRXOG IRUPXODWH DQG IROORZ SROLFLHV $OYDUH] f $OWKRXJK WKH

PAGE 91

&RRUGHWWDGRULD DQG ZRPHQn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f :KDW LV HVVHQWLDO LQ RXU 1*2SURIHVVLRQDOL]DWLRQ VWRU\ LV WKDW ZRUNLQJ ZLWKLQ WKHVH FRXQFLOV DQG RWKHU VWDWH RUJDQV SURYLGHG H[SHULHQFH WR VRPH ZRPHQ ZKR ZHUH WKHQ UHDG\ WR FUHDWH WKHLU RZQ RUJDQL]DWLRQ ZKHQ D FRQVHUYDWLYH JRYHUQPHQW FDPH EDFN LQWR RIILFH 7KLV ZDV WUXH IRU IRUPHU FRXQFLO PHPEHUV LQ WKH IRUPHU 3UHVLGHQW RI WKH &1'0 FRIRXQGHG &(3,$ &LWL]HQVKLS 6WXGLHV 5HVHDUFK ,QIRUPDWLRQ DQG $FWLRQf DQ 1*2 ORFDWHG LQ 5LR GH -DQHLUR 6HYHUDO ZRPHQ IRUPHU PHPEHUV RI WKH &1'0 FUHDWHG LQ %UDVLOLD DQ 1*2 &)(0($f ZKLFK KDV VSHFLDOL]HG LQ PRQLWRULQJ DQG SUHVVXULQJ WKH %UD]LOLDQ &RQJUHVV RQ JHQGHUUHODWHG OHJLVODWLRQ LQ ,Q 6DR 3DXOR *HOHGV ,QVWLWXWR GD 0XOKHU 1HJUD RQH RI WKH ILUVW EODFN IHPLQLVW 1*2V LQ %UD]LO ZDV ERUQ DIWHU VHYHUDO RI LWV PHPEHUV OHIW WKH %ODFN ZRPHQnV FRPPLVVLRQ RI &(&) RU WKH &1'0 DQG UDWKHU WKDQ JRLQJ EDFN WR ZRUN LQ WKHLU RULJLQDO VWDWH DJHQFLHV IRU D FRQVHUYDWLYH PXQLFLSDO JRYHUQPHQW ZKHUH WKH\ ZRXOG KDYH EHHQ FRQVWUDLQHG GHFLGHG WR FUHDWH WKHLU RZQ RUJDQL]DWLRQ 7KH 7DNHRYHU E\ ,VVXH6SHFLILF *URXSV DQG 1HWZRUNV 7KH ILUVW %UD]LOLDQ IHPLQLVW JURXSV ZHUH PXOWLSXUSRVH &RVWD f PDLQO\ JUXSRV GH UHIOH[£R FRQVFLRXVQHVVUDLVLQJ JURXSVf DGGUHVVLQJ LVVXHV DV WKH\ DSSHDUHG DQG IRFXVLQJ

PAGE 92

LQ ODUJH SDUW RQ WKH H[SHULHQFH RI WKHLU RZQ PHPEHUV ,VVXHVSHFLILF RUJDQL]DWLRQV DSSHDUHG LQ WKH HDUO\ V $OYDUH] UHFRXQWV WKDW WKH 6DR 3DXOR VWDWHZLGH IHPLQLVW PHHWLQJ KHOG LQ 9DOLQKRV LQ PDUNHG D ZDWHUVKHG LQ WKLV UHJDUG DV IHPLQLVWV VWDUWHG GHDOLQJ LQ SDUWLFXODU ZLWK GRPHVWLF YLROHQFH UHSURGXFWLYH ULJKWV DQG WKH IHPLQLVW DOWHUQDWLYH SUHVV $OYDUH] f 7KHVH LVVXHIRFXVHG RUJDQL]DWLRQV VHHPHG WR KDYH ZHDWKHUHG EHWWHU WKH LQFUHDVLQJ SROLWLFDO GLYLVLRQV DORQJ SDUW\ OLQHV ZKLFK DSSHDUHG ZLWK WKH UHWXUQ WR GHPRFUDF\ $OYDUH] f 7KLV VKLIW WR LVVXHVSHFLILF RUJDQL]DWLRQV KDV EHHQ QHLWKHU D XQLIRUP QRU D VPRRWK SURFHVV 6RPH ROG WLPH IHPLQLVWV ZKR DUH QRW LQWHUHVWHG LQ HQJDJLQJ LQ LQVWLWXWLRQDOL]HG IHPLQLVP FRPSODLQHG DERXW WKH IDFW WKDW WKH PRYHPHQW KDG DEDQGRQHG VHOIUHIOH[LYH DFWLYLWLHV ZKLFK DUH VWLOO YHU\ PXFK QHHGHG LQ WKHLU YLHZ 6RPH RI WKHP KDYH UHFHQWO\ IRUPHG D JURXS FDOOHG 9HUGH /LO£V ZKLFK LV PHDQW WR IXQFWLRQ DORQJ WKH OLQHV RI WKH ROG IRUPXOD 1HYHUWKHOHVV DW WKH WLPH LQWHUYLHZHG RQH RI LWV PHPEHUV WKH JURXS ZLVKHG WR JLYH VSHFLDO DWWHQWLRQ WR LVVXHV UHODWHG WR ZRPHQ DQG WKH HQYLURQPHQW DV LWV QDPH LQGLFDWHV JUHHQ OLODFf +HQFH WKH\ ZHUH DOUHDG\ JRLQJ IRU VRPH OHYHO RI VSHFLDOL]DWLRQ 2QH YROXQWHHU JURXS WKH 8QLGR GH 0XOKHUHV GR 0XQLFLSLR GH 6DR 3DXOR PDNHV D SRLQW RI QRW VSHFLDOL]LQJ RQ RQH LVVXH EXW LQVWHDG ZRUNV RQ DOO LVVXHV UHOHYDQW WR ZRPHQ 2QH RI LWV OHDGHUV ZURWH 7KH ZRPHQfV TXHVWLRQ D PDFURSUREOHP WR EH UHVROYHG ZLOO QRW ILQG D VROXWLRQ LQ D IUDJPHQWHG PDQQHU ZKLFK LV RQH RI WKH FKDUDFWHULVWLFV RI DFDGHPLF GLVFLSOLQHV DQG JRYHUQPHQWDO SROLFLHV ,W FDQQRW EH GHDOW ZLWK DV D PHUH WHFKQLFDO SUREOHP RU E\ VSHFLDOL]LQJ LQ WKLV RU WKDW LVVXH 7HOHV f 7KH JURXS LV LQGHHG RSHQ WR DQ\ LVVXH 6WLOO LVVXHV RI YLROHQFH DJDLQVW ZRPHQ DUH WKHLU IRUWH

PAGE 93

,Q SDUW DV D UHVXOW RI WKLV FRQWHVWHG SURFHVV RI VSHFLDOL]DWLRQ DQG SURIHVVLRQDOL]DWLRQ WKH JURXSV LQYROYHG LQ WKH 6DR 3DXOR ZRPHQnV KHDOWK PRYHPHQW SUHVHQW YDU\LQJ GHJUHHV RI VSHFLDOL]DWLRQ DQG RI SURIHVVLRQDOL]DWLRQ DV ZHOO DV IRUPDOL]DWLRQ 7KH PRVW IRUPDOL]HG JURXSV WHQG WR EH WKH PRVW VSHFLDOL]HG DQG WKH PRVW SURIHVVLRQDOL]HG 2UJDQL]DWLRQDO GLYHUVLW\ 7RGD\ WKH ZRPHQnV KHDOWK PRYHPHQW LQ 6DR 3DXOR LV FKDUDFWHUL]HG QRW RQO\ E\ UHJLRQDOJHRJUDSKLFDO GLYHUVLW\ EXW DOVR E\ D KLJK GHJUHH RI RUJDQL]DWLRQDO GLYHUVLW\ 2UJDQL]DWLRQDO IRUPV UDQJH IURP LQIRUPDO QHWZRUNV RI QHLJKERUKRRG ZRPHQ WR SURIHVVLRQDOL]HG RUJDQL]DWLRQV 1*2Vf +HQFH WKH OHYHO RI IRUPDOL]DWLRQ LQVWLWXWLRQDOL]DWLRQ DQG SURIHVVLRQDOL]DWLRQ RI WKH JURXSV YDU\ ZLGHO\ IRXQG ORRVHO\ VWUXFWXUHG LQIRUPDO JURXSV VXFK DV ZRPHQ RUJDQL]LQJ D SKDUPDF\ IRU GLVDGYDQWDJHG FRPPXQLWLHV ZRPHQ SDUWLFLSDWLQJ LQ D FRXUVH RQ KHDOWK ZLWK D ZRPHQnV KHDOWK FRPSRQHQW RU ZRPHQ IURP ORFDO 0RWKHUVn &OXEV PRELOL]LQJ ZKHQHYHU WKH\ GHHP QHFHVVDU\ 7KHVH JURXSV GR QRW FRQVLGHU WKHPVHOYHV IHPLQLVWV DOWKRXJK WKH\ ZRUN ZLWK ZRPHQnV LVVXHV DQG VKDUH PDQ\ IHPLQLVW LGHDV 7KH &DWKROLF &KXUFKnV &KULVWLDQ %DVH &RPPXQLWLHV &(%Vf RU LWV SDVWRUDO FRPPLVVLRQ IRU KHDOWK DUH DW WKH URRW RI HDFK RI WKHVH RUJDQL]LQJ HIIRUWV %\ QRZ WKHUH DUH DOVR D QXPEHU RI QHLJKERUKRRG ZRPHQnV JURXSV IRFXVLQJ RQ KHDOWK VL[ RXW RI WKH YLVLWHGf LQ ZKLFK DW OHDVW VRPH PHPEHUV LGHQWLI\ WKHPVHOYHV DV IHPLQLVWV 6RPH RI WKHP DUH IDLUO\ LQIRUPDO RWKHUV DUH PRUH IRUPDO VRPH UHSUHVHQW DQ HIIRUW E\ IHPLQLVW RUJDQL]DWLRQV WR EULQJ WRJHWKHU WKH OHDGHUVKLS RI YDULRXV JURXSV RI D UHJLRQ 7ZR SRSXODU JURXSV ZKR DFNQRZOHGJH WKHLU IHPLQLVW LGHQWLW\ DUH QRZ ZHOOHVWDEOLVKHG UHFHLYLQJ VRPH LQWHUQDWLRQDO IXQGLQJ ZKLFK DOORZV WKHP WR UHQW RU EX\ WKHLU RZQ VSDFH ZKHUH WKH\

PAGE 94

RIIHU ZRUNVKRSV HLWKHU LQ SUDFWLFDO VNLOOV RU LQ FRQVFLRXVQHVVUDLVLQJ 7KH\ DUH QRW SURIHVVLRQDOL]HG LQ WKH VHQVH WKDW WKHLU PHPEHUV DUH QRW SHUPDQHQWO\ HPSOR\HG E\ WKH RUJDQL]DWLRQ DOWKRXJK VRPH PHPEHUV UHFHLYH FRPSHQVDWLRQ IHHV RMXGD GH FXVLf 7KH LGHRORJLFDO DQG ORJLVWLFDO VXSSRUW WKHVH JURXSV KDYH UHFHLYHG IURP IHPLQLVW RUJDQL]DWLRQV KDV EHHQ HVVHQWLDO LQ VRPH FDVHV DOWKRXJK QRW LQ DOO LQ JHWWLQJ WKHP WR IRFXV VSHFLILFDOO\ RQ ZRPHQnV LVVXHV DQG LQ VRPH FDVHV HYHQ WR H[LVW DV HQWLW\ 0RVW RI WKHVH QHLJKERUKRRG ZRPHQ ZHUH RULJLQDOO\ DFWLYH LQ &KXUFK OLQNHG RUJDQL]DWLRQV 6DR 3DXOR DOVR KRVWV WZR IHGHUDWLRQV RI ZRPHQnV JURXSV GHDOLQJ ZLWK YDULRXV JHQGHU LVVXHV QRW OLPLWHG WR KHDOWK %RWK FRQVLVW RI DQ DFWLYH FHQWUDOO\ORFDWHG JURXS ZKLFK EULQJV WRJHWKHU WKH OHDGHUVKLS DQG RI YDULRXV JURXSV LQ WKH SHULSKHU\ RI WKH FDSLWDO DQG LQ RQH FDVH LQ WKH HQWLUH VWDWH RI 6DR 3DXOR 7KHVH WZR IHGHUDWLRQV DUHZHUH OLQNHG WR WKH &RPPXQLVW 3DUW\ RI %UD]LO 3& GR %f 2QH RI WKHP ZDV H[SHOOHG IURP WKH SDUW\ ILYH \HDUV DJR 1HLWKHU RQH LV LQWHUHVWHG LQ SURIHVVLRQDOL]LQJ DOWKRXJK WKH LVVXH FUHDWHV WHQVLRQV DPRQJ PHPEHUV LQ RQH RI WKHP )LQDOO\ RQH ILQGV IHPLQLVW DFDGHPLFV RU IRUPHU SXEOLF KHDOWK FDUH RU VRFLDO ZRUNHUV PRVW RI ZKLFK ZLWK DQ DFWLYLVW EDFNJURXQG RUJDQL]HG LQ SURIHVVLRQDOL]HG QRQSURILW RUJDQL]DWLRQV LH 1*2Vf DQG RQH VHPLSURIHVVLRQDOL]HG RUJDQL]DWLRQ 7KH\ FRQGXFW UHVHDUFK GRFXPHQWDWLRQ DQG WUDLQLQJ DQG SXEOLVK ZULWWHQ DQG DXGLRYLVXDO VXSSRUW PDWHULDOV RQ JHQGHU DQG KHDOWK LVVXHV SURYLGH J\QHFRORJLFDO MXULGLFDO RU SV\FKRORJLFDO VHUYLFHV LQIOXHQFH QDWLRQDO DQG LQWHUQDWLRQDO SROLFLHV UHJDUGLQJ ZRPHQnV KHDOWK DQG SURYLGH VXSSRUW WR ORFDO ZRPHQnV PRYHPHQWV

PAGE 95

1HWZRUNV 7HQ RI WKH JURXSV YLVLWHG GXULQJ WKH ILUVW SKDVH RI P\ UHVHDUFK WKRVH WKDW FRQVLGHUHG WKHPVHOYHV IHPLQLVWV DQG ZKLFK KDG D PLQLPXP RI IRUPDOL]DWLRQ KDG EHHQ SDUWLFLSDWLQJ LQ DQ LQQRYDWLYH RUJDQL]DWLRQDO IRUP D QDWLRQDO QHWZRUN FDOOHG 5HGH 1DFLRQDO )HPLQLVWD GH 6DGH H 'LUHLWRV 5HSURGQWLYRV 1DWLRQDO )HPLQLVW 1HWZRUN IRU +HDOWK DQG 5HSURGXFWLYH 5LJKWVf KHUHDIWHU FDOOHG 5HGH 1HWZRUNLQJ GHVLJQDWHV WKH QRQSHUPDQHQW FROODERUDWLRQ EHWZHHQ YDULRXV RUJDQL]DWLRQV RQ SROLWLFDO LVVXHV RI MRLQW LQWHUHVW 8YLQ DQG 0LOOHU f )D[HV HPDLO DQG RWKHU LQIRUPDWLRQ DQG FRPPXQLFDWLRQ WHFKQRORJLHV KDYH IDFLOLWDWHG WKH HPHUJHQFH RI VXFK RUJDQL]DWLRQDO IRUPV ,Q %UD]LO WKH UHDOL]DWLRQ RI WKH 8QLWHG 1DWLRQV &RQIHUHQFH RQ WKH (QYLURQPHQW DQG 'HYHORSPHQW 81&('f LQ 5LR GH -DQHLUR LQ ZDV D FDWDO\]LQJ IDFWRU IRU WKH FUHDWLRQ RI VRPH 1*2 IHGHUDWLYH DJJUHJDWLRQV VXFK DV $%21* DQG WKH %UD]LOLDQ )RUXP RI 1*2V ^)RUXP %UDVLOHLUR GH 21*Vf $V ,OVH 6FKHUHU:DUUHQ f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fWR HQJDJH LQ D FRQVFLRXV VWUDWHJ\ WR LQWHUDFW ZLWK WKH 6WDWH VR DV WR DGGUHVV VWDWHOHYHO GLPHQVLRQV RI ORFDO SUREOHPV 7KLV LQYROYHV GHYHORSLQJ VWUDWHJLHV WR JR IURP WKH PLFUR WR

PAGE 96

WKH PDFUROHYHO ZLWK WKH REMHFWLYH WR EULQJ DERXW JRYHUQPHQWDO SROLF\ FKDQJH 8YLQ DQG 0LOOHU f VKDOO VKRZ KRZ LW DSSOLHV WR WKH 1DWLRQDO )HPLQLVW 1HWZRUN IRU +HDOWK DQG 5HSURGXFWLYH 5LJKWV 7KH 5HGH ZDV FUHDWHG LQ $XJXVW $FFRUGLQJ WR LWV RZQ GHILQLWLRQ LW XQLWHV JURXSV DQG LQGHSHQGHQW DFWLYLVWV ZKRVH SROLWLFDO DQG SURIHVVLRQDO ZRUN IRFXVHV RQ ZRPHQnV KHDOWK DQG UHSURGXFWLYH ULJKWV 7KLV ZRUN KDV WZR PDLQ WKUXVWV WKH FRQFHSW RI UHSURGXFWLYH ULJKWV ZLWKLQ WKH IUDPHZRUN RI KXPDQ ULJKWV DQG WKH UHFRYHU\ RI 3$,60 ,QWHJUDWHG :RPHQnV +HDOWK 3URJUDPf DV D UHIHUHQFH WR LPSURYH SXEOLF KHDOWK VHUYLFHV 0HPEHUV RI WKH 5HGH DUH ZRPHQnV JURXSV 1*2V ZRPHQnV VWXGLHV FHQWHUV LQ XQLYHUVLWLHV DQG UHVHDUFK LQVWLWXWLRQV DV ZHOO DV KHDOWK SURIHVVLRQDOV ,WV GHFODUHG REMHFWLYHV DUH WR RUJDQL]H WKH ZRPHQnV KHDOWK PRYHPHQW DURXQG D MRLQW DFWLRQ SURSRVDO ZKLFK JXDUDQWHHV VSDFH IRU IHPLQLVW LGHDV ZLWKLQ WKH FRQWH[W RI WKH QHZ ZRUOG RUGHU DQG WR PD[LPL]H WKH SRWHQWLDO OHYHO RI LQIOXHQFH RI WKH IHPLQLVWZRPHQnV PRYHPHQW LQ WKH GHVLJQ RI SXEOLF DQG VRFLDO KHDOWK SROLFLHV DW WKH QDWLRQDO VWDWH DQG PXQLFLSDO OHYHOV ,W IRFXVHV LWV DFWLYLWLHV RQ SROLWLFDO QHWZRUNLQJ DW WKH ORFDO QDWLRQDO DQG LQWHUQDWLRQDO OHYHOV WR PRQLWRU WKH HODERUDWLRQ RI KHDOWK SROLFLHV RQ SDUWLFLSDWLRQ LQ 6WDWH KHDOWK FRXQFLOV DQG ZRPHQnV KHDOWK FRPPLVVLRQV RQ SURPRWLRQ DQGRU SDUWLFLSDWLRQ LQ VHPLQDUV GHEDWHV DQG FRXUVHV LQ WKH ILHOG RI KHDOWK DQG UHSURGXFWLYH ULJKWV RQ RUJDQL]DWLRQ RI SXEOLF FDPSDLJQV $,'6 DERUWLRQ PDWHUQDO PRUWDOLW\ HWF f RQ PHGLD LQWHUYHQWLRQV DQG RQ SURGXFWLRQ DQG H[FKDQJH RI LQIRUPDWLRQ EHWZHHQ PHPEHUV RI WKH 5HGH DQG ZLWK V\PSDWKL]HUV RI WKH IHPLQLVW DQG RWKHU VRFLDO PRYHPHQWV LQWHOOHFWXDOV WKH JRYHUQPHQWDO VSKHUH DQG WKH SUHVV 7KLV GHILQLWLRQ DV ZHOO DV PRVW RI WKH IROORZLQJ LQIRUPDWLRQ DERXW WKH 5HGH ZDV REWDLQHG IURP D SUHVHQWDWLRQ SDPSKOHW GLVWULEXWHG DW WKH ,,, QDWLRQDO PHHWLQJ RI WKH 5HGH KHOG LQ 5LR GH -DQHLUR LQ $SULO

PAGE 97

7KH5HGH LV FRPSRVHG RI D &RXQFLO RI 'LUHFWRUV DQ ([HFXWLYH 6HFUHWDULDW DQG D *HQHUDO $VVHPEO\ 7KH ILUVW WZR DUH UHVSRQVLEOH IRU WKH FRRUGLQDWLRQ RI WKH 1HWZRUN DQG KROG SHULRGLF PHHWLQJV WR GHILQH DFWLRQ SURSRVDOV 7KH ([HFXWLYH 6HFUHWDULDW LV URWDWHG DPRQJ PHPEHU RUJDQL]DWLRQV ,Q LW ZDV SDVVHG IURP 626&RUSR ORFDWHG LQ 5HFLIH LQ WKH 1RUWKHDVW RI WKH FRXQWU\ WR WKH &ROHWLYR )HPLQLVWD 6H[XDOLGDGH H 6DGH ORFDWHG LQ 6DR 3DXOR ,W LV UHVSRQVLEOH IRU WKH 5HGHnV QHZVOHWWHU WKH -RUQDO GD 5HGH ZKLFK LV SXEOLVKHG HYHU\ IRXU PRQWKV DQG IRU ZULWLQJ SURSRVDOV WR REWDLQ IXQGLQJ IRU WKH IXQFWLRQLQJ RI WKH 1HWZRUN 2QH SUREOHP UDLVHG DW WKH VHFRQG 5HGHn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

PAGE 98

)RU $OYDUH] f WKHVH PRUH IOXLG IRUPV DQG IRUXPV RI IHPLQLVW RUJDQL]LQJ DQG WKH DUWLFXODWLRQ RI D PXOWLSOLFLW\ RI IHPLQLVW WUDQVIRUPDWLRQDO SURMHFWV LQ WKH V DSSHDUHG WR EH UHSODFLQJ WKH PRUH IRUPDOLVWLF DQG WHQVLRQULGGHQ PRYHPHQW FRRUGLQDWLRQV RI WKH )LUVW DQG 6HFRQG 3DXOLVWD :RPHQn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
PAGE 99

GHYHORSPHQW DSSDUDWXV (VFREDU ILIf 7KH ODWWHU PDGH IXQGLQJ DYDLODEOH IRU ZRPHQfV SURMHFWV 7KLV OHG WR WKH FUHDWLRQ RI MREV DURXQG VXFK LVVXHV 7DEOH &KDUDFWHULVWLFV RI IHPLQLVW 1*2V PHPEHUV RI $%21* 1DPH RI 1*2 'DWH RI FUHDWLRQr 6L]H RI VWDII EXGJHW LQ 866 1XPEHU RI YROXQWHHUV &$&(6 &DVD GD 0XOKHU GR 1RUGHVWH LQWnO Q QDWnO &DVD GH 3DVVDJHP OLQWnO QDWnO &(0,1$ &HQWUR GDV 0XOKHUFV GR &DER 1RW DYDLODEOH &(3,$ &)(0,$ &)66 &RPXOKHU &8580,1 (&26 *(/('(6 ,QVWLWXWR GD 0XOKHU 1HJUD 1RW DYDLODEOH 0RYWR 0XOKHUHV GR &DPSRGD &LGDGH 5HGH 0XOKHU LQWfO 5('(+ LQWnO 62) 6HPSUHYLYD 2UJ )HPLQLVWD 626 &RUSR 6RXUFH /DQGLP t &RWULP f H[FHSW IRU *HOHGV *HOHGV LQIRUPDWLRQ LV EDVHG RQ LQWHUYLHZ PDWHULDO 1RWH r /HJDO GDWH RI FUHDWLRQ 2Q WKH SDUW RI DFWLYLVWV GHPRFUDWL]DWLRQ PHDQW D SHUFHSWLRQ RI LQFUHDVHG SRVVLELOLWLHV RI JDLQV IRU WKH PRYHPHQW LQ WKH LQVWLWXWLRQDO VSKHUH RI SROLWLFV VKRZ LQ WKLV VWXG\ WKDW LQFUHDVHG LQYROYHPHQW ZLWK WKH QDWLRQDO DQG LQWHUQDWLRQDO SROLWLFDO V\VWHP UHTXLUHG D PRUH IRUPDOL]HG VWUXFWXUH ZKLFK SXVKHG WRZDUGV SURIHVVLRQDOL]DWLRQ D SURFHVV VLPLODU WR WKDW GLVFXVVHG E\ 6WDJJHQERUJ f LQ WKH FDVH RI WKH 86 SURFKRLFH PRYHPHQWf )RUPDOL]DWLRQ DQG SURIHVVLRQDOL]DWLRQ ZHUH DOVR D UHVXOW RI EHLQJ OHJDOO\ DQG DGPLQLVWUDWLYHO\ DEOH WR REWDLQ DQG PDQDJH GRQRU IXQGLQJ DV ZH ZLOO VHH LQ FKDSWHU 2WKHU HOHPHQWV KDYH DOVR FRQWULEXWHG WR WKH SURIHVVLRQDOL]DWLRQ RI IHPLQLVW RUJDQL]DWLRQV LQ WKH PLG WR ODWH V 2QH ZDV D VHYHUH SURWUDFWHG HFRQRPLF FULVLV ZKLFK

PAGE 100

SUHYHQWHG PLGGOH FODVV ZRPHQ IURP HQJDJLQJ LQ DFWLYLVP ZKLOH KROGLQJ RQH RU WZR MREV WR PDNH HQGV PHHW 7KLV ZDV FRPSRXQGHG E\ WKH GHVLUH IRU D PRUH VWDEOH OHVV HQHUJ\VDSSLQJ PRGH RI DFWLYLVP RQ WKH SDUW RI WKH FRKRUW ZKR VWDUWHG LW DOO LQ WKH PLG V DQG ODVW EXW QRW OHDVW D VWURQJ GHVLUH IURP IHPLQLVW DFWLYLVWV WR LQWHJUDWH IHPLQLVP LQWR WKHLU HYHU\GD\ OLYHV WKURXJK WKHLU MREV /HERQ f /HWfV WDNH D EULHI ORRN DW VRPH FDVHV RI 6DR 3DXORfV IHPLQLVW 1*2V ,Q RQH FDVH D JURXS RI DERXW PHPEHUV JRW WRJHWKHU LQ WKH HDUO\ V RULJLQDOO\ PHDQW WR EH PXOWLSXUSRVH DOWKRXJK ZLWK DQ HPSKDVLV RQ KHDOWK DQG VH[XDOLW\ $ IHZ \HDUV ODWHU ZLWK D PXFK UHGXFHG FUHZ LW VSHFLDOL]HG DV D ZRPHQnV FOLQLF LW DGDSWHG WR %UD]LOLDQ UHDOLW\ WKH PRGHO RI D (XURSHDQ FOLQLF D OHDGLQJ PHPEHU RI WKH JURXS KDG YLVLWHG $ VHFRQG JURXS KDV D KLVWRU\ ZKLFK IROORZV PRUH FORVHO\ WKH PRGHO RI GHYHORSPHQW 1*2V ,W ZDV RULJLQDOO\ D IDPLO\ SODQQLQJ FOLQLF ZLWK SDWHUQDOLVWLF XQGHUWRQHV DVVLWHQFLDOLVWDf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
PAGE 101

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nYH JRW WR ILQG RXW D QHLJKERUKRRG DFWLYLVW VDLG GXULQJ D SOHQDU\ PHHWLQJ IRU WKH SUHSDUDWLRQ RI WKH %HLMLQJ FRQIHUHQFH $Q 1*2 IHPLQLVW UHVSRQGHG MRNLQJO\ LW ELWHV 7KH SRLQWV RI FRQWHVWDWLRQ LQ WKH GHILQLWLRQ RI 1*2V DPRQJ DFWLYLVWV FRUUHVSRQG WR SUREOHPDWLF LVVXHV UDLVHG LQ WKH DFDGHPLF OLWHUDWXUH DQG DOVR UHIOHFW IRFL RI WHQVLRQV EHWZHHQ SURIHVVLRQDOL]HG DQG YROXQWHHU JURXSV 7KHVH FRQWHVWHG DUHDV DUH WKH LVVXHV RI IXQGLQJ DQG RI UHODWLRQVKLSV WR WKH ZRPHQnV PRYHPHQW DQG WR WKH 6WDWH )XQGLQJ DV D 'HILQLQJ &ULWHULRQ" $UH $LG $JHQFLHV 6WUDLJKW-DFNHWLQJ 1*2V" :LWKLQ WKH FRQWH[W RI WKH ZRPHQnV PRYHPHQW RU RI RWKHU VRFLDO PRYHPHQWV IRU WKDW PDWWHUf D VLPSOH GHILQLWLRQ RI DQ 1*2 PLJKW EH DQ\ PRYHPHQW RUJDQL]DWLRQ ZKLFK UHFHLYHV IXQGLQJ DQG LV DEOH WR RIIHU D VDODU\ WR LWV PHPEHUV 7R ZKDW H[WHQW VKRXOG UHFHLSW RI IXQGLQJ

PAGE 102

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n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nV JURXS WKDW 1*2V DUH SURILVVLRPLV PLOLWDQWHV DFWLYLVW SURIHVVLRQDOVf 7KLV ZDV DOVR WKH WHUP VXJJHVWHG WR PH E\ D PHPEHU RI D YROXQWHHU RUJDQL]DWLRQ ZKR DOVR ZRUNV LQ DQ 1*2 $FFRUGLQJ WR $%21*nV GHILQLWLRQ UHFHLYLQJ IXQGLQJ LV QRW D GHILQLQJ FKDUDFWHULVWLF RI 1*2V 7KLV IX]]LQHVV DV WR ZKHUH WR GUDZ WKH OLQH DW WKH UHFHLSW RI IXQGLQJ RU DW WKH UHPXQHUDWLRQ RI PHPEHUVf LQ WKH GHILQLWLRQ RI DQ 1*2 LV D VRXUFH RI WHQVLRQ DV PRVW YROXQWHHU JURXSV EHOLHYH WKDW SURIHVVLRQDOL]HG JURXSV DUH VRPHZKDW FRRSWHG E\ ILQDQFLQJ DJHQFLHV ZKLOH SURIHVVLRQDOL]HG JURXSV VHH WKLV FULWLTXH DV EHLQJ K\SRFULWLFDO VLQFH PRVW YROXQWHHU JURXSV DOVR UHFHLYH VRPH PRQH\ IURP GRQRU DJHQFLHV DV ZDV H[SOLFLWO\ WROG E\ D UDWKHU LUULWDWHG 1*2 OHDGHU

PAGE 103

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
PAGE 104

PLJKW ZHOO EH WKDW RI 8QLWHG 1DWLRQV RIILFLDOV DV ZHOO VLQFH WKH SDUDOOHO IRUD DFFRPSDQ\LQJ WKH 81 ZRPHQnV FRQIHUHQFHV UHIHU WR 1*2V DQG QRW WR VRFLDO PRYHPHQWV ,Q WKH FDVH RI %HLMLQJ LW ZDV WKH 1*2 IRUXP RQ ZRPHQ 7KLV PLJKW SDUWO\ H[SODLQ WKH SRSXODULW\ RI WKH DFURQ\P 1*2 DQG ZK\ RQH JUDVVURRWV JURXS YLVLWHG PDGH D SRLQW RI EHLQJ FRQVLGHUHG DQ 1*2 DOWKRXJK WKH\ DUH QRW SURIHVVLRQDOL]HG DQG WKHLU FKDUDFWHULVWLFV FRUUHVSRQG PRUH WR WKRVH RI D QHLJKERUKRRG ZRPHQfV RUJDQL]DWLRQ 7KH YLHZ VKDUHG E\ WKH VWDII RI D WKLUG 1*2 ZKR LV DFWLYH LQ $%21* DQG HVSRXVHV LWV GHILQLWLRQ LV WKDW WKH\ DUH FOHDUO\ VHSDUDWH IURP WKH SRSXODU PRYHPHQWV WKH\ VXSSRUW +RZHYHU WKH\ FRQVLGHU WKHPVHOYHV SDUW RI WKH IHPLQLVW PRYHPHQW DQG RI WKH ODUJHU ZRPHQn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f WKH\ DUH VRFLDO PRYHPHQW RUJDQL]DWLRQV ZLWK D ERG\ RI DIILOLDWHV ZKR GHFLGHV ZKR LV JRLQJ WR OHDG ZKR LV QRW JRLQJ WR OHDG ZKR GHFLGHV DV ZHOO ZKHWKHU ZH QHHG WR ORRN IRU IXQGLQJ RU QRW ZKDW DUH RXU SULQFLSOHV LQ WKLV VWRU\ PHDQ LW LV QRW WKH %RDUG RI 'LUHFWRUV ZKR GHFLGH WKHVH WKLQJV LW LV WKH *HQHUDO $VVHPEO\ RI RXU RUJDQL]DWLRQ PHDQ HYHU\ERG\ UXOHV LVQfW LW" :KDWfV WKH EDVLF GLIIHUHQFH EHWZHHQ DQ 1*2 LQ %UD]LO DQG D VRFLDO PRYHPHQW RUJDQL]DWLRQ" ,W LV WKDW LQ WKH HQG LQ WKH YHU\ HQG DQ 1*2 LV D PLFUR RU D PHGLXPn VL]HG ILUP ,W KDV D ERVV (PSKDVL]LQJ DJDLQ WKH GLIIHUHQFH EHWZHHQ 1*2V DQG VRFLDO PRYHPHQW RUJDQL]DWLRQV VKH VDLG 6R WKH\ DUH DUH QRW 1*2V WKH\ DUH VRFLDO PRYHPHQW RUJDQL]DWLRQV ZKLFK ZRUN HVVHQWLDOO\ ZLWK GLVFRXUVHV ZLWK FRQVFLRXVQHVVUDLVLQJ ZH GR QRW KDYH DQ\ VHUYLFH GHOLYHU\ DSDUW IURP RXU GLVFRXUVH QR" 6ROLGDULW\ LV RXU SROLWLFDO RSWLRQ

PAGE 105

:KDW )OYLD LV SRLQWLQJ DW LV WKH LVVXH RI VRFLDO FRQWURO RYHU 1*2Vf ZRUN 2WKHUV KDYH OLQNHG LW WR WKH DFFRXQWDELOLW\ RI 1*2V WR ILQDQFLQJ DJHQFLHV ,PSOLFLW LQ )OYLDfV WLUDGH LV DOVR WKH LVVXH RI WKH LQWHUQDO G\QDPLFV RI 1*2V ZKLFK DUH GLIIHUHQW IURP WKRVH RI RWKHU VRFLDO PRYHPHQW RUJDQL]DWLRQV DQG VKH DUJXHV OHVV GHPRFUDWLF LQ WHUPV RI GHFLVLRQn PDNLQJ ,W HFKRHV &DUUROOfV GLVWLQFWLRQ EHWZHHQ JUDVVURRWV VXSSRUW RUJDQL]DWLRQV DQG JUDVVURRWV PHPEHUVKLS RUJDQL]DWLRQV f ZLOO H[DPLQH LVVXHV RI LQWHUQDO G\QDPLFV LQ &KDSWHU $Q +\EULG ,GHQWLW\ /HWfV FRPH EDFN WR WKH LVVXH RI SRO\VHP\ ZKLFK WKH 1*2 ODEHO HQWDLOV ,PSRUWDQW IHPLQLVW 1*2V VXFK DV 626&RUSR 62) ,' $& 5HGH 0XOKHU DUH PHPEHUV RI $%21* 626&RUSR DQG (' $& DUH PHPEHUV RI LWV ERDUG RI GLUHFWRUV 62) DQG 5HGH 0XOKHU DUH PHPEHUV RI WKH 6DR 3DXOR 1*2 )RUXP )UXP 3DXOLVWDGH 21*Vf ,Q D SHUIHFW H[DPSOH RI WKLV SROLVHP\ OHDGHUV RI WZR RI WKHVH RUJDQL]DWLRQV WROG PH WKHUH LV QR GLIIHUHQFH EHWZHHQ 1*2V DQG VRFLDO PRYHPHQWV
PAGE 106

1*2V 51)6'5 f %XW LQ WKHLU SUHVHQWDWLRQ IROGHU WKH QHWZRUN LV SUHVHQWHG DV D SROLWLFDO DUWLFXODWLRQ RI WKH ZRPHQfV PRYHPHQW LQ %UD]LO XUQD DUWLFXODQGR GR PRYLPHQWR GH PXOKHUHV GR %UDVLOf ZKLFK LV FRQVWLWXWHG RI ZRPHQfV JURXSV DQG 1*2V HWF 6LPLODUO\ WKHLU PHPEHUVKLS FULWHULRQ LV WKDW PHPEHUV FDQ EH DXWRQRPRXV JURXSV RU XQLYHUVLW\ ZRPHQnV VWXGLHV FHQWHUV RU LQGLYLGXDOV 51)6'5 f ,Q WKH ZRUGV RI )OYLD 1*2V DUH VWURQJO\ K\EULG GRQf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nV PRYHPHQW RU WKH %ODFN PRYHPHQW VKDUH WKH VDPH LGHQWLW\ DV ZRPHQ RU DV $IUR%UD]LOLDQV ZLWK YROXQWHHU SDUWLFLSDQWV RI WKH PRYHPHQW GHVSLWH GLIIHUHQFHV RI FODVV RU UDFH HWF ,Q WKH FDVH RI WKH IHPLQLVW 1*2V ZRUNHG ZLWK PRVW SDUWLFLSDQWV DOWKRXJK WR D OHVVHU GHJUHH IRU \RXQJHU PHPEHUV ZHUH YROXQWHHU DFWLYLVWV EHIRUH SURIHVVLRQDOL]LQJ 0RUHRYHU 1*2 PHPEHUV DUH DFWLYH DV PRYHPHQW SDUWLFLSDQWV LQ PRYHPHQWZLGH DFWLYLWLHV VXFK DV WKH %HLMLQJ SUHSDUDWLRQ DOWKRXJK WKH\ WHQGHG WR UHGXFH WKHLU LQYROYHPHQW

PAGE 107

LQ WKH SUHSDUDWLRQ IRU VWUHHW DFWLYLWLHV VXFK DV ,QWHUQDWLRQDO :RPHQn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nV JURXSV LQ WKH FDSDFLW\ RI D SURIHVVLRQDO RUJDQL]DWLRQ ZLWK D SRVVLELOLW\ RI FDUHHUn EXLOGLQJ ZRUN IRU RWKHU ZRPHQf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

PAGE 108

WKHPVHOYHV DV 1*2V ,W LV XQGHUVWDQGDEOH 7KLV LV DOVR WKH FDVH ZKHQ WKH\ ZDQW WR SUHVV DQ LVVXH DW WKH QDWLRQDO OHYHO QRW QHFHVVDULO\ OLQNHG WR ZRPHQnV LVVXHV EXW LQ FRQMXQFWLRQ ZLWK RWKHU SURJUHVVLYH 1*2V ZKR DUH WKHLU OHJLWLPDWH DOOLHV 2Q WKH RWKHU KDQG ZKHQ IHPLQLVW 1*2V VHH LW DV SROLWLFDOO\ DGYDQWDJHRXV WR SUHVHQW D PRELOL]HG DQG XQLILHG ZRPHQnV IURQW WR DSSO\ SUHVVXUH DQG VKRUH XS WKHLU OHJLWLPDF\ LQ FHUWDLQ IRUXPV VXFK DV DW 81&(' RU DW WKH SDUDOOHO IRUD RI 81 ZRPHQnV FRQIHUHQFHV WKH\ SUHVHQW WKHPVHOYHV DV SDUW RI WKH ZRPHQnV PRYHPHQW )RU H[DPSOH GRFXPHQWV SUHSDUHG IRU WKH %HLMLQJ :RPHQfV FRQIHUHQFH VHHP WR GHOLEHUDWHO\ LJQRUH RU PLQLPL]H WKH UROH RI 1*2V 7KH 'HFODUDWLRQ RI %UD]LOLDQ ZRPHQ IRU WKH WK :RUOG &RQIHUHQFH RQ :RPHQ 'HFODUDQGR GDV 0XOKHUHV %UDVLOHLUDV SDUD D ,9 &RQIHUHQFLD 0XQGLDO GDV 0XOKHUHVf XVHV WKH SKUDVH WKH %UD]LOLDQ ZRPHQfV PRYHPHQW KDV EHHQ RUJDQL]LQJ QDWLRQDOO\ R PRYLPHQWR GH PXOKHUHV QR %UDVLO YHP VH RUJDQL]DQGR QDFLRQDOPHQWH f ZKLOH WKH V\QWKHVLV RI WKH %UD]LOLDQ ZRPHQnV GRFXPHQW WDONV DERXW ZRPHQnV RUJDQL]DWLRQV DQG HPSKDVL]HV WKH RUJDQL]DWLRQDO GLYHUVLW\ RI WKRVH LQYROYHG LQ WKH DUWLFXODWLRQ :H LQYROYHG ZRPHQfV JURXSV ZLWK D FOHDU IHPLQLVW RULHQWDWLRQ RU QRW IHPLQLVW 1*2V 1*2V ZKR ZRUN SULQFLSDOO\ ZLWK ZRPHQ RU QRW ZRPHQfV JURXSV DFWLYH LQ WUDGHXQLRQV SURIHVVLRQDO RU QHLJKERUKRRG DVVRFLDWLRQV SROLWLFDO SDUWLHV FKXUFKHV DFDGHPLF FHQWHUV EHVLGHV RWKHU RUJDQL]DWLRQV RI FLYLO VRFLHW\ $UWLFXODIDR GH 0XOKHUHV %UDVLOHLUDV f 7KLV V\QWKHVLV DOVR HPSKDVL]HV WKH YROXQWHHU FKDUDFWHU RI WKH SURFHVV \HV RXU MRXUQH\ WR &KLQD ZLWK DOO LWV DFWLYLWLHV LV DQ LUUHIXWDEOH SURRI RI RQH DQG D KDOI \HDUV RI ZRUN E\ ZRPHQ VWHDOLQJ KRXUV KHUH DQG WKHUH LELGf 7KLV HPSKDVLV RQ WKH PRYHPHQW UDWKHU WKDQ RQ SURIHVVLRQDOL]HG DFWLYLVP LV OLNHO\ WR DOVR EH WKH UHVXOW RI WKH SUHVVXUH E\ YROXQWHHU DP UHIHUULQJ WR GRFXPHQWV HODERUDWHG E\ WKH PRYHPHQW QRW WR WKRVH HODERUDWHG E\ IHPLQLVW DFDGHPLFV IRU WKH %UD]LOLDQ JRYHUQPHQW IRU WKH RIILFLDO FRQIHUHQFH

PAGE 109

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fV JUHDW ,W VKRXOG QRW UHPDLQ LQ FODQGHVWLQLW\ $ IHPLQLVW SURIHVVLRQDO ZKDWf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fW WKLQN WKDW EHFDXVH \RX DUH DQ 1*2 PHDQV WKDW \RX VWRS EHLQJ SURJUHVVLYH DYDQ]DGRf WKDW \RX VWRS FRQWULEXWLQJ WR WKH PRYHPHQW +RZHYHU LW LV WKH RSLQLRQ RI PRVW YROXQWHHU ZRPHQ LQWHUYLHZHG ,Q D VWULNLQJ H[DPSOH RI WKLV SHUVSHFWLYH

PAGE 110

RQH ORQJWLPH YROXQWHHU IHPLQLVW GHILQHG 1*2V E\ WKHLU SROLWLFDO VHOOLQJRXW WR WKH 6WDWH DQG WKH GHYHORSPHQW DSSDUDWXV $QRWKHU YROXQWHHU IHPLQLVW WROG PH VKH KDG D IHPLQLVW IULHQG ZKRP VKH GLG QRW QDPH EXW ZKR ZRUNHG LQ D IHPLQLVW 1*2 DQG ZKR KDG FRQILGHG WR KHU WKDW IRU KHU 1*2V UHSUHVHQWHG D VKLIW RI WKH PRYHPHQW IURP VXEYHUVLRQ WR VXEYHQWLRQ $JDLQ VRPH RI WKHVH FULWLTXHV IURP ZLWKLQ WKH ZRPHQnV PRYHPHQW HFKR WKH FULWLFLVP OHYHOHG DW 1*2V LQ JHQHUDO LQ WKH DFDGHPLF OLWHUDWXUH &ULWLFV KDYH FODLPHG WKDW 1*2Vn SHUIRUPDQFH KDV EHHQ RYHUVWDWHG DQG WKDW WKH\ DUH EHFRPLQJ SDUW RI WKH SDFW RI GRPLQDWLRQ DORQJ ZLWK VWDWHV JOREDO GHYHORSPHQW DJHQFLHV DQG SULYDWH ILUPV WKXV FRPSURPLVLQJ WKHLU VRFLDO FKDQJH SRWHQWLDO &ODUN (YHUHWW +HO]QHU DQG 6KHSDUG +XOPH t (GZDUGV f %UD]LOLDQ 1*2V LQFOXGLQJ WKH ZRPHQnV KHDOWK 1*2V ZRUNHG ZLWK KDYH DW OHDVW RQH IRRW LQ WKH GHYHORSPHQW DUHQD LI RQO\ IRU WKH YHU\ IDFW WKDW WKHLU GRQRUV DUH SDUW DQG SDUFHO RI WKDW HVWDEOLVKPHQW DOWKRXJK ZLWK YDU\LQJ GHJUHHV +HQFH VRPH RI WKH UHFHQW SRVWVWUXFWXUDOLVW FULWLTXHV RI GHYHORSPHQW DSSO\ WR 1*2V DV ZHOO
PAGE 111

)RU RXU SXUSRVHV DQ LPSRUWDQW HOHPHQW RI WKH SRVWVWUXFWXUDOLVW FULWLTXH RI GHYHORSPHQW LV WKH FKDUJH WKDW LW GHSROLWLFL]HV WKH SUREOHPV RI SRYHUW\ E\ PDNLQJ WKHP DSSHDU WR EH HFRQRPLF DQG WHFKQLFDO SXVKLQJ LQWR WKH EDFNJURXQG WKH LVVXHV RI XQHTXDO GLVWULEXWLRQ RI UHVRXUFHV IURP ZKLFK WKHVH SUREOHPV VWHP (VFREDU f $V D UHVXOW GHYHORSPHQW KDV EHHQ FDOOHG WKH DQWLSROLWLFV PDFKLQH )HUJXVRQ f (VFREDU ZULWHV GHYHORSPHQW IRVWHUHG D ZD\ RI FRQFHLYLQJ RI VRFLDO OLIH DV D WHFKQLFDO SUREOHP DV D PDWWHU RI UDWLRQDO GHFLVLRQ DQG PDQDJHPHQW WR EH HQWUXVWHG WR WKDW JURXS RI SHRSOH WKH GHYHORSPHQW SURIHVVLRQDOV ZKRVH VSHFLDOL]HG NQRZOHGJH DOOHJHGO\ TXDOLILHG WKHP IRU WKH WDVN f 7KHVH SURIHVVLRQDOV DQG WKH LQVWLWXWLRQV WR ZKLFK WKH\ EHORQJ KDYH FUHDWHG FOLHQWV RXW RI WKLUG ZRUOG SHRSOH GLYLGLQJ WKHP LQ D VHULHV RI FDWHJRULHV VXFK DV SHDVDQWV RU WKH SRRU DQG KDYH VHW XS VWUXFWXUHG DJHQGDV DQG EXURFUDFLHV 7KH\ KDYH GHYHORSHG D ILHOG RI H[SHUW NQRZOHGJH (VFREDU f ,Q WKH FDVH RI ZRPHQ WKHUH KDV EHHQ DQ LQVWLWXWLRQDOL]DWLRQ DQG EXUHDXFUDWL]DWLRQ RI IHPLQLVW NQRZOHGJH LQ SDUWLFXODU RI WKH :RPHQ ,Q 'HYHORSPHQW RU :,' DSSURDFK ,W LV UHFRJQL]HG WKDW WKH :/' DSSURDFK KDV EHHQ DFFHSWHG E\ WKH GHYHORSPHQW DSSDUDWXV LQ SDUW EHFDXVH LW VKDUHV PDQ\ RI LWV DVVXPSWLRQV ,Q SDUWLFXODU LW DGYRFDWHV IRU WKH PDLQVWUHDPLQJ DQG LQWHJUDWLRQ RI ZRPHQ LQ GHYHORSPHQW HIIRUWV DUJXLQJ WKDW GHYHORSPHQW ZLOO EH PRUH HIILFLHQW LI ZRPHQnV SURGXFWLYH UROHV DUH WDNHQ LQWR DFFRXQW .DEHHU f 7KH OLPLWDWLRQV RI WKLV DSSURDFK KDYH EHHQ GLVFXVVHG WKRURXJKO\ E\ .DEHHU f 7KH 1*2V ZRUNHG ZLWK GR QRW QHFHVVDULO\ VKDUH D :,' YLHZ ,Q JHQHUDO WKH\ DGRSW D PRUH VWUXFWXUDOLVW DSSURDFK ZKLFK PD\ ILQG LWV RULJLQV LQ WKH 0DU[LVWRULHQWHG JURXSV LQ ZKLFK PRVW IHPLQLVW DFWLYLVWV ZHUH ILUVW SROLWLFDOO\ DFWLYH 7KH HTXLW\HPSRZHUPHQW DUJXPHQW LV LPSRUWDQW WR WKHP +RZHYHU DV DQ $IUR%UD]LOLDQ

PAGE 112

IHPLQLVW DFWLYLVW IURP D YROXQWHHU RUJDQL]DWLRQ FODLPHG 1*2V KDYH EXUHDXFUDWL]HG DFWLYLVP 7KHUH LV QR GRXEW WKDW SURIHVVLRQDOL]HG IHPLQLVW JURXSV KDYH IDFLOLWDWHG WKH WUDQVODWLRQ RI VRFLDO PRYHPHQW NQRZOHGJH LQFOXGLQJ IHPLQLVW DQG SRSXODU PRYHPHQW PHWKRGRORJLHVf LQWR H[SHUW NQRZOHGJH 7R TXRWH (VFREDU DJDLQ WKH FRQFHSW RI SURIHVVLRQDOL]DWLRQ UHIHUV PDLQO\ WR WKH SURFHVV WKDW EULQJV WKH WKLUG ZRUOG LQWR WKH SROLWLFV RI H[SHUW NQRZOHGJH DQG :HVWHUQ VFLHQFH LQ JHQHUDO f 7KLV NQRZOHGJH QRZ KDV D SULFH VLQFH VRPH IHPLQLVW DFWLYLVWV ZRUN DV FRQVXOWDQWV LQFOXGLQJ IRU RWKHU ZRPHQnV JURXSV $W WKH VDPH WLPH WKHUH LV QR GRXEW WKDW WKH IHPLQLVW PRYHPHQW DQG RWKHU PRYHPHQWV VXFK DV WKH HQYLURQPHQWDO PRYHPHQW RU SRSXODU PRYHPHQWVf KDYH LQIOXHQFHG GHYHORSPHQW SUDFWLFHV +RZHYHU ZKDW ZDV DQ H[HUFLVH LQ FRQVFLRXVQHVVUDLVLQJ ZLWK VRFLDO PRYHPHQW DFWLYLVWV UXQV WKH ULVN RI EHFRPLQJ D WUDLQLQJ ZRUNVKRS ZLWK GHYHORSPHQW H[SHUWV WKXV ZLWK WKH SRWHQWLDO WR VKDGH RII WKH FROOHFWLYH DQG SROLWLFDO URRWV RI SDUWLFLSDQWVf SUREOHPV /RQJWLPH LQVLGHU REVHUYHU RI 1*2V /HLODK /DQGLP Df DUJXHV WKDW WKH WHQVLRQ EHWZHHQ WKH SROLWLFDO DQG WKH SURIHVVLRQDOWHFKQLFDO DVSHFWV RI WKH ZRUN RI 1*2V KDV DOZD\V H[LVWHG VLQFH WKHLU LQFHSWLRQ EHFDXVH 1*2V ZHUH ERP RXW RI WKH ZLOOLQJQHVV WR EULQJ WRJHWKHU GLIIHUHQW SROLWLFDO SRVLWLRQV DQG WKH SRVLWLRQ RI SURJUHVVLYH UHOLJLRXV SHRSOH f .DEHHU f ZDUQV XV QRW WR HTXDWH WKH WHFKQLFDO ZLWK WKH QRQLGHRORJLFDO RU QRQSROLWLFDO WKRXJK :KDW LV WHFKQLFDO PD\ VHHP QRQLGHRORJLFDO EHFDXVH LW UHVWV RQ DQG GRHV QRW TXHVWLRQ WKH FXOWXUDO SUHPLVHV RI WKH GRPLQDQW GLVFRXUVH LQ WKLV FDVH RI WKH GHYHORSPHQW HVWDEOLVKPHQW DQG RI :HVWHUQ FXOWXUH DQG VFLHQFH LQ JHQHUDO ,Q %RXUGLHXnV WHUPLQRORJ\ LW IROORZV WKH RUWKRGR[LF RUGHU

PAGE 113

$V PHQWLRQHG HDUOLHU WKH SULPDU\ LQVWLWXWLRQDO OLQN EHWZHHQ 1*2V DQG WKH GHYHORSPHQW HVWDEOLVKPHQW DUH ILQDQFLQJ DJHQFLHV &ODUN f DUJXHV WKDW DV QDWLRQDO DQG LQWHUQDWLRQDO GHYHORSPHQW DJHQFLHV IURP WKH QRUWK LQFUHDVLQJO\ DUH IXQGLQJ 1*2V WKH OHVV UDGLFDO DPRQJ WKH ODWWHU KDYH EHHQ WDLORULQJ WKHLU SURJUDPV WR WKH GLUHFWLYHV RI WKH IRUPHU WKXV UHIOHFWLQJ WKH GRQRUVn PDLQVWUHDP LGHRORJ\ DQG PHWKRGRORJ\ 7KLV DUJXPHQW LV ZRUWK\ RI LQWHUHVW FRQVLGHULQJ WKH SUROLIHUDWLRQ RI 1*2V ZKLFK LQ WKH V DQG V ZHUH IRXQGHG LQ SDUW E\ HFRQRPLFDOO\ GLVSODFHG SURIHVVLRQDOV ZKR ORVW WKHLU MREV ZLWK 6WDWH DJHQFLHV GXH WR VWUXFWXUDO DGMXVWPHQW SURJUDPV DQG IRXQG DQ DOWHUQDWLYH IRU HPSOR\PHQW LQ WKH IXQGLQJ DYDLODEOH IRU 1*2V %HEELQJWRQ HW DO f 7KHVH PRUH RSSRUWXQLVWLF OHVV UDGLFDO 1*2V PLJKW EH OHVV TXHVWLRQLQJ RI ILQDQFLQJ DJHQFLHVn SURMHFWV LQ %HEELQJWRQfV FDVH RI WKH 6WDWHf EHFDXVH WKH\ QHHG WR VHFXUH DQ LQFRPH UDWKHU WKDQ WR VWUXJJOH IRU VRFLDO FKDQJH 3XEOLF RSLQLRQ LV DZDUH RI WKH H[LVWHQFH RI WKHVH RSSRUWXQLVWLF 1*2V ZKLFK XQGHUPLQHV WKH OHJLWLPDF\ RI DOO 1*2V LELGf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f )RU H[DPSOH WKH :RUOG %DQN D OHDGHU LQ GHYHORSPHQW SURMHFW ILQDQFLQJ FDOOHG LWV VWUDWHJ\ IRU WKH QLQHWLHV 6HH FKDSWHU UHODWLRQV ZLWK WKH 6WDWH IRU D GLVFXVVLRQ RI VRFLDO LQYHVWPHQW IXQGV LQ SDUWLFXODU LQ %UD]LO ZKHUH WKH\ KDYH EHHQ OHVV SURPLQHQW WKDQ LQ RWKHU SDUWV RI /DWLQ $PHULFD

PAGE 114

PDUNHW IULHQGO\ GHYHORSPHQW 7KLV VWUDWHJ\ ZDV FRQVLGHUHG E\ $UWXUR (VFREDU DV WKH ILQDO FU\VWDOOL]DWLRQ RI WKH UHWXUQ RI QHROLEHUDOLVP f 6RPH /DWLQ $PHULFDQ 1*2V KDYH UHIXVHG WKLV W\SH RI ILQDQFLQJ DV WKLV ZRXOG FRQVWLWXWH DQ HQGRUVHPHQW RI VWUXFWXUDO DGMXVWPHQW SURJUDPV LQ WKHLU H\HV %HEELQJWRQ HW DO f %HEELQJWRQ DUJXHV WKDW WKH SRVLWLYH VLGH RI WKLV VLWXDWLRQ LV WKDW ZKHQHYHU 1*2V KDYH DFFHSWHG WKHVH SURMHFWV WKH\ KDYH KDG D VD\ LQ KRZ SXEOLF PRQH\ ZDV DOORFDWHG LELG f ,W LV SRVLWLYH LI ZH FRQVLGHU WKDW 1*2Vf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nV SKUDVH HVSHFLDOO\ ZKHQ WKH\ ZRUN ZLWK DQGRU IRVWHU ORFDO JURXSV DQG DUH DZDUH RI WKH LPSOLFDWLRQV RI WKHLU LQVWLWXWLRQDO OLQNV WR WKH GHYHORSPHQW HVWDEOLVKPHQW 7KHVH JURXSV FDQ FRQWULEXWH WR SURYLGLQJ WKH VSDFHV QHHGHG IRU DOWHUQDWLYHV WR GHYHORSPHQW VXJJHVWHG E\ (VFREDU f +H HPSKDVL]HV WKH UROH WKDW ORFDO RUJDQL]LQJ LQ WKH 6RXWK VKRXOG SOD\ LQ WKH IXWXUH RI WKHLU RZQ VRFLHWLHV E\ DOORZLQJ SHRSOH WR GHILQH WKHLU RZQ QHHGV DQG VWUDWHJLHV DV WKH\ QHJRWLDWHUHVLVW FXOWXUDO DQG HFRQRPLF GRPLQDWLRQ E\ WKH 1RUWK 6LPLODUO\ .DEHHU DUJXHV IRU WKH QHHG WR FRPH XS ZLWK WUDQVLWLRQDO VWUDWHJLHV EHIRUH ZH JHW WR RXU ILQDO YLVLRQ RI D VRFLHW\ RUJDQL]HG RQ IHPLQLVW SULQFLSOHV f 7R GR VR ZH VKRXOG WDNH DGYDQWDJH RI

PAGE 115

WKH FRQWUDGLFWLRQV SUHVHQW LQ WKH GHYHORSPHQW HVWDEOLVKPHQW EHFDXVH WKH ODWWHU GRHV QRW UHSUHVHQW D PRQROLWKLF VHW RI LQWHUHVWV VHH SROLWLFDOO\ DZDUH 1*2V DV SDUW RI VXFK DQ LQWHUPHGLDWH VWUDWHJ\ 7KH LGHDO VHWXS IRU VRFLDO FKDQJH LV WKDW RI D WZRSURQJHG VWUDWHJ\ ZLWK ZRPHQ DFWLYLVWV ERWK ZLWKLQ DQG ZLWKRXW WKH GHYHORSPHQW DUHQD MXVW DV 6RQLD $OYDUH] f DUJXHG LQ WKH FDVH RI WKH 6WDWH $OO DFWLYLVWV LQYROYHG QHHG WR EH ZDU\ QRW WR WLOW WR EDODQFH WRR IDU LQ WKH GLUHFWLRQ RI WKRVH ZLWKLQ 7KLV WHQGV WR KDSSHQ EHFDXVH WKRVH FORVHU WR WKH SRZHU KROGHUV KDYH PRUH UHVRXUFHV DQG SRZHU DV ZLOO GLVFXVV LQ WKH FRPLQJ FKDSWHUV 7KH :RPHQnV 0RYHPHQW DV 6RFLDO 0RYHPHQW )LHOG $W WKLV SRLQW ZDQW WR UHHQJDJH RXU WKHRUHWLFDO GLVFXVVLRQ EHJXQ LQ FKDSWHU RQ WKH QDWXUH RI VRFLDO PRYHPHQWV DQG WKH SODFH RI RUJDQL]DWLRQV ZLWKLQ WKHP 7KH FRQFHSW RI VRFLDO PRYHPHQW ILHOG LV SDUWLFXODUO\ ZHOOVXLWHG ZLWK UHJDUG WR WKH ZRPHQf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£ LQ WKH 6RXWK DQG 3LDXL LQ WKH 1RUWK GRPHVWLF ZRUNHUV DFDGHPLFV

PAGE 116

WUDGHXQLRQLVWV PHPEHUV RI WKH IHGHUDO FRQJUHVV DORQJ ZLWK PHPEHUV RI ZRPHQnV RUJDQL]DWLRQV RI DOO NLQGV DQG WKH QHZO\ DSSRLQWHG SUHVLGHQW RI WKH UHFHQWO\ UHYLYHG &1'0 5RVLVND 'DUF\ GH 2OLYHLUD ZHUH SUHVHQW DW WKH FRQIHUHQFH +RZHYHU D QXPEHU RI SURIHVVLRQDOL]HG IHPLQLVWV NH\ ILJXUHV RI WKH 6DR 3DXOR ZRPHQnV KHDOWK PRYHPHQW ZHUH QRWDEO\ DEVHQW $ %ODFN IHPLQLVW WUDGHXQLRQLVW IURP 6DR 3DXOR ZDV SOHDVHG ZLWK WKH GLYHUVLW\ RI WKH FRQIHUHQFH 6KH VDLG WKH DUWLFXODWLRQV ZRUNHG ZHOO WKH DUWLFXODWLRQ RI LQGLJHQRXV ZRPHQ ZRPHQ ZLWK GLVDELOLWLHV EODFN ZRPHQ HYHU\ERG\ ,W ZDV D YHU\ ULFK SURFHVV WKLQN LW LV SURGXFWLYH 6LPLODUO\ WKH HYDOXDWLRQ RI WKH FRQIHUHQFH E\ 0DWLOGH 5LEHLUR SURIHVVLRQDOL]HG IHPLQLVW DQG OHDGHU LQ WKH %ODFN ZRPHQfV PRYHPHQW LV WKDW $IUR%UD]LOLDQ ZRPHQ ZHUH QRZ QRW RQO\ SUHVHQW DW WKH PHHWLQJV LQ RUGHU WR GHQRXQFH WKH DEVHQFH RI WKHLU LVVXHV RQ WKH DJHQGD EXW SDUWLFLSDWLQJ LQ WKH HODERUDWLRQ >RI WKH 'HFODUDWLRQ RI %UD]LOLDQ :RPHQ@ HQVXULQJ YLVLELOLW\ RI WKH UDFH LVVXH 5LEHLUR f 2QH RI WKH IHZ LQGLJHQRXV ZRPHQ DFWLYLVWV SUHVHQW ZKRP LQWHUYLHZHG VDLG ZH GRQfW GLVFULPLQDWH LI LW LV D SURVWLWXWH D GRPHVWLF ZRUNHU DQ ,QGLDQ ZRPDQ D EODFN ZRPDQ D OHVELDQ D IHPLQLVW ,QGHHG SURVWLWXWHV ZHUH SUHVHQW IRU WKH ILUVW WLPH DW D QDWLRQDO ZRPHQnV PRYHPHQW HYHQW 7KLV RI FRXUVH GRHV QRW PHDQ WKDW DOO WURXEOHV RI LQWHJUDWLQJ IHPLQLVPV DUH RYHU EXW LW LV D VHULRXV VWHS IRUZDUG 7KH VWUHQJWKHQLQJ RI SRSXODU DIUREUD]LOLDQ DQG OHVELDQ IHPLQLVPV LQ %UD]LO KDYH EHHQ QRWHG DQG FRPPHQWHG XSRQ E\ VFKRODUV DQG DFWLYLVWV DOLNH $OYDUH] 6RDUHV HW DO f )RU WKH KLVWRU\ RI WKH %ODFN :RPHQfV 0RYHPHQW VHH *HOHGHV f DQG 5LEHLUR f DQG WKH OLPLWDWLRQV RI WKH LQFOXVLRQ RI $IUR%UD]LOLDQ DQG LQGLJHQRXV ZRPHQ LQ WKH IHPLQLVW PRYHPHQW VHH DOVR *XLOKHUPH f DQG &,0 f )RU SRSXODU IHPLQLVP &LWHOL f DQG OHVELDQ IHPLQLVP VHH &ROHWLYR GH )HPLQLVWDV /VELFDV f

PAGE 117

7KH GRFXPHQW ZKLFK UHVXOWHG IURP WKLV FRQIHUHQFH WKH 'HFODUDWLRQ RI %UD]LOLDQ ZRPHQ IRU WKH WK :RUOG &RQIHUHQFH RQ :RPHQ VKRZV WKDW GLYHUVLW\ LQFOXGLQJ RUJDQL]DWLRQDO IRUPV LV LQGHHG KLJKO\ SUDLVHG 7KH WKLUG SDUDJUDSK RI WKH GRFXPHQW UHDGV 7KLV >SUHSDUDWLRQ@ SURFHVV ZDV UHPDUNDEOH IRU LWV UHVSHFW RI GLYHUVLWLHV DQG IRU LWV PXOWLSOLFLW\ RI RUJDQL]DWLRQDO IRUPV D SURRI RI WKH ZRPHQfV PRYHPHQWnV ULFKQHVV :H FRPH IURP GLIIHUHQW UHJLRQV UDFHHWKQLF JURXSV DJHV ZH KDYH GLIIHUHQW VH[XDO SUHIHUHQFHV SK\VLFDO DQG PHQWDO FKDUDFWHULVWLFV UHOLJLRXV DQG SDUW\ DOOHJLDQFHV ZKLFK H[SUHVV RXU FXOWXUDO DQG VRFLDO GLIIHUHQFHV WH[W DSSURYHG DW WKH &RQIHUHQFH SOHQDU\ VHVVLRQ RQ -XQH f XQGHUVWDQG 1*2V DQG YROXQWHHU RUJDQL]DWLRQDO IRUPV DV DQRWKHU GLPHQVLRQ RI WKLV GLYHUVLW\ 6WDUWLQJ IURP DQ XQGHUVWDQGLQJ RI VRFLDO PRYHPHQW ILHOGV DV KHWHURJHQHRXV ZHEV RI LQWHUFRQQHFWHG RUJDQL]DWLRQV RU DVVRFLDWLRQV RI LQGLYLGXDOV ZKR VKDUH D VHW RI SROLWLFDO DQG HWKLFDO LGHDV FRQVLGHU OLNH PRVW DFWLYLVWV ZRUNHG ZLWK WKDW IHPLQLVW 1*2V DUH SDUW RI WKH IHPLQLVW PRYHPHQW :RPHQnV 1*2V UHSUHVHQW WKH PRVW LQVWLWXWLRQDOL]HG SROH RI WKH PRYHPHQW 7KH\ UHSUHVHQW WKH DGYRFDF\FHQWHUHG UHIRUPLVW SDUW RI WKH ZRPHQnV PRYHPHQW ZKLFK ZRUNV LQFUHDVLQJO\ ZLWKLQ WKH PDLQVWUHDP SROLWLFDO DUHQD DW WKH QDWLRQDO DQG LQWHUQDWLRQDO OHYHO RIWHQ XVLQJ WKH VWUDWHJLHV RI D OREE\LQJ JURXS :KDW DUH WKH FRQVHTXHQFHV IRU GHPRFUDWL]DWLRQ DQG JHQGHUHG VRFLDO FKDQJH RI %UD]LOLDQ VRFLHW\ RI WKLV QHZ IRUP RI DFWLYLVP" :KDW GRHV LW PHDQ IRU WKH LQWHUQDO G\QDPLFV DQG WKH VHDUFK IRU D QHZ VRFLDELOLW\ RI PRYHPHQW RUJDQL]DWLRQV" +RZ GRHV LW DIIHFW WKH PRYHPHQWnV FDSDFLW\ WR VWUHQJWKHQ WKH YRLFH RI OHVV SULYLOHJHG %UD]LOLDQV" 7R ZKDW GHJUHH ZLOO WKH PRYHPHQW EH FKDQQHOHG E\ HOLWH ILQDQFLQJ DJHQFLHV" 7KHVH ZLOO EH WKH TXHVWLRQV H[DPLQHG LQ WKH UHVW RI WKLV ZRUN

PAGE 118

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nW NQRZ XS WR ZKDW SRLQW ZH DUH DEOH WR FUHDWH DQ DOWHUQDWLYH RUJDQL]DWLRQ VLQFH LQ IDFW ZH DUH SULVRQHUV RI D SDUWLFXODU VWUXFWXUH >5DFKHO SURIHVVLRQDOL]HG IHPLQLVW )t6@ ,QWURGXFWLRQ ,Q %UD]LO DV LQ WKH 8QLWHG 6WDWHV WKH IHPLQLVW LGHRORJ\ RI WKH V HDUO\ V FDUULHG VWURQJ HJDOLWDULDQ WRQHV HPSKDVL]LQJ VRFLDO UHODWLRQV EDVHG RQ HTXDOLW\ ZRPHQnV DXWRQRP\ VHOIKHOS DQG FROOHFWLYH DFWLRQ >,W@ VWUHVVHG HTXDOLW\ LQ DOO SKDVHV RI WKH RUJDQL]DWLRQnV RSHUDWLRQ GHFLVLRQPDNLQJ WKH GLYLVLRQ RI ODERU DQG DFFHVV WR NQRZOHGJH ZDJHV DQG RWKHU UHZDUGV > @ 3URJUDPV ZHUH IRUPXODWHG E\ ZRPHQ DQG IRU ZRPHQ PDQLIHVWLQJ WKH JRDO RI VHOIGHWHUPLQDWLRQ E\ WKH FROOHFWLYH DQG IDFLOLWDWLQJ FRQWURO E\ LQGLYLGXDO ZRPHQ RYHU WKHLU OLYHV 0RUJHQ f 7KHVH JURXSV VHDUFK IRU DOWHUQDWLYHV WR WKH KLHUDUFKLFDO SULQFLSOHV ZKLFK KDYH VWUXFWXUHG ODUJHVFDOH FRPSOH[ VRFLHWLHV VLQFH WKH QHROLWKLF %RXOGLQJ f 7KH\ VHDUFK IRU D QHZ VRFLDELOLW\ :KDW KDSSHQV WR WKLV LGHRORJ\ DQG RUJDQL]DWLRQDO IHDWXUHV ZKHQ WKH\ DUH IDFHG ZLWK WKH SUDJPDWLFV RI SURMHFW REMHFWLYHV JHQGHU HTXLW\ ELOOV WR SDVV LQ &RQJUHVV DQG WKH UHDOLW\

PAGE 119

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f 7KLV LVVXH LV HYHQ PRUH UHOHYDQW LI ZH FRQVLGHU WKDW SUDFWLFHV DUH QRW VLPSO\ LQIOXHQFHG E\ LGHRORJ\ EXW DOVR GR LQIOXHQFH D JURXSnV FROOHFWLYH LGHQWLW\ DV GLVFXVVHG LQ FKDSWHU 6DQGUD 0RUJHQ IRU H[DPSOH GHPRQVWUDWHG EHDXWLIXOO\ KRZ WKH FROOHFWLYH LGHQWLW\ RI WKH :RPHQnV +HDOWK &ROOHFWLYH VKH VWXGLHG FKDQJHG DV D UHVXOW RI WKH LQFRUSRUDWLRQ LQ LWV VWDII RI ZRPHQ RI FRORU RI ZRUNLQJ FODVV RULJLQ DV D UHVXOW RI D IHGHUDOO\ IXQGHG SURMHFW f 7KH VSRWOLJKWV DUH WKXV QRZ WXUQLQJ RQWR WKH IRXU JURXSV ZRUNHG ZLWK PRUH FORVHO\ DOO RI ZKLFK KDYH D YDOXDEOH FRQWULEXWLRQ WR PDNH WR WKH %UD]LOLDQ ZRPHQn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n UHODWLRQV 7KH\ GR QRW LQ VRPH FDVHV VXFK DV IRU WKHLU DGPLQLVWUDWLYH SHUVRQQHO PDLQWDLQ D IHPLQLVW LGHQWLW\ DV HVVHQWLDO IRU SDUWLFLSDWLRQ

PAGE 120

, WKHQ ORRN IRU VRPH RI WKH SURFHVVHV WKDW KDYH SXVKHG 1*2V LQ WKLV GLUHFWLRQ 7KHVH LQFOXGH WKH GLIILFXOWLHV H[SHULHQFHG E\ YROXQWHHU JURXSV LQ PDLQWDLQLQJ DGPLQLVWUDWLYH FRQWLQXLW\ ZLWK DOWHUQDWLYH IRUPV RI RUJDQL]DWLRQV VXFK DV URWDWLQJ GXWLHV DV ZHOO DV WKH QHHG IRU SURIHVVLRQDO KHOS WR HQVXUH SURSHU IXOILOOPHQW RI DFFRXQWLQJ UHTXLUHPHQWV WR GRQRU DJHQFLHV ,Q RUGHU WR SUHVHUYH DV EHVW FDQ WKH DQRQ\PLW\ RI WKH JURXSV DQG EHFDXVH P\ LQWHUSUHWDWLRQ RI PHPEHUVn VWDWHPHQWV DQG EHKDYLRUV PLJKW QRW FRLQFLGH ZLWK WKH ZD\ WKH\ ZRXOG OLNH WR EH SRUWUD\HG ZLOO XVH SVHXGRQ\PV QDPHG WKH WZR 1*2V ZRUNHG ZLWK PRVW FORVHO\ 6DGH 3DUD 7RGDV 637f DQG )HPLQLVWDV t 6DGH )t6f ZKLOH WKH YROXQWHHU JURXSV DUH UHQDPHG &DVD GD 0XOKHU &0f DQG 0XOKHUHV 8QLGDV 08f UHDOL]H WKDW WKRVH ZKR PDLQWDLQ FORVH FRQWDFW ZLWK WKHVH JURXSV ZLOO EH DEOH WR LGHQWLI\ WKHP 7KHUHIRUH KDYH EHHQ FDUHIXO WR PDVN DQG FKDQJH GHWDLOV DQG VLWXDWLRQV ZKHQ P\ ZULWLQJ FRXOG EH GHWULPHQWDO WR WKH JURXS 6QDSVKRWV RI (QFRXQWHUV ZLOO VWDUW ZLWK WZR EULHI VNHWFKHV SXW WRJHWKHU RQ WKH EDVLV RI P\ ILHOGQRWHV DQG PHPRU\ ZKLFK FRQYH\ VRPH RI WKH GLIIHUHQFHV LQ WKH DWPRVSKHUH DQG FKDUDFWHU RI 0XOKHUHV 8QLGDV 08f D YROXQWHHUEDVHG JURXS DQG )HPLQLVWDV t 6DGH )t6f D SURIHVVLRQDOL]HG RUJDQL]DWLRQ 7KH RIILFH RI WKH ODWWHU LV QHDW WLG\ DQG ZHOFRPLQJ ZLWK URRPV DQG SHRSOH IXOILOOLQJ GLIIHUHQW IXQFWLRQV ZKLOH WKH RWKHU KDV DPSOH VSDFH IRU UHODWLYHO\ ODUJH QXPEHUV RI SHRSOH WR PHHW DQG ZLWK UHODWLYHO\ XQVSHFLILF IXQFWLRQV DV ZHOO DV EHLQJ GDULQJ DQG DOWHUQDWLYH LQ LWV RXWORRN :KDW GLG QRW VHH RQ WKDW ILUVW YLVLW ZDV )t6n GRFXPHQW FHQWHUVWDII PHHWLQJ URRP DV ZHOO DV WKH WZR VPDOO URRPV ZKHUH WKHLU DFFRXQWDQW DQG VHFUHWDU\ ZRUN HTXLSSHG ZLWK DQRWKHU FRPSXWHU D FRS\ PDFKLQH DQG D ID[ PDFKLQH

PAGE 121

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f DQG D ODVW RQH ZLWK WZR ZRPHQ NLVVLQJ :H WKHQ HQWHUHG D VPDOO URRP ZLWK D ODUJH DQG ORZ URXQG WDEOH LQ LWV FHQWHU $URXQG WKH WDEOH ZKLFK WRRN PRVW RI WKH VSDFH DQG DORQJ WKH ZDOOV ODLG D VHW RI ORZ FRXFKHV ZLWK WKHLU ZRUQRXW QRQPDWFKLQJ FXVKLRQV 7KHVH SLHFHV DQG D VPDOO WDEOH ZLWK D WHOHSKRQH DQG DQRWKHU FRYHUHG ZLWK SDPSKOHWV DQG QHZVOHWWHUV FRPSOHWHG WKH URRPnV IXUQLWXUH 7KH ZDOOV ZHUH OLQHG ZLWK IHPLQLVW SRVWHUV IURP YDULRXV FRXQWULHV QRWHG VHYHUDO IURP

PAGE 122

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nFDPHORWVn RU VWUHHWYHQGRUV VHOOLQJ DQ\WKLQJ IURP VKRHVWULQJV RU VPDOO UDGLRV WR ORFDOO\SURGXFHG FKHHVH :DONLQJ DZD\ IURP WKLV EXV\ VTXDUH WRRN D ULJKW RQ D TXLHW VWUHHW OLQHG ZLWK VLPSOH EXW ZHOONHSW KRXVHV
PAGE 123

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n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nFDIH]LQKRn 6WHSSLQJ LQWR WKH NLWFKHQ ZDV OLNH HQWHULQJ EDFNVWDJH 7ZR ZRPHQ ZHUH WKHUH FKDWWLQJ LQ WKH VXQOLW URRP IXUQLVKHG ZLWK D VWRYH IULGJH URXQG WDEOH DQG WZR FKDLUV $IWHU WKH FDIH]LQKR GXULQJ ZKLFK ZH

PAGE 124

,OO H[FKDQJHG VPDOO WDON 5RVHPHLUH VDLG JRRGE\H DQG ZHQW XSVWDLUV ZKLOH WKH VHFUHWDU\ WRRN PH EDFN WR WKH IURQW GRRU 'HPRFUDWL]DWLRQ DQG 1*2Vn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

PAGE 125

WKH OLIH RI WKH JURXS 7KH\ KDYH EHHQ KHOG DW WKH VDPH WLPH DQG WKH VDPH SODFH HYHU\ ZHHN IRU D QXPEHU RI \HDUV QRZ DQG DUH RSHQ WR DQ\ERG\ LQWHUHVWHG ,Q DOO WKUHH RWKHU RUJDQL]DWLRQV LQFOXGLQJ WKH &DVD WKHUH LV QR VXFK WDONLQJ DJHQGD DQG WKH EXOOHWLQ ERDUG GRHV QRW VHUYH VXFK DQ LPSRUWDQW IXQFWLRQ ,W VHUYHV PDLQO\ DV DQ LQIRUPDWLYH WRRO WR DQQRXQFH RXWVLGH HYHQWV RUJDQL]HG E\ RWKHU RUJDQL]DWLRQV FRQIHUHQFHV HWF ,Q ERWK 1*2V LW LV ORFDWHG LQ FRPPRQ DUHDV KDOOZD\ RU NLWFKHQf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t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

PAGE 126

6RFLDO &RQWURO *HQHUDO $VVHPEOLHV DQG %RDUGV RI 'LUHFWRUV $ PDMRU GLIIHUHQFH EHWZHHQ SURIHVVLRQDOL]HG DQG YROXQWHHU IHPLQLVW RUJDQL]DWLRQV LV WKDW DW OHDVW LQ SULQFLSOH LQ YROXQWHHU JURXSV WKH JHQHUDO OLQHV RI ZRUN DUH GHILQHG E\ WKH JHQHUDO DVVHPEO\ RI WKHLU PHPEHUV DVVHPEOLD JHUDOf ZKR DOVR HOHFWV WKH PHPEHUV RI WKH %RDUG RI 'LUHFWRUV ^'LUHWRULDf ZKR DUH LQ FKDUJH 7KLV LV WKH FDVH DW 08 DQG DW WKH &DVD 7KH RQO\ UHVWULFWLRQ IRU DQ\ PHPEHU RQ KHU ULJKW WR YRWH RU WR EH YRWHG WR WKH %RDUG RI 'LUHFWRUV LV D PLQLPXP SHULRG RI SDUWLFLSDWLRQ IRU H[DPSOH PRQWKV IRU &DVD GD 0XOKHUf ,Q ERWK RUJDQL]DWLRQV WKH %RDUG RI 'LUHFWRUV LV HOHFWHG IRU WZR \HDUV DQG WKH *HQHUDO $VVHPEO\ LV WR PHHW HYHU\ \HDU 7KH ODVW *HQHUDO $VVHPEO\ KHOG DW WKDW SRLQW E\ 08 KDG JDWKHUHG ZRPHQ 2Q WKH RWKHU KDQG )t6nV *HQHUDO $VVHPEO\ LV UHVWULFWHG WR DFWLYH PHPEHUV ZKR IXOILOO VSHFLILF WDVNV IRU WKH GHYHORSPHQW RI WKH RUJDQL]DWLRQ )t6 VWDWXWHf 7KLV DVVHPEO\ XVHG WR HOHFW WKT 'LUHWRULD ZKRVH PHPEHUV ZHUH LQ IDFW WKH )t6 VWDII PHPEHUV ,Q WKH VWDWXWHV ZHUH PRGLILHG DQG QRZ VWDWH WKDW WKH %RDUG RI 'LUHFWRUV ZKRVH PHPEHUV DUH WKH VWDII PHPEHUV ZLOO UHPDLQ LQ FKDUJH LQGHILQLWHO\ ILFD HP SUD]R LQGHWHUPLQDGR R PDQGDWR GHVWD GLUHWRULDf 7KLV DOWHUDWLRQ UHIOHFWV WKH FKDQJHV LQ WKH QDWXUH RI )t6 IURP D ZRPHQn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

PAGE 127

KDYH DIILQLWLHV ZLWK WKH ZRUN RI 637 FDQ SDUWLFLSDWH LQ WKH *HQHUDO $VVHPEO\ 7KH *HQHUDO $VVHPEO\ HOHFWV WKH %RDUG RI 'LUHFWRUV ZKR DUH QRW DV LQ WKH FDVH RI )t6 WKH VWDII PHPEHUV WKHPVHOYHV EXW DUH FKRVHQ DPRQJ IRUPHU VWDII PHPEHUV EHQHILFLDULHV DQG RWKHU LQWHUHVWHG LQGLYLGXDOV 7KH %RDUG RI 'LUHFWRUV PHHWV ZLWK VRPH VWDII PHPEHUV HYHU\ PRQWK DQG LV WKHQ WR DSSURYH WKH ZRUN GRQH ,Q SUDFWLFH WKH GLIIHUHQFH EHWZHHQ )t6 DQG WKH RWKHU JURXSV LV QRW DV JUHDW DV LW PLJKW VHHP 'XULQJ LWV KLVWRU\ 637 KDV H[SHULHQFHG WUDXPDWLF FKDQJHV RI %RDUG RI 'LUHFWRUV ZKLFK PHDQW VLJQLILFDQW FKDQJHV IRU WKH SROLWLFDO OLQH RI WKH RUJDQL]DWLRQ %XW WRGD\ 637n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f +RZHYHU D PHPEHU RI DQRWKHU YROXQWHHU ZRPHQnV RUJDQL]DWLRQ ZKLFK IXQFWLRQV RQ D VLPLODU PRGHO UHFDOOV ZKDW KDSSHQHG DW WKHLU ODVW DVVHPEO\

PAGE 128

6R ZH KDYH JHQHUDO DVVHPEOLHV ZLWK DERXW ZRPHQ DQG GXULQJ WKH ODVW DVVHPEO\ IRU H[DPSOH WKHUH ZHUH ZRPHQ ZKR ZHUH DJDLQVW DERUWLRQ :RPHQ IURP WKH EDVH FDQQRW XQGHUVWDQG ZK\ ZH GLVFXVV DERUWLRQ DQG WKLV ZRPDQ VKH LV D 8%0 PHPEHU VKH RUJDQL]HV ZRPHQ LQ KHU QHLJKERUKRRG HWF 6R ZH WDONHG LW RYHU WKH ZKROH SROHPLF VXUIDFHG DQG ZH YRWHG >6\OYLD@ 1*2Vn OHJLWLPDF\ LV WKHUHIRUH QRW EDFNHG XS E\ D VXEVWDQWLDO QXPEHU RI PHPEHUV DV LV WKH FDVH RI YROXQWHHU RUJDQL]DWLRQV 08 IRU H[DPSOH KDV ZRPHQ DIILOLDWHG ZKR UHFHLYH LWV QHZVOHWWHU DQG DERXW RI ZKRP FDPH WR LWV *HQHUDO $VVHPEO\ ,Q FRPSDULVRQ )t6nV WHFKQLFDO WHDP LV PHPEHU VWURQJf 7KLV LVVXH RI ODFN RI VRFLDO FRQWURO LV D UHFXUUHQW FULWLFLVP OHYHOHG DW 1*2V ZKLFK WKH\ WDNH VHULRXVO\ DW OHDVW DW WKH OHYHO RI $%21* &DUUROOnV GLVWLQFWLRQ EHWZHHQ VXSSRUW DQG PHPEHUVKLS RUJDQL]DWLRQV LV XVHIXO KHUH DOWKRXJK DV ZH ZLOO VHH WKH ODEHO RI VXSSRUW JURXS LV EHFRPLQJ D VWUHWFK RI 1*2Vn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f LQ FRPPHQWV VXFK DV WKH IURQWOLQH LV FORVH PLQGHG LQ D YROXQWHHU JURXSf RU ZH >VRPH PHPEHUV@ VDLG WKDW ZH WKRXJKW WKDW WKHUH VKRXOG EH D GHFHQWUDOL]DWLRQ RI >GHFLVLRQV DQG D FODULILFDWLRQ RI@ WKH VXEWOH ZD\ LQ ZKLFK GHFLVLRQV DUH VDLG WR EH PDGH E\ WKH WHDP :H ZRXOG QHHG PRUH, GRQnW NQRZ LQ VRPH IXQGDPHWDO FDVHV WKLQN WKDW GHFLVLRQV VKRXOG VWLOO EH PDGH E\ WKH WHDP LQ DQ 1*2f

PAGE 129

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f KXUWf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f )URP ZKDW FRXOG VHH WKH RWKHU PHPEHUV RI WKH JURXS JHQHUDOO\ DJUHHG ZLWK WKH SRVLWLRQ WDNHQ E\ WKH LQGLYLGXDO PHPEHU )URP WKH SRLQW RI YLHZ RI UHODWLYH QHZFRPHUV RU WKRVH ZKR KDYH D GLIIHUHQW LGHD RQ KRZ WR GR WKLQJV WKHUH LV D PDLRULD PDMRULW\f ZKLFK LV DOUHDG\ FRQVWLWXWHG DQG RI ZKLFK WKH\ DUH QRW SDUW VR WKDW WKH\ KDYH D KDUG WLPH EULQJLQJ WKHLU SRLQWV DFURVV

PAGE 130

$QRWKHU IUXVWUDWLRQ FRPHV IURP WKH IDFW WKDW GHFLVLRQV DUH PDGH EXW DUH QRW IROORZHG WKURXJK $OHVVDQGUD FRPSODLQHG KDWH LW ZKHQ SHRSOH PDNH D GHFLVLRQ DQG WKHQ GRQnW GR ZKDW KDV EHHQ DJUHHG XSRQ DQG KHUH *HH,nP WLUHG RI VHHLQJ WKLV KDSSHQLQJ 6RPHERG\ VD\V VKH LV JRLQJ WR GR WKLV EXW DEVROXWHO\ QRWKLQJ KDSSHQV GR \RX XQGHUVWDQG" %HFDXVH WKH\ GR PRUH ZKDW WKH\ IHHO OLNH RQ WKH VSXU RI WKH PRPHQW >@ 6R LW LV UHDOO\ ZHLUG LVQnW LW" ZRUNLQJ WKLV ZD\ ,W LV ZD\ WRR GLVRUJDQL]HG 2Q WKH RWKHU KDQG VKH VD\V SHRSOH GR H[DFWO\ ZKDW WKH\ ZDQW WR GR 1RZ WKH DGYDQWDJH LV WKDW SHRSOH GR H[DFWO\ ZKDW WKH\ ZDQW DQG VR WKH\ GR LW ZLWK PRUH IHUYRU \RX NQRZ" WKLQN WKDWnV WUXH $V IDU DV WKH WZR SURIHVVLRQDOL]HG JURXSV DUH FRQFHUQHG EH\RQG WKH IDFW WKDW WKH FOHULFDODGPLQLVWUDWLYH VWDII GRHV QRW SDUWLFLSDWH LQ WKH GHFLVLRQPDNLQJ ZKLFK ZH ZLOO GLVFXVV ODWHU WKHUH LV DOVR D PRUH IRUPDO DFNQRZOHGJPHQW RI SRZHU GLIIHUHQWLDOV 7KH FRRUGLQDWRU LQ WKH FDVH RI 637 KDV PRUH SRZHU WR WDNH GHFLVLRQV 7KHUH LV QR FRRUGLQDWRU DW )t6 EXW D FOHDU OHDGHUVKLS RI $QD 0DULD DFNQRZOHGJHG E\ DOO 2QH H[DPSOH RI WKH GHFLVLRQPDNLQJ SRZHU RI WKH FRRUGLQDWRUOHDGHU LQ 1*2V ZDV ZKHQ DVNHG 5RVLPHLUH DW )t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

PAGE 131

H[SODLQHG LQ WKLV SDVW VHFWLRQ OHDGHUV ZKR DUH PRUH HQJDJHG LQ DFWLYLWLHV HQG XS PDNLQJ PRUH GHFLVLRQV 7KHLU RSLQLRQ DOVR FDUU\ PRUH ZHLJKW ZKHQ GHFLVLRQV DUH UHDFKHG FROOHFWLYHO\ WR WKH SRLQW ZKHUH WKRVH ZLWK FRQWUDU\ RSLQLRQV VRPHWLPHV IHHO VLOHQFHG ,W LV LPSRUWDQW WR QRWH WKDW DW 637 WKH JURXS GHFLGHV ZKR LV JRLQJ WR EH WKH FRRUGLQDWRU DQG DW )t6 WKHUH LV DV VDLG FRQVHQVXV WKDW $QD 0DULD LV WKH OHDGHU $V \HDUV JR E\ WKRXJK LW EHFRPHV LQFUHDVLQJO\ GLIILFXOW WR FKRRVH DQRWKHU FRRUGLQDWRU DV VKH SOD\V D FUXFLDO UROH LQ WKH RUJDQL]DWLRQn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t6 ZKHUH WKH SKUDVH IDOVH GHPRFUDF\ ZDV XVHG D QXPEHU RI WLPHV ZKHQ UHIHUULQJ WR WKH LGHDO RI HYHU\ERG\ GRHV HYHU\WKLQJ ZKLFK XVHG WR EH WKH QRUP ZKHQ WKH JURXS ILUVW IRUPHG ,W LV VWLOO PXUN\ IRU 637 ZKRVH PHPEHUV VWURQJO\ EHOLHYH LQ RUJDQL]DWLRQ DQG PRELOL]DWLRQ DQG DOO WKH FROOHFWLYLVW LGHDOV WKDW FRPH ZLWK LW
PAGE 132

HQRXJK SHRSOH VR WKDW WKH\ GR QRW KDYH HQRXJK WLPH WR H[FKDQJH WKHLU H[SHULHQFH 6WHSSLQJ DZD\ IURP D FROOHFWLYLVW PRGHO 1DUD DOVR FRQILGHG DOWKRXJK WKLV ZDV REYLRXVO\ D GLIILFXOW DQG HPRWLRQDO PDWWHU WR KHUf§ WKDW VKH ZDV SODQQLQJ RQ PRUH FREUDQTD VXSHUYLVLRQf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f WRR PDQ\ DFWLYLWLHV 6KH ZDQWV WKH RWKHUV WR GR PRUH $W 08 DOO PHPEHUV ZHUH LQYLWHG WR PHHW ZLWK D ILQDQFLQJ DJHQF\ UHSUHVHQWDWLYH DQG DERXW KDOI GLG JR $-HVVDQGUD HPSKDVL]HG WKH FROOHFWLYLVW FKDUDFWHU RI 08 ZKHQ VHHNLQJ WR GLVWLQJXLVK LW IURP WKH UHVW RI VRFLHW\ :H OLYH LQ D VRFLHW\ ZKLFK LV YHU\ GHVWUXFWLYH QRERG\ ZDQWV WR WDNH WKH LQLWLDWLYH WR WDNH FDUH RI WKH FROOHFWLYH RI D FROOHFWLYH FDXVH \RX NQRZ" ,Wn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

PAGE 133

RUJDQL]DWLRQV DV IDU DV WKH WHFKQLFDO VWDII LV FRQFHUQHG 7KH W\UDQQ\ RI VWUXFWXUHOHVVQHVV WR XVH -R )UHHPDQnV SKUDVH f WKDW 6DQGUD RI )t6 FDOOHG WR P\ DWWHQWLRQ PHDQV WKDW SRZHU FDQ EH PDQLSXODWHG ZKHQ UXOHV DQG UROHV DUH QRW ZHOOGHILQHG MXVW DV PXFK DV ZKHQ WKH\ DUH IRUPDOO\ VSHFLILHG )ORZHYHU DV ZLOO QRZ GLVFXVV RWKHU LQWHUQDO GLPHQVLRQV RI WKH RUJDQL]DWLRQ QHHG WR EH WDNHQ LQWR DFFRXQW ZKHQ FRQVLGHULQJ WKH LQWHUQDO GHPRFUDF\ RI WKHVH JURXSV 3URIHVVLRQDOL]HG RUJDQL]DWLRQV EHFDXVH WKHLU PHPEHUVKLS FULWHULD DUH EDVHG RQ FRPSHWHQFH DQG VNLOOV DUH PRUH KRPRJHQHRXV LQ WHUPV RI PHPEHUVn HGXFDWLRQ DQG EDFNJURXQG WKXV JHQHUDOO\ H[FOXGLQJ ZRPHQ ZLWK OLWWOH IRUPDO HGXFDWLRQ 7KH GLIIHUHQFH LV QRW VR FOHDU LQ WHUPV RI RWKHU IDFWRUV VXFK DV HWKQLFLW\UDFH DQG DJH 7KH\ DOVR H[KLELW D KLHUDUFKL]DWLRQ RI GLIIHUHQW W\SHV RI PHPEHUV WHFKQLFDO YHUVXV DGPLQLVWUDWLYH VWDIIf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f -DQDLQD WKH RQO\ )t6 PHPEHU ZLWK QR XQLYHUVLW\ WUDLQLQJ KDV DQ XQXVXDO OLIH VWRU\ 6KH ZDV D PHPEHU RI D QHLJKERUKRRG ZRPHQnV JURXS LQ WKH SHULSKHU\ DQG WKURXJK WKH LQYROYHPHQW RI )t6 ZLWK WKLV JURXS VKH ZDV VHOHFWHG HDUO\ LQ

PAGE 134

WKH OLIH RI WKH RUJDQL]DWLRQ WR EH WUDLQHG DV D SDUDPHGLF DQG LV QRZ D IXOOIOHGJHG PHPEHU RI )t6 $OO WKH FUHGLW VKRXOG EH JLYHQ WR KHU DQG WR WKH )t6 WHDP ZKR EHOLHYHG LQ KHU RYHUFRPLQJ WKH VWURQJ FODVV SUHMXGLFH SUHYDOHQW LQ %UD]LOLDQ VRFLHW\ ,Q WHUPV RI RFFXSDWLRQ 1*2 ZRPHQ DOO KDYH SURIHVVLRQDO DFWLYLWLHV 6HH WDEOH f ,Q FRQWUDVW YROXQWDU\ IHPLQLVW JURXS PHPEHUV KDYH GLIIHUHQWLDWHG OHYHOV RI HGXFDWLRQ DQG RFFXSDWLRQ :KLOH PDQ\ GLG JR WR XQLYHUVLW\ GLG QRW DQG ZKLOH PDQ\ DUH SURIHVVLRQDOV RQH DOVR ILQGV WZR KRXVHZLYHV D KRVSLWDO UDGLR RSHUDWRUVWDQGDUGLVW DQG DQ XQHPSOR\HG SULPDU\ VFKRRO WHDFKHU LQ WKHLU PLGVW 6HH WDEOH f $V IDU DV LQFRPH OHYHO LV FRQFHUQHG LW LV JRRG WR UHPHPEHU WKDW 1*2 SURIHVVLRQDOV LQ 637 DQG )t6 DFFHSW UHPXQHUDWLRQ ZHOO EHORZ WKHLU OHYHO RI FRPSHWHQFH DQG GHGLFDWLRQ ,QGHHG PRVW RI WKHP HDUQ DURXQG 5 SHU PRQWK RQH 5 5HDOf ZDV URXJKO\ HTXLYDOHQW WR RQH 86 GROODU ZKLOH ZDV LQ %UD]LOf 7KH PD[LPXP PRQWKO\ ZDJH UHFRUGHG IRU DQ 1*2 SURIHVVLRQDO ZDV 5 LQ WKH 1*2 DP QRW FRXQWLQJ RWKHU LQFRPH VRXUFHV VLQFH GR QRW KDYH VXIILFLHQW GDWD IRU WKLVf DQG WKH ORZHVW 5 $V LV WR EH H[SHFWHG EDVHG RQ WKHLU GLYHUVH HGXFDWLRQ OHYHOV ZDJHV DPRQJ YROXQWHHU PHPEHUV YDU\ PXFK PRUH ZLGHO\ WKH ORZHVW PRQWKO\ ZDJH UHFRUGHG ZDV 5 IRU WKH SXEOLF KHDOWK UDGLR RSHUDWRU ZKLOH WKH KLJKHVW ZDV 5 IRU D PHGLFDO GRFWRU 6HH WDEOH f :LWK VLPLODU OLPLWDWLRQV UHJDUGLQJ QHW YHUVXV JURVV LQFRPH FRUH ZRPHQ LQ YROXQWHHU RXW RI WKH DFWLYLVWV LQWHUYLHZHG ZHUHDUH FXUUHQWO\ HPSOR\HG LQ WKH SXEOLF VHFWRU ,W LV GLIILFXOW IRU PH WR JLYH PRUH DFFXUDWH QXPEHUV EHFDXVH DVNHG SHRSOH KRZ PXFK WKH\ HDUQHG PRQWKO\ DQG UHDOL]HG DIWHU WKH IDFW WKDW GLG QRW VSHFLI\ QHW RU JURVV LQFRPH nEUXWRn RU nOTXLGRnf 7R JLYH DQ LGHD RI ZDJH VFDOHV LQ %UD]LO D QXUVH LQWHUYLHZHG HDUQV 5 DQG DQRWKHU 5 ZKLOH D SHGLDWULFLDQ LQ WKH SXEOLF KHDOWKFDUH V\VWHP HDUQV DERXW 5 D PRQWK :DJHV LQ WKH SXEOLF V\VWHP DUH DOVR ORZHU WKDQ LQ WKH SULYDWH VHFWRU

PAGE 135

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nV RUJDQL]DWLRQ :KHQ DVNHG ZKDW WKH\ FRQVLGHUHG WKHLU UDFLDO LGHQWLW\ FRUf WR EH RQO\ RXW RI VXSSRUW JURXS WHFKQLFDO VWDII UHIHUUHG WR WKHPVHOYHV DV QHJUD EODFNf DV PRUHQD SDUGD RU PLVWXUDGD YDULRXV WHUPV UHIHUULQJ WR PL[HG GHVFHQWf DQG DV EUDQFD ZKLWHf 2QH ZRPDQ FRQVLGHUHG KHUVHOI DPDUHODf $VLDQf UHIHUULQJ WR KHU -DSDQHVH IDWKHU DQG %UD]LOLDQ PRWKHU $OO IRXU ZRPHQ UHIHUULQJ WR WKHPVHOYHV DV QHJUD ZHUH PHPEHUV RI SURIHVVLRQDOL]HG RUJDQL]DWLRQV 7KH ZRPHQ ZKR LGHQWLILHG WKHPVHOYHV DV EHLQJ RI PL[HG GHVFHQW ZHUH GLYLGHG DOPRVW HTXDOO\ EHWZHHQ YROXQWHHU DQG SURIHVVLRQDOL]HG RUJDQL]DWLRQV VHH WDEOH f

PAGE 136

, DP FRQYLQFHG WKDW WKH GLVFXVVLRQ RI LVVXHV RI UDFH ZLWKLQ WKH ZRPHQnV PRYHPHQW EURXJKW D OHYHO RI UDFLDO FRQVFLRXVQHVV ZKLFK PDUNHG WKH UHVXOWV RI WKLV LQTXLU\ ,W VHHPV WKDW WKH LPSDFW KDV EHHQ ODUJHU RQ SURIHVVLRQDOL]HG DFWLYLVWV WKDQ RQ YROXQWHHU DFWLYLVWV +DG WKHVH ZRPHQ EHHQ RUGLQDU\ FLWL]HQV EHOLHYH IHZHU ZRXOG KDYH UHIHUUHG WR WKHLU EODFN LGHQWLW\ 6WLOO LQ RQH FDVH H[SHFWHG PRUH DFNQRZOHGJPHQW RI $IULFDQ RULJLQV LQ D YROXQWHHU RUJDQL]DWLRQf DQG LQ WZR FDVHV GHILQLWHO\ OHVV ERWK LQ SURIHVVLRQDOL]HG RUJDQL]DWLRQVf 2I FRXUVH P\ RZQ MXGJPHQW LV PDLQO\ EDVHG RQ SKHQRW\SHV ZKLFK GHVSLWH DOO LWV OLPLWDWLRQV VWLOO KDV VRPH UHOHYDQFH VLQFH LW LQIRUPV GLVFULPLQDWLRQ E\ RWKHUV $JH $ WURXEOLQJ IDFWRU 2QH LQWULJXLQJ LVVXH LV WKDW RI WKH DJH RI WKH SDUWLFLSDQWV ,Q ERWK W\SHV RI RUJDQL]DWLRQV WKH PDMRULW\ RI WKH SDUWLFLSDQWV LV LQ WKHLU V ZKLOH RQO\ WKUHH DUH \RXQJHU WKDQ 9ROXQWHHU DFWLYLVWV DUH VOLJKWO\ ROGHU WKDQ SURIHVVLRQDOL]HG DFWLYLVWV 6HH WDEOHV DQG f 7KH WHQGHQF\ WRZDUGV DQ ROGHU SDUWLFLSDWLRQ LV HYHQ FOHDUHU DPRQJ QHLJKERUKRRG JURXSV 7KH PHDQ IRU WKH ZRPHQ LQWHUYLHZHG ZDV DUH DQG DERYHf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

PAGE 137

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n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t6 WUDQVODWH IURP 3RUWXJXHVH DV DGPLQLVWUDWLYH DQG WHFKQLFDO VWDII ZKLFK FRQQRWHV WKH ZLVK WR OLPLW WKH KLHUDUFKLFDO GLVWDQFH EHWZHHQ WKH WZR $QRWKHU 1*2 PDGH D VWDUNHU GLVWLQFWLRQ EHWZHHQ

PAGE 138

7DEOH 6RFLRHFRQRPLF SURILOH 6XPPDU\ E\ RUJDQL]DWLRQ 2UJDQL]DWLRQ 1DPH 7RWDO PHPEHUV (GXFDWLRQ OHYHO 2FFXSDWLRQ 0RQWKO\ PHDQ LQFRPH 5DFH $JH )HPLQLVWDV t 6DGH 8QLYHUVLW\ 1RQXQLY 3URIHVVLRQDOV 2WKHU 5 :KLWH 0L[HG %ODFN 6DGH 3DUD 7RGDV 8QLYHUVLW\ 1RQ XQLY 3URIHVVLRQDOV 2WKHU 5 :KLWH 0L[HG %ODFN &DVD GD 0XOKHU 8QLYHUVLW\ 1RQ XQLY 3URIHVVLRQDOVA 2WKHU 5 :KLWH 0XOKHUHV 8QLGDV 8QLYHUVLW\ 1RQ XQLY 3URIHVVLRQDOV 2WKHU 5 :KLWH 0L[HG 1RWH 7KHVH GDWD ZHUH FRPSLOHG RQ WKH EDVLV RI WKH FRUH JURXS RI YROXQWHHU JURXSV DQG WKH WHFKQLFDO VWDII RI 1*2V RQO\

PAGE 139

7DEOH 6RFLRHFRQRPLF 3URILOH DQG 3ROLWLFDO 3DUWLFLSDWLRQ RI 0HPEHUV 6XSSRUW *URXSVf 2UJDQL]DWLRQ 3URIHVV YROXQWHHU $JH 5DFH 2FFXSDWLRQ :DJH (GXFDWLRQ 0DULWDO VWDWXV RI FKLOGUHQ 3ODFH RI RULJLQ 'DWH MRLQHG 3ROLWLFDO 3DUW\ )t6 $GP ( VHFUHWDU\ 6HSDU 63 LQW 1RQH )t6 $GP $ ILQDQFLDO PDQDJHU 6LQJOH 63 1RQH )t6 $GP $ VHFUHWDU\ 6HSDU 63 LQW 37 )t6 3URI 0 PHGLFDO GRFWRU 6LQJOH %DKLD 37 )t6 3URI $ SK\VLFLDQ DVVLVWDQW r 0DUULHG %DKLD 37 )t6 3URI ( SK\VLFLDQ DVVLVWDQW 0DUULHG 86$ 37 )t6 3URI 0 QXWULWLRQLVW &RQVXQLRQ *RLDQLD 37r )t6 3URI ( IDUPDFHXWLFDO VSHFLDOLVW 0DUULHG 63 LQW 37r )t6 3URI ( PHGLFDO GRFWRU r 6HSDU 63 3& GR % )t6 3URI 0 SXEOLF KHDOWK PHG GRFWRU r 0DUULHG 5LR 37r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r 0XOKHUHV 8QLGDV 9RO 0 SV\FKRORJLVW SXEOLF KHDOW :LGRZ 63 LQW 1RQH 0XOKHUHV 8QLGDV 9RO 0 KRVSLWDO DWWHQGDQWUDGOR RS 6LQJOH %DKLD 37 0XOKHUHV 8QLGDV 9RO 0 SV\FKRORJLVW 1$ 6HSDUDWHG 63 LQW 3& GR %r 0XOKHUHV 8QLGDV 9RO ( SROLWLFDO DGYLVRU WHDFKHUf 0DUULHG 0LQDV 3& GR %r 0XOKHUHV 8QLGDV 9RO ( FRS\ HGLWRU 6LQJOH 63 37 0XOKHUHV 8QLGDV 9RO ( PHGLFDO GRFWRU 6LQJOH 3DUDLED 1RQH 0XOKHUHV 8QLGDV 9RO 0 JUDSKLF DUWLVW 6LQJOH (VS 6DQWR 1RQH 0XOKHUHV 8QLGDV 9RO ( XQHPS HOHP VFK WHDFKHU 6LQJOH 63 1RQH 0XOKHUHV 8QLGDV 9RO 0 VWXGHQW WHDFKHUf 'LYRUFHG 63 3& GR %r &DVD GD 0XOKHU $GPYRO 0 VHFUHWDU\ 0DUULHG 63 37 &DVD GD 0XOKHU 9RO ( KRXVHZLIHSROLWLFVRGG MREV /HJDOO\ VHS 3LDXL 37 &DVD GD 0XOKHU 9RO ( VRFLDO ZRUNHU 1$ 6LQJOH ,WDO\ DEURDG &DVD GD 0XOKHU 9RO ( KRXVHZLIH VHDPVWUHVV 1$ 0DUULHG 3LDXL 37 &DVD GD 0XOKHU 9RO ( SHGDJRJXH 0DUULHG 63 LQW 37 1RWHV $GP $GPLQLVWUDWLYH VWDII 3URI 3URIHVVLRQDO VWDII 9RO 9ROXQWHHU f§ 5DFH $ $IULFDQ GHVFHQW 0 0L[HG GHVFHQW ( (XURSHDQ GHVFHQW $V $VLDQ :DJH r +DV DQRWKHU MREVRXUFH RI LQFRPH (GXFDWLRQ +DV FRPSOHWHG PRUH WKDQ WKH VWLSXODWHG OHYHO (OHPHQWDU\ 0LGGOH VFKRRO +LJK VFKRRO 8QLYHUVLW\ f§ 3ROLWLFDO 3DUW\ $FWLYH PLOLWDQW PHPEHU r 3DVW PLOLWDQW PHPEHU

PAGE 140

WKHLU WHDP LQ FKDUJH LWV DVVLVWDQWV DQG WKH DGPLQLVWUDWLYH VWDII D HTXLSH UHVSRQV£YHO RV DVVLVWDQHV H D HTXLSH DGPLQLVWUDWLYDf 637nV DGPLQLVWUDWLYH WHDP WRWDOV SHUVRQV LQFOXGLQJ DQ DGPLQLVWUDWLYH PDQDJHU DQ DFFRXQWDQW D OLEUDULDQGRFXPHQWDWLRQ VSHFLDOLVW D FXVWRGLDO SHUVRQUHFHSWLRQLVW D FRRN DQG D PDLQWHQDQFH VSHFLDOLVW )t6 KDV DQ DGPLQLVWUDWLYH WHDP RI WKUHH \RXQJ ZRPHQ DQ DFFRXQWDQW D VHFUHWDU\ DQG D UHFHSWLRQLVWVHFUHWDU\ )t6 DOVR KDV D \RXQJ FOHDQLQJ ZRPDQ ZKR FRPHV RQFH D ZHHN DQG WKH DFFRXQWDQWnV PRWKHU FRPHV LQ WR WDNH FDUH RI WKH JDUGHQ $ OLEUDULDQ DOVR FRPHV RQFH D ZHHN IRU D IHZ KRXUV WR RUJDQL]H WKHLU GRFXPHQWDWLRQ FHQWHU $ FHUWDLQ GHJUHH RI IOH[LELOLW\ LV GHILQLWHO\ SUHVHQW ERWK DW 637 DQG )t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t6 DQG OHVV WKDQ WR DW 637 H[FHSW IRU WKHLU DGPLQLVWUDWLYH FRRUGLQDWRU DQG WKHLU DFFRXQWDQW ZKR HDUQ VDODULHV FRPSDUDEOH WR WKRVH RI WKH WHFKQLFDO VWDII 6HH WDEOH f DP QRW IDFWRULQJ LQ WKH QXPEHU RI KRXUV ZRUNHG $GPLQLVWUDWLYH SHUVRQQHO KDV D VHW KRXU ZRUNZHHN ZKLOH WHFKQLFDO VWDII KDYH DQ RIILFLDO ZRUNORDG YDU\LQJ IURP WR KRXUV DFFRUGLQJ WR WKH SUHIHUHQFHV RI WKH LQGLYLGXDO ZKR LV SDLG DFFRUGLQJO\ ,W LV RQO\ KHOG LQIRUPDO FRQYHUVDWLRQV ZLWK 'RQD ,UHQH WKH FRRN DQG 7L£R WKH PDLQWHQDQFH VSHFLDOLVW GLG QRW LQWHUYLHZ WKH OLEUDULDQ RU DQ\ QRQSHUPDQHQW SHUVRQQHO NQHZ WKH OLEUDULDQ D YROXQWHHU IHPLQLVW IDLUO\ ZHOO WKURXJK KHU SDUWLFLSDWLRQ LQ WKH %HLMLQJ SUHSDUDWLRQ SURFHVV

PAGE 141

GLIILFXOW WR HYDOXDWH WKH UHDO QXPEHU RI KRXUV ZRUNHG E\ WKH WHFKQLFDO VWDII 6RPH GR PDQ\ PRUH WKDQ WKH QXPEHU RI KRXUV WKH\ DUH VXSSRVHG WR EH SDLG IRU :KDW ZDV WKH PRVW VXUSULVLQJ WR PH ZDV WKDW QHLWKHU DW )t6 QRU DW 637 GLG WKH DGPLQLVWUDWLYH SHUVRQQHO SDUWLFLSDWH LQ WHDP PHHWLQJV DQG WKH RUJDQL]DWLRQfV GHFLVLRQn PDNLQJ 7KLV PDGH PH DZDUH RI P\ RZQ SUHFRQFHSWLRQV DERXW ZKDW D IHPLQLVW RUJDQL]DWLRQ VKRXOG EH /LGLD 637nV DGPLQLVWUDWLYH PDQDJHU VDLG WKDW WKH WHDP KDG GLVFXVVHG WKH IDFW WKDW VKH QHHGV WR SDUWLFLSDWH LQ WKHVH PHHWLQJV EXW WKLV KDV EHHQ GLIILFXOW GXH WR ODFN RI WLPH 6KH ZRXOG VWLOO EH WKH RQO\ DGPLQLVWUDWLYH VWDII WR SDUWLFLSDWH 7KH DGYDQWDJH RI KDYLQJ HYHU\ERG\ SDUWLFLSDWLQJ LV H[HPSOLILHG E\ &HFLOLD D QHLJKERUKRRG IHPLQLVW IRUPHU 637 VWDII DQG KRVSLWDO KRVSLWDO DWWHQGDQWf ,Q WKH V 637 ZDV DQ DVVRFLDWLRQ ZKRVH PHPEHUV VRGDVf ZHUH WKH SDWLHQWV RI WKH FOLQLF $W WKDW WLPH WKH DGPLQLVWUDWLYH VWDII ZDV VXSSRVHG WR SDUWLFLSDWH LQ WKH WHDP PHHWLQJV RI WKH IXQGRQ£ULRV HPSOR\HHVf &HFLOLD ZKR LV DQ DFWLYH SDUWLFLSDQW LQ SRSXODU KHDOWK PRYHPHQWV UHPHPEHUHG PHHWLQJ ZLWK UHSUHVHQWDWLYHV IURP ILQDQFLQJ DJHQFLHV DW WKDW WLPH 6KH UHSRUWHG KDYLQJ OHDUQHG KHU VNLOOV IRU ZULWLQJ SURMHFW SURSRVDOV GXULQJ WKDW WLPH ,W LV QRW FOHDU DW ZKDW VWDJH WKH LQFRUSRUDWLRQ RI DOO SHUVRQQHO LQ WKH WHDP PHHWLQJV FHDVHG 'HVSLWH WKHVH OLPLWDWLRQV WR WKHLU SDUWLFLSDWLRQ 1*2 DGPLQLVWUDWLYH VWDII DUH JHQHUDOO\ VDWLVILHG ZLWK WKHLU MRE MXGJLQJ IURP WKHLU LQWHUYLHZV RXW RI f ,Q SDUWLFXODU WKH\ HQMR\ WKH UHODWLYH DXWRQRP\ WKH\ DUH JUDQWHG +RZHYHU WXUQRYHU LV KLJK LQ SDUW GXH WR WKH ORZ VDODU\ WKDW 1*2V FDQ DIIRUG WR SD\ WKHLU VWDII %RWK )t6 DQG 6DQGH DQRWKHU IHPLQLVW 1*2 ORVW YDOXHG VWDII PHPEHUV WR D EHWWHU SDLG MRE LQ WKH SULYDWH VHFWRU 7 2I FRXUVH SDUWLFLSDWRU\ GHPRFUDF\ DOVR KDV LWV H[FHVVHV 'RQD ,UHQH 637nV FRRN ZKR KDV EHHQ ZRUNLQJ IRU WKH RUJDQL]DWLRQ IRU \HDUV f WROG PH KRZ VKH KDG DVNHG WKH ([HFXWLYH 6HFUHWDU\ RI WKH WLPH QRW WR SDUWLFLSDWH LQ WKRVH ERULQJ PHHWLQJV

PAGE 142

&RPSODLQWV UHJDUGLQJ WKH DXWKRULWDULDQLVP RI WKH WHFKQLFDO VWDII DOVR PRWLYDWHG DW OHDVW RQH UHVLJQDWLRQ ,QWURGXFLQJ (OHPHQWV RI ,QVWUXPHQWDOLW\ 5ROH 6SHFLDOL]DWLRQ DPRQJ 1*2Vn 7HFKQLFDO 6WDII $OWKRXJK WKH FOHDUHVW FOHDYDJH LQ 1*2 LV EHWZHHQ DGPLQLVWUDWLYH DQG WHFKQLFDO VWDII DQ LQIRUPDO GLYLVLRQ RI ODERU H[LVWV DPRQJ WKH PHPEHUV RI WKH WHFKQLFDO VWDII LWVHOI 2I FRXUVH GHILQLWLRQ RI WDVNV LV FOHDUHU DPRQJ 1*2 PHPEHUV WKDQ DPRQJ YROXQWHHU JURXS PHPEHUV 7KH GLIIHUHQFH ZDV SDUWLFXODUO\ VWULNLQJ ZKHQ DVNHG PHPEHUV RI WKH YROXQWHHU JURXSV ZKDW WKHLU UROH ZDV LQ WKH RUJDQL]DWLRQ 6HH $QQH[ % GHVFULSWLRQ RI PHPEHUVn DFWLYLWLHVf )RU H[DPSOH 08 PHPEHUV JDYH PH DQVZHUV VXFK DV GR DQ\WKLQJ WKDW VKRZV XS RU ,nYH DOUHDG\ GRQH D ELW RI HYHU\WKLQJ > @ GRQnW KDYH D VSHFLILF UROH ,W GHSHQGV RQ WKH FRQMXQFWXUH RU 6LQFH DP UDWKHU RUJDQL]HG DP VWXFN ZLWK GRLQJ WKH SDSHUZRUN ,WnV SUHWW\ ERULQJ )DJR OXGR TXH SLQWD RU M£ IL] GH WXGR >@ QDR WHP SDSHO HVSHFILFR 'HSHQGH GD FRQMXQWXUD RU &RPR VRX RUJDQL]DGLQKD VREUD SDUD PLP D SDSHODGD ( PHLR FKDWRf 2QO\ WZR PHPEHUV UHSRUWHG EHLQJ GLUHFWRU RI WKH KHDOWK GHSDUWPHQW RU LQ FKDUJH RI WKH FXOWXUDO GHSDUWPHQW DQG D WKLUG WKDW VKH ZDV 3UHVLGHQW SUR IRUPD GLUHWRUD GR GHSDUWDPHQWR GD VDGH UHVSRQV£YHO GR GHSDUWDPHQWR FLGWXUDO RU SUHVLGHQWH SURn IRUPD f &0 PHPEHUV UHIHUUHG WR WKHLU UROH RQ WKH VWDWXWHV ZLWK WKH GLVFODLPRU WKDW WKHVH DUH RQO\ SURIRUPD DQG WKDW WKH\ ZRUN LQ D PRUH FROOHFWLYH IDVKLRQ 2QH PHPEHU UHIHUUHG WR ZKDW VKH LV GRLQJ LQ WHUPV RI KDYH WKLV UROH RI VHHLQJ WKLQJV FRPLQJ WHQKR HVVH SDSHO GH

PAGE 143

YHU DV FRLVDV DFRQWHFHQGRf UHIHUULQJ WR KHU OHDGLQJ UROH 0D\EH WKH PRVW H[SUHVVLYH H[DPSOH LV WKDW RI %HDWUL] ZKR VDLG DP WKH VHFUHWDU\ LQ WHUPV RI EXUHDXFUDF\ RI WKH 6WDWXHV RI WKH &DVD >@ EXW ZH IXQFWLRQ LQ D ZD\ OHWnV VD\ PRUH FROOHFWLYHO\ $QG WKHVH UROHV RI VHFUHWDU\ JHQHUDO SUHVLGHQW WUHDVXUHU WKLV LV QRW WKH ZD\ ZH ZRUN 6R KHUH LW LV PRUH KRUL]RQWDO ZH ZRUN DV D FROOHFWLYH $QG DP D PHPEHU RI WKLV FROOHFWLYH DQ DFWLYH PHPEHU RI WKLV FROOHFWLYH SUHVHQW LQ WKH HYHU\GD\ OLIH RI WKH RUJDQL]DWLRQ IURP D SUDFWLFDO SRLQW RI YLHZ IURP WKH SRLQW RI YLHZ RI VRPH FRQWULEXWLRQV RI WKLQNLQJ DQG VXFK EXLOGLQJ DQG SXVKLQJ IRUZDUG WKH ZRUN WKDW WKH &DVD HQJDJHV LQ WKHQ SURPSWHG %HDWUL] WR WHOO PH D ELW PRUH DERXW WKH WZR SURMHFWV NQHZ VKH ZDV LQYROYHG ZLWK ZKLFK DUH D UHSURGXFWLYH ULJKWV SURMHFW ZLWK WHHQDJH JLUOV DQG D SURMHFW WR KHOS ZRPHQ ZKR WDNH FDUH RI $,'6 SDWLHQWV LQ WKHLU IDPLO\ 2Q WKH RWKHU KDQG )t6 PHPEHUV KDG QR GLIILFXOWLHV RXWOLQLQJ WKHLU DFWLYLWLHV DQG UROHV 7KH\ H[SUHVVHG PRVWO\ VDWLVIDFWLRQ ZLWK ZKDW WKH\ ZHUH GRLQJ )RU H[DPSOH 5DFKHO VDLG :HOO WRGD\ DP PRUH LQYROYHG ZLWK UHVHDUFK ZLWK WZR UHVHDUFK SURMHFWV 2QH RQ ZRPHQ DQG $,'6 DQG WKH RWKHU RQ PDWHUQLW\ DQG ZRUN PHDQ WKHVH DUH WZR YHU\ GLIIHUHQW WKHPHV $QG DP DOVR LQ FKDUJH RI WKH ILQDQFLDO FRRUGLQDWLRQ RI WKH RUJDQL]DWLRQ %DVLFDOO\ WKDWnV LW +LQWLQJ DW WKH FRQWLQXLW\ ZLWK YROXQWHHU IHPLQLVW RUJDQL]DWLRQV 0DUOHQH SUHIDFHG WKH GHVFULSWLRQ RI KHU MRE ZLWK D DP RQH RI WKH PHPEHUV RI WKLV &ROHFWLYH $QD 0DULD )t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

PAGE 144

,Q P\ XQGHUVWDQGLQJ WKLV LQGHILQLWLRQ RI UROHV UHVXOWV LQ SDUW IURP 637nV GHVLUH WR UHPDLQ PRUH UHVSRQVLYH WR WKH QHHGV H[SUHVVHG E\ WKHLU FRQVWLWXHQF\ QHLJKERUKRRG JURXSV SRSXODU PRYHPHQWV DQG WUDGH XQLRQ ZRPHQnV VHFWLRQVf ^UHVSRQGHU DV GHPDQGDVf ZKLFK PHDQV WKDW WKHUH LV D QHHG IRU IOH[LELOLW\ LQ ZKDW VWDII PHPEHUV DUH JRLQJ WR EH GRLQJ KHQFH LQGHILQLWLRQ 1HYHUWKHOHVV HDFK PHPEHU ZDV DEOH WR QDPH DFWLYLWLHV ZKLFK ZHUH VSHFLILFDOO\ KHU GRPDLQ DV DSSHDUV FOHDUO\ LQ $QQH[ % 'HVFULSWLRQ RI PHPEHUVn DFWLYLWLHVf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f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

PAGE 145

YROXQWHHU JURXS PHPEHUV WR ILOO 'XULQJ WKDW ZHHN )ORUD RI &0 DPRQJ RWKHU WKLQJV PDGH FRQWDFWV ZLWK WZR ILQDQFLQJ DJHQFLHV DQG JDYH DQ LQWHUYLHZ DERXW DERUWLRQ IRU D 79 SURJUDP EXW VKH DOVR WRRN FDUH RI DGPLQLVWUDWLYH DQG DFFRXQWLQJ ZRUN IRU WKH RUJDQL]DWLRQ DQG VKH JDYH WZR SDOHVWUDV RU OHFWXUHV RQH DERXW YLROHQFH WR WKH ORFDO 0RYLPHQWR GRV 6HP 7HUUD /DQGOHVV 0RYHPHQWf DQG RQH DERXW nZRPHQ LQ VRFLHW\n WR WKH 0RYLPHQWR GH 0RUDGLD +RXVLQJ 0RYHPHQWf $W WKH ULVN RI H[DJJHUDWLQJ WKH FRQWUDVW 5DFKHO RI )t6 WKDW VDPH ZHHN VSHQW DOPRVW DOO KHU ZHHN ZRUNLQJ RQ D UHSRUW IRU UHVHDUFK VKH KDG EHHQ FRQGXFWLQJ 7KDW ZHHN ZDV QRW UHSUHVHQWDWLYH RI KHU XVXDO ZRUN VFKHGXOH DOWKRXJK PRVW RI KHU WLPH LQ WKH SUHFHGLQJ PRQWKV KDG EHHQ GHYRWHG WR WKDW UHVHDUFK DQG UHSRUWV DUH GXH DW WKH HQG RI HDFK UHVHDUFK RU SURMHFW 2IIHULQJ D PRUH UHSUHVHQWDWLYH SLFWXUH RI WKH GHJUHH RI YDULHW\ RI ZRUN GRQH E\ )t6 WHFKQLFDO VWDII 5RVHPHLUH WKDW ZHHN ZRUNHG RQ WKUHH RQJRLQJ SURMHFWV ZKLFK UHTXLUHG JHWWLQJ LQ WRXFK ZLWK RWKHU IHPLQLVW DFWLYLVWV SDUWLFLSDWHG LQ WKH 3UHSDUDWLRQ IRU %HLMLQJ PHHWLQJ SUHSDUHG DQ LQYLWDWLRQ IRU D SDUW\ FHOHEUDWLQJ )t6 WK DQQLYHUVDU\ ZRUNHG RQ D SURSRVDO IRU WUDLQLQJ VHVVLRQV RQ ZRPHQ DQG $,'6 IRU WKH SURJUHVVLYH 37 PXQLFLSDO JRYHUQPHQW LQ 3RUWR $OHJUH UHFHLYHG D YLVLWRU LQWHUHVWHG LQ WKH ZRUN RI WKH RUJDQL]DWLRQ DV VKH GRHV HYHU\ )ULGD\ PRUQLQJ DQG DQVZHUHG FRUUHVSRQGHQFH 1HYHUWKHOHVV WKHUH LV D GHJUHH RI VSHFLDOL]DWLRQ DPRQJ 1*2 WHFKQLFDO VWDII ,Q ERWK 637 DQG )t6 QR PRUH WKDQ WZR SHRSOH ZHUH LQYROYHG ZLWK WKH VHDUFK IRU IXQGLQJ DQG )RU WKH ZHHN RI 2FWREHU WR D ZHHN SLFNHG DW UDQGRP DVNHG WKH WHFKQLFDO VWDII RI 637 DQG )t6 DV ZHOO DV WKH PHPEHUV RI &0 DQG 08 WR ILOO XS D ZHHNO\ SODQQHU ZLWK WKH DFWLYLWLHV WKH\ KDG HQJDJHG LQ DQG WKH QXPEHU RI KRXUV WKH\ KDG VSHQW IRU HDFK )URP WKH PHPEHUV VWLOO SDUWLFLSDWLQJ DW WKDW GDWH UHFHLYHG VXFK SODQQHUV 0RVW RI WKRVH ZKR GLG QRW WXUQ LW LQ EHORQJ WR RQH RI WZR FDWHJRULHV VL[ DUH YROXQWHHU PHPEHUV ZKR KDYH D PRGHUDWH WR ORZ OHYHO RI SDUWLFLSDWLRQ DQG WZR DUH OHDGLQJ 1*2 ILJXUHV ZKR DUH YHU\ EXV\ DQG WUDYHO D JRRG GHDO

PAGE 146

FRQWDFWV ZLWK ILQDQFLQJ DJHQFLHV ,Q ERWK FDVHV WKH FRRUGLQDWRU RU OHDGHU RI WKH JURXS ZDV LQ FKDUJH RI WKLV WDVN 7KH\ ERWK FRPSODLQHG WKDW WKH\ ZRXOG OLNH WR VKDUH WKLV EXUGHQ EXW WKDW LW ZDV GLIILFXOW WR ILQG PHPEHUV ZLOOLQJ WR GR WKDW NLQG RI ZRUN 2Q WKH RWKHU KDQG WZR PHPEHUV RI )t6 GHGLFDWH DOPRVW DOO WKHLU WLPH WR WKH J\QHFRORJLFDO YLVLWV LH WR WKH ORFDO ZRUN 7ZR PHPEHUV RI 637 GR PRVWO\ ORFDO ORQJWHUP DVVHVVRULD VXSSRUWf DQG ZRUNVKRSV ,Q RWKHU ZRUGV WKHUH LV D GLYLVLRQ RI ODERU DJDLQ ZLWK VRPH FURVVRYHUV EHWZHHQ f WKRVH ZKR GR RILFLQDV RU ZRUNVKRSV DQG DVVHVVRULD LH WKH ORFDO ZRUN f§LQ WKH FDVH RI )t6 WKH ZRPHQ ZKR DWWHQG LQ WKH FOLQLF f WKRVH ZKR HQJDJH LQ UHVHDUFK DQG WUDLQLQJ DFWLYLWLHV LQFOXGLQJ LQ RWKHU VWDWHV DQG f WKH ZRPHQ ZKR UHSUHVHQW WKH RUJDQL]DWLRQ HLWKHU LQ QDWLRQDOLQWHUQDWLRQDO ZRPHQnV PHHWLQJV DQG DFWLYLWLHVQHWZRUNV RU LQ 1*2 QHWZRUNV DQG DUH UHVSRQVLEOH IRU IXQGUDLVLQJ DFWLYLWLHV FRQWDFWV ZLWK GRQRUVf )RU H[DPSOH 1DUD FRRUGLQDWRU RI 637 VDLG GXULQJ KHU LQWHUYLHZ WKDW VKH QR ORQJHU GRHV RILFLQDV EXW ZRUNV RQ WKH SROLWLFDO UHODWLRQV RI WKH RUJDQL]DWLRQ DQG FRQGXFWV WUDLQLQJ FXUVRV VHPLQ£ULRVf 6KH GRHV KHOS RQH RI WKH VWDII PHPEHU ZLWK DVVHVVRULD WR WKH &HQWUDO GRV 0RYLPHQWRV 3RSXODUHV )HGHUDWLRQ RI 3RSXODU 0RYHPHQWVf 6LPLODUO\ WZR RI WKH IRXQGLQJ PHPEHUV RI )t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

PAGE 147

7KLV OHDGV WR D FU\VWDOOL]DWLRQ RI NQRZOHGJH GLIIHUHQFHV DQG OHDGHUVKLS UROHV ZKLFK LV FULWLFL]HG DQG UHVHQWHG E\ MXQLRU RU OHVV SURPLQHQW PHPEHUV DV ZH ZLOO GLVFXVV LQ FKDSWHU 7KLV FRQVWLWXWHV RQH RI WKH FKDOOHQJHV WR LQWHUQDO GHPRFUDF\ RI 1*2V )HPLQLVW LGHQWLW\ DQG $GPLQLVWUDWLYH 6WDII 7KH ORJLF ZLWKLQ DQ LGHQWLW\EDVHG VRFLDO PRYHPHQW LV WKDW PHPEHUV VKDUH D FRPPRQ LGHQWLW\ DQG FRPPRQ JRDOV ZDV VXUSULVHG WR GLVFRYHU WKDW WKH DGPLQLVWUDWLYH SHUVRQQHO DW )t6 ZHUH QHLWKHU IHPLQLVW QRU OLQNHG WR DQ\ PRYHPHQW SULRU WR EHLQJ KLUHG ,Q WKH FDVH RI 637 WZR PHPEHUV RI LWV DGPLQLVWUDWLYH VWDII WKH FOHDQLQJ ODG\UHFHSWLRQLVW DQG WKH PDLQWHQDQFH SHUVRQf ZHUH PHPEHUV RI KHDOWK PRYHPHQWV SULRU WR EHLQJ KLUHG ZKLOH WKHLU DGPLQLVWUDWLYH PDQDJHU ZDV D 37 PLOLWDQW DQG IULHQG RI RQH RI WKH PHPEHUV 6LPLODUO\ RI WKH SDUWLFLSDWH YHU\ RFFDVLRQDOO\ RU QRW DW DOO LQ IHPLQLVW HYHQWV 7KH H[FHSWLRQ LV /DXUD 637 FXVWRGLDO ODG\UHFHSWLRQLVW ZKR GLG VWDUW SDUWLFLSDWLQJ LQ ZRUNVKRSV DQG FRQIHUHQFHV RQ ZRPHQnV KHDOWK DIWHU VKH MRLQHG 637 0RVW FODLPHG WKDW WKHLU KLULQJ LQWHUYLHZ KDG QRW EHHQ GLIIHUHQW IURP RWKHU LQWHUYLHZV WKH\ KDG KDG DOO WKUHH )t6 HPSOR\HHV DQG 637nV DGPLQLVWUDWLYH FRRUGLQDWRU LH RXW RI VHYHQ LQWHUYLHZHGf 7ZR PHPEHUV RI 637 GLG QRW PHQWLRQ WKHLU LQWHUYLHZ VLQFH RQH FDPH LQ ILUVW DV D FRQVXOWDQW DQG HQGHG XS VWD\LQJ IRU \HDUV DQG WKH RWKHU ZDV WKH FOHDQLQJ ODG\UHFHSWLRQLVW ZKRP GLG QRW DVN DERXW KHU KLULQJ LQWHUYLHZ VKRZLQJ P\ RZQ ELDV 7KH )t6 DFFRXQWDQW &OHXVD IRU H[DPSOH UHPHPEHUHG WKDW VKH KDG EHHQ VHOHFWHG ZLWK WKH KHOS RI D ILQDQFLDO FRQVXOWDQW 5DFKHO D WHFKQLFDO VWDII PHPEHU UHIHUUHG WR WKH VHOHFWLRQ FULWHULD RI &OHXVD ZH GLG QRW QHHG D IHPLQLVW DFFRXQWDQW 6KH DGGHG WKDW LW ZDV GLIIHUHQW ZLWK D VHFUHWDU\ RU D J\QHFRORJLVW

PAGE 148

:KHQ \RX KLUH D VHFUHWDU\ RU D J\QHFRORJLVW WKLV TXHVWLRQ LV PRUH LPSRUWDQW WKH QHHG WR KDYH D SHUVRQ ZKR XQGHUVWDQGV D ELW EHWWHU ZKHUH VKH LV JRLQJ WR ZRUN KRZ VKH ZLOO EH LQWHJUDWHG LQ WKH ZRUN GRQH ZKLFK LV D OLWWOH ELW ZKLFK ZH FRQVLGHU D OLWWOH ELW GLIIHUHQW IURP WKDW RI DQRWKHU RUJDQL]DWLRQ WKHUH LQ WKH SULYDWH VHFWRU ,Q D VWULNLQJ FRQWUDVW 637nV OLEUDULDQ ZKR KDG EHHQ VHOHFWHG QRW E\ 637 EXW E\ D PHPEHU RI &,0 WKH &HQWUR ,QIRUPDQGR 0XOKHU D IHPLQLVW YROXQWHHU JURXS ZDV HPSKDWLF WKDW WKH LQWHUYLHZ KDG EHHQ YHU\ GLIIHUHQW IURP RWKHU LQWHUYLHZV VKH KDG JRQH WKURXJK 7KH SHUVRQ ZKR KLUHG KHU GLG QRW DVN PXFK DERXW KHU SURIHVVLRQDO TXDOLILFDWLRQV EXW WDONHG DERXW ZRPHQnV TXHVWLRQV DQG KRZ VKH ZRXOG EH WKULOOHG DSDL[RQDGDf DERXW WKH MRE DQG ZRXOG JURZ D ORW 6KH DVNHG KHU ZKHWKHU VKH OLNHG WR UHDG WR ZULWH DQG WR OHDUQ 'HVSLWH WKH OLPLWDWLRQV RI WKHLU LQYROYHPHQW ZLWK WKH JURXS DOO WKUHH DGPLQLVWUDWLYH SHUVRQQHO DW )t6 DQG PRVW DW 637 H[SUHVVHG WKDW ZRUNLQJ IRU D IHPLQLVW 1*2 KDG FKDQJHG WKHLU OLYHV DV ZRPHQ DQG PHQ 7ZR ZRPHQ IHOW WKDW WKH\ KDG FKDQJHG EXW QRW DV GUDVWLFDOO\ HLWKHU EHFDXVH WKH\ DOUHDG\ VKDUHG IHPLQLVW LGHDV RU ZHUH DFWLYLVWV EHIRUHKDQG &DURO RI )t6 ZDV YHU\ DUWLFXODWH LQ H[SUHVVLQJ WKHVH FKDQJHV ,Q KHU RZQ ZRUGV :HOO WKHUH LV QR GRXEW FKDQJHG TXLWH D ELW *HH (YHQ GLVFRYHULQJ FHUWDLQ YDOXHV WKDW ZKHQ \RX ZRUN RXWVLGH >RI )t6@ \RX GRQn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nV LVVXHV ZLWK WKHLU SDUWQHU DQG IDPLO\ IHHOLQJ OLNH WKH\ FRQWULEXWH WR WKH EHWWHUPHQW RI VRFLHW\ KDYLQJ EHFRPH FRPIRUWDEOH ZLWK WKHLU RZQ ERG\ IHHOLQJ IUHHU OHVV SULVRQHU RI VRFLDO UXOHV PH VROWHL PH VLQWR VROD 7KH RQO\ PDQ LQWHUYLHZHG DGPLWWHG WKDW KH QRZ XQGHUVWDQGV ZK\ LW LV LPSRUWDQW WR VKDUH KRXVHZRUN

PAGE 149

&ROOHFWLYH YHUVXV ,QGLYLGXDO ,QFHQWLYHV DQG 5HZDUGV DQG WKH /RJLF RI ,GHQWLW\ 7KHUH LV QR GRXEW WKDW PRVW 1*2 DFWLYLVWV LQWHUYLHZHG KDYH D VWURQJ LGHQWLW\ DV IHPLQLVWV :H ZLOO GLVFXVV WKLV LQ WKH FRPLQJ FKDSWHU +RZHYHU XQOLNH FODVVLFDO PRYHPHQW RUJDQL]DWLRQV ZKHUH SHRSOHnV UHZDUGV IRU SDUWLFLSDWLQJ DUH PRVWO\ SXUSRVLYH VXFK DV WKH VDWLVIDFWLRQ WR ZRUN IRU WKH FDXVH DQG IRU WKH IHHOLQJV RI EHORQJLQJ LW SURYLGHV WKHP LH LQWHUQDO PRWLYDWRUVf IHPLQLVW 1*2 DFWLYLVWV UHFHLYH D ZDJH IRU WKH ZRUN WKH\ GR H[WHUQDO PRWLYDWRUVf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f DW )t6 VRPH PHPEHUV GR PRUH WKDQ RWKHUV VR LW LV XQIDLU LI DOO UHFHLYH WKH VDPH ZDJH 7KH\ GLVFXVVHG WKH SRVVLELOLW\ WKDW LQGLYLGXDO PHPEHUV EHFRPH ILQDQFLDOO\ GHSHQGHQW RQ WKH SDUWLFXODU SURMHFW WKH\ ZRUN RQ 7KLV FRXOG FUHDWH FRPSHWLWLYH WHQVLRQV DV ZDV H[HPSOLILHG E\ WKH IDFW WKDW LQ DQRWKHU FDVH VRPH PHPEHUV FRPSODLQHG DERXW D FROOHDJXH ZKR LQVLVWHG WKDW KHU VDODU\ ZDV JXDUDQWHHG XQWLO WKH HQG RI WKH \HDU EHFDXVH WKH SURMHFW VKH ZDV ZRUNLQJ RQ HQGHG DW WKDW WLPH )t6 LV DOVR FRQWHPSODWLQJ WKH LQWURGXFWLRQ RI D SODQR GH FDUUHLUD RU FDUHHU SODQ 7KLV KDV DOUHDG\ EHHQ GRQH LQ DQRWKHU IHPLQLVW 1*2 )DFHG ZLWK WKH QHHG WR GHDO ZLWK LQGLYLGXDO GLIIHUHQFHV 1*2V PLJKW WDNH ELJ VWHSV WRZDUGV LQGLYLGXDOL]HG LQFHQWLYHV DQG UHZDUGV

PAGE 150

0D\EH WKH PRVW H[WUHPH IRUP RI VXFK LQGLYLGXDOL]HG LQFHQWLYH DQG UHZDUG DV ZHOO DV LQVWUXPHQWDO UDWKHU WKDQ SULPDULO\ SXUSRVLYH UHODWLRQ LV VXEFRQWUDFWLQJ 6XEFRQWUDFWLQJ LV YHU\ PXFK DW RGGV ZLWK WKH LQWHUQDO ORJLF RI D WUDGLWLRQDO VRFLDO PRYHPHQW RUJDQL]DWLRQ ZKHUH D PHPEHUn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nV PRVW UHFHQW UHFUXLWV DUJXHG LQ DQ LQIRUPDO FRQYHUVDWLRQ WKDW WKH ZD\ RXW RI 637n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nV 1*2V KDYH VWDUWHG VXEFRQWUDFWLQJ VRPH RI WKHLU SHUVRQQHO ,W LV QRW DOZD\V D SRVLWLYH H[SHULHQFH IRU WKRVH VXEFRQWUDFWHG $Q DQWKURSRORJ\ 0DVWHUnV VWXGHQW ZKR KDG GRQH UHVHDUFK IRU D IHPLQLVW 1*2 RQ D FRQWUDFW EDVLV UHFDOOHG KRZ VKH IHOW ORRNHG GRZQ XSRQ E\ VRPH 1*2 PHPEHUV 6KH DGGHG WKDW PDQ\ RI KHU IULHQGV QR ORQJHU ZDQWHG WR ZRUN ZLWK PRUH VHDVRQHG IHPLQLVWV EHFDXVH WKH\ IHOW H[SORLWHG DQG GLG QRW IHHO WKH\ UHFHLYHG DQ\

PAGE 151

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f %HVLGHV WKH FXUUHQW ILQDQFLDO FULVLV RI WKH 1*2 VHFWRU RWKHU SURFHVVHV KDYH FRQWULEXWHG WR WKHVH RUJDQL]DWLRQDO FKDQJHV ZKLFK ZLOO WXUQ WR LQ WKH IROORZLQJ VHFWLRQ :K\ D 0RUH )RUPDOL]HG 6HJPHQWHG 2UJDQL]DWLRQDO 6WUXFWXUH 9ROXQWHHU *URXSVn $GPLQLVWUDWLYH &KDOOHQJHV 2UJDQL]DWLRQV ZLWK PLQLPDO FRPPLWPHQW DQG REOLJDWLRQV WR RXWVLGH LQVWLWXWLRQV DQG EXUHDXFUDFLHV VXFK DV YROXQWHHU PRYHPHQW RUJDQL]DWLRQV H[SHULHQFH UHDO GLIILFXOWLHV LQ HQVXULQJ FRQWLQXLW\ LQ WKH ZRUN WKH\ GR ,W LV EDVLFDOO\ OLQNHG WR WKH IDFW WKDW DFWLYLVWV LQYROYHG LQ D VWUXJJOH PLJKW QRW IHHO HQWLFHG E\ WKH QLWW\JULWW\ ZRUN RI DGPLQLVWUDWLYH REOLJDWLRQV

PAGE 152

7DEOH 2UJDQL]DWLRQDO &KDUDFWHULVWLFV RI 9ROXQWHHU DQG 3URIHVVLRQDOL]HG *URXSV 2UJDQL]DWLRQ 1DPH 7\SH RI RUJDQL]DWLRQ 6RFLDO &RQWURO 0HFKDQLVP /HYHO RI FODVV KRPRJHQHLW\ LQ FRUH JURXS WHFKVWDII 2UJDQL]DWLRQDO VWUXFWXUH 5ROHV LQ FRUH JURXS WHFKQ VWDII 7\SHV RI UHZDUGV ,QGLYLGXDO 'LIIHUHQFH LQ SRZHU t FDSDFLW\ )HPLQLVWD t 6DGH 3URIHVVLRQDOL]HG %RDUG RI 'LUHFWRUV DUH WHFKQLFDO VWDII PHPEHUV 0RUH KRPRJHQHRXV 7HFKQLFDO YHUVXV DGPLQLVWUDWLYH VWDII :HOO GHILQHG t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f 1R GHILQLWLRQ 3XUSRVLYH &UHDWHV WHQVLRQ

PAGE 153

%HDWUL] RI 7KH &DVD H[SODLQV WKH QHHG IRU EHWWHU DGPLQLVWUDWLYH RUJDQL]DWLRQ ZKLFK VKH DQG RWKHU PHPEHUV HTXDWH ZLWK WKHLU DPDGRQVPR DPDWHXULVPf DQG RI WKH FRQVHTXHQFHV RI ODFN RI SODQQLQJ DQG RI LQGHILQLWLRQ RI WDVNV DQG UHVSRQVLELOLWLHV ,W HQGV XS HQJHQGHULQJ DFWLRQV ZKLFK DUH YHU\ LPSURYLVHG 6R ZH DOZD\V HQG XS LPSURYLVLQJ 6R IRU H[DPSOH ZKHQ ZH RUJDQL]H DQ DFWLYLW\ ZLWK DQRWKHU 1*2 IRU H[DPSOH ZH DUH ZRUNLQJ RQ D ZRPHQ DQG $LGV SURMHFW ZLWK )t6 7KDWn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nV ZLOO ZKR LV DOVR D OHDGLQJ PHPEHU 7KH PRWKHU ZDV DIUDLG RI EHLQJ DFFXVHG RI QHSRWLVP (OHRQRUDnV SRVLWLRQ LV FORVHU WR WKH &DVDnV PHPEHUV WKDQ DUH 1*2Vn DGPLQLVWUDWLYH VWDII WR WKHLU WHFKQLFDO WHDP 6WLOO VKH LV QRW IXOO\ LQWHJUDWHG LQ WKH DFWLYLWLHV RI WKH JURXS %H\RQG WKH UHFHSWLRQLVWVHFUHWDULDO ZRUN GRQH E\ (OHRQRUD QXPHURXV DGPL PL VWUDWLYH WDVNV DUH ILOOHG E\ WKH RWKHU PHPEHUV HVSHFLDOO\ )ORUD DQG 0RHPD (OHRQRUD IHHOV LQWHJUDWHG DOWKRXJK VKH GLG PHQWLRQ WKDW VKH ZRXOG HQMR\ EHLQJ PRUH DFWLYH LQ WKH &DVDnV DFWLYLWLHV +HU PRWKHU ZRXOG OLNH WR VHH KHU PRUH LQWHJUDWHG DV ZHOO 6KH PDGH D SRLQW RI WHOOLQJ PH WKDW VKRXOG LQWHUYLHZ (OHRQRUD EHFDXVH VKH ZDV D PHPEHU RI WKH JURXS (OHRQRUD GLG WDNH SDUW LQ WZR RXW RI WKH IRXU &DVDnV PHHWLQJV SDUWLFLSDWHG LQ EXW VKH PRVWO\ OLVWHQHG DQG GLG QRW YRLFH KHU RSLQLRQ 6KH DOVR KDG WR DQVZHU WKH WHOHSKRQH DQG WR UHFHLYH WKRVH ZKR FDPH LQ 6KH KDV QHYHU OHG DFWLYLWLHV VXFK DV ZRUNVKRSV 6KH EODPHV LW RQ KHU VK\QHVV 6KH DOVR UHFRJQL]HV WKDW KHU PRWKHU H[SHFWV KHU WR EH DQ DFWLYLVW DQG H[SHFWV PRUH IURP KHU EHFDXVH VKH LV KHU GDXJKWHU FREUD FRPR ILOKDf

PAGE 154

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f WKH\ FRXOG RUJDQL]H D SODQWDR URWDWLQJ RQ FDOOf LH WR KDYH VHYHUDO SHUVRQV VLJQ XS IRU D GD\ RI WKH ZHHN ZKHQ WKH\ ZRXOG FRPH WR DQVZHU WKH SKRQH DQG WDNH FDUH RI WKH SDSHUZRUN 7KLV SODQWDR FRXOG EH UHPXQHUDWHG RU QRW f WKH\ FRXOG KDYH D VHFUHWDU\ ZKLFK FRXOG EH KLUHG HLWKHU LQ DQ LQIRUPDO ZD\ LH D IULHQGDFWLYLVW RU UHODWLYH ZKR ZRXOG UHFHLYH FRPSHQVDWRU\ IHHV RU D SURIHVVLRQDO VHFUHWDU\ KLUHG ZLWK D UHJXODU ZDJH 2I WKH VHYHQ ZRPHQ SUHVHQW DW WKH PHHWLQJ WKUHH ZHUH LQ IDYRU RI D URWDWLQJ V\VWHP 2QH IHOW WKDW D KLUHG VHFUHWDU\ KDG EHHQ D FRQTXLVWD FRQTXHVWf 7KH RWKHUV GLG QRW YRLFH WKHLU RSLQLRQ RQ WKH WRSLF ,W ZDV DUJXHG WKDW WKH DGYDQWDJHV RI WKH URWDWLQJ V\VWHP DUH WKDW LW EULQJV WKRVH ZKR SDUWLFLSDWH LQ LW FORVHU WR WKH OLIH RI WKH RUJDQL]DWLRQ DQG D EHWWHU

PAGE 155

NQRZOHGJH RI WKH RUJDQL]DWLRQ 7KH GLVDGYDQWDJH LV WKDW WKH\ ZRXOG QHHG HQRXJK SHRSOH WR VLJQ XS DQG WR NHHS XS ZLWK WKHLU SOHGJH ,W LV DOVR GLIILFXOW WR SDVV WKH LQIRUPDWLRQ IURP RQH SHUVRQ WR WKH QH[W IRU IROORZXSV 7KH VROXWLRQ RI D WDONLQJ DJHQGD ZDV WKHQ VXJJHVWHG +LULQJ D VHFUHWDU\ ZLWK D IXOO ZDJH RU FRPSHQVDWRU\ IHHV ZDV DOZD\V FRPSOLFDWHG DQG KDG DOZD\V FDXVHG SUREOHPV DFFRUGLQJ WR 7DWLDQD LQ SDUW EHFDXVH WKH VHFUHWDU\ KDV IRXU SHRSOH TXDWUR FKHIHVf WR WHOO KHU ZKDW WR GR 6KH SHUVRQDOO\ LV KRUULILHG E\ >WKHLU@ H[SHULHQFHV ZLWK VHFUHWDULHV ^WHUQ SDYRU GD QRVVD H[SHULHQFLD FRP VHFUHW£ULDVf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

PAGE 156

7KH /RJLF RI 3URMHFWV DQG 0DQDJHPHQW RI *UDQW 0RQH\ $ VWURQJ SXVK WRZDUGV IRUPDOL]DWLRQ FRPHV IURP WKH ORJLF RI SURMHFWV OJLFD GRV SURMHWRVf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t6f UHFDOOV %HIRUH KHU >WKH LQKRXVH DFFRXQWDQW@ ZH KDG WR GR DOO WKH ILQHSULQW ZRUN RI DFFRXQWLQJ WKLV HYHU\GD\ DFFRXQWLQJ ZRUN DQG ZH JRW WKH KHOS RI DQ DFFRXQWLQJ RIILFH %XW ZLWK DQ DFFRXQWLQJ RIILFH \RX QHHG WR JLYH WKHP WKH DFFRXQWV DOUHDG\ LQ RUGHU VR WKDW WKH\ FDQ FORVH WKHP 6R LW ZDV QRW SRVVLEOH :H KDG WR GHDO PRUH DQG PRUH ZLWK WKLV ZRUN DQG ZH ZHUH QRW WKHUH IRU WKDW WKDWnV IRU VXUH 6R ZH KLUHG DQ DFFRXQWDQW UHDOO\ EHFDXVH RI WKDW 6R LW KDSSHQHG LQ VWDJHV XV IURP WKH WHFKQLFDO WHDP WKH KHDOWK WHDPf§ HQGHG XS WDNLQJ FDUH RI WKH FRRUGLQDWLQJ SDUW RI WKH ZRUN WKH SDUW WKDWnV UHODWHG WR WKH SURMHFWV DQG UHSRUWV $QG ZH GHOHJDWHG WKH GD\WRGD\ ZRUN ZKLFK LV UHDOO\ DOVR WKH ELJJHVW SDUW RI WKH ZRUN WR &OHXVD 5DFKHO DOVR H[SODLQHG WKDW WKH 1*2 DFFRXQWLQJ LV PRUH FRPSOH[ WKDQ UHJXODU EXVLQHVV DFFRXQWLQJ $W WKH EHJLQQLQJ )t6 ZDV UHFHLYLQJ PRQH\ IURP RQH DJHQF\ WKHQ LW ZDV WZR DQG QRZ WKHUH DUH PDQ\ PRUH SURMHFWV (YHU\ DJHQF\ KDV LWV VSHFLILFDWLRQV IRU

PAGE 157

DFFRXQWLQJ DQG PRQH\ PXVW EH GLVEXUVHG DFFRUGLQJO\ 7KH\ UHDOO\ QHHGHG D VSHFLDOLVW RI WKH DUHD 7KHQ WKH DGPLQLVWUDWLYH VWDII LWVHOI XVHG WR UHJXODU EXVLQHVV SUDFWLFHV SXVKHV IRU IXUWKHU URXWLQL]DWLRQ DQG UXOHV )t6 DGPLQLVWUDWLYH VWDII IRU H[DPSOH WRRN WKH LQLWLDWLYH WR PHHW WR GLVFXVV D UHRUJDQL]DWLRQ RI WKHLU WDVNV $Q DGPLQLVWUDWLYH VWDII PHPEHU 7KHUH ZDV D SHULRG ZKHQ ZH VWDUWHG PHHWLQJ RQFH D ZHHNWR WU\ DQG RUJDQL]H WKH WDVNV VROLFLWDWLRQV HWF %XW WKLV LV ZKDW WROG \RX WKH\ >WKH WHFKQLFDO VWDII@ DUH QRW XVHG WR WKH ZD\ D ILUP ZRUNV 7KH PRUH WKH WKUHH RI XV PHW WKH PRUH ZH UHDOL]HG ZKDW QHHGHG WR EH FKDQJHG ZK\ LW QHHGHG WR FKDQJH ZH JDYH VXJJHVWLRQV ZH GUHZ VRPH FRQFOXVLRQV DQG GHFLGHG RQ D FRXUVH RI DFWLRQ DQG SRVWHG LW RQ WKH PDQDJHPHQW EXOOHWLQ ERDUG %XW WKLV UHDOO\ GLVWXUEHG WKHP QRWLFHG WKDW LW GLVWXUEHG WKHP D ORW VR ZH VWRSSHG PHHWLQJ >@ +HOHQD HVSHFLDOO\ GLG QRW ZDQW WR FUHDWH DQ\ FRQIOLFWV ,Q VKRUW WKLV LQLWLDWLYH IRU PRUH GHILQHG UROHV DQG UXOHV DQG SXVKLQJ IRU IXUWKHU IRUPDOL]DWLRQ ZDV QRW YHU\ ZHOOUHFHLYHG E\ WKH WHFKQLFDO VWDII VR WKDW WKH\ GLVFRQWLQXHG WKHLU HIIRUW 7KLV VKRZV DJDLQ WKH OLPLWV RI SDUWLFLSDWLRQ E\ DGPLQLVWUDWLYH VWDII LQ WKH RUJDQL]DWLRQ RI WKHLU RZQ ZRUN DQG WKHLU VXEDOWHUQ UROH LQ WKH RUJDQL]DWLRQ $V WKLV HPSOR\HH SXW LW ,W LV FOHDU IRU PH WKDW )t6 ZDQWV PH WR ZDON XS WR WKLV OLQH VR LW LV XS WR PH WR GHFLGH LI ZDQW WR FRQWLQXH KHUH ZLWK WKLV OLPLWDWLRQ RU LI ZDQW WR ORRN IRU VRPHWKLQJ ZKHUH ZDQW WR JURZ PRUH 'HVSLWH WKHVH OLPLWDWLRQV DGPLQLVWUDWLYH VWDII PHPEHUV JHQHUDOO\ UHSRUWHG IHHOLQJ UHVSHFWHG 7KH VDPH HPSOR\HH WROG PH ODWHU GXULQJ KHU LQWHUYLHZ WKDW GR QRW IHHO UHVWUDLQHG KHUH DW )t6 LQ ZKDW GR JLYH LGHDV DQG WKH\ XVH P\ LGHDV DQG VLJQ XQGHUQHDWK 0D\EH PRUH LQWHUHVWLQJO\ WKLV LQFLGHQW KLJKOLJKWV WKH UHVLVWDQFH IHPLQLVWV DW )t6 IHHO ZKHQ IDFHG ZLWK WKH LQFUHDVLQJ IRUPDOL]DWLRQ IRU ZKLFK WKH DGPLQLVWUDWLYH VWDII LV SXVKLQJ 7KLV HPSOR\HH KDG FRPSODLQHG RI WKH LQIRUPDOLW\ ZLWK ZKLFK VKH ZDV DVNHG WR SHUIRUP FHUWDLQ WDVNV VKH ZDQWHG WKHP ZULWWHQ RQ SDSHU VR WKDW WKHUH ZRXOG QRW EH DQ\

PAGE 158

PLVWDNHV RU PLVXQGHUVWDQGLQJV 5DFKHOnV TXRWH DW WKH EHJLQQLQJ RI WKLV FKDSWHU LV V\PSWRPDWLF RI WKH GRXEWV DQG DQ[LHW\ )t6 IHPLQLVWV DUH H[SHULHQFLQJ DW WKH LQFUHDVLQJ IRUPDOL]DWLRQ RI WKHLU RUJDQL]DWLRQ 7KHVH GRXEWV DQG DQ[LHWLHV XQGHUOLQH WKH LPSRUWDQFH RI RUJDQL]DWLRQDO VWUXFWXUH DQG SUDFWLFHV WR IHPLQLVW DFWLYLVWV ZKHQ LW FRPHV WR GHILQLQJ WKHLU JURXS DQG GLIIHUHQWLDWLQJ LW IURP RWKHU IHPLQLVW JURXSV 7KLV DSSHDUHG FOHDUO\ LQ WKH LQWHUYLHZV RI YROXQWHHU RUJDQL]DWLRQV 08nV WKUHH OHDGLQJ PHPEHUV UHIHUUHG WR WKH DQDUFKLF QDWXUH RI WKH RUJDQL]DWLRQ LQ VWDWHPHQWV VXFK DV ZH DUH YHU\ DQDUFKLFDO RU RXU W\SH RI RUJDQL]DWLRQ LV YHU\ DQDUFKLFDO VRPRV PLOLWR DQ£UTXLFDV RU D QRVVD PDQHLUD GH RUJDQL]DU PHLR DQ£UTXLFDf 7KUHH RWKHU PHPEHUV UHIHUUHG WR WKHLU ODFN RI SURIHVVLRQDOL]DWLRQ DV VHWWLQJ WKHP DSDUW IURP RWKHU IHPLQLVW RUJDQL]DWLRQV $W WKH &DVD IRXU PHPEHUV XVHG WKHLU RUJDQL]DWLRQDO IRUP WR GLVWLQJXLVK LW IURP RWKHU IHPLQLVW JURXSV RQ ERWK VLGH RI WKH VSHFWUXP 7KH &DVD KDV D VSDFH WHP HVSDGRf ZKLFK RWKHU SRSXODU IHPLQLVW JURXSV GR QRW KDYH ZKLFK JLYHV WKHP PRUH SRVVLELOLWLHV EXW ,W LV QRW SURIHVVLRQDO ,W LV QRW DQ 1*2 ZLWK D PRUH IRUPDO DGPLQLVWUDWLYH VWUXFWXUH ZKLOH LW LV QRW LQ DOO RUJDQL]DWLRQ WKDW DQ\ERG\ FDQ SDUWLFLSDWH DQG EH SDUW RI WKH FRRUGLQDWLRQ 7KH &DVD KDV WKLV SRZHU WR LQWHJUDWH SHRSOH QDR SURILVVLRQDO 1DR 21* FRP HVWUXWXUD DGPLQLVWUDWLYD PDLV IRUPDOn ZKLOH QDR HP FDGD XUQD >HQWLGDGH@ TXH G£ SDUD HQWUDU H ILFDU QD FRRUGHQDGR $ &DVD WHP HVVH SRGHU GH LQWHJUDU DVSHVVRDV GHQWURf 2Q WKH RWKHU KDQG )t6 PHPEHUV IRFXVVHG RQ KRZ ZHOO RUJDQL]HG DQG HVWDEOLVKHG WKH RUJDQL]DWLRQ ZDV 5DFKHO QRWHG WKDW WKH RUJDQL]DWLRQDO IRUP LV ZKDW KDG PRVW FKDQJHG RYHU WKH \HDUV $W 637 RQO\ 0DULQD UHIHUUHG WR RUJDQL]DWLRQDO LVVXHV ZKHQ DVNHG DERXW WKH LGHQWLW\ RI WKH JURXS 6KH WDONHG DERXW WKH FKDQJLQJ QDWXUH RI WKH JURXS IURP PRYHPHQW WR 1*2 WKDW ZDV UHIHUUHG WR DW RWKHU WLPHV E\ RWKHU PHPEHUV

PAGE 159

,Q SDUW WKLV HPSKDVLV RQ RUJDQL]DWLRQDO LVVXHV FDQ EH WUDFHG WR SDUWLFLSDQWVn DZDUHQHVV RI P\ ZRUN RQ WKHVH LVVXHV +RZHYHU WKLV UHVSRQVH LV DOVR FRQVLVWHQW ZLWK VWXGLHV RQ WKH 86 IHPLQLVW PRYHPHQW ZKLFK KDYH VKRZQ WKDW RUJDQL]DWLRQDO LVVXHV GR PDWWHU WR DFWLYLVWV VLQFH WKH\ XVXDOO\ FRQVLGHU WKDW WKHLU LQWHUQDO VWUXFWXUH DQG SUDFWLFHV VKRXOG EH FRQVLVWHQW ZLWK WKHLU HJDOLWDULDQ LGHRORJ\ ,Q WKHVH VWXGLHV DV DPRQJ 6DR 3DXOR IHPLQLVWV PDQ\ DQ DFWLYLVW ZRXOG QRW ZDQW WR ZRUN LQ DQ RUJDQL]DWLRQ WKDW GHYLDWHV IURP WKH QRUPV RI FROOHFWLYLVWGHPRFUDWLVP )HUUHH f &RQFOXVLRQ 8QOLNH WKH LGHDOLVW FROOHFWLYLVW GUHDP RI HJDOLWDULDQLVP 1*2V DUH IRUFHG EHFDXVH RI WKH FRQVWUDLQWV LPSRVHG E\ WKH QHHG WR VHFXUH IXQGLQJ DQG KHQFH WR EH FRPSHWHQW DQG WLPH HIILFLHQW DW ZKDW WKH\ GR WR FRQVLGHU LVVXHV RI LQGLYLGXDO FRPSHWHQFH FDSDFLWLHV DQG DYDLODELOLW\ 5DFKHO VDLG 6R LQ WHUPV RI RXU GLIIHUHQFHV WKLQN WKDW ZH DUH FRQVWDQWO\ OHDUQLQJ DOO WKH WLPH WR GHDO ZLWK RXU GLIIHUHQFHV GLIIHUHQFHV RI SRZHU GLIIHUHQFHV RI FDSDFLW\ 1*2V H[SHULPHQW ZLWK WUDQVSDUHQW GLIIHUHQWLDWHG VHPLKLHUDUFKLFDO VWUXFWXUHV ZKLOH YROXQWDU\ JURXSV SHUVHYHUH LQ WKH IHPLQLVW LGHDO RI QRQKLHUDUFKLFDO QRQGLIIHUHQWLDWHG FROOHFWLYHV ZLWK DOO WKHLU FRQWUDGLFWLRQV %RWK 637 DQG )t6 DUH VWUXJJOLQJ ZLWK WKH RULJLQDO FROOHFWLYLVW FKDUDFWHU RI WKHLU RUJDQL]DWLRQ DV WKH\ ILQG LW GLIILFXOW WR DFFRPPRGDWH WR WKH WDVNV WKH\ KDYH WR SHUIRUP DQG WKH JRDOV WKH\ KDYH VHW IRU WKHPVHOYHV 8QIRUWXQDWHO\ WKH FXUUHQW HFRQRPLF FULVLV 1*2V DUH IDFLQJ LV OLNHO\ WR PDNH LW HYHQ KDUGHU IRU WKHP WR H[SORUH QHZ VRFLDELOLWLHV DQG DOWHUQDWLYH IRUPV RI RUJDQL]DWLRQV

PAGE 160

7KH FRPLQJ FKDSWHU ZLOO H[DPLQH KRZ WKHVH RUJDQL]DWLRQDO SUDFWLFHV DIIHFW PHPEHUVn LQGLYLGXDO LGHQWLW\ FRPPLWPHQW DQG VROLGDULW\ WR WKH JURXS DV ZHOO DV WKH JURXSVn FROOHFWLYH LGHQWLW\ QDPHO\ WKHLU VWUDWHJ\ IRU VRFLDO FKDQJH

PAGE 161

&+$37(5 7+( /$%25 2) /29( $1' %5($' 25*$1,=$7,21$/ 35$&7,&(6 ,1',9,'8$/ $1' &2//(&7,9( ,'(17,7,(6 ,QWURGXFWLRQ QRZ ZLVK WR UHWXUQ WR RXU GLVFXVVLRQ RI KRZ RUJDQL]DWLRQDO IRUPV LQIOXHQFH LQGLYLGXDO DQG FROOHFWLYH LGHQWLW\ DQG VROLGDULW\ DV SUHVHQWHG LQ FKDSWHU KDYH PHQWLRQHG WKH IDFW WKDW FRQVHQVXDO GHFLVLRQPDNLQJ KHLJKWHQV JURXS PHPEHUVn FRPPLWPHQW WR WKH GHFLVLRQV PDGH DQG KHQFH LQFUHDVHV VROLGDULW\ 2WKHU SUDFWLFHV WKDW HQFRXUDJH YDOXHUDWLRQDOLW\ FRPPLWPHQW DQG YDOXHV RWKHU WKDQ VHOILQWHUHVWf KDYH EHHQ LGHQWLILHG E\ 5RWKVFKLOG:KLWW f 7KHVH LQFOXGH DXWKRULW\ EDVHG LQ WKH FROOHFWLYH ZLWKRXW KLHUDUFKLFDO VWUXFWXUH KRPRJHQHLW\ XVHG DV D PHWKRG RI VRFLDO FRQWURO LH WR OLPLW SRWHQWLDO FRQIOLFWV KROLVWLF DQG DIIHFWLYH UDWKHU WKDQ VHJPHQWHG UROHEDVHG DQG LQVWUXPHQWDO VRFLDO UHODWLRQVKLSV DPRQJ PHPEHUV DQG DQ LQFHQWLYH VWUXFWXUH $QD 0DULD )t6f XQGHUVWDQGV YHU\ ZHOO WKH FRPPLWPHQW GLPHQVLRQ RI FRQVHQVXDO GHFLVLRQPDNLQJ WKLQN WKDW WKH SRVLWLYH DVSHFW >RI WKLV PRGHO RI GHFLVLRQPDNLQJ@ LV WKDW SHRSOH KDYH WR WDNH FKDUJH HDFK SHUVRQ KDV WR WDNH FKDUJH RI D UHVSRQVLELOLW\ ULJKW" PHDQ RI ZKDW LV JRLQJ RQ LQ )t6 PHDQ LQ UHDOLW\ WKLQN WKDW WKLV IRUFHV SHRSOH WR JHW LQYROYHG PRUH WR PDNH GHFLVLRQV DQG WR MXPS LQ ULJKW" 2Q WKH RWKHU KDQG +HFKWHU f IRXQG WKDW WKH ORQJHVW OLYLQJ LQWHQWLRQDO FRPPXQLWLHV ZLWK VWURQJ FRPPXQDO LGHRORJ\ DUH KLJKO\ KLHUDUFKLFDO 7KLV LV EHFDXVH WKH VXERUGLQDWLRQ RI LQGLYLGXDOVn ZLOO WR WKH JHQHUDO ZLOO WDNHV WKH VKDSH RI XQTXHVWLRQLQJ REHGLHQFH WRZDUG OHDGHUV 7KLV ORQJHYLW\ PLJKW EH H[SODLQHG E\ WKH IDFW WKDW QRQKLHUDUFKLFDO GHPRFUDWLF RUJDQL]DWLRQV SODFH D KLJK YDOXH RQ FRQVHQVXV KHQFH FRQIOLFW WHQGV WR EH IHDUHG DQG DYRLGHG 3HRSOH DOVR GHDO IDFHWRIDFH ZLWK HDFK RWKHU ZLWK KLJK SHUVRQDO LQYROYHPHQW DQG HPRWLRQDO LQWHQVLW\ 0DQVEULGJH 5RWKVFKLOG:KLWW f

PAGE 162

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f $FFRUGLQJ WR 5RWKVKLOG :KLWW DQG )HUUHH WKHVH ZRXOG QRW EH DV IDYRUDEOH DQ HQYLURQPHQW IRU YDOXHUDWLRQDOLW\ KLJK OHYHO RI FRPPLWPHQW DQG VROLGDULW\ DPRQJ PHPEHUV FRPSDUHG WR PLQLPDO VWUDWLILFDWLRQ RI WDVNV DQG SD\ PRVWO\ SXUSRVLYH LQFHQWLYHV f§ LH OLWWOH PDWHULDO UHZDUGVf§ DQG QRQLQVWUXPHQWDO VRFLDO UHODWLRQVKLSV DPRQJ PHPEHUV 1*2Vn VHW RI RUJDQL]DWLRQDO FKDUDFWHULVWLFV ZRXOG RQ WKH RWKHU KDQG IDYRU JUHDWHU IRUPDO UDWLRQDOLW\ LH FRVWEHQHILW FDOFXODWLRQV EDVHG RQ VHOILQWHUHVWf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

PAGE 163

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nV HYHQWV LQ WKH FRXUVH RI D ZHHNHQG RQH SURIHVVLRQDOL]HG DFWLYLVW FRPPHQWHG WR PH 4X PLOLW£QFLD9n VRPHWKLQJ WR WKH HIIHFW RI :KDW D GHGLFDWHG DFWLYLVPf WR ZKLFK UHVSRQGHG 1R WKDWn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

PAGE 164

+DG EHHQ DQ DFWLYLVW ZRXOG KDYH GRQH LW +DG EHHQ LQ %UD]LO WKH SUHVVXUH IRU GRLQJ LW ZRXOG DOVR KDYH EHHQ VWURQJHU $V ZH ZLOO VHH YROXQWHHU DFWLYLVWV H[SUHVV D VWURQJ HPRWLRQDO DWWDFKPHQW WR WKHLU RUJDQL]DWLRQ DQG XQDPELJXRXVO\ LGHQWLI\ WKHLU DFWLYLWLHV DV DFWLYLVP PLOLW£QFLDf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n RUJDQL]DWLRQDO IHDWXUHV FRPSDUHG WR EXVLQHVVHV RU EXUHDXFUDFLHVf WKHLU DFWLYLVW KLVWRU\ DV ZHOO DV RI WKH OLPLWDWLRQV SODFHG RQ LQGLYLGXDO UHZDUGV E\ ODFN RI MRE VHFXULW\ DQG VRFLDO EHQHILWV LQ 1*2V :KDW WKHQ DUH WKH PHDQLQJV WKDW GLIIHUHQW SDUWLFLSDQWV DWWULEXWH WR WKHLU DFWLYLWLHV 7ZR PHPEHUV RI 08 ZHQW DV IDU DV WR VD\ WKH\ KDG XUQD SDL[£R D SDVVLRQ IRU WKH RUJDQL]DWLRQ KDYH D SDVVLRQ IRU 08 WHQKR XUQD SDL[£R SHOD 08n DQG HVWRX DSDL[RQDGD SHOD 08f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

PAGE 165

RI WKH &DVD GD 0XOKHU ZHUH QRW DV YRFDO DERXW WKHLU HPRWLRQV DERXW WKH RUJDQL]DWLRQ DOWKRXJK WKH &DVD ZDV D WUHPHQGRXV SDUW RI WKHLU OLYHV WRR $PRQJ WKH SURIHVVLRQDOL]HG JURXSV ZRUNHG ZLWK LGHQWLILHG D GXDO LGHQWLW\ DFWLYLVPZRUNf DQG GLIILFXOWLHV LQ VHSDUDWLQJ WKH WZR 0DULQD RI 637 H[SUHVVHG KRZ ERWK HOHPHQWV DUH SUHVHQW EXW DOVR KRZ GLIILFXOW LW LV IRU KHU WR WHDVH RXW RQH IURP WKH RWKHU 1
PAGE 166

, WKLQN WKDW )t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nV 1*2 ZLWK ZKLFK FRQGXFWHG D FROOHFWLYH LQWHUYLHZ DOVR H[SUHVVHG WKH DPELJXRXV RU GXDO QDWXUH RI WKHLU UHODWLRQVKLS WR WKHLU DFWLYLWLHV VHH )LJXUH DW WKH HQG RI WKLV FKDSWHUf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

PAGE 167

GLG QRW ZDQW WR EH FREUDGD UHPLQGHGf IRU GRLQJ RQO\ WKH QXPEHU RI KRXUV WKH\ KDG GHFLGHG XSRQ /DWHU RQ 6LOYLD DQG DQRWKHU QHZ PHPEHU DUJXHG WKDW ZRPHQ GR QRW YDOXH WKHLU ZRUN LH QRW SD\LQJ ZHOO PRVW ZDJHV IRU 1*2 SURIHVVLRQDOV DUH FRQVLGHUDEO\ ORZHU WKDQ SULYDWH VHFWRU ZDJHVf $QD 0DULD RQH RI WKH IRXQGLQJ PHPEHUV UHSOLHG WKDW LW ZDV QRW D TXHVWLRQ RI QRW YDOXLQJ WKHLU ZRUN EXW IRU KHU LW ZDV XUQD RS£R GH YLGD D FKRVHQ OLIHVW\OHf 6KH FRXOG EH ZRUNLQJ LQ LQWHUQDWLRQDO RUJDQL]DWLRQV DV D FRQVXOWDQW DQG HDUQ D ORW PRUH PRQH\ DQG ZKDW WKH\ HDUQ LV LQ OLQH ZLWK RWKHU 1*2 VDODULHV >ILHOGQRWHV 2FWREHU @ ,Q WKH FDVH RI WKH $IUR%UD]LOLDQ ZRPHQnV 1*2 6DQGH VHH )LJXUH f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nV LQFRPH LV KHOSLQJ KHU PDLQWDLQ KHUVHOI DQG WKH IDPLO\ 6KH VDLG LW LV D FKRLFH \RX PDNH QRZ GRQnW NQRZ PH IRU H[DPSOH LI KDG WR VHSDUDWH IURP P\ KXVEDQG LI ZRXOG QRW KDYH WR PDNH RWKHU SURIHVVLRQDO RSWLRQV DV ZHOO ,Q RWKHU ZRUGV DV 6DQGUD SXWV LW :H KDYH D GHJUHH RI DFWLYLVP ZKLFK LV YHU\ GLIIHUHQW IURP RQH SHUVRQ WR WKH QH[W KHUH DW )t6

PAGE 168

,W LV LQWHUHVWLQJ WR QRWH WKDW 6LOYLD LV D OHDGLQJ ILJXUH RI D YROXQWHHU IHPLQLVW RUJDQL]DWLRQ LQ 6DR 3DXOR DQG KHQFH VKH LV PRUH OLNHO\ WR FRQVLGHU KHU SDUWLFLSDWLRQ LQ )t6 DV D MRE LQGHHG ZKLOH KHU SDUWLFLSDWLRQ LQ WKH RWKHU JURXS LV KHU VSDFH IRU DFWLYLVP 6WLOO WKH PHDQLQJ RI KHU SDUWLFLSDWLRQ LQ )t6 LV QRW DEVROXWHO\ FOHDU LQ KHU PLQG DV ZDV VKRZQ GXULQJ KHU LQWHUYLHZ D IHZ PRQWKV HDUOLHU 6KH KDG DOVR VHQVHG WKDW RWKHU PHPEHUV RI WKH JURXS IHOW GLIIHUHQWO\ IURP KHU LQ WKLV UHJDUG 6KH VWDUWHG E\ H[SODLQLQJ KRZ GLIIHUHQW LW LV WR ZRUN DW )t6 FRPSDUHG ZLWK KHU MRE LQ WKH SXEOLF KHDOWK VHFWRU EHFDXVH 6LOYLD 3HRSOH NQRZ PH WKH\ NQRZ P\ OLIH > @ ,WnV QRW OLNH QHHG WR SXQFK WKH WLPHFDUG > @ DOUHDG\ KDG H[SHULHQFHG WKLV ZLWK P\ FRPUDGHV >RI WKH JURXS VKH PLOLWDWHV LQ@ OHWnV VD\ DOUHDG\ KDG WKLV H[SHULHQFH EXW LQ D VLWXDWLRQ RI DFWLYLVP ZKLFK LV GLIIHUHQW 1 $ VLWXDWLRQ RI DFWLYLVP ZKLFK LV GLIIHUHQW" 6R \RX FRQVLGHU \RXU SDUWLFLSDWLRQ KHUH DV D MRE" 6LOYLD ,WnV ERWK LW HQGV XS EHLQJ LWn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nW NQRZ >@

PAGE 169

WKHUH DUH SHRSOH HYHQ WKH PRQH\ WKDW WKH\ UHFHLYH WR OLYH GRQnW NQRZ KRZ WR SXW LW LW GRHV QRW PDWWHU LI WKH\ DUH SDLG RU QRW WKH\ GR WKLQJV %XW WKLV LV D YHU\ VSHFLDO VLWXDWLRQ GRQnW NQRZ RI VRPH YHU\ VSHFLDO OHDGHUV ,Q JHQHUDO ZKHQ VRPHERG\ UHFHLYHV PRQH\ PHDQ ZKHQ VKH OLYHV IURP WKLV ZRUN WKLQN WKDW WKH UHODWLRQ FKDQJHV 7KHQ DP QRW GRLQJ LW RQO\ EHFDXVH WKLV LV LPSRUWDQW DP JRLQJ WR GR LW DOVR EHFDXVH LI GRQnW GR LW ZRQnW EH SDLG LI GRQnW GR LW WKH\nOO ILUH PH LI GRQnW GR LW WKLV SURMHFW ZLOO QRW EH UHQHZHG ,Q RWKHU ZRUGV WKLV RWKHU FRPSRQHQW 6LOYLDn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nV JURXS LQ ZKLFK \RX SDUWLFLSDWH 1
PAGE 170

)RU 'HLVH ZRUNLQJ IRU D IHPLQLVW 1*2 VWUHQJWKHQHG KHU LGHQWLW\ DV D ZRPDQ DQG DV D SDUWLFLSDQW LQ WKH ZRPHQnV PRYHPHQW 6WLOO VKH ZLVKHV WR SDUWLFLSDWH LQ D JURXS WR ZKLFK VKH ZRXOG EHORQJ FRPSOHWHO\ LQ ZKLFK VKH ZRXOG QRW ZRUN 7KH FRPPRGLILHG TXDOLW\ RI KHU UHODWLRQVKLS WR WKH JURXS DOWHUV LWV PHDQLQJ ,Q FRQFOXVLRQ WKHUH LV QR GRXEW WKDW WKH LGHQWLW\ RI D QXPEHU RI 1*2 PHPEHUV LV GLIIHUHQW IURP WKDW RI YROXQWHHU DFWLYLVWV DQG WKDW WKH SUHVHQFH RI ILQDQFLDO UHZDUGV SOD\V D ODUJH UROH LQ WKLV SURFHVV )RU PRVW WKHLU DFWLYLWLHV KDYH EHFRPH D EOHQG RI ZRUN DQG DFWLYLVP 7KHVH ZRPHQnV WHVWLPRQLHV DWWHVW WR WKH WKHRU\ WKDW ZKHQ H[WULQVLF PRWLYDWRUV LQ WKLV FDVH PRQH\ DUH SUHVHQW WKH\ DUH SHUFHLYHG E\ WKH LQWHUHVWHG LQGLYLGXDOV DQG E\ REVHUYHUV DV PRUH VDOLHQW WKDQ LQWULQVLF PRWLYDWRUV VXFK DV FRPPLWPHQW WR WKH JURXSnV JRDOV 7KHVH KRZHYHU DUH YHU\ PXFK DOVR SUHVHQW ,QGHHG 0\UD 0DU[ )HUUHH f ZDUQV XV WKDW H[WULQVLF PRWLYDWRUV VXFK DV ILQDQFLDO UHZDUGV >@ WHQG WR EH PRUH VDOLHQW DV FDXVHV RI EHKDYLRU ZKHQ WKH\ DUH SUHVHQW WKH\ WHQG WR UHGXFH WKH H[WHQW WR ZKLFK LQWULQVLF PRWLYDWRUV SHUFHLYHG LQWHUHVW YDOXH RU FRPPLWPHQWf DUH VHHQ DV SURGXFLQJ EHKDYLRU ERWK LQ RQHVHOI DQG LQ RWKHUV %HUQ f 7KXV DGGLQJ H[WHUQDO LQFHQWLYHV WR DQ LQWULQVLFDOO\ PRWLYDWHG WDVN FDQ DFWXDOO\ GHFUHDVH WKH DPRXQW RI HIIRUW GHYRWHG WR LW RQHVHOI DQG GLVFUHGLW WKH PRWLYHV RI RWKHUV DV PHUHO\ VHOILQWHUHVWHG 6XFK WHQGHQFLHV DUH LQGHHG PLWLJDWHG E\ LQGLYLGXDO FKDUDFWHULVWLFV DQG DFWLYLVW KLVWRU\ DV ZHOO DV E\ WKH K\EULG QDWXUH RI IHPLQLVW SURIHVVLRQDOL]HG RUJDQL]DWLRQV DV 0DULQDnV WHVWLPRQ\ H[SUHVVHG SDUWLFXODUO\ ZHOO 6ROLGDULW\ DQG 6HOI,QWHUHVW $EVWUDFW FRQFHSWV VXFK DV FRPPLWPHQW DQG VROLGDULW\ DUH GLIILFXOW WR JHW DW OHW DORQH WR HYDOXDWH DQG FRPSDUH 7KH GLVFXVVLRQ RI WKH SRVVLELOLW\ RI LQGLYLGXDOL]HG SURMHFWV PHQWLRQHG

PAGE 171

LQ FKDSWHU FHUWDLQO\ SRLQWV LQ WKH GLUHFWLRQ RI LQFUHDVHG LQGLYLGXDO VHOILQWHUHVW FDOFXODWLRQV LQ 1*2V :KR FRXOG EODPH WKHP DIWHU DOO 1*2 PHPEHUVn VXVWHQDQFH LV DW VWDNH DQG LW GHSHQGV RQ WKH PDLQWHQDQFH RI WKH RUJDQL]DWLRQ /LQHV DUH LQGHHG GLIILFXOW WR GUDZ ZKHQ RQHnV RZQ SHUVRQDO VXVWHQDQFH FRPHV LQWR SOD\ )RU H[DPSOH D IHPLQLVW ZKR KDG MXVW OHIW DQ 1*2 DVNHG D SRSXODU IHPLQLVW JURXS ZKHWKHU VKH FRXOG XVH WKH QDPH RI WKHLU RUJDQL]DWLRQ WR VHQG D SURMHFW WR D ILQDQFLQJ DJHQF\ ZKLFK GLG QRW DFFHSW LQGLYLGXDO SURSRVDOV ,Q WKH SRSXODU IHPLQLVWVn XQGHUVWDQGLQJ WKLV ZRPDQ ZDV ZLOOLQJ WR XVH WKHLU JURXS IRU KHU LQGLYLGXDO VXVWHQDQFH ZKLOH IRUJHWWLQJ WKH QHFHVVLW\ RI FROOHFWLYH DFWLRQ 7KH\ ZRXOG KDYH ZHOFRPHG WKH ZRPDQ KDG VKH ZDQWHG WR SDUWLFLSDWH ZLWK WKH JURXS 7KH\ ZRXOG WKHQ KDYH HYDOXDWHG KRZ KHU SURMHFW ILW ZLWK WKHLU DFWLYLWLHV 9LFHYHUVD DQ 1*2 VWDII ZKR GRHV QRW ILW WKH FRPSHWHQFH RU JRDOV DJUHHG XSRQ E\ WKH UHVW RI WKH JURXS FDQ EH ILUHG 7KLV LV QHYHU GRQH OLJKWKHDUWHGO\ DQG JHQHUDWHV PXFK DQ[LHW\ IRU WKH JURXS 637n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

PAGE 172

1HYHUWKHOHVV FRXOG KDUGO\ GHVFULEH 637 DQG )t6 DV QRQVROLGDU\ QRQFRPPLWWHG JURXSV ZKRVH UHODWLRQV DUH VROHO\ UROHEDVHG DQG LQVWUXPHQWDO )t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f DQG WKH PHDQLQJ WKH\ DWWULEXWH WR WKHLU DFWLYLWLHV DOVR FRQWULEXWH WR OLPLWLQJ WKH SRWHQWLDO IRU JUHDWHU IRUPDO UDWLRQDOLW\ DQG GLUHFW FRVWEHQHILW DQDO\VLV DW WKH LQGLYLGXDO OHYHO LQ IHPLQLVW 1*2V ZKLOH PDLQWDLQLQJ YDOXHUDWLRQDOLW\ FRPPLWPHQW DQG VROLGDULW\ DW YDU\LQJ GHJUHHV GHSHQGLQJ RQ LQGLYLGXDO JURXSVf 7KLV PLJKW EH PRUH GLIILFXOW WR PDLQWDLQ LI WKH RUJDQL]DWLRQ JURZV DQG KLUHV QHZ VWDII PHPEHUV ZKR KDYH QRW KDG DQ DFWLYLVW H[SHULHQFH %HVLGHV ZRUNLQJ IRU DQ 1*2 GRHV QRW FRQIHU RQO\ DGYDQWDJHV DW D YHU\ LQGLYLGXDO OHYHO 7KH GUDZEDFNV RI WKLV W\SH RI FDUHHU DUH VLJQLILFDQW )RU HGXFDWHG SURIHVVLRQDOV LW PHDQV DFFHSWLQJ D VDODU\ ORZHU WKDQ WKH OLIHVW\OH WKH\ DUH DFFXVWRPHG WR DV ZHOO DV QR

PAGE 173

HPSOR\PHQW EHQHILWV RU MRE VHFXULW\ ,QGHHG WKH 1*2V ZRUNHG ZLWK PDGH VXUH WKDW WKHLU DGPLQLVWUDWLYH VWDII HQMR\HG IRUPDO HPSOR\PHQW EHQHILWV WKURXJK WKH FDUWHLUD DVVLQDGD WKH GRFXPHQW ZKLFK SURYLGHV WKHP DPRQJ RWKHUV ZLWK UHWLUHPHQW PRQH\ DQG PLQLPXP KHDOWK FRYHUDJH 2Q WKH RWKHU KDQG PRVW 1*2Vn WHFKQLFDO VWDII GR QRW KDYH D FDUWHLUD DVVLQDGD EHFDXVH WKH RUJDQL]DWLRQ FDQQRW DIIRUG WKH GXHV WKDW IRUPDO HPSOR\HUV DUH UHTXLUHG WR SD\ 7KLV PHDQV WKDW 1*2 VWDII GR QRW HQMR\ WKH VRFLDO EHQHILWV RI IRUPDO HPSOR\PHQW ZKLFK SURPSWHG 7DWLDQD RI 08 WR ODEHO WKHP WKH FDPH ORWV GDV SURILVVRHV OLEHU£LV J\SV\ SURIHVVLRQDOVf 637nV FDVH LV GLIIHUHQW EHFDXVH LW REWDLQHG LQ WKH SDVW WKH VWDWXV RI HQWLGDGH GH XWLOLGDGH SEOLFD SXEOLF HQWLW\f ZKLFK OLEHUDWHV WKH RUJDQL]DWLRQ IURP SD\LQJ HPSOR\HUVn GXHV WR WKH 6WDWH 637nV VRPHWKLQJ \HDUV RI H[LVWHQFH KDYH EHHQ D SOXV LQ REWDLQLQJ WKLV VWDWXV %UD]LOnV ZHOONQRZQ EXUHDXFUDWLF PD]H PDNHV LW GLIILFXOW IRU RUJDQL]DWLRQV WR REWDLQ WKLV VWDWXV RU WR HYHQ WU\ 1*2 PHPEHUV DUH LQFUHDVLQJO\ DZDUH RI WKLV ODFN RI EHQHILWV DQG RI WKH SDUDGR[ LW FUHDWHV FRQVLGHULQJ WKDW 1*2V RIWHQ VHHN WR LPSURYH VXFK SXEOLF VRFLDO EHQHILWV IRU DOO %UD]LOLDQV ,Q WKH ZRUGV RI 'RUD PHPEHU RI 6DQGH 'RUD 1RZ DP TXLWH FULWLFDO RI RXU SRVLWLRQ \RX NQRZ UHJDUGLQJ WKLQN WKDW ZH KDYH WR GR VRPHWKLQJ GRQnW NQRZ KDYH QRW GLVFRYHUHG ZKDW \HW EXW WRJHWKHU ZH ZLOO ILQG RXW DOO WKH 1*2V %XW ZH KDYH WR SURJUHVV RQ WKLV LVVXH ZH ZRUN IRU D FHUWDLQ TXDOLW\ RI OLIH DQG ZH GR QRW JXDUDQWHH LW IRU RXUVHOYHV VRXQGV RI DSSUREDWLRQ IURP WKH RWKHUVf 1 ,W LV )OYLD ZKR EURXJKW WKLV WR P\ DWWHQWLRQ VKH VDLG FDQnW UHPHPEHU H[DFWO\ WKDW VKH KDG D IULHQG ZKR KDG FRPPHQWHG WKDW VKH ZDV QRW JRLQJ WR KDYH DQ\ UHWLUHPHQW PRQH\ 'RUD KDYH EHHQ IUHHODQFH LQ UHVHDUFK VLQFH ZDV \HDUV ROG ZRUNHG \HDUV IRU WKH 6WDWH WKHQ MRLQHG DQ 1*2 @ 1RZ ZH JLYH XS RQ FHUWDLQ ULJKWV ZKLFK DUH DOUHDG\ FRQVROLGDWHG EHFDXVH ZH JLYH SULRULW\ WR WKH ZRUN WKDW QHHGV WR EH GRQH WR D SROLWLFDO YLVLRQ WR ZKDW QHHGV WR EH GRQH 6R WKH FRVWV IRU RXU SHUVRQDO OLYHV DUH FRQVLGHUDEOH

PAGE 174

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n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nW QHHG DQ\ERG\nV FKDULW\ )LQDQFLQJ DJHQFLHV SOD\ DQ LPSRUWDQW UROH LQ WKH LQVHFXULW\ RI 1*2 ZRUN E\ ILQDQFLQJ VSHFLILF SURMHFWV UDWKHU WKDQ SURYLGLQJ LQVWLWXWLRQDO VXSSRUW $QD 0DULD IURP )t6 IRU H[DPSOH H[SODLQHG WKDW FHUWDLQ DJHQFLHV VXFK DV 81)3$ 8QLWHG 1DWLRQV )XQG IRU 3RSXODWLRQf H[SOLFLWO\ VWDWH LQ WKHLU FRQWUDFWV WKDW WKH\ GR QRW ILQDQFH HPSOR\HUVn GXHV HQFDUJRV VRFLDLVf DQG YDFDWLRQV $QG WKH\ MXVWLI\ LW E\ VD\LQJ WKDW LW LV 81 SROLF\ /DFNLQJ D VRFLDO VHFXULW\ FDUG QRW RQO\ PHDQV QR VRFLDO EHQHILWV LW DOVR VLJQLILHV MRE LQVHFXULW\ 7KLV LV SDUWLFXODUO\ WUXH VLQFH WKH PLGV ZKHQ /DWLQ $PHULFDQ 1*2V KDYH

PAGE 175

HQWHUHG WURXEOHG ILQDQFLDO ZDWHUV ,Q RUGHU WR SURWHFW WKHPVHOYHV IURP DGYHUVH XQSUHGLFWDEOH FLUFXPVWDQFHV VRPH 1*2 PHPEHUV DUH NHHSLQJ D IRRW LQ WKH SXEOLF VHFWRU HLWKHU DV D SDUWWLPH HPSOR\HH DV LQ WKH FDVH RI 6LOYLD RU E\ VRPH EXUHDXFUDWLF PHFKDQLVP ZKLFK DOORZV WKH LQGLYLGXDO WR UHPDLQ RQ WKH SXEOLF VHUYLFH URVWHUV ZLWKRXW DFWXDOO\ ZRUNLQJ WKHUH RU EHLQJ SDLG 6LOYLD H[SODLQV KHU LQVHFXULWLHV DERXW ZRUNLQJ RQO\ DW )t6 LQ WHUPV RI WKH UHVSRQVLELOLWLHV VKH KDV WRZDUGV KHU FKLOGUHQ 6KH LV VHSDUDWHG IURP KHU KXVEDQG ZRXOG QHYHU ZRUN RQO\ KHUH DW )t6 EHFDXVH RI P\ NLGV DQG DP QRW WKH W\SH RI SHUVRQ ZKR PDQDJHV WR OLYH LQ VHUHQLW\ ZLWKRXW NQRZLQJ ZKDW WRPRUURZ ZLOO EULQJ DP NLQG RI DQ[LRXV WR ZDQW WR KDYH WKLQJV ,Q RWKHU ZRUGV WKHUH DUH VHULRXV OLPLWDWLRQV RQ WKH PDWHULDO UHZDUGV RIIHUHG E\ 1*2V IRU WKH W\SH RI ZRPHQ ZKR DUH WKHLU PHPEHUV 7KLV OLPLWV WKH GHJUHH WR ZKLFK LQWULQVLF PRWLYDWRUV VXFK DV FRPPLWPHQWf DUH RYHUVKDGRZHG E\ H[WULQVLF UHZDUGV 7KHUH DUH RWKHU W\SHV RI UHZDUGV VXFK DV SUHVWLJH DQG WUDYHO WKDW 1*2V RIIHU WR WKHLU PRVW YLVLEOH PHPEHUV ZKLFK ZLOO GLVFXVV DJDLQ LQ &KDSWHU DQG 7KH /DERU RI /RYH DQG %UHDG KRSH WR KDYH VKRZQ WKDW IRU PRVW SURIHVVLRQDOL]HG DFWLYLVWV WKHLU DFWLYLWLHV DUH D EOHQG RI ZRUN DQG DFWLYLVP +HQFH FROOHFWLYH ZRUN LV QR ORQJHU FRQVWUXHG E\ PRVW 1*2 PHPEHUV VROHO\ DV D ODERU RI ORYH DV 5RWKVFKLOG:KLWW f SXWV LW EXW DV D ODERU RI ORYH DQG EUHDG /HLODK /DQGLP EULHIO\ UHIHUV WR D VLPLODU SURFHVV RI 1*2 PHPEHUV FRPLQJ WR JUDVS ZLWK DQ DFWLYLW\ ZKLFK LV ERWK HPSUHJRPLOLWGQFLD ZRUNDFWLYLVPf 6KH FRPSDUHV LW WR WKH ZRUN RI UHOLJLRXV FOHUJ\ DV QHLWKHU SURIHVVLRQDO QRU YROXQWDU\

PAGE 176

D f 7KHUHIRUH P\ GDWD VXSSRUWV 0DF&DUWK\ DQG =DOGnV DQDO\VLV WKDW SURIHVVLRQDOL]DWLRQ DOWHUV WKH PHDQLQJ RI PHPEHUVKLS WR WKH JURXS > @ f 2Q WKH RWKHU KDQG LW GRHV QRW VXSSRUW WKHLU FODLP WKDW SURIHVVLRQDO PRYHPHQW HQWUHSUHQHXUV FRPH IURP RXWVLGH WKH PRYHPHQW RU DUH V\VWHPDWLFDOO\ OHVV FRPPLWWHG WR LW /LNH LQ 3DP 2OLYHUnV VWXG\ f %UD]LOLDQ IHPLQLVW SURIHVVLRQDOL]HG DFWLYLVWV KDYH FRPH PRVWO\ IURP WKH UDQNV RI FRPPLWWHG DFWLYLVWV $ %UD]LOLDQ IHPLQLVW VRFLRORJLVW RI KHDOWK VLPLODUO\ DUJXHG WKDW 1*2 PHPEHUV ZRXOG QRW GR ZKDW WKH\ GR ZLWKRXW D FRPPLWPHQW FRPSURPLVVRf VLQFH WKH\ HDUQ PRGHVW VDODULHV LQ WKH FRQWH[W RI WKH %UD]LOLDQ PLGGOHFODVV RI ZKLFK WKH\ DUH SDUW $V KDYH MXVW GLVFXVVHG WKH\ DOVR JLYH XS RQ LPSRUWDQW VRFLDO ULJKWV ,Q WKHLU RZQ ZRUGV LW LV D FKRVHQ OLIHVW\OH XUQD RSJ£R GH YLGDf ,W EHFRPHV REYLRXV WKDW LI WKHUH LV D GHILQLWH DVSHFW RI HDUQLQJ D OLYLQJ ZLWK RQHnV DFWLYLVP IHZ RI WKH 1*2 ZRPHQ LQWHUYLHZHG ZRXOG ZRUN LQ DQ 1*2 VROHO\ IRU VHOILQWHUHVWHG PRWLYHV DV VRPH RI WKHLU GHWUDFWRUV VRPHWLPHV FODLP )LQDOO\ WKLV QHZ IRUP RI DFWLYLVP GRHV FUHDWH D SXOO IRU LQGLYLGXDO VHOILQWHUHVW ZKLFK PLJKW EH GHWULPHQWDO WR WKH VROLGDULW\ RI WKH JURXS LQ WKH ORQJ UXQ
PAGE 177

VRFLHW\ GUHZ WKLV LQIRUPDWLRQ IURP WKH LQGLYLGXDO LQWHUYLHZV FRQGXFWHG 0\ LQWHUSUHWDWLRQ LV DOVR LQIRUPHG E\ WKH SDUWLFLSDQW REVHUYDWLRQ FRQGXFWHG IRXQG WKH TXHVWLRQ DERXW WKH GLIIHUHQFH ZLWK RWKHU IHPLQLVW JURXSV TXLWH UHYHDOLQJ LQ WHUPV RI WKH LGHQWLW\ RI WKH JURXSV 7KLV GHQRWHV WKH RSSRVLWLRQDO DQG UHODWLRQDO QDWXUH RI LGHQWLW\ &ROOHFWLYH LGHQWLW\ LV DOVR UHIOHFWHG LQ DQG UHLQIRUFHG E\ D JURXSnV KHDGTXDUWHUVn VHWWLQJ WKH SURJUDPV DQG DFWLYLWLHV WKH\ FKRRVH WR HQJDJH LQ WKHLU GDLO\ SUDFWLFHV DQG WKH LQWHUDFWLRQ DPRQJ PHPEHUV DQG ZLWK RWKHU LQVWLWXWLRQV DQG RWKHU JURXSV DV ZHOO DV WKH ZD\ WKH\ SUHVHQW WKHPVHOYHV LQ SXEOLF IRUXPV 7KHUH DUH FOHDU GLIIHUHQFHV LQ WKH ZD\ JURXSV WKLQN DERXW WKHPVHOYHV DQG KRZ WR DFKLHYH VRFLDO FKDQJH ZLOO SUHVHQW WKH FROOHFWLYH LGHQWLW\ RI 0XOKHUHV 8QLGDV DQG )HPLQLVWDV t 6DGH EHFDXVH WKH\ RIIHU WKH VWDUNHVW FRQWUDVW +RZHYHU XQGHUVWDQG WKH IRXU RUJDQL]DWLRQV WR EH PRUH DORQJ D FRQWLQXXP UDWKHU WKDQ IRUPLQJ D GLFKRWRP\ ,QGHHG 7KH &DVD DQG 637 DUH PRUH K\EULG 0XOKHUHV 8QLGDV ,WnV /LNH D 7UDLQ DW WKH 5K\WKP RI WKH 0RYHPHQW 7KH ORJR RI 0XOKHUHV 8QLGDV 08f LV D ZRPDQ EUHDNLQJ RXW RI KHU FKDLQV $ OXWD WKH VWUXJJOHf DQG GHQXQFLDU WR GHQRXQFHf DUH HVVHQWLDO WR WKHLU GLVFRXUVH DQG LQ WKHLU DFWLRQV IRU H[DPSOH WKH\ VHQW D ID[ WR RWKHU RUJDQL]DWLRQV WR GHQRXQFH SROLFH YLROHQFH DJDLQVW SXEOLF VHUYLFH ZRUNHU GHPRQVWUDWLRQV 7ZR OHDGHUV RI 08 GHILQHG LW DV D PRELOL]LQJ RUJDQL]DWLRQ DQG D PDVV RUJDQL]DWLRQ 2QH VDLG 08 LV D VSRQWDQHRXV PRYHPHQW WKH RWKHU >LWnV@ D WUDLQ EHFDXVH SHRSOH JHW RQ DQG WKHQ JHW RII WKHQ JHW RQ DJDLQ >@ LW GRHV QRW UHDOO\ KDYH WKH VWDWLF FKDUDFWHULVWLFV RI DQ RUJDQL]DWLRQ LW LV PRUH OLNH D PRYHPHQW LW IOXFWXDWHV DW WKH UK\WKP RI WKH PRYHPHQW DW WKH UK\WKP RI ZRPHQnV QHHGV 6R ZKHQ LWnV PRYLQJ DQG VKDNLQJ RXW WKHUH DPRQJ ZRPHQ LW LV PRYLQJ DQG VKDNLQJ LQ KHUH DV ZHOO GR \RX XQGHUVWDQG"

PAGE 178

,Q WHUPV RI SUDFWLFHV WKLV LV UHIOHFWHG LQ WKH IDFW WKDW 08 PHPEHUV FRQVWDQWO\ LQYLWH ZRPHQ WR SDUWLFLSDWH LQ WKHLU DFWLYLWLHV LQFOXGLQJ PHf 08 DOVR VHHV LWVHOI DV D PXOWLWRSLF QRQ VSHFLDOL]HG RUJDQL]DWLRQ $ IHZ PHPEHUV DOVR HPSKDVL]HG WKDW LW LV RSHQ WR LVVXHV QRW RQO\ UHODWHG WR ZRPHQnV VXERUGLQDWLRQ EXW WR RWKHU W\SHV RI VRFLDO LQMXVWLFHV ,Q NHHSLQJ ZLWK WKLV QRQVSHFLDOL]HG PRYHPHQW LGHQWLW\ WKH RUJDQL]DWLRQnV JRDOV DUH YHU\ EURDG 7KHUH LV D WRQ >LWnV@ D VSDFH IRU ZRPHQ WR WDNH WKHLU SUREOHPV DQG UHVROYH WKHP WR VWUXJJOH IRU UHDO FLWL]HQVKLS IRU ZRPHQ WR ILJKW GLVFULPLQDWLRQ HQVXUH FLWL]HQVKLS DQG QRW RQO\ RI ZRPHQ >IRU@ SRVLWLYH GLVFULPDWLRQ VR WKDW ZRPHQ EH UHVSHFWHG ULJKWV EH UHDOO\ UHVSHFWHG )RU EODFN SHRSOH LQGLDQV FKLOGUHQ ULJKWV DV ZHOO WR LPSURYH WKH VLWXDWLRQ RI ZRPHQ DV FLWL]HQV WKURXJK WKLV RUJDQL]DWLRQ WKH\ SHUFHLYH ZKDW WKHLU SRWHQWLDO LV 2QO\ RQH SHUVRQ JDYH D PRUH VSHFLILF DQVZHU ILJKW DJDLQVW YLROHQFH FRPEDWH D YLROHQFLDf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f 7KH RUJDQL]DWLRQ ZDV ERP DV D ZRPHQnV VHFWLRQ RI WKH &RPPXQLVW 3DUW\ RI %UD]LO EXW LQ FXW LWV WLHV WR WKH SDUW\ 6WLOO YDULRXV VDWHOOLWH RUJDQL]DWLRQV ZKLFK DUH LQ IDFW PRVWO\ LQGHSHQGHQW XVH WKH QDPH RI WKH PRWKHU RUJDQL]DWLRQ

PAGE 179

)HPLQLVWDV t 6DGH $ 5HVSHFWHG +HDOWK 3ROLF\&HQWHUHG 1*2 7KH DQFKRU RI )t6 LGHQWLW\ LV WKH GLUHFW VHUYLFHV LW RIIHUV ,WV FOLQLF ZDV WKRXJKW RI DV D SLORW SURMHFW WR GHPRQVWUDWH WKH IHDVLELOLW\ RI KROLVWLF SULPDU\ FDUH IRU ZRPHQ DQG WR EH UHSOLFDWHG LQ SXEOLF VHUYLFHV 7ZR OHDGLQJ PHPEHUV RI WKH JURXS ZKHQ DVNHG DERXW ZKDW ZHUH WKH FKDUDFWHULVWLFV RI WKHLU RUJDQL]DWLRQ GHVFULEHG )t6 DV D VWDEOH RUJDQL]DWLRQ ZLWK VWDEOH HPSOR\PHQW DQG D VROLG H[SHULHQFH DQG NQRZKRZ JRRG FRQWDFWV DQG LQIOXHQWLDO LW LV D UHIHUHQFH DW WKH OHYHO RI /DWLQ $PHULFD ZKLFK FRPPDQGV JUHDW UHVSHFW LQ WKH ZRPHQnV PRYHPHQW DQG DPRQJ KHDOWK SURIHVVLRQDOV ,W KDV PRUH FUHGLELOLW\ ZLWK SXEOLF DXWKRULWLHV $QRWKHU PHPEHU RI WKH WHFKQLFDO VWDII DJUHHG WKDW )t6 ZDV SOD\LQJ D OHDGHUVKLS UROH LQ WKH KHDOWK TXHVWLRQ XP SDSHO GH OLGHUDQAD QHVVD TXHVWDR GD VDGHf DV D UHVXOW RI LWV FRQFUHWH FOLQLFDO H[SHULHQFH ZKLFK JLYHV LW D GLVWLQJXLVKHG SRVLWLRQ LQ WHUPV RI NQRZOHGJH XP OXJDU GHVWDFDGR HP WHUPRV GH FRQKHFLPHQWR ZKLOH DQRWKHU LQVLVWHG RQ LWV VHULRXV DQG SURIHVVLRQDO FKDUDFWHU WU\LQJ WR LPSURYH LWV SHUIRUPDQFH 7KH DGPLQLVWUDWLYH VWDII DOVR PHQWLRQHG WKDW )t6 KDG D JUHDW H[SHULHQFH DQG DPRXQW RI LQIRUPDWLRQ DQG DFWLYLWLHV KDG EHFRPH D UHIHUHQFH SRLQW ZLWK UHJDUG WR ZRPHQnV KHDOWK VHQGHHV DQG ZDV VHULRXV YHU\ ZHOOFRQVLGHUHG E\ RWKHU JURXSV $ OHDGHU VDLG )t6 OLNH RWKHU 1*2V >@ WKHVH DUH JURXSV ZKLFK DUH LQ WKH YDQJXDUG LQ WKH IURQWOLQH ZLWK UHJDUG WR HYHU\WKLQJ RI WKH KHDOWK TXHVWLRQ 7KH SURIHVVLRQDO FKDUDFWHU RI )t6 LV UHIOHFWHG LQ WKH ODQJXDJH LW XVHV 7KH ZRPHQ ZKR FRPH WR WKH FOLQLF DUH UHIHUUHG WR DV XVHUV^XVXDULDVf WKH WHUP XVHG LQ SXEOLF VHUYLFHVf DQG WKH 7KUHH RXW RI WHFKQLFDO VWDII PHQWLRQHG WKH DPEXODWRULR RU DWHQGLPHQWRn;FOLQLFDO VHUYLFHVf DV D FHQWUDO FKDUDFWHULVWLF RI WKHLU RUJDQL]DWLRQ PHPEHUV RI WKH WHFKQLFDO VWDII DQG DOO WKUHH DGPLQLVWUDWLYH SHUVRQQHO VDZ WKH FOLQLF DV WKH FKDUDFWHULVWLF ZKLFK GLIHUHQWLDWHV WKHP IURP RWKHU ZRPHQnV KHDOWK RUJDQL]DWLRQV LQ %UD]LO

PAGE 180

DFWLYLWLHV RI WKH JURXS DV VHUYLGRV RU VHUYLFHV :KHQ SUHVHQWHG P\ UHVHDUFK DVNHG ZKHWKHU WKLV ZRXOG EH WKH FRUUHFW ZD\ WR GHVFULEH ZKDW WKH\ GR DQG WKH OHDGHU RI WKH JURXS VDLG LW ZDV WKH\ DUH RIIHULQJ VHUYLJRV 7R VKRZ WKH FRQWUDVW 08 PHPEHUV IHOW XQFRPIRUWDEOH ZLWK WKH WHUP XVX£ULDV DV WKH\ GLVFXVVHG WKH FUHDWLRQ RI D FHQWHU WR RIIHU KHOS WR ZRPHQ YLFWLPV RI GRPHVWLF YLROHQFH -RNLQJO\ RQH RI LWV OHDGHUV VDLG LW VRXQGHG OLNH SURWR]R£ULDV SURWR]RDQVf )t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£R WUDLQLQJf 6DQGUD VDLG :KDW KDV FKDQJHG LV WKDW WKH WUDLQLQJ DVSHFW FDPH LQ 5HVHDUFK DQG SROLWLFDO DUWLFXODWLRQ FDPH LQ 5RVHPHLUH DUJXHG WKDW DOO WKHVH RWKHU DFWLYLWLHV RI )t6 VWLOO UHYROYHG DURXQG WKH FOLQLF LWVHOI 5DFKHO DUJXHG WKDW DOO DFWLYLWLHV UHFHLYHG HTXDO SULRULW\ EXW WKDW LW LV QRZ QHFHVVDU\ WR LQWHJUDWH WKH YLVLWV ZLWKLQ UHVHDUFK SURMHFWV WR EH DEOH WR PDLQWDLQ WKH YLVLWV ,QGHHG OHDUQHG ODWHU WKDW LW ZDV DOPRVW LPSRVVLEOH WR REWDLQ ILQDQFLQJ IRU WKH FOLQLF DQ\PRUH VR WKDW WKH\ DFWXDOO\ QHHG WR OLQN LW WR UHVHDUFK LQ RUGHU WR REWDLQ ILQDQFLQJ :RUNLQJ IRU ODUJHU VRFLDO FKDQJH WHQGV WR EH VHFRQGDU\ LQ WKH GLVFRXUVH RI PRVW )t6 PHPEHUV WR WKH PRUH FRQFUHWH JRDO RI WKH LPSURYHPHQW RI KHDOWK FDUH IRU ZRPHQ DQG LQ

PAGE 181

SDUWLFXODU RI UHSOLFDWLQJ WKH H[SHULHQFH LQ WKH SXEOLF KHDOWK VHFWRU ZKLFK LV FOHDU IRU DOO PHPEHUV ,QIOXHQFLQJ SXEOLF SROLF\ ZDV PHQWLRQHG E\ ERWK OHDGHUV RI WKH RUJDQL]DWLRQ DV D SULRULW\ IRU WKH RUJDQL]DWLRQ 2Q WKH RWKHU KDQG RQO\ WZR PHPEHUV PHQWLRQHG WKH ZRPHQnV PRYHPHQW ZKHQ WDONLQJ DERXW WKH JRDOVSULRULWLHV RI WKH RUJDQL]DWLRQ LQ RQH FDVH LQ WKH VHQVH RI WKH UROH RI )t6 WR IRUZDUG LQIRUPDWLRQ WR WKH PRYHPHQW DQG WUDLQLQJ RI RWKHU ZRPHQ ZKR ODWHU XVHG WKH H[SHULHQFH RI )t6 WR FUHDWH WKHLU RZQ JURXS LQ RWKHU SDUWV RI WKH FRXQWU\ 5RVHPHLUH ZDV WKH RQO\ RQH ZKR PHQWLRQHG YHU R PRYLPHQWR DUWLFXODGR IRUWH ZRUN IRU D VWURQJ DUWLFXODWHG PRYHPHQWf DV LPSRUWDQW IRU WKH RUJDQL]DWLRQ ,Q IDFW RUJDQL]LQJ RU PRELOL]LQJ ZRPHQ LV QRW PHQWLRQHG PXFK E\ )t6 PHPEHUV GXULQJ WKHLU LQWHUYLHZV EHFDXVH WKH FRQVWUXFWLRQ RI D EURDGEDVHG PRYHPHQW LV QRW D WRS SULRULW\ IRU )t6 +RZHYHU WKLQJV DUH QHYHU VR HDVLO\ FOHDUFXW /RRNLQJ EH\RQG WKH RQHWLPH VWDWHPHQWV PDGH GXULQJ WKHLU LQWHUYLHZV DW WKH JURXSnV DFWLYLWLHV LW LV LPSRUWDQW WR QRWH WKDW IRU VHYHUDO \HDUV )t6 KDV EHHQ OHDGLQJ WKH LQLWLDWLYH RI D IHPLQLVW QHZVOHWWHU SURGXFHG LQ FROODERUDWLRQ ZLWK D QXPEHU RI RWKHU IHPLQLVW PRVWO\ YROXQWHHU RUJDQL]DWLRQV 7KH WZR )t6 PHPEHUV LQYROYHG ZLWK WKLV QHZVOHWWHU FRQVLGHU LW WR EH DQ LPSRUWDQW IRUXP WR EULQJ WKHVH JURXSV :KHQ DVNHG IRU WKH JRDOV RI WKH RUJDQL]DWLRQ RXW RI PHQWLRQHG WKH FOLQLF ILUVW 7KUHH GLG PHQWLRQ WKHLU FRQWULEXWLRQ WR ODUJHU FKDQJHV LQ VRFLHW\ 7KH GHVLUH WR EH ZRUNLQJ IRU FKDQJH RQ D ODUJHU VFDOH DSSHDUV LQ WKH GLVFRXUVH RI WZR PRUH PHPEHUV LQ VWDWHPHQWV VXFK DV LQIOXHQFH WKH FKDQJHV LQ WKH FRXQWU\ DOZD\V LQ WHUPV RI ZRPHQ SURPRWH ZRPHQnV FLWL]HQVKLS EHOLHYLQJ LQ WKH WUDQVIRUPDWLRQ RI VRFLHW\ LQ WKH ORQJUXQ H[SUHVVHG ZKHQ DVNLQJ IRU WKH JRDOVSULRULWLHV RI WKH RUJDQL]DWLRQ :KHQ DVNHG ZKDW WKH XOWLPDWH JRDO RI )t6 ZDV RXW RI DJUHHG WKDW LW ZDV WR SURPRWH D QHZ W\SH RI KHDOWK FDUH IRU ZRPHQ WR VHUYH DV D PRGHO IRU ZRPHQnV KHDOWK FDUH LQ WKH SXEOLF VHUYLFH 7KH WK PHPEHU ZDQWHG D D PRUH VROLGDU\ VRFLHW\ GHQRXQFLQJ WKH LQMXVWLFH RI JHQGHU UHODWLRQV

PAGE 182

WRJHWKHU %XW DV 5RVHPHLUH SXW LW ZKHQ VKH LQWURGXFHG WKH RUJDQL]DWLRQ WR PH RQ RXU ILUVW HQFRXQWHU %HFDXVH )t6 LV DD VSDFH ZKHUH ZH GHOLYHU VHUYLFHV WKDW LV ZH SURYLGH PHGLFDO VHUYLFHV PHDQ WKH PDMRULW\ WKLV LV WKH RQO\ VHUYLFH LQ %UD]LO ZKHUH WKLV LV GRQH >@ WKH PDMRULW\ RI ZRPHQnV 1*2V WKH\ KDYH D PRUH SROLWLFDO UROH ZKHUH WKH\ RUJDQL]H 7KHQ VKH DGGHG PHDQ KHUH EHVLGHV WKLV SROLWLFDO UROH f§ZH DUH YHU\ DFWLYH LQ WKH ZRPHQnV PRYHPHQW DW WKH QDWLRQDO UHJLRQDO DQG JOREDO OHYHO >ZH SURYLGH VHUYLFHV@ 7KLV VKRZV WKHLU HPSKDVLV RQ QDWLRQDO DQG WUDQVQDWLRQDO YHUVXV ORFDOf RUJDQL]LQJ DQG WKH GLIIHUHQW PHDQLQJV WKDW FDQ EH DWWULEXWHG WR RUJDQL]LQJ 7KH JURXS ZLVKHV WR SURPRWH HPSRZHUPHQW DQG SURPRWHV LW f§ WKURXJK WKH YLVLWV ^FRQVXOWDVf ,W LV PDLQO\ LQGLYLGXDO HPSRZHUPHQW $ GLIIHUHQW UHODWLRQ RI SRZHU LV HVWDEOLVKHG EHWZHHQ WKH SDWLHQW DQG WKH KHDOWK SURIHVVLRQDO ZKHUH WKH ZRPDQ JDLQV FRQWURO RYHU KHU ERG\ E\ NQRZLQJ LW EHWWHU DQG LV DEOH WR PDNH LQIRUPHG GHFLVLRQV :RPHQ JDLQ VHOIHVWHHP DQG VHOIUHVSHFW 7KHVH QHFHVVDULO\ OLPLWHG SUHVHQWDWLRQV RI 08 DQG )t6 FROOHFWLYH LGHQWLW\ VKRZ WKH GLIIHUHQFH EHWZHHQ D PRYHPHQWRULHQWHG YROXQWHHU RUJDQL]DWLRQ DQG D SROLF\FHQWHUHG SURIHVVLRQDOL]HG RUJDQL]DWLRQ ,W WXUQV RXW WKDW DOO RI 6DR 3DXORnV ZRPHQnV KHDOWK SURIHVVLRQDOL]HG RUJDQL]DWLRQV EXW RQH 637 DUH PRUH SROLF\FHQWHUHG WKDQ PRYHPHQW RULHQWHG +RZ GR ZH H[SODLQ WKLV FRUUHODWLRQ" ZRXOG DUJXH OLNH 6X]DQQH 6WDJJHQERUJ f WKDW FHUWDLQ SUDFWLFHV RI SURIHVVLRQDOL]HG RUJDQL]DWLRQV SOD\ WKHLU SDUW LQ IDYRU RI DQ RULHQWDWLRQ WRZDUGV LQVWLWXWLRQDO ZRUN UDWKHU WKDQ GLUHFW DFWLRQ 7KHVH SUDFWLFHV DUH UHODWHG WR WKH QHFHVVLW\ RI SODQQLQJ LQ SURIHVVLRQDOL]HG RUJDQL]DWLRQV 3ODQQLQJ 9HUVXV &RORU D 5HDOLGDGH VWLFN WR FRQMXQFWXUHf ,QGHHG SURIHVVLRQDOL]HG RUJDQL]DWLRQV KDYH D GLIIHUHQW G\QDPLF ZLWK UHJDUG WR SODQQLQJ 3URIHVVLRQDOL]HG RUJDQL]DWLRQV WHQG WR SODQ PRUH DQG GHOD\ DFWLRQ ZKLOH YROXQWHHU

PAGE 183

RUJDQL]DWLRQV WHQG WR OLYH LQ WKH KHDW RI WKH PRPHQW DQG UHDFW WR FRQMXQFWXUDO HYHQWV FRODU D UHDOLGDGHf 9ROXQWHHU PRYHPHQW RUJDQL]DWLRQV WKULYH RQ HYHQWV DQG LVVXHV WKDW PRWLYDWH SHRSOH WR SDUWLFLSDWH 7KH\ ZDQW SHRSOH WR SDUWLFLSDWH VLQFH SHRSOH DUH WKHLU PRVW YDOXDEOH UHVRXUFH 6LQFH WKH\ WHQG WR EH PRUH SURWHVWRULHQWHG WKH\ GR QRW IHDU FRQIURQWDWLRQ EXW RQ WKH FRQWUDU\ ORRN IRU KRW LVVXHV )RU H[DPSOH WRZDUGV WKH HQG RI P\ LQWHUYLHZ RI 7DWLDQD DW 08 WKH SKRQH UDQJ 7KH FDOOHUnV ZLIH KDG GLHG LQ FKLOGELUWK :KLOH RQ WKH SKRQH VKH WROG KLP WKDW WKH 08 ZDV JRLQJ WR WDNH WKH FDVH YHU\ VHULRXVO\ 6KH UHIHUUHG KLP WR WKH PDWHUQDO GHDWK FRPPLWWHH DQG WROG KLP WR FRPH WR 08 ZHHNO\ PHHWLQJ WKDW HYHQLQJ VR WKDW WKH\ FRXOG VWDUW RUJDQL]LQJ 6KH VDLG WKDW LW ZDV DURXQG FRQFUHWH FDVHV VXFK DV WKLV RQH WKDW WKLQJV ZRXOG FKDQJH 6KH WROG KLP 7HUQ TXH SHJDU TXHQWH LVVR OHWnV JHW WKLV ZKLOH LWnV KRWf 08 WKHQ VHQW VHYHUDO OHWWHUV UHTXLULQJ H[SODQDWLRQV WR YDULRXV SXEOLF KHDOWK DXWKRULWLHV DVNHG WR PHHW DQG PHW ZLWK WKH KRVSLWDO GLUHFWRU DQG FRQWDFWHG RWKHU IHPLQLVW RUJDQL]DWLRQV IRU VXSSRUW DQG MRLQW DFWLRQ $V $OHVVDQGUD RI 08 SXWV LW +HUH ZH GR QRW JR DIWHU DQ\WKLQJ KHUH WKLQJV FRPH WR XV DTXL QV QDR EXVFDPRV QDGD DTX DV FRLVDV YPf 2Q WKH RWKHU KDQG SURIHVVLRQDOL]HG RUJDQL]DWLRQV QHHG WR SODQ DKHDG PRUH LI WKH\ DUH WR DWWDLQ WKHLU SURMHFWVn REMHFWLYHV 3ODQQLQJ LV SDUW RI WKH H[SHUW RU SURIHVVLRQDOnV WRRONLW ZKLFK HPSKDVL]HV WKH QHFHVVLW\ WR SODQ EHIRUH DFWLQJ LQ RUGHU WR GR VR PRUH HIILFLHQWO\ 7KHVH FRQFHUQV DUH UHIOHFWHG LQ HYHU\GD\ SUDFWLFHV DQG DIIHFW 1*2Vn PRELOL]LQJ SRWHQWLDO ZKLFK LV UHODWHG WR WKH IORZ RI LQIRUPDWLRQ DQG HQHUJ\ EHWZHHQ WKH RXWVLGH DQG WKH RUJDQL]DWLRQ 7KH ILUVW LQVWDQFH WKDW FRPHV WR PLQG LV WKH VFKHGXOLQJ DQG GHJUHH RI RSHQQHVV RI PHHWLQJV 08 KROGV LWV ZHHNO\ PHHWLQJ DW WKH VDPH WLPH DQG WKH VDPH SODFH HYHU\ ZHHN ,W KDV EHHQ WKLV ZD\ IRU VHYHUDO \HDUV $Q\ERG\ ZKR ZDQWV WR FRPH LQ DQG SUHVHQW WKHLU LVVXHV RU JULHYDQFHV LV ZHOFRPH )RU H[DPSOH RQ RQH RFFDVLRQ WZR SURVWLWXWHV FDPH WR WKH PHHWLQJ DIWHU WKH\ KDG

PAGE 184

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n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

PAGE 185

OLVWHQHG WR DQG KHOSHG ,Q -DQXDU\ RQH RI WKH EXVLQHVVHV ORFDWHG RQ WKH VDPH IORRU DV WKH &DVD ZDV UREEHG LW ZDV WKHQ GHFLGHG WR SXW XS D JDWH ZLWK LQWHUFRP DW WKH HQWUDQFH RI WKH FRUULGRU 7KH OHDGHU RI WKH &DVD ZDV SDUWLFXODUO\ XSVHW ZLWK WKH LGHD VD\LQJ WKDW ZRPHQ DOUHDG\ ZHUH LQWLPLGDWHG WR FRPH LQ ZKHQ WKH GRRU RI WKH &DVD LWVHOI ZDV QRW ZLGH RSHQ EXW RQO\ DMDU f§VKH KDG IRXQG VHYHUDO ZRPHQ VLWWLQJ LQ WKH FRUULGRU RQH GD\f§ ,PDJLQH DQ LURQ GRRU VKH H[FODLPHG 6KH IHDUHG WKH\ ZRXOG QRW NQRZ KRZ WR XVH WKH LQWHUFRP HLWKHU 'HVSLWH KHU ZRUULHV WKH JDWH ZDV LQVWDOOHG ZLWK QR LQWHUFRP 7KLV HSLVRGH H[HPSOLILHV WKH LPSRUWDQFH WKH\ DWWDFK WR EHLQJ DFFHVVLEOH DOWKRXJK WKH\ ZHUH IRUFHG E\ DGYHUVH FLUFXPVWDQFHV WKH\ VKDUH WKH SUHPLVHV ZLWK WKUHH VPDOO EXVLQHVVHVf ,Q ERWK 1*2V ZRUNHG ZLWK D FRQVLGHUDEOH HIIRUW LV EHLQJ PDGH WR GHILQH DQG SODQ DFWLYLWLHV $W 637 WKLV WDNHV WKH IRUP RI D VHULHV RI PHHWLQJV DW WKH EHJLQQLQJ RI HDFK \HDU DQG D ZULWWHQ GRFXPHQW FDOOHG SODQR GH WUDEDOKR ZRUN SODQf 7KLV LV LQ SDUW DV D UHVSRQVH WR WKH SUHIHUHQFHV RI ILQDQFLQJ DJHQFLHV UHFDOO IURP WKH HDUOLHU FKDSWHU 0DULQD RI 637 VD\LQJ WKDW 1*2V ZRUN ZLWK WKH ORJLF RI SURMHFWV ZKLFK GHILQH GHDGOLQHV DQG VSHFLILF UHVSRQVLELOLWLHV 6KH HQGHG ZLWK DQG \RXU ZRUN LV QRW QHFHVVDULO\ JXLGHG E\ FRQMXQFWXUDO HPHUJHQFLHV H QDR QHFHVVDULDPHQWH YRF WRFD VHX WUDEDOKR SHODV HPHUJHQFLDV FRQMXQWXUDLVf $V D UHVXOW 1*2V DUH OHVV UHVSRQVLYH WR WKH FXUUHQW FRQMXQFWXUH 0DULQD JLYHV D FRQFUHWH H[DPSOH RI WKLV WUDGHn RII 6R IRU H[DPSOH ZH GHFLGHG WKDW IRU WZR \HDUV ZH ZLOO OHDG D FDPSDLJQ DJDLQVW QRW DJDLQVW EXW IRU FDQFHU SUHYHQWLRQ LQ WKH (DVWHUQ 3HULSKHU\ 0HPLVD GHFLGHV WR ILQDQFH WKLV DFWLYLW\ DQG GXULQJ WZR \HDUV \RX DUH JRLQJ WR PDNH WKLV KDSSHQ ,Q WKH PHDQWLPH WKH +HDOWK 0RYHPHQW KDV D EXQFK RI WKLQJV WR GR EXW \RX VWD\ WKHUH LQ WKLV OLWWOH FRPHU ZKHUH \RX GHFLGHG \RX ZHUH JRLQJ WR ODXQFK D WZR\HDU FDPSDLJQ

PAGE 186

5HWXUQLQJ WR WKH LVVXH RI WKH WHDP PHHWLQJV WKH\ DUH QRW RSHQ LQ WKH WZR SURIHVVLRQDOL]HG RUJDQL]DWLRQV 7KLV UHIOHFWV DQ HIIRUW WR FRQWURO WKHLU SURGXFWLYLW\ DQG JR DORQJ ZLWK WKHLU SODQQLQJ 6LPLODUO\ LQ ERWK 1*2V SKRQH FDOOV DUH XVXDOO\ ILOWHUHG DQG GLUHFWHG E\ D UHFHSWLRQLVWVHFUHWDU\ EHIRUH JHWWLQJ WR WKH DSSURSULDWH WHFKQLFDO VWDII PHPEHUV ,I WKLV DOORZV JUHDWHU UHVSHFW IRU ZKDWHYHU JRDOV KDYH EHHQ VHW IRU WKH RUJDQL]DWLRQ LW DOVR FRQVWUDLQV WKH IORZ RI LQIRUPDWLRQ DQG HQHUJ\ ZLWK WKH ORFDO RXWVLGH ZRUOG DQG UHVWULFWV WKH SRVVLELOLW\ RI VHL]LQJ RQ LVVXHV ZKLFK PLJKW PRELOL]H SHRSOH &RQIOLFWLQJ 7LPH 6FKHGXOHV $QRWKHU FRQVWUDLQLQJ IDFWRU RQ PRELOL]LQJRUJDQL]LQJ DFWLYLWLHV RQ WKH SDUW RI 1*2V VWHPPLQJ IURP WKHLU RUJDQL]DWLRQDO IRUP LV WKDW YROXQWHHU JURXSV IXQFWLRQ DW QLJKW DQG RQ WKH ZHHNHQG ZKHQ WKHLU PHPEHUV DUH QRW DW ZRUN ZKLOH 1*2V IXQFWLRQ RQ ZHHN GD\V PDLQO\ IURP 7KH WHFKQLFDO VWDII KDV D IDLUO\ IOH[LEOH VFKHGXOH WR DFFRPPRGDWH LQGLYLGXDO QHHGV VXFK DV EULQJLQJ FKLOGUHQ WR VFKRRO HWF f§ZKLFK LV RQO\ ILWWLQJ LQ D L IHPLQLVW RUJDQL]DWLRQ DQG UHIOHFWV WKH ZRPHQVHQVLWLYH JHQGHUHG RUJDQL]DWLRQ RI WLPH FDOOHG IRU E\ *RHW] f ,W DOVR FRPSHQVDWHV IRU WKH ZHHNHQG DQG HYHQLQJ DFWLYLWLHV VRPH PHPEHUV QHHG WR HQJDJH LQ DV D IXQFWLRQ RI WKHLU ZRUN HLWKHU LQ FRDOLWLRQ ZRUN RU $Q ROG WLPH PHPEHU RI WKH PRYHPHQW RQH GD\ FRQILGHG WKDW WKH ZRPHQ LQ WKH 1*2V ZHUH DOO KHU IULHQGV WKH\ KDG PLOLWDWHG WRJHWKHU D ORW DQG VOHSW LQ HDFK RWKHUVn KRXVH %XW QRZ VKH QHHGHG WR PDNH DQ DSSRLQWPHQW ZLWK WKHP WR WDON WR WKHP DQG WKH\ ZRXOG QRW DFFHSW KHU LQ WKH PHHWLQJ RI WKH 1*2 XQOHVV LW ZDV D VSHFLDO PHHWLQJ $QRWKHU LVVXH LQYROYHG LV WKDW 1*2V VKRZ JUHDWHU FDXWLRXVQHVV LQ SURMHFWLQJ D SRVLWLYH LPDJH EHFDXVH WKH\ VLPSO\ KDYH PRUH WR ORVH WKDQ YROXQWHHU RUJDQL]DWLRQV 7KHLU UHSXWDWLRQ LV HVVHQWLDO LQ VHFXULQJ IXWXUH IXQGLQJ

PAGE 187

ZLWK QHLJKERUKRRG ZRPHQn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nV f GLVWLQFWLRQ EHWZHHQ PHPEHUVKLS DQG VXSSRUW RUJDQL]DWLRQV LV XVHIXO %DVHG RQ WKH ZHHNO\ SODQQHUV DVNHG PHPEHUV RI 1*2V DQG YROXQWHHU JURXSV WR ILOO RXW VHH FKDSWHU f LW WXUQV RXW WKDW IRU WKDW SDUWLFXODU ZHHN RQH 1*2 PHPEHU ZRUNHG RQ WKDW SDUWLFXODU 6DWXUGD\ ZKLOH DOO WKUHH PHPEHUV RI 08 ZKR WXUQHG LQ WKHLU nSOFPLOKDKDG DFWLYLWLHV ERWK RQ 6DWXUGD\ DQG 6XQGD\ DQG RQH PHPEHU RI &0 KDG DFWLYLWLHV RQ WKDW 6DWXUGD\ 6LPLODUO\ DOO WKUHH 08 PHPEHUV ZRUNHG LQ WKH HYHQLQJV D WRWDO RI QLJKWVf DQG WZR PHPEHUV RI &0 ZRUNHG LQ WKH HYHQLQJV D WRWDO RI QLJKWVf 7KH EXON RI WKH LQSXW RI 1*2 PHPEHUV ZDV GXULQJ ZHHN GD\V ,Q WKH FDVH RI 637 RQH SHUVRQ ZRUNHG RQH QLJKW DQG IRU )t6 RQH PHPEHU ZRUNHG WKUHH HYHQLQJV EHFDXVH D UHSRUW ZDV GXH )RXU PHPEHUV RI WKH YROXQWHHU JURXSV DOVR SXW LQ D FRQVLGHUDEOH DPRXQW RI WLPH LQ PRYHPHQW DFWLYLWLHV GXULQJ WKH ZHHN GD\V EHFDXVH WKHLU VDODULHG DFWLYLWLHV DOORZ WKHP IOH[LELOLW\ RU EHFDXVH WKH\ GR QRW KDYH SDLG HPSOR\PHQW EHOLHYH WKDW WKLV ZHHN XQGHUUHSUHVHQWV 637nV DQG &0V ZRUN RQ ZHHNn HQGV )OYLD D YROXQWHHU DFWLYLVW UHFDOOHG WKDW ZKHQ VKH ILUVW FDPH WR 6DR 3DXOR PDQ\ PHHWLQJV ZHUH KHOG LQ WKH DIWHUQRRQ EXW VKH UHIXVHG WR JR DQG LQVLVWHG WKH\ EH KHOG LQ WKH HYHQLQJ RU RQ WKH ZHHNHQG ,W KDV EHHQ DQ WLULQJ EDWWOH

PAGE 188

+RZHYHU DV ZH ZLOO VHH LQ WKH IROORZLQJ FKDSWHU WKH VXSSRUWLQJ GLPHQVLRQ RI 1*2V LQ 6DR 3DXOR LV VKULQNLQJ ZKLOH WKHLU DGYRFDF\ UROH LV JDLQLQJ VWUHQJWK 7KH GLIIHUHQFH LQ PHPEHUVKLS VWUDWHJLHV DSSHDUV FOHDUO\ LQ WKH HPSKDVLV RQ HQOLVWLQJ DQG JDLQLQJ SHRSOH WR WKH JURXS DW 08 RU WKH &DVD DV KDYH PHQWLRQHG HDUOLHU ZKLFK LV QRW SUHVHQW DW )t6 RU 637 ,QWHJUDWLQJ QHZ PHPEHUV KDV DOZD\V EHHQ D FKDOOHQJH IRU IHPLQLVW RUJDQL]DWLRQV DV 0DULQD RI 637 RQFH QRWHG HVSHFLDOO\ LI WKH JURXS KDV EHHQ DURXQG IRU VRPH WLPH 7KH JURXSVn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t6 DV ZHOO DV PRVW IHPLQLVW 1*2V LQ 6DR 3DXOR DQG LQGHHG WKURXJKRXW %UD]LO VHH 7DEOH f GR QRW ZRUN ZLWK YROXQWHHUV PRVWO\ RXW RI D GHVLUH WR EH HTXLWDEOH 0RUHRYHU WHQVLRQV EHWZHHQ YROXQWHHUV DQG SURIHVVLRQDOL]HG VWDII DUH WR EH H[SHFWHG DQG KDYH EHHQ QRWHG LQ RWKHU FRQWH[WV .OHLGPDQ f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

PAGE 189

$QRWKHU GLPHQVLRQ RI WKH GLVWLQFWLRQ EHWZHHQ PHPEHUVKLS DQG VXSSRUWDGYRFDF\ RUJDQL]DWLRQ LV WKDW LV 1*2V DUH PRVWO\ HQJDJLQJ LQ IHPLQLVP IRU WKH RWKHU WR XVH 7HUHVD &DOGHLUDnV SKUDVH R IHPLQLVPR GD RXWUD ZLWK D WZLVWf 7KH\ GR QRW RUJDQL]H DFWLYLWLHV IRFXVHG RQ WKHLU PHPEHUVn SHUVRQDO QHHGV DQG ZHOOEHLQJ XQOLNH YROXQWHHU JURXSV )RU H[DPSOH 08 RUJDQL]HG D VHULHV RI ZRUNVKRSV RQ PHQRSDXVH ZKHQ LW EHFDPH RI LQWHUHVW WR VHYHUDO RI LWV PHPEHUV 7KH FRXUVH ZDV JLYHQ E\ D IHPLQLVW PHGLFDO GRFWRU DQG D FRUSRUDO WKHUDSLVW WHUDSHXWD FRUSRUDOf DQG IXQFWLRQHG DV JURXS WKHUDS\ DV ZHOO $W WKH &DVD GD 0XOKHU ELRGDQFH FODVVHV DUH RIIHUHG HYHU\ RWKHU ZHHN IRU ZKRHYHU LV LQWHUHVWHG 7KUHH PHPEHUV RI WKH &RRUGLQDWLRQ WDNH SDUW UHJXODUO\ LQ WKLV DFWLYLW\ 2YHU WKH FRXUVH RI WKH \HDU VSHQW ZLWK )t6 DQG 637 GLG QRW REVHUYH DQ\ VXFK DFWLYLW\ IRU WKH PHPEHUV RI WKH JURXS 2Q WKH RWKHU KDQG WKHUH LV SURIHVVLRQDO UHF\FOLQJ nUHF\FODJHPnf PHDQW WR XSGDWH VWDII RQ FXUUHQW LVVXHV $W )t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

PAGE 190

XQGHUVWDQGDEOH IDWLJXH DQG UHVLVWDQFH RQ WKH SDUW RI VWDII WR ZRUN RXWVLGH RI UHJXODU EXVLQHVV KRXUV 7KHVH SUDFWLFHV DOWHU WKH OLQNV RI SURIHVVLRQDOL]HG RUJDQL]DWLRQV WR WKHLU ODUJHU ORFDO FRQVWLWXHQF\ DV ZHOO DV WKHLU SRWHQWLDO DQG ZLOOLQJQHVV WR PRELOL]H DQG UHO\ RQ GLUHFW DFWLRQ 2Q WKH RWKHU KDQG WKH\ IDFLOLWDWH LQWHUDFWLRQ ZLWK DQG OREE\LQJ RI LQVWLWXWLRQDO SROLWLFDO DFWRUV VXFK DV JRYHUQPHQWDO DQG LQWHUQDWLRQDO DJHQFLHV 7KH %UD]LOLDQ ZRPHQnV PRYHPHQW FDVH WKXV VXSSRUW 6X]DQQH 6WDJJHQERUJnV FODLP WKDW SURIHVVLRQDOL]HG OHDGHUV DQG IRUPDOL]HG VRFLDO PRYHPHQW RUJDQL]DWLRQV VWLPXODWH WKH XVH RI LQVWLWXWLRQDOL]HG WDFWLFV f 6KH VKRZHG LQ KHU VWXG\ RIWKH SURIHVVLRQDOL]DWLRQ RI WKH 86 SURFKRLFH PRYHPHQW WKDW IRUPDOL]HG RUJDQL]DWLRQV SUHIHU WR HQJDJH LQ LQVWLWXWLRQDOL]HG WDFWLFV EHFDXVH WKHLU VWUXFWXUH DOORZV WKHP WR RQJRLQJ FRQWDFW LV SRVVLEOH WKURXJK DGPLQLVWUDWLYH VWDII ZRUNLQJ KRXUV DUH VLPLODU DQG GLYLVLRQ RI ODERUf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f f§ZLWK VRPH UHVWULFWLRQV DV ZH ZLOO GLVFXVV LQ IROORZLQJ FKDSWHU ZKLFK VKRZ WKDW WKH SUHVVXUH LV JUHDW LQGHHG 7KLV WDNHV XV EDFN WR WKH EURDGHU VWUXFWXUH RI SROLWLFDO RSSRUWXQLW\ LQ %UD]LOLDQ DQG LQWHUQDWLRQDO SROLWLFDO OLIH GLVFXVVHG LQ FKDSWHU DV ZHOO DV WR WKH H[SHULHQFH RI IHPLQLVWV LQ VWDWH DJHQFLHV ZKLFK KDYH PDGH LQVWLWXWLRQDO ZRUN PRUH DSSHDOLQJ WR DFWLYLVWV DOWKRXJK

PAGE 191

QRW WR DOOf DQG WR GRQRU DJHQFLHV ZKR DUH QRZ HQFRXUDJLQJ VXFK DQ DSSURDFK 6WDJJHQERUJ VLPLODUO\ QRWHG DQ LQFUHDVHG SURIHVVLRQDOL]DWLRQ DQG IRUPDOL]DWLRQ ZKHQ WKH PRYHPHQW ZDV SXVKHG LQWR LQVWLWXWLRQDOL]HG DUHQDV E\ FKDQJLQJ SROLWLFDO FRQGLWLRQV QDPHO\ WKH OHJDOL]DWLRQ RI DERUWLRQ LQ f ,QGHHG WKHUH LV D IHHGEDFN ORRS EHWZHHQ RUJDQL]DWLRQDO SUDFWLFHV DQG WKH PRUH LGHDWLRQDO VLGH RI WKH FROOHFWLYH LGHQWLW\ RI D JURXS $V 0LFKDHO -DPLVRQ SXWV LW RUJDQL]DWLRQDO SDWWHUQV DQG LGHDV DUH LQWHUWZLQHG DQG VKDUH GHHSHU URRWVf f :KHUH WKH LQIOXHQFH RI SUDFWLFHV PLJKW EH IHOW PRUH GHFLVLYHO\ LV RQFH WKLV FRXUVH RI LQVWLWXWLRQDO ZRUN KDV EHHQ FKRVHQ ,QGHHG SURIHVVLRQDOL]DWLRQ DQG IRUPDOL]DWLRQ DUH OLNHO\ WR VHW RUJDQL]DWLRQDO PDLQWHQDQFH JRDOV VLQFH PHPEHUV IURP WKHQ RQ ZLOO GHSHQG RQ WKH RUJDQL]DWLRQ IRU WKHLU OLYHOLKRRG ZKLFK PLJKW PDNH GLIILFXOW D UHWXUQ WR PRUH PRYHPHQW RULHQWHG GLUHFW DFWLRQ WDFWLFV 7KH QH[W WZR FKDSWHUV ZLOO H[DPLQH WKH FRQVHTXHQFHV RI WKHVH WDFWLFDO FKDQJHV LQ WKH ZRUN GRQH E\ IHPLQLVW VXSSRUW JURXSV ZLWK QHLJKERUKRRG ZRPHQ DQG DW WKH QDWLRQDO DQG LQWHUQDWLRQDO OHYHO DQG IRU WKH GHHSHQLQJ DQG JHQGHULQJ RI GHPRFUDF\ LQ %UD]LO

PAGE 192

1 6R KRZ GR \RX FRQVLGHU WKH ZRUN \RX GR IRU 6DQGH" ,V LW DFWLYLVP" ,V LW ZRUN" ERWK" 6HYHUDO YRLFHV ,W LV ERWK /LOLDf LWnV D WRQ RI ZRUN ODXJKWHUf DQG DFWLYLVPVRPHERG\f ,W LV ERWK 'RUDf WKLQN WKDW ZH ZRUN D ORW LQ WKH SHUVSHFWLYH RI GRQn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f WKLQN LQ D FHUWDLQ ZD\ GHOLYHU D VHUYLFH WKDWnV ZKDW ZH GR KHUH %HFDXVH1RZ WKH ZD\ ZH GR LW LV ZKDW LV JRLQJ WR JLYH WKH LGHD RI ZKDW W\SH RI VHUYLFH DP GHOLYHULQJ )RU H[DPSOH GR ,, KDYH WR ZRUN KRXUV 6R LW ZRXOG EH D MRE LVVXH SXUH DQG VLPSOH JR WKHUH JR JLYH D ZRUNVKRS >@ ZH H[FKDQJH LGHDV 0\ KRXUV DUH XS %HFDXVH LW LV D WKLQJ ZKLFK KDV WR EH GRQH LW LV VRPHWKLQJ WKDW QHHGV WR EH GRQH DQG LW LV D MRE ZH DUH GRLQJ ILQDQFHG E\ GRQnW NQRZ ZKRP EXW LW LV D WKLQJ ZH KDYH GHFLGHG WR GR DQ HGXFDWLRQDO SURJUDP 1RZ ZKDW LV WKH SHUVSHFWLYH RI WKLV SURJUDP KRZ PXFK WLPH DP JRLQJ WR VSHQG RQ LW LQ ZKDW ZD\ DP JRLQJ WR FRPSOHWH LW ZKDW DUH WKH SROLWLFV EHKLQG LW ZKDW LV P\ LGHD RI LW ZKDW DUH P\ LGHDOV > @ 7KLV LV ZKHUH D GLIIHUHQW OHYHO D GLIIHUHQW TXDOLW\ FRPHV LQ %XW WKLQN WKDW LW LV D KLJKO\ VRFLDOO\ UHOHYDQW MRE ODXJKWHU RI /LOLDf )LJXUH 6DQGH PHPEHUVn GHILQLWLRQ RI WKHLU DFWLYLWLHV

PAGE 193

&+$37(5 (1&2817(56 $1' 0,6(1&2817(56 &,7< $1' 1(,*+%25+22' )(0,1,606 &KDQGUD 0RKDQW\ f ZDUQHG :HVWHUQ IHPLQLVWV DJDLQVW DVVXPLQJ D XQLWDU\ WKLUG ZRUOG ZRPDQ WKXV OXPSLQJ DOO WKLUG ZRUOG ZRPHQ LQ D VLQJXODU FDWHJRU\ ZKLFK ZRXOG LJQRUH WKHLU LQGLYLGXDOLW\ DQG H[SHULHQFH DV ZHOO DV GLIIHUHQFHV LQ WHUPV RI UDFH FODVV DJH HWF 'LIIHUHQFHV RI UDFH FODVV VH[XDO RULHQWDWLRQ DQG DJH EHWZHHQ ZRPHQ FDQ KDUGO\ EH LJQRUHG DQG DUH UHIOHFWHG LQ WKH %UD]LOLDQ ZRPHQnV PRYHPHQW ,Q %UD]LO WKHVH GLIIHUHQFHV KDYH EHHQ DFNQRZOHGJHG E\ PRYHPHQW DFWLYLVWV DQG RXWVLGH REVHUYHUV DOLNH $OYDUH] &LWHOL 6RDUHV HW DO 6WHPEDFK HW DO f ,Q WKLV FKDSWHU ZLOO IRFXV RQ WKH UHODWLRQV EHWZHHQ PLGGOH FODVV IHPLQLVWV XVXDOO\ RI (XURSHDQ GHVFHQW DQG QHLJKERUKRRG ZRPHQ IURP 6DR 3DXORnV SRRU SHULSKHU\ ZKR PRVW RIWHQ KDYH VRPH $IULFDQ DQFHVWU\ +HQFH GLIIHUHQFHV LQ ERWK OLIH FRQGLWLRQV DQG HWKQLFLW\UDFH DUH FRQVLGHUHG ,Q WKH SDVW QHLJKERUKRRG ZRPHQ IURP WKHVH SRRU VHFWRUV RI WKH FLW\ WHQGHG WR UHMHFW WKH ODEHO IHPLQLVW DQG LQVLVWHG RQ WKHLU IHPLQLQH LGHQWLW\ 7RGD\ WKHUH LV VWLOO FHUWDLQO\ D UHVLVWDQFH WR WKH In ZRUG 7KHVH ZRPHQ VHH WKHPVHOYHV GLIIHUHQWO\ IURP WKH IHPLQLVWDV GD FLGDGH WKH IHPLQLVWV IURP WKH FLW\f +RZHYHU VRPH QHLJKERUKRRG ZRPHQ DQG LQGHHG VRPH QHLJKERUKRRG ZRPHQnV RUJDQL]DWLRQV KDYH FRPH WR DGRSW IHPLQLVP DV WKHLU RZQ DQG UHGHILQH LW 6RPH RI WKHVH ZRPHQ DQG JURXSV DUH QRZ DFWLYH LQ IHPLQLVW PRYHPHQWZLGH DFWLYLWLHV DQG QHWZRUNV 7KLV EURDGHQLQJ RI WKH PRYHPHQW LV D QRWHZRUWK\ DFKLHYHPHQW RI %UD]LOLDQ IHPLQLVWV

PAGE 194

DQG FRQWULEXWHV JUHDWO\ WR WKH GHPRFUDWLF SRWHQWLDO RI WKH PRYHPHQW +RZHYHU LW LV QRW ZLWKRXW WHQVLRQV VRPH RI ZKLFK ZLOO EH DGGUHVVHG LQ WKLV FKDSWHU ,Q WKH OLQH RI ( 3 7KRPSVRQ f GHILQH FODVV ERWK LQ PDWHULDO DQG FXOWXUDO WHUPV ,Q SDUW WKLV LV EHFDXVH WKH ERXQGDU\ EHWZHHQ ZKDW ZH FRQVLGHU DV WKH HFRQRP\ DQG ZKDW ZH FRQVLGHU DV WKH VRFLDOFXOWXUDO UHDOP LV QRW FOHDUO\ GHPDUFDWHG DV LQWHUSUHWLYH DQWKURSRORJLVWV DPRQJ RWKHUV KDYH GHPRQVWUDWHG H J 5REEHQ f %XW DOVR EHFDXVH DOO HFRQRPLF SUDFWLFHV FRQWDLQ FXOWXUDO FRPSRQHQWV ZKLOH FXOWXUDO SUDFWLFHV DOVR KDYH UHDO PDWHULDO f§UHDG HFRQRPLF FRQVHTXHQFHV 5RVHEHUU\ f %RXUGLHXnV QRWLRQ RI KDELWXV KHOSV VSHFLI\ WKH UHODWLRQVKLS EHWZHHQ PDWHULDO REMHFWLYH FRQGLWLRQV DQG FXOWXUDO SUDFWLFHV IRU D JLYHQ JURXS RU nFODVVn ,QGHHG DOWKRXJK JURXSV RU FODVVHV LQ D GLIIHUHQWLDWHG VRFLHW\ VKDUH D QXPEHU RI YDOXHV EHOLHIV DQG SUDFWLFHV HDFK DOVR GHYHORSV LWV RZQ VHW RI SUDFWLFHV $V %UD]LOLDQ DQWKURSRORJLVW 5REHUWR 'D 0DWWD SXWV LW LW LV NQRZQ ZKR LV ULFK DQG ZKR LV SRRU E\ EHKDYLRU DQG OLIHVW\OH f HYHQ ZLWKLQ WKH VDPH QHLJKERUKRRG $FFRUGLQJ WR %RXUGLHX WKLV LV EHFDXVH WKH GLVSRVLWLRQV GXUDEO\ LQFXOFDWHG E\ WKH SRVVLELOLWLHV DQG LPSRVVLELOLWLHV IUHHGRPV DQG QHFHVVLWLHV RSSRUWXQLWLHV DQG SURKLELWLRQV LQVFULEHG LQ WKH REMHFWLYH FRQGLWLRQV JHQHUDWH GLVSRVLWLRQV >KDELWXV@ REMHFWLYHO\ FRPSDWLEOH ZLWK WKHVH FRQGLWLRQV DQG LQ D VHQVH SUHDGDSWHG WR WKHLU GHPDQGV %RXUGLHX f 0HPEHUV RI D VDPH JURXS KDYH VLPLODU KLVWRULHV DQG H[SHULHQFHV VR WKDW WKHLU LQGLYLGXDO KDELWXV UHIOHFWV RU H[SUHVVHV WKH FODVV RU JURXS KDELWXV LELGf 2EYLRXVO\ LQGLYLGXDO YDULDWLRQ H[LVWV LQGLYLGXDOV DUH LQ D UHODWLRQVKLS RI KRPRORJ\ WKDW LV RInGLYHUVLW\ ZLWKLQ KRPRJHQHLW\n LELGf 7KH FRQWHQWLRQ WKDW GLIIHUHQW HWKQLF JURXSV KDYH GLIIHUHQW FXOWXUDO SUDFWLFHV LV XVXDOO\ PRUH HDVLO\ DFFHSWHG PD\EH WRR HDVLO\ 8QIRUWXQDWHO\ KDYH QHYHU OLYHG LQ WKH 1RUWKHDVW RI %UD]LO ZKHUH PDQ\ RI WKH QHLJKERUKRRG ZRPHQ FRPH IURP VR WKDW LW LV GLIILFXOW IRU PH WR WHDVH

PAGE 195

RXW ZKDW SUDFWLFHV DUH UHODWHG WR SHRSOHnV HWKQLF YHUVXV FODVV EDFNJURXQG ,Q IDFW UHSUHVHQWDWLRQV RI ZKDW LW PHDQV WR EH SRRU RIWHQ FRQMXUH XS LPDJHV RI 1RUWKHDVWHUQ PLJUDQWV KHQFH RIWHQ RI $IULFDQ DQG LQGLJHQRXV GHVFHQW ,Q REMHFWLYH WHUPV WKH PDMRULW\ RI WKH SRRU KDYH VRPH $IULFDQ DQFHVWU\ 7KLV FRQIODWLRQ RI FODVV DQG UDFH DW WKH OHYHO RI UHSUHVHQWDWLRQV DQG REMHFWLYH FRQGLWLRQV KDV EHHQ QRWHG IRU WKH 86 DV ZHOO &RXVLQV 2UWQHU f 7KH ILUVW VHFWLRQ RI WKLV FKDSWHU DGGUHVVHV WKH WHQVLRQV WKDW VXFK GLIIHUHQFHV LQ FXOWXUHFODVV FUHDWH DPRQJ IHPLQLVWV DQG WKH FKDOOHQJHV WKH\ SRVH WR WKH SDUWLFLSDWLRQ RI QHLJKERUKRRG ZRPHQ LQ PRYHPHQWZLGH IRUD VXFK DV WKH 5HGH 7KH VHFRQG VHFWLRQ VKRZV WKDW GHVSLWH WKH LQFOXVLRQ LQ WKH IHPLQLVW PRYHPHQW RI D QXPEHU RI SRSXODU IHPLQLVWV PLGGOH FODVV IHPLQLVW JURXSVn LQYROYHPHQW ZLWK QHLJKERUKRRG ZRPHQ LQ 6DR 3DXORnV SHULSKHU\ KDV GLPLQLVKHG 7KH QHZ IRUPDOO\ GHPRFUDWLF UHJLPH KDV FHUWDLQO\ FKDQJHG WKH SRVVLELOLWLHV DQG FRQVWUDLQWV RI 1*2 DQG VRFLDO PRYHPHQW SROLWLFV DQG DOWHUHG WKH UHODWLRQVKLSV EHWZHHQ WKH WZR DQG WKHLU SUHIHUUHG VWUDWHJLHV +RZHYHU WKH VSHFLILFLW\ RI WKH PRYHPHQW LQ 6DR 3DXOR QRWDEO\ LWV ORQJHYLW\ DQG LWV SURIHVVLRQDOL]DWLRQ DV ZHOO DV SRSXODU IHPLQLVWVn SHUFHSWLRQ RI WKHLU SRVVLELOLWLHV DQG OLPLWDWLRQV QHHG WR EH WDNHQ LQWR FRQVLGHUDWLRQ )LQDOO\ ZLOO FRQVLGHU KRZ WKH SUHGHILQHG FKDUDFWHU RI UHVHDUFK DQG SLORW SURMHFWV D ZRUNLQJ WRRO IRU 1*2V PLJKW FRQWULEXWH WR WKH GLIILFXOWLHV 1*2V DUH H[SHULHQFLQJ LQ EULQJLQJ WRJHWKHU QHLJKERUKRRG ZRPHQnV JURXSV IRU WKHLU FRPSOHWLRQ KHQFH FRQWULEXWLQJ WR WKH ORZ HEE RI PRELOL]DWLRQ LQ QHLJKERUKRRGV +RZ 'LIIHUHQW $UH 1HLJKERUKRRG :RPHQ" LQWHUYLHZHG ZRPHQ PHPEHUV RI QHLJKERUKRRG ZRPHQnV JURXSV ZKLFK UHFHLYHG VXSSRUW IURP WKH FLW\ IHPLQLVW JURXSV SURIHVVLRQDOL]HG RU YROXQWHHUf ZDV ZRUNLQJ ZLWK (LJKW ZRPHQ ZHUH PHPEHUV RI 0RYLPHQWR 0XOKHU H 6DGH D JURXS ZKLFK UHFHLYHG VXSSRUW

PAGE 196

IURP 637 )t6 VWLOO RIIHUV VSRUDGLF EXW QR ORQJ WHUP VXSSRUW WR QHLJKERUKRRG JURXSVf 6L[ ZRPHQ EHORQJHG WR WKH QHLJKERUKRRG QXFOHL RI 0XOKHUHV 8QLGDV ZKLOH DQRWKHU ZRPHQ SDUWLFLSDWH LQ WKH DFWLYLWLHV RUJDQL]HG E\ WKH &DVD GD 0XOKHU IRU D WRWDO RI ZRPHQ UHFHLYLQJ VXSSRUW IURP YROXQWHHU JURXSVf ZLOO SUHVHQW WKH VRFLRHFRQRPLF SURILOH RI WKH QHLJKERUKRRG ZRPHQ LQWHUYLHZHG EHIRUH JHWWLQJ WR WKH FXOWXUDO HOHPHQWV WKDW GLVWLQJXLVK WKHP IURP WKH IHPLQLVWV IURP WKH FLW\ 6WDUWLQJ ZLWK HWKQLF LGHQWLW\ DPRQJ WKH JUDVVURRWV ZRPHQ LQWHUYLHZHG RQO\ VL[ FRQVLGHUHG WKHPVHOYHV DV EUDQFDnn ZKLWHf WKUHH LGHQWLILHG WKHPVHOYHV DV QHJUD RU SUHWD EODFNf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f DUH KRXVHZLYHV WZR RI ZKLFK DUH KRPH VHDPVWUHVVHV RQ WKH VLGH 7ZR ZRPHQ ZRUN FRQVLVWHQWO\ DV VHDPVWUHVVHV ZKLOH DQRWKHU RSHQHG VPDOO EXVLQHVVHV 7KHVH ZRPHQnV LQFRPHV WHQG WR EH ORZHU WKDQ WKDW RI PLGGOH FODVV IHPLQLVWV DOWKRXJK LW LV QRW DOZD\V WKH FDVH $V IDU DV HGXFDWLRQ LV FRQFHUQHG RQO\ WZR RI WKHVH ZRPHQ KDYH VWXGLHG EH\RQG KLJK VFKRRO ZKLOH WKH ODUJH PDMRULW\ HOHYHQf KDYH FRPSOHWHG HOHPHQWDU\ VFKRRO SULPHLUR JUDXf $ QXPEHU RI WKHP KDYH VWDUWHG VWXG\LQJ DJDLQ DIWHU MRLQLQJ WKH PRYHPHQW $Q HOHPHQW ZKLFK ZDV YHU\ SUHVHQW LQ QHLJKERUKRRG ZRPHQnV XQGHUVWDQGLQJ RI WKH GLIIHUHQFHV EHWZHHQ WKHPVHOYHV DQG PLGGOH FODVV IHPLQLVWV LV WKH SODFH ZKHUH WKH\ OLYH $ VWURQJ GLVWLQFWLRQ LV PDGH EHWZHHQ WKRVH ZKR OLYH LQ WKH EDLUUR WKH QHLJKERUKRRGf DQG WKRVH ZKR OLYH

PAGE 197

7DEOH 6RFLRHFRQRPLF 3URILOH DQG 3ROLWLFDO 3DUWLFLSDWLRQ RI 1HLJKERUKRRG $FWLYLVWV 2UJDQL]DWLRQ $JH 5DFH 2FFXSDWLRQ +G ,QFRPH (GXFDWLRQ 0DULWDO VWDWXV RI FKLOGUHQ 3ODFH 2ULJLQ 'DWH MRLQHG 6WDUWHG DFWLYLVP 3ROLWLFDO 3DUW\ &DVD GD 0XOKHU 0 UHVWDXUDQW RZQHU 0DUULHG 63 37 &DVD GD 0XOKHU ( KRXVHZLIH HPEURLGHU\ 0DUULHG 63 LQW 37 &DVD GD 0XOKHU 0 KRXVHZLIH 0DUULHG 0LQDV V 37 &DVD GD 0XOKHU ( KRXVHZLIH 0DUULHG 63 LQW V 37 0RYLPHQWR 0XOKHU H 6DXGH ( KRVSLWDO DWWHQGDQW r &RQV XQLRQ 63 LQW V 37 0RYLPHQWR 0XOKHU H 6DXGH 0 KRXVHZLIH WHDFKHUf r 0DUULHG 0LQDV V 37 0RYLPHQWR 0XOKHU H 6DXGH $ KRXVHZLIHVHDPVWUHVV 1$ 1$ 0DUULHG %DKLD 37 0RYLPHQWR 0XOKHU H 6DXGH ( VHOO FRVPHWLFV VHDPVWUHVV 0DUULHG 63 LQW 37 0RYLPHQWR 0XOKHU H 6DXGH $ 1XUVH r 6LQJOH 63 QRQH 0RYLPHQWR 0XOKHU H 6DXGH 0 6HDPVWUHVV GRPHVWLF ZRUN r 6HSDUDWHG 3DUDLED 37 0RYLPHQWR 0XOKHU H 6DXGH ( VHOOHU KRVSLWDO DWWHQGf :LGRZ 5* 6XO QRQH 0RYLPHQWR 0XOKHU H 6DXGH 0 KRVSLWDO DWWHQGDQW r &RQV XQLRQ 63 V 37 0XOKHUHV 8QLGDV 0 GD\FDUH DWWHQGDQW r 0DUULHG 0LQDV V 3& GR %r 0XOKHUHV 8QLGDV 0 KRVSLWDO DWWHQGDQW UHVWDXUDQW 0DUULHG 63 LQW V 36'% 0XOKHUHV 8QLGDV $ 7HDFKHU 0DUULHG 63 37 0XOKHUHV 8QLGDV ( KRVSLWDO DWWHQGDQW &RQV XQLRQ 3DUDQD 3& GR %r 0XOKHUHV 8QLGDV 0 VWXGHQW LQVSHFWRU 6LQJOH 0LQDV V 3& GR %r 0XOKHUHV 8QLGDV 0 EDU RZQHU 1$ 1$ :LGRZHG %ROLYLD QRQH 1RWHV 5DFH $ $IULFDQ GHVFHQW 0 0L[HG GHVFHQW ( (XURSHDQ GHVFHQW $V $VLDQ f§ +RXVHKROG LQFRPH r ,QGLYLGXDO LQFRPH (GXFDWLRQ (OHPHQWDU\ VFKRRO 0LGGOH VFKRRO +LJK VFKRRO 8QLYHUVLW\ KDV FRPSOHWHG PRUH WKDQ WKH VWLSXODWHG OHYHO r 6WXG\LQJ LQ VSHFLDO DGXOW SURJUDP WR FRPSOHWH PLGGOH VFKRRO f§ 3ROLWLFDO SDUW\ r 1R ORQJHU D PHPEHU 22

PAGE 198

LQ WKH FLGDGH WKH FLW\f WKH ZHDOWKLHU SDUW RI 6DR 3DXOR $V 7HUHVD &LWHOL f DUJXHV WKH FODVV HOHPHQW LV FRPSRXQGHG E\ D IHHOLQJ WKDW FLW\ IHPLQLVWV DUH QRW SUHVHQW LQ WKH GD\WRGD\ VWUXJJOH WKH\ DUH ZDJLQJ &XOWXUDO 'LIIHUHQFHV ,Q WKH FDVH RI WKH %UD]LOLDQ ZRPHQnV PRYHPHQW GLIIHUHQFHV OLQNHG WR OLIH FRQGLWLRQV DUH H[SUHVVHG DW WLPHV GUDPDWLFDOO\ LQ ODQJXDJH DQG LQ SUDFWLFHV LQ DQ HPSKDVLV RQ WKH FROOHFWLYH YHUVXV WKH LQGLYLGXDO 1HLJKERUKRRG DQG &LW\ ZRPHQ DOVR GLIIHU LQ WKHLU UHODWLRQ WR PHQ DV ZHOO DV WR *RG DQG WKH &DWKROLF &KXUFK &RQVHTXHQWO\ WKH\ DOVR GLIIHU LQ WHUPV RI LQWHUHVWV DQG QHHGV UHYLYLQJ WKH QHYHU TXHQFKHG LVVXH RI WKH JHQHUDO QHHGV RI ERWK PHQ DQG ZRPHQ RI WKH SRSXODU FODVVHVf YHUVXV WKH VSHFLILF QHHGV RI ZRPHQf DQG WKH QHZHU LVVXH RI ORFDO YHUVXV QDWLRQDOLQWHPDWLRQDO VWUDWHJLHV RI VRFLDO FKDQJH 7KH ODQJXDJH ULIW EHWZHHQ SRSXODU DQG PLGGOH FODVV HGXFDWHG IHPLQLVWV FDPH EHVW WR WKH IRUH ZKHQ D QHLJKERUKRRG IHPLQLVW VKDUHG KHU IHHOLQJV DERXW WKH PHHWLQJV RI WKH 5HGH WKDW KDG WDNHQ SODFH LQ 5LR GH -DQHLUR DVSHVVRDV EXVFDP IRUPDV GH VH H[SUHVVDU >@ XVDP SDODYUDV TXH QHP VDR QR GLFKP£ULR SHRSOH VHDUFK IRU ZD\V WR H[SUHVV WKHPVHOYHV > @ WKH\ XVH ZRUGV WKDW DUH QRW HYHQ LQ WKH GLFWLRQDU\ $QG WKLV DFWLYLVW LV QRW D QHZFRPHU WR WKH IHPLQLVW PRYHPHQW HLWKHU EHO KRRNV f HPSKDVL]HG WKH LPSRUWDQFH RI PRGLI\LQJ RXU YRFDEXODU\ DQG VHQWHQFH VWUXFWXUH ZKLFK GRHV QRW PHDQ WDONLQJ GRZQ HLWKHU ZKHQ DGGUHVVLQJ D GLIIHUHQW SXEOLF LQ SDUW WR JHW DURXQG GLIIHUHQFHV LQ OLWHUDF\ DQG IRUPDO HGXFDWLRQ OHYHOV 'LIIHUHQFHV LQ SUDFWLFHV JR GRZQ WR WKH PLQXWH GHWDLOV RI HYHU\GD\ OLIH ZKLFK DUH UHIOHFWLRQV RI WKH SRZHU GLIIHUHQWLDO EHWZHHQ FODVVHV 7R JLYH DQ H[DPSOH 1DGLD 0RYLPHQWR 0XOKHU H 6DGH KHUHDIWHU 006f UHFRXQWHG KRZ LOODWHDVH VKH KDG IHOW DW GLQQHUV LQ IHPLQLVW

PAGE 199

PHHWLQJV EHFDXVH VKH OLNH PRVW SHRSOH OLYLQJ LQ WKH SHULSKHU\ RI 6DR 3DXOR LV XVHG WR HDWLQJ ZLWK D VSRRQ UDWKHU WKDQ ZLWK D IRUN DQG NQLIH 'LIIHUHQFHV DUH DOVR REYLRXV LQ WKH ZD\ ZRPHQ GUHVV FRPE WKHLU KDLU RU ORRN DW RWKHUV 6XFK VHHPLQJO\ WULYLDO SUDFWLFHV DUH SDUW RI WKH VRFLDO FDSLWDO RI LQGLYLGXDOV ZKLFK WUDQVODWHV LQ PDWHULDO EHQHILWV VXFK DV EHWWHU HPSOR\PHQW DQG PDWHULDOL]HV SRZHU GLIIHUHQWLDOV EHWZHHQ FODVVHV %RXUJRLV f 7KH\ DOVR PDUN WKHLU GLIIHUHQFH DQG EHFRPH D VRXUFH RI VHOIFRQVFLRXVQHVV DQG XQHDVLQHVV ZKHQ WKH\ FRPH WRJHWKHU %UD]LOLDQ DQWKURSRORJLVWV KDYH QRWHG WKDW SRSXODU FODVVHV KDYH D VRFLDELOLW\ EDVHG RQ WKH SULQFLSOH RI UHFLSURFLW\ D G£YLGDf DQG UHOLJLRVLW\ )HUQDQGHV f D UHODWLRQDOKLHUDUFKLFDO ZRUOGYLHZ 'D 0DUWD f 'D 0DWWD EHOLHYHV WKDW KH D %UD]LOLDQ LQWHOOHFWXDO VKDUHV WKLV UHODWLRQDO ZRUOGYLHZ ZLWK KLV IHOORZ %UD]LOLDQV ZKLOH )HUQDQGHV DUJXHV WKDW FHUWDLQ VHFWRUV RI WKH %UD]LOLDQ SRSXODWLRQ LQ SDUWLFXODU 1*2V DQG VRFLDO PRYHPHQWV KDYH IRXQG WKHPVHOYHV VRPHZKDW FXW RII IURP WKH PDVVHV RI WKH SHRSOH EHFDXVH RI WKHLU PRUH LQGLYLGXDOLVWLF VHFXODULVW FXOWXUH )HUQDQGHV f ,QGHHG LI SRSXODU PRYHPHQWV LQFOXGLQJ QHLJKERUKRRG ZRPHQnV JURXSV KDYH DGRSWHG VRPH RI WKH PRGHUQLVW YLVLRQ LQ SDUWLFXODU WKH ORJLF RI HTXDOLW\ DQG SDUWLFLSDWLRQ WKH\ GR QRW VHHP WR KDYH FRPSOHWHO\ DFFHSWHG WKDW RI LQGLYLGXDOLVP RU HYHQ RIXQLYHUVDOLVWLF UDWLRQDOLVP ,QGHHG WKH W\SH RI ULJKWV SRSXODU PRYHPHQWV VWUXJJOH IRU DUH EDVLFDOO\ FROOHFWLYH D FODLP PDGH E\ D FRPPXQLW\ IRU WKH ZKROH RI LWV PHPEHUVf WKH\ GR QRW DLP WKHUHIRUH DW WKH H[SDQVLRQ RI LQGLYLGXDO ULJKWV &LWHOL f )RU 7HUHVD &LWHOL WKLV LV RQH RI WKH UHDVRQV ZK\ WKH ZRPHQ LQ SRSXODU PRYHPHQWV VXFK DV WKH +HDOWK 0RYHPHQW RI WKH (DVWHUQ 3HULSKHU\ 06=/f DUH VR DPELYDOHQW WRZDUGV IHPLQLVP DQG LWV QRWLRQ RI UHSURGXFWLYH n 5HFDOO /HLODK /DQGLPnV FRQWHQWLRQ WKDW 1*2V EULQJ WR SRSXODU JURXSV WKH DVVXPSWLRQV RI D XQLYHUVDOLVW UDWLRQDOLVP WKH ORJLF RI HTXDOLW\ DXWRQRP\ LQGLYLGXDOLVP SDUWLFLSDWLRQ DQG GLDORJXH WKH ORJLF RI FLWL]HQVKLS Df

PAGE 200

ULJKWV 7KLV HPSKDVLV RQ WKH FROOHFWLYH ZDV UHIOHFWHG LQ WKH SUDFWLFHV RI WKH JURXSV YLVLWHG )RU H[DPSOH P\ ILUVW FRQWDFW ZLWK QHLJKERUKRRG JURXSV ZDV RIWHQ ZLWK WKH ZKROH JURXS RU DW OHDVW ZLWK VHYHUDO RI LWV PHPEHUV 1HLJKERUKRRG ZRPHQ DUH DOVR ZHDU\ RI WKH DOOHJHG DQWLPHQ VWDQFH RI IHPLQLVWV ZKLFK WKH\ FDQQRW DQG GR QRW ZDQW WR DGRSW DQG VHH DV D WKUHDW WR WKHLU IHPLQLQH LGHQWLW\ 7KH WUDMHFWRU\ RI 'DOYD D SRSXODU PRYHPHQW DFWLYLVW QRZ DFWLYH RQ ZRPHQnV KHDOWK LVVXHV LV TXLWH UHSUHVHQWDWLYH RI D QXPEHU RI ZRPHQ 6KH VWDUWHG LQ D &KULVWLDQEDVHG FRPPXQLW\ &(%Vf DQG SDUWLFLSDWHG LQ KHU FRPPXQLW\ VWUXJJOHV WR REWDLQ ZDWHU HOHFWULFLW\ DQG VDQLWDWLRQ LQ KHU QHLJKERUKRRG 6KH WKHQ HQWHUHG WKH KHDOWK PRYHPHQW VRPH \HDUV DJR 7ZR \HDUV DJR VKH MRLQHG 0RYLPHQWR 0XOKHU H 6DGH +HUH LV ZKDW VKH KDV WR VD\ DERXW IHPLQLVP 6RPHWKLQJ KDG GRXEWV DERXW ZDV DERXW MRLQLQJ WKLV FRPPLVVLRQ ZDV PL[LQJ XS WKH ZRPHQnV FRPPLVVLRQ ZLWK WKH IHPLQLVWV 6RPHWLPHV VDZ WKH IHPLQLVWV DV EHLQJ YHU\ UDGLFDO >@ %HLQJ D PHPEHU RI WKH ZRPHQnV FRPPLVVLRQ GRHV LW PHDQ EHLQJ D IHPLQLVW" GRQnW ZDQW WR EH RQH RI WKHVH IHPLQLVWV QR ZDQW WR EH IHPLQLQH 1RW WKHVH IHPLQLVWV VR GRQnW NQRZVR >@ GRQnW NQRZ LI \RX NQRZ ZKDW ZDQW WR VD\ 6RWKDW ZRPHQ KDYH WR ZRUN DORQJVLGH PHQ 7KH LVVXH RI UHVSHFW WKDW PHQ KDYH IRU ZRPHQ > @ VLQFH \RX ZDQW WR KDYH \RXU ULJKWV KHUH WKH\ DUH EH HTXDO ZLWK PHQ $QG VR ZH DUH WUHDWHG ZLWK PXFK GLVUHVSHFW :H DUH QRW WUHDWHG DV ZRPHQ DQ\PRUH 7KH IDFW WKDW WKH SURJUHVVLYH FKXUFK DQG &(%V KDYH SOD\HG DQ LPSRUWDQW SDUW LQ SURPRWLQJ WKH RUJDQL]DWLRQ RI SRSXODU PRYHPHQWV DQG KHQFH RI QHLJKERUKRRG ZRPHQ LV QRZ ZHOOHVWDEOLVKHG %UXQHDX DQG +HZLWW 'RLPR f DOWKRXJK WKH H[WHQW WR ZKLFK WKH\ OHG WR SHRSOHnV SROLWLFL]DWLRQ LV VWLOO GHEDWHG %XUGLFN f 7KH FRQVHUYDWLYH WXUQDURXQG RI WKH LQWHUQDWLRQDO &DWKROLF &KXUFK VLQFH WKH QRPLQDWLRQ RI 3RSH -RKQ 3DXO ,, KDV DOVR DIIHFWHG 7KLV SHUFHLYHG WKUHDW WR WKHLU LGHQWLW\ LV DFFRUGLQJ WR SROLWLFDO VFLHQWLVW &HOLD 3LQWR f WKH PRVW OLNHO\ UHDVRQ IRU WKH OLPLWHG DFFHSWDWLRQ RI IHPLQLVP E\ ZRPHQ LQ VRFLHW\ DW ODUJH

PAGE 201

&(%V QHJDWLYHO\ WKURXJKRXW /DWLQ $PHULFD 1HYHUWKHOHVV &(%V KDYH GHILQLWHO\ EHHQ HVVHQWLDO LQ WKH OLYHV RI WKH QHLJKERUKRRG ZRPHQ LQ WKH SHULSKHU\ RI 6DR 3DXOR -DFREL f DQG LQ SDUWLFXODU RI WKH JURXSV ZRUNHG ZLWK +RZHYHU HYHQ WKH SURJUHVVLYH &KXUFK KDV RQO\ EHHQ ZLOOLQJ WR JR VR IDU DV ZRPHQ KDYH DIILUPHG FHUWDLQ IHPLQLVW SRVLWLRQV LQ SDUWLFXODU ZLWK UHJDUG WR DERUWLRQ RU FRQWUDFHSWLRQ WKH\ KDYH HQWHUHG LQWR FRQIOLFW ZLWK WKH &KXUFK DQG KDYH VLJQLILFDQWO\ FXUWDLOHG WKHLU WLHV WR LW RU KDYH EHHQ RVWUDFL]HG IURP LW 'URJXV f 7HUHVD &LWHOL f DUJXHV WKDW EHOLHYLQJ LQ *RG RU QRW LV DQ LPSRUWDQW GLIIHUHQFH EHWZHHQ IHPLQLVWV DQG QHLJKERUKRRG ZRPHQ DFWLYH LQ SRSXODU PRYHPHQWV 6KH VKRZV WKDW QHLJKERUKRRG ZRPHQ EHOLHYH WKDW WR EH D IHPLQLVW \RX KDYH WR EH DQ DWKHLVW 6KH DOVR DUJXHV WKDW WKH VWURQJ DQWLKRPRVH[XDO VHQWLPHQWV RI QHLJKERUKRRG ZRPHQ SDUWO\ OLQNHG WR WKHLU FRQQHFWLRQ WR WKH &KXUFKf§ ZKLFK KDYH DOVR ZLWQHVVHG LV DQRWKHU GLYLGHU ZLWK WKH FLW\ IHPLQLVWV IRU ZKRP KRPRVH[XDOLW\ DPRQJ ZRPHQ LV QRZ IDLUO\ ZHOODFFHSWHG 7KLV WDNHV XV EDFN WR 'DOYDnV LGHDV RI ZKDW FRQVWLWXWH SURSHU IHPLQLQH EHKDYLRU DQG LGHQWLW\ 'LIIHUHQFHV LQ ,QWHUHVWV DQG 1HHGV ,QWHUHVWV DQG QHHGV DULVH QRW RQO\ IURP DQ LQGLYLGXDOnV SRVLWLRQLQJ LQ WKH VRFLDO VWUXFWXUH DV LV DVVXPHG LQ WKH 0DU[LVWVWUXFWXUDOLVW WUDGLWLRQ EXW DOVR IURP WKDW LQGLYLGXDOnV H[SHULHQFH ZKLFK LQFOXGHV KHUKLV GLIIHULQJ UHODWLRQVKLS WR WKRVH ZKR KROG SRZHU 7KLV XQGHUVWDQGLQJ DOORZV XV WR JR EH\RQG 0RO\QHX[nV f RULJLQDO GLVWLQFWLRQ RI SUDFWLFDO YHUVXV 6HH /HERQ IRU D FRQFLVH UHYLHZ RI WKH OLWHUDWXUH RQ WKH UHODWLRQVKLS EHWZHHQ WKH FKXUFK DQG SRSXODU PRYHPHQWV )RU DQ LQWHUHVWLQJ GLVFXVVLRQ RI WKH GLIIHUHQFH EHWZHHQ LQWHUHVWV DQG QHHGV LQ WKH FRQWH[W RI JHQGHU SODQQLQJ VHH 1DLOD .DEHHU f

PAGE 202

VWUDWHJLF JHQGHU LQWHUHVWV DQG HVSHFLDOO\ EH\RQG WKH DVVHUWLRQ WKDW SUDFWLFDO JHQGHU LQWHUHVWV GR QRW JHQHUDOO\ HQWDLO D VWUDWHJLF JRDO VXFK DV ZRPHQnV HPDQFLSDWLRQ RU JHQGHU HTXDOLW\ f )HPLQLVWV KDYH VLQFH WKHQ UHSHDWHGO\ VKRZQ WKH FKDOOHQJH WKDW QHLJKERUKRRG ZRPHQnV RUJDQL]LQJ HYHQ DURXQG LVVXHV RI SUDFWLFDO LQWHUHVW WR WKHP SRVHV WR WKH HVWDEOLVKHG VRFLDO DQG JHQGHUHG RUGHU )ULHGPDQ HW DO /LQG 5DGFOLL)H DQG :HVWZRRG 6DID f 7KH OLIH FRQGLWLRQV H[SHULHQFH DQG VHQVH RI LGHQWLW\ RI QHLJKERUKRRG ZRPHQ DV ZHOO DV WKHLU UHODWLRQV WR PHQ DQG WR PLGGOH FODVV ZKLWH PHQ LQ SDUWLFXODU VKDSHV WKHLU LQWHUHVWV DQG QHHGV )RU H[DPSOH QRQH RI WKH QHLJKERUKRRG JURXSV ZRUNHG ZLWK LGHQWLILHG DV D EODFN ZRPHQnV JURXS ,Q IDFW GR QRW NQRZ RI DQ\ VXFK JURXS LQ WKH SHULSKHU\ RI 6DR 3DXOR DOWKRXJK DV KDYH VKRZQ PRVW PHPEHUV KDYH VRPH $IULFDQ KHULWDJH )RU WKH PRVW SDUW PHPEHUV ZHUH DZDUH RI UDFLDO GLVFULPLQDWLRQ f§KRZ FRXOG WKH\ QRW EH f§ EXW WKH\ GR QRW RUJDQL]H VSHFLILFDOO\ DURXQG WKLV LVVXH DQG KDYH QRW FRPH WR WXUQ UDFH LQWR D VDOLHQW VHOI LGHQWLI\LQJ HOHPHQW $V D UHVXOW RU PD\EH EHFDXVH RI P\ RZQ EOLQG VSRWV LVVXHV WKDW DUH GLYLGLQJ $IIR%UD]LOLDQ IURP (XUR%UD]LOLDQ IHPLQLVWV IURP WKH FLW\ VXFK DV VWHULOL]DWLRQ VHH 5RODQG *HOHGV f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f 7KH\ HPSKDVL]H WKH JHQHUDO 7KH\ ZHUH PRUH DGDPDQW LQ FULWLFL]LQJ WKH QHROLEHUDO SROLFLHV RI WKH

PAGE 203

JRYHUQPHQW WKDQ PRVW 1*2V
PAGE 204

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f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

PAGE 205

XQLYHUVDO DQG LQWHJUDWHG KHDOWK V\VWHP 'XULQJ WKH PHHWLQJ DERXW ZRPHQ UHSUHVHQWLQJ WKH JURXSV WKHQ PHPEHUV RI WKH 1HWZRUN FDPH WRJHWKHU WR HYDOXDWH WKH ZRUN GRQH GXULQJ WKH SDVW \HDU WR GLVFXVV WKH EURDG OLQHV RI DFWLRQ IRU WKH FRPLQJ \HDU DQG WR GLVFXVV WKH VWUXFWXUH RI WKH QHWZRUN LWVHOI :KLOH WKH HVWUHODV VWDUVf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nV RQO\ EHFDXVH LW LV D PHHWLQJ ZLWK JUDVVURRWV ZRPHQ WKDW WKH\ SXW XV LQ WKLV SODFH :KHQ ZH FKRRVH D JRRG SODFH SHRSOH VD\ WKDW ZH DUH ZDVWLQJ PRQH\ > @ 6R WKHUH LV VRPHWKLQJ FULWLFDO ZLWKLQ WKH PRYHPHQW DQG WKH FODVV VWUXJJOH LV UHIOHFWHG LQ HDFK FODVV FRQWH[W GR \RX XQGHUVWDQG"

PAGE 206

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£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

PAGE 207

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f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

PAGE 208

LQWHUDFWLRQ DV RSSRVHG WR D SDQHO IDFLQJ URZV RI OLVWHQHUVf
PAGE 209

FRQFLOLDWLRQ 7HOOHV f
PAGE 210

JURXS RI ZRPHQ PD\EH ILIWHHQ RI XV PRVWO\ IURP 6DR 3DXOR GHFLGHG WR HDW DW D SL]]HULD :H ZDONHG WRJHWKHU WR WKH UHVWDXUDQW ZKLFK KDG ODUJH WDEOHV RXWVLGH ZKLFK FRXOG KDYH DFFRPPRGDWHG DOO RI XV +RZHYHU D IHZ ZRPHQ DOO IDLUO\ ZHOONQRZQ XQLYHUVLW\HGXFDWHG PLGGOH FODVV DQG IURP 1*2V H[FHSW IRU RQH ZKR ZDV DQ DFDGHPLFf ZDQWHG WR HDW LQVLGH $OO IROORZHG LQVLGH $W WKDW SRLQW WKH ZRPHQ VDW DW D VPDOO WDEOH ZKLOH WKH UHVW VDW DW DQRWKHU RQO\ RQH EHORQJHG WR D SURIHVVLRQDOL]HG RUJDQL]DWLRQf 7KH LPSRUWDQW GLVWLQFWLRQ KHUH WKRXJK LV QRW EHOLHYH SURIHVVLRQDOL]DWLRQ EXW WKH SRVLWLRQ RI WKHVH ZRPHQ LQ WKH FXSXOD GR PRYLPHQWR WKH WRS RI WKH PRYHPHQWf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n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f H[SUHVVHG EHLQJ WLUHG RI KDYLQJ nWR UHLQYHQW

PAGE 211

WKH ZKHHOn HDFK WLPH D QHZ ZRPDQ EHFDPH LQWHUHVWHG LQ IHPLQLVP 6WHPEDFK HW DO f 7R VXP LW XS WKH FRQVWUDLQWV RI WLPH DQG UHVRXUFHV DQG FRQFHUQV IRU HIILFDF\ RI SURIHVVLRQDOL]HG JURXSV DQG D QDWXUDO WHQGHQF\ WRZDUGV KRPRJDP\ DUH PDNLQJ LW KDUGHU IRU WKH PRYHPHQW WR GHDO ZLWK WKH FKDOOHQJHV WR SDUWLFLSDWLRQ SRVHG E\ LWV LQFUHDVLQJ GLYHUVLW\ D GLYHUVLW\ ZKLFK VKRXOG EH KHUDOGHG DV DQ DFKLHYHPHQW RI WKH IHPLQLVW PRYHPHQW :KHUH 'LG $OO WKH &LW\ )HPLQLVWV *R" $V KDYH DOUHDG\ QRWHG WKH ZRUN RI PLGGOH FODVV IHPLQLVWV FRQWULEXWHG WR WKH IDFW WKDW D KDQGIXO RI QHLJKERUKRRG ZRPHQnV JURXSV LQ WKH SHULSKHU\ RI 6DR 3DXOR FRQVLGHU WKHPVHOYHV WR EH IHPLQLVWV )HPLQLVW 1*2V KDYH DOVR SDUWLDOO\ VXEVWLWXWHG WKH UROH RI WKH &KXUFK LQ SURYLGLQJ WKHVH QHLJKERUKRRG JURXSV ZLWK PHHWLQJ VSDFH DQG RWKHU VXSSRUW +RZHYHU PXFK ZRUN UHPDLQV WR EH GRQH LQ WKHVH QHLJKERUKRRGV DV ZRPHQ DUH VWLOO VXIIHULQJ IURP VH[LVW RSSUHVVLRQ DQG IURP ZRUVHQLQJ HFRQRPLF WLPHV 7KH\ DUH LQ QHHG RI VXSSRUW IRU RUJDQL]LQJ DURXQG JHQGHU LVVXHV
PAGE 212

7DEOH &KDQJH LQ $%21* 0HPEHUVn 6SDWLDO 6FDOHV RI $FWLRQ LQ SHUFHQWDJH RI WRWDO $%21* PHPEHUVf 6FDOH RI $FWLRQ
PAGE 213

H[DPSOH &DUROLQD ZKR EHORQJHG WR 006 UHSRUWHG WR WKH JURXS KRZ EDG VKH IHOW EHFDXVH VKH KDG QRW IRXQG DQ\RQH WR JLYH D WDON DW D PHHWLQJ ZKHUH WKHUH ZRXOG EH ZRPHQ JDWKHUHG RQ D 6XQGD\ PRUQLQJ DW D P 6KH WULHG WR FDOO YDULRXV SHRSOH EXW WKH\ GLG QRW ZDQW RU FRXOG QRW GR LW 'XULQJ KHU LQWHUYLHZ 1RHPL 08 QHLJKERUKRRG QFOHRf YRLFHG KHU VXUSULVH DW WKH IDFW WKDW WKH ZRPHQ IURP 08V KHDGTXDUWHUV GLG QRW FRPH WR WKH 1FOHR > @ VKH IHOW LW ZDV LPSRUWDQW WR WUDYHO DURXQG f§WKUHH ZRPHQ KDG MXVW EHHQ WR %HLMLQJf§ EXW WKDW LW ZDV DOVR PRUH LPSRUWDQW WR GR WKH ORFDO ZRUN 7KHQ DJDLQ WZR QHLJKERUKRRG ZRPHQ ZKR GR QRW FRQVLGHU WKHPVHOYHV IHPLQLVWV ZKRP LQWHUYLHZHG LQ WKH 6RXWKHUQ SHULSKHU\ ODPHQWHG WKH IDFW WKDW WKHUH QR ORQJHU ZHUH (QFRQWURV IRU WKHP WR JR WR 7KH\ VDLG WKDW SDUWLFLSDWLQJ LQ WKHVH ZRPHQnV PHHWLQJV JDYH WKHP WKH VWUHQJWK WKH\ QHHGHG WR FRQWLQXH WKHLU GDLO\ VWUXJJOH 6RPH ORQJWLPH YROXQWHHU IHPLQLVWV IURP WKH FLW\ DOVR QRWLFHG FKDQJHV LQ WKH LQWHUDFWLRQ RI GLIIHUHQW JURXSV %HDWUL] SXW LW WKLV ZD\ /RRN WKH ZRPHQnV PRYHPHQW IURP WLOO > @ WKLQN WKDW D ORW RI WKLQJV FKDQJHG IRU WKH EHVW EXW VRPH FKDQJHG IRU WKH ZRUVH 6R IRU H[DPSOH LQ \RX FRXOG VHH D PXFK PRUH DFWLYLVW LQWHUYHQWLRQ RQ WKH SDUW RI WKH OHDGHUVKLS RI WKH ZRPHQnV PRYHPHQW PRUH VSRQWDQHRXV DQG PXFK PRUH FRPPLWWHG /HWn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nW RQO\ WZR KRXUV OLYHG RYHU WKHUH LQ &DPSR /LPSR DQG ZDV JRLQJ WR ,WDTXHUD VHH ZKDW PHDQ" EURXJKW DQ H[SHUW DORQJ >RQ VRPH SDUWLFXODU LVVXH@ > @ :HnG JHW WKHUH VKH JDYH KHU ZRUNVKRS ZKLFK ZDV D UHDO VXFFHVV EHFDXVH VKH ZDV DQ H[SHUW 7RGD\ \RX FDQQRW ILQG DQ\ERG\ WR GR WKLV 7RGD\ \RX KDYH WR JR ZLWK \RXU RZQ FDSDFLW\ \RX JHW WKHUH \RX VHH ZKDW \RX FDQ GR %XW EULQJLQJ DQ H[SHUW DORQJ WRGD\ LW LV LPSRVVLEOH \RX VHH"

PAGE 214

$V D UHVXOW QHLJKERUKRRG ZRPHQ FODLP IHPLQLVWV IURP WKH FLW\ QR ORQJHU NQRZ ZKDW WKHLU OLIH LV OLNH ,Q D ILQDO PHHWLQJ KDG ZLWK 006 &DUROLQD DUJXHG WKDW LW ZDV UHDOO\ FRPSOLFDWHG EHFDXVH WKHVH ZRPHQ ZKR ZRUN DW WKH QDWLRQDO DQG LQWHUQDWLRQDO OHYHO VH GLVWDQFLDUDP GLVWDQFHG WKHPVHOYHVf DQG GR QRW NQRZ WKH UHDOLW\ OLYHG E\ QHLJKERUKRRG ZRPHQ WRGD\ 6KH VDLG OLIH KDV FKDQJHG IRU WKHVH ZRPHQ RYHU WKH ODVW \HDUV DQG LW KDV FKDQJHG IRU WKH ZRPHQ LQ WKH SHULSKHU\ DV ZHOO $V IRU &ULVWLQD *0=/f WKH SUREOHP ZDV WKDW WKH ZRPHQ IURP WKH &LW\ DUH GHVOLJDGDV GR WUDEDOKR FRQFUHWR FRP DV PXOKHUHV 7KH\ DUH QR ORQJHU LQ WRXFK ZLWK WKH FRQFUHWH ZRUN GRQH ZLWK ZRPHQ DQG WKH JDS EHWZHHQ WKHP LV ZLGHQLQJ 7KLV LV D GLIILFXOW PRPHQW VKH DGGHG $ORQJ WKH VDPH OLQH )ORUD &DVD GD 0XOKHUf FRQILGHG GXULQJ KHU LQWHUYLHZ 7KH ZD\ VHH LW 1DWKDOLH DP SUHWW\ ZRUULHG EHFDXVH VHH D JUHDWHU DQG JUHDWHU JDS VHH QHLJKERUKRRG ZRPHQ ZKR DUH GRLQJ UHDOO\ LPSRUWDQW ZRUN ZKLFK FRXOG HQULFK WKH WKHVLV RI DQ\ DFDGHPLF ZRPDQ WKH\ DUH GRLQJ WKLQJV ZKLFK DUH RIWHQ OHIW WR WKH VLGH GRQn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f LQ LWV SHULSKHUDO QHLJKERUKRRG

PAGE 215

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f RUJDQL]LQJ LW ZKLFK KDG EHHQ SUHVHQW LQ WKH V 7KLV LV D GLIILFXOW WRSLF IRU 0/7V OHDGHUVKLS WKH ORQJWLPHUV ZKR IHHO FORVH WR QHLJKERUKRRG ZRPHQ DQG LQ $OHVVDQGUDnV FDVH ZDQW WR EH LGHQWLILHG DV PXOKHU GR SRYR D ZRPDQ IURP WKH SHRSOHf $OHVVDQGUD UHPLQGHG PH GXULQJ KHU LQWHUYLHZDOLDV HX VRX GD SHULIHULD LQ IDFW DP IURP WKH SHULSKHU\f 6KH JORULILHG QHLJKERUKRRG ZRPHQ DV ZKHQ VKH PHQWLRQHG WKDW LW ZDV WKH\ PXOKHUHV KHP VLPSOHV ZRPHQ ZLWK OLWWOH HGXFDWLRQf ZKR KDG GLVFRYHUHG WKH HIIHFWV RI &LWRWHF D FRPPRQ PHGLFDWLRQ ZKLFK ZDV GLVFRYHUHG WR KDYH DERUWLIDFLHQW SURSHUWLHVf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

PAGE 216

SRUTXH HVWRX ID]HQGR HVWH WLSR GH WUDEDOKR (ODV IDODP TXH HX JRVWR GH SREUH]D 7KH\ PDNH Q RI PH EHFDXVH GR WKLV W\SH RI ZRUN 7KH\ VD\ WKDW OLNH SRYHUW\f 6KH UHFDOOHG WKDW VRPH QHLJKERUKRRG ZRPHQ ZHUH KXUW E\ WKH EHKDYLRU RI WKHVH PHPEHUV DV WKH\ IHOW WKDW WKH RWKHUV VHQWHP QRMR GH QVSRUTXH VRPRV SREUHV ILQG XV GLVJXVWLQJ EHFDXVH ZH DUH SRRUf 7KH YRLFLQJ RI VXFK VWURQJ DQG ERGLO\ VHQWLPHQWV UHYHDOV WKH GHSWK RI WKH GLIIHUHQFH DQG WKH DOPRVW QRQFRQVFLRXV YLVFHUDO GLVWDVWHV WKDW H[LVW RU DUH WKRXJKW WR H[LVW EHWZHHQ GLIIHUHQW JURXSV &DVVHOO f 7KLV DQDO\VLV LV FRUURERUDWHG E\ WKH GLVOLNH WKDW VRPH 08 PHPEHUV IURP WKH QFOHRV H[SUHVVHG WRZDUGV JLYHQ PHPEHUV RI WKH KHDGTXDUWHUV ZKLFK ZHUH DW WLPHV FKDUDFWHUL]HG DV EXUJXV ERXUJHRLVf 2Q WKH RWKHU KDQG ZKHQ DVNHG 1RHPL 08 QFOHRf ZKHWKHU VKH FRQVLGHUHG $OHVVDQGUD DV EHORQJLQJ WR WKH VDPH FODVVH VRFLDO FODVVf DV KHU VKH DQVZHUHG \HV ZLWKRXW D KHVLWDWLRQ $V IDU DV SURIHVVLRQDOL]HG JURXSV DUH FRQFHUQHG )t6 WULHG WR XQGHUVWDQG WKH GHFOLQH LQ WKH QXPEHU RI YLVLWV DW WKHLU FOLQLF DQG KLW RQ WKH LVVXH RI GLVVHPLQDWLRQ RI LQIRUPDWLRQ $QD 0DULD QRWHG WKDW VKH XVHG WR JR DQG JLYH WDONV LQ WUDGH XQLRQV DQG DVVRFLDWLRQV LQ WKH FLW\ DQG VKH ZRXOG WDON DERXW ZKDW )t6 GRHV 6KH KDV QRZ WDNHQ XS RWKHU DFWLYLWLHV ZKLFK RIWHQ WDNH KHU DZD\ IURP WKH FLW\ DQG QR ORQJHU JHWV WR GR WKLV 1RERG\ HOVH IXOILOOV WKLV UROH LQ WKH RUJDQL]DWLRQ HLWKHU H[FHSW IRU 5RVLPHLUH RFFDVLRQDOO\ 7KH WZR ZRPHQ ZKR GR ORFDO ZRUN DW )t6 ZRUN LQ WKH FOLQLF DV SDUDPHGLFV )RU LWV SDUW 637 VWLOO KDV WZR ZRPHQ ZKR ZRUN H[FOXVLYHO\ RQ WKH ORFDO OHYHO SURYLGLQJ DVVHVVRULD VXSSRUWf WR PRYHPHQWV SOXV DQRWKHU SHUVRQ ZKR GRHV ORFDO ZRUN DQG VRPH QDWLRQDO DFWLYLWLHV $ IRXUWK SHUVRQ ZRUNV DW WKH 6WDWH OHYHO ZLWK WUDGHXQLRQ ZRPHQ 2QO\ WZR RI WKHVH IRXU ZRPHQ ZHUH VWLOO ZRUNLQJ IRU 637 ZKHQ OHIW 6DR 3DXOR 2QH ZDV GLVVDWLVILHG ZLWK WKH RUJDQL]DWLRQ DQG WKH RWKHU KDG WR PRYH DEURDG

PAGE 217

637 FRRUGLQDWRU 1DUD GHILQHV WKH FKDQJHV ZLWK UHJDUG WR ZRUN ZLWK WKH ORFDO QHLJKERUKRRG PRYHPHQWV LQ WKRVH WHUPV WKH\ KDYH JRQH IURP RUJDQL]HUV WR nDVVHVVRULDn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f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nV TXHVWLRQ VR DV IDU DV WKH >KHDOWK@ PRYHPHQW JRHV LW KDV ORVW D ELW RI LWV FDSDFLW\ WR SURYLGH VXSSRUW 1RZ RQ ZRPHQnV LVVXHV LW LV VWLOO DQ RUJDQL]DWLRQ ZKLFK KDV WKH FDSDFLW\ WR SURYLGH VXSSRUW ,Q D WHOOLQJ PRYH LQ VSULQJ 637 VROG WKHLU KHDGTXDUWHUV LQ D SHULSKHUDO QHLJKERUKRRG ZKHUH LW KDG EHHQ ORFDWHG VLQFH WKH V DQG PRYHG WR D PRUH FHQWUDO ORFDWLRQ 7KH ROG KHDGTXDUWHUV ZHUH QR ORQJHU DSSURSULDWH WR WKHLU QHHGV DQG DFWLYLWLHV DQG 637 ZDV XQGHU VHYHUH ILQDQFLDO FRQVWUDLQW 7KH FRPLQJ VHFWLRQ ZLOO WU\ WR XQGHUVWDQG ZKDW KDSSHQHG WR 637 DQG RWKHU IHPLQLVW JURXSV DQG 1*2V

PAGE 218

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f 7KH SURJUHVVLYH FKXUFK ZKLFK KDG EHHQ HVVHQWLDO LQ ZHDYLQJ D IDEULF RI SRWHQWLDO DFWLYLVWV IRU WKHVH PRYHPHQWV WKURXJK LWV FRQVFLRXVQHVVUDLVLQJ DFWLYLWLHV DQG KDG RIIHUHG WKHP ORJLVWLFDO VXSSRUW KDV QRZ UHWUHDWHG RU EHHQ IRUFHG EDFN LQWR D PRUH WUDGLWLRQDO SRVLWLRQ $QD 0DULD 'RLPRnV ZRUN f LV SDUWLFXODUO\ GHWDLOHG RQ WKLV LVVXH +RZHYHU WKH &KXUFK KDV QHYHU EHHQ LQWHUHVWHG LQ VHHLQJ ZRPHQ RUJDQL]H DV VXFK HVSHFLDOO\ DURXQG LVVXHV RI UHSURGXFWLYH ULJKWV $V IRU RWKHU DOOLHV RI SRSXODU PRYHPHQWV VXFK DV OHIWLVW LQWHOOHFWXDOV PDQ\ KDYH DOVR PRYHG EDFN WR XQLYHUVLWLHV RU WR SDUW\ SROLWLFV DV WKH UHJLPH GHPRFUDWL]HG VHH 'RLPR f $PRQJ QHLJKERUKRRG ZRPHQ DOVR KHDUG H[SUHVVLRQV RI IDWLJXH FDQVDGRf DW EDWWOLQJ WR QR DYDLO LW LV PRUH DQG PRUH GLIILFXOW WR PDNH D GHFHQW OLYLQJ DQG WKH SROLWLFDO VLWXDWLRQ LV JRLQJ QRZKHUH GXH WR WKH FRQVHUYDWLYH ORFDO JRYHUQPHQW ,Q WHUPV RI SXEOLF KHDOWK SROLF\ WKH SODQ WR SULYDWL]H WKH PXQLFLSDO KHDOWK V\VWHP 3$6f ZKLFK ZDV VXFFHVVIXOO\ YRWHG LQ E\ WKH PXQLFLSDO OHJLVODWXUH ZDV D KDUG EORZ JRLQJ DJDLQVW WKH JUDLQ RI ZKDW WKH KHDOWK PRYHPHQW KDG EHHQ VWUXJJOLQJ DERXW IRU PRUH WKDQ \HDUV

PAGE 219

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nV FRXQFLOV RU SHUVRQDO FRQWDFWV RI SROLWLFDO ZRPHQ 7KLV PHDQV WKDW GHYHORSLQJ D VRFLDO EDVH RU D SRGHU GH SUHVV£R SUHVVXUH SRZHUf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

PAGE 220

DV PHVPDV ZH DUH VWLOO WKH VDPH RQHVf LQ IHPLQLVW PHHWLQJV DV &HFLOLD UHPDUNHG 7KH YHU\ IDFW WKDW PRVW DFWLYLVWV DUH QRZ LQ WKHLU V RU ROGHU GRHV EHOLHYH LPSDFW WKH VWUDWHJLHV RI WKH PRYHPHQW /LWHUDOO\ WKH\ DUH JHWWLQJ ROGHU DQG DV D \HDU ROG IHPLQLVW 1*2 PHPEHU QRWHG WR PH WKH\ QR ORQJHU KDYH R SLTXH SDUD ILFDU QD UXD WKH SHS WR WDNH WR WKH VWUHHWVf ,Q DQ H[WUHPH H[DPSOH &ODULVVH 08f FRPSODLQHG RI SUREOHPV ZLWK KHU OHJV WKDW SUHYHQWHG KHU IURP JRLQJ WR GHPRQVWUDWLRQV 7KHQ DOVR ZLWK P\ SK\VLFDO GLIILFXOWLHV WKLV DFWLYLW\ ZKLFK HQMR\HG VR PXFK LQ ZKLFK SDUWLFLSDWHG D ORW PHDQ LQ WKH VWUHHWV KDYH D ORW RI GLIILFXOWLHV WR SDUWLFLSDWH > @ FDQn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f /RQJWHUP SDUWLFLSDQWV DUH OLNHO\ WR JURZ WLUHG RI ROG IRUPV RI FROOHFWLYH DFWLRQ DQG DOVR WR EHFRPH PRUH SHVVLPLVWLF DV WR SRVVLELOLWLHV RI VXFFHVV $V 'HLVH RI 637 SXW LW ZLWK UHJDUG WR ZRPHQ LQ WKH QHLJKERUKRRG ZRPHQnV KHDOWK PRYHPHQW 1RERG\ FDQ VWDQG WR JR WR D KHDULQJ GR D SXEOLF GHPRQVWUDWLRQ WKH\ DUH WLUHG QLQJXP DJHQOD PDLVID]HU DXGLHQFLD DWRHVWDR FDQVDGDVf 7DUURZ WKHRUL]HG WKLV SUREOHP LQ WKH IROORZLQJ WHUPV 5HSHDWLQJ WKH VDPH IRUP RI FROOHFWLYH DFWLRQ RYHU DQG RYHU DJDLQ UHGXFHV XQFHUWDLQW\ DQG LV JUHHWHG ZLWK D VPLOH RU D \DZQ 3DUWLFLSDQWV DW ILUVW HQWKXVHG DQG LQYLJRUDWHG E\ WKHLU VROLGDULW\ DQG DELOLW\ WR FKDOOHQJH DXWKRULWLHV EHFRPH MDGHG RU GLVLOOXVLRQHG f

PAGE 221

'HLVH IHOW WKDW WKHUH ZHUH QHZ ZD\V RI VWDJLQJ SURWHVW DFWLYLWLHV DQG LQ IDFW 006 FDPH XS ZLWK WKH LGHD RI VWDJLQJ SUDQDV GH GHPLQFLDV GHQXQFLDWLRQ FRPHUVf LQVWHDG RI WKH WUDGLWLRQDO DWR SXEOLF DFWf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nQR WKLV ZRQnW ZRUNn RU nWKLV GRHVQnW ZRUN WKLV ZD\n $QRWKHU HOHPHQW FRQWULEXWLQJ WR WKH GLPLQLVKLQJ LQYROYHPHQW RI IHPLQLVWV IURP WKH FLW\ ZLWK QHLJKERUKRRG ZRPHQnV JURXSV LV WKH UHDO DQG SHUFHLYHG DFFXPXODWLRQ RI NQRZOHGJH DQG FRPSHWHQFH RI ORQJWLPH DFWLYLVWV HVSHFLDOO\ WKRVH ZKR KDYH D KLJKHU OHYHO RI HGXFDWLRQ DQG FXOWXUDO FDSLWDO WR SDUWLFLSDWH LQ QDWLRQDO DQG LQWHUQDWLRQDO OHYHO SROLWLFV $V -DQDLQD )t6f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

PAGE 222

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nV 5LJKWV &1'0f 6KH DGGHG WKDW VRPH SHRSOH ZDQW YLVLELOLW\ DQG RWKHUV GR QRW ,W LV D PDWWHU RI SHUVRQDO HJR ZLOO FRPH EDFN WR WKLV LVVXH LQ FKDSWHU

PAGE 223

7KH 'HVN DQG WKH 6WUHHW 6RFLDO PRYHPHQWV DUH HPEHGGHG LQ WKH FXOWXUDO PDWUL[ WKH\ FRPH IURP ,Q %UD]LO DV LQ WKH /DWLQ ZRUOG LQ JHQHUDO IHHOLQJV DJDLQVW PDQXDO ODERU DQG LQ IDYRU RI LQWHOOHFWXDO ZRUN UXQ VWURQJ ,W LV QR VXUSULVH LI WKLV GLIIHUHQWLDO YDOXDWLRQ LV FDUULHG RYHU LQ IHPLQLVW DQG SRSXODU PRYHPHQWV 7KLV QRWLRQ VWUXFN PH ZKHQ KHDUG WKH ORFDO RUJDQL]LQJ ZRUN EHLQJ UHIHUUHG WR DV WUDEDOKR EUDJDO OLWHUDOO\ PDQXDO ZRUNf 7KH PLGGOH FODVV IHPLQLVW DFWLYLVWV DQG VFKRODUV ZKR HPEDUNHG RQ WKH ZRPHQnV PRYHPHQW DGYHQWXUH LQ WKH V GHVHUYH VSHFLDO FUHGLW 7KH\ EURNH GRZQ WKHVH FXVWRPDU\ FDWHJRULHV DQG SUHIHUHQFHV E\ OHDYLQJ WKHLU SURWHFWHG ZRUOG WR PHHW ZRPHQ LQ WKHLU KRPHV DQG QHLJKERUKRRGV $V WKH SROLWLFDO DUHQD KDV UHWXUQHG WR D PRUH IDPLOLDU VFHQH DQG ZRPHQnV LVVXHV DUH RQ WKH DJHQGD WKH SRZHU DQG DSSHDO RI WKH ZULWWHQ ZRUG LV EDFN 7KH ZD\ ZULWWHQ NQRZOHGJH LV YDOXHG FDPH WKURXJK RQ D QXPEHU RI RFFDVLRQ 1DUD RI 637 UHFDOOV $W WKLV WLPH KDG WKH LGHD RI VWDUWLQJ D VWXG\ JURXS EXW ZH KDG WR SRVWSRQH RUJDQL]LQJ WKLV JURXS EHFDXVH HYHU\ERG\ ZDQWHG WR EH SDUW RI LW $QD 0DULD RI )t6 H[SUHVVHG ZDQWLQJ WR ZULWH PRUH ZRXOG OLNH WR GR RWKHU WKLQJV DV ZHOO WR EH DEOH WR ZULWH D ELW ZULWH D ERRN DQG GR, ZRXOG OLNH WR OHDUQ WKLQJV QRZ ZRXOG OLNH WR EHFRPH PRUH RI D VWXGHQW QR 3RSXODU IHPLQLVWV IRU WKHLU SDUW EHOLHYH WKDW RUJDQL]LQJ DQG ORFDO ZRUN LV UHSHWLWLYH DQG DUGXRXV &HFLOLD 006f ZKLOH ZULWLQJ DQG RWKHU LQWHOOHFWXDO ZRUN DUH HDVLHU $FFRUGLQJ WR 'HLVH RI 637 SRSXODU IHPLQLVWV WKLQN WKDW WKLV LV WKH UHDVRQ ZK\ FLW\ IHPLQLVWV SUHIHU WR HQJDJH LQ WKHVH DFWLYLWLHV DQG QR ORQJHU FRPH WR WKH SHULSKHU\ 0RHPD RI 7KH &DVD GD 0XOKHU DJUHHG WKDW LW LV WLULQJ WR GR WKH VDPH WKLQJ WKUHH WLPHV LQ D URZ HQMRD ID]HU WUHV YH]HV D PHVPD FRLVD HP VHJXLGDf 6KH VDLG VKH KHDUG VRPH IHPLQLVWV VD\LQJ GRQnW GR WKLV DQ\PRUH

PAGE 224

7KH ZRPHQ ZDQW WR WDON DERXW NQRZLQJ WKHLU RZQ ERG\ WKHVH WKLQJV WKDW ZH ZHUH GRLQJ \HDUV DJR > @ ,nYH GRQH LW GRQfW GR WKDW DQ\PRUH ZRQn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nV JURXSV EHFDXVH RI WKHLU IHPLQLVW DQG OHIWLVW LGHRORJ\ DQG FRPPLWPHQW 7KH\ FRXOG KDYH FKRVHQ WR GR VRPHWKLQJ HOVH $V 1DQF\ )UDVHU SXWV LW WKH UDGLFDO DFDGHPLF LV QRW DQ R[\PRURQ EXW UDGLFDOV LQ DFDGHPLD GR ILQG WKHPVHOYHV VXEMHFW WR FRPSHWLQJ SUHVVXUHV DQG FRXQWHUSUHVVXUHV f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

PAGE 225

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n LQFUHDVLQJ FDOO IRU 1*2V WR GHPRQVWUDWH WKH LPSDFW RI WKHLU ZRUN ZKLFK ZLOO EH GLVFXVVHG LQ FKDSWHU f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nV VD\ WKH PLFURVFRSLF ZRUN >DQWVn ZRUN@ ZKLFK LV GRQH WKHUH LQ *XDLDQD]HV RU LQ &DPSR /LPSR WKLQN WKDW SDUW RI WKH ZRUN WKDW 6DQGH GRHV LV VXEPHUJHG IURP WKLV SRLQW RI YLHZ RI WKH ZRUOG RI 1*2V DQG RI DJHQFLHV %HFDXVH LW LV ZRUN ZH GR RYHU WKHUH LQ WKH YHU\ HQG RI *XDLDQD]HV LQ WKH YHU\ HQG RI &DPSR /LPSR PHDQ WKLV ZLOO RQO\ EH PRUH YLVLEOH WKH GD\ ZH FUHDWH D YLGHR DERXW LW 7KHQ HYHU\ERG\ LV JRLQJ WR VD\ 2K ZKDW D JUHDW MRE \RX DUH GRLQJ EHFDXVH WKHQ WKHUH LV D YLVLEOH SURGXFW D SURGXFW ZKLFK FDQ FLUFXODWH WKURXJKRXW WKH ZRUOG 'R \RX XQGHUVWDQG" 1DUD RI 637 SRLQWV WR DQRWKHU SDWWHUQ ILQDQFLQJ DJHQFLHV XVXDOO\ ZLOO QRW EH VDWLVILHG ZLWK DQ 1*2nV FRQWHQWLRQ WKDW SRSXODU JURXSV ZLOO FDOO XSRQ WKHP IRU VXSSRUW $OWKRXJK WKH\ DUH QRW DOO DOLNH ILQDQFLQJ DJHQFLHV SUHIHU IXQGLQJ D SUHGHVLJQHG SURMHFW UDWKHU WKDQ WR

PAGE 226

UHVSRQG WR WKH GHPDQG UHVSRQGHU DV GHPDQGDVf 1DUD VDLG IRU \RX WR REWDLQ ILQDQFLQJ WRGD\ RXU ZRUN PLVVHV IRU H[DPSOH WKH IDFW WKDW 637 LV DQ RUJDQL]DWLRQ ZKLFK ZRUNV PRVWO\ IURP WKH GHPDQGV RI RWKHUV LW LV YHU\ JRRG IRU WKH PRYHPHQW EXW LW LV UHDOO\ EDG IRU DQ DJHQF\ WR WUXVW XV 'R \RX XQGHUVWDQG" 1DUD H[SODLQV IXUWKHU WKDW ILQDQFLQJ DJHQFLHV KDYH WKLV IDG WKLV IDVKLRQ ZKLFK LV VWDUWLQJ WR WDNH RYHU RI FRPPXQLFDWLRQ WKLQJV (VVD FRTXHOXFKH TXH HVWDR HQWUDQGR QD PRGD GDV FRLVDV GD FRPXQLFDQGRf VR WKDW LW LV QRZ LPSRUWDQW WR KDYH DQ LPSDFW RQ WKH PHGLD LPSDFWR QD PLGLDf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nV JURXSV +HU LPSUHVVLRQ ZDV WKDW IRU WKHVH ZRPHQ SDUWLFLSDWLQJ LQ ZRUNVKRSV ZDV OLNH WRPDU FKD]LQKR KDYLQJ WHDf ZKLOH WKH LPSDFW RI WKHLU ZRUN LQ WKH OLYHV RI ZRPHQ ZKR SDUWLFLSDWHG LQ WKHLU ZRUNVKRSV DW WKH ,QVWLWXWR &DMDPDU D SROLWLFDO LQVWLWXWH OLQNHG WR WKH 37f DV ZHOO DV WR WUDGHXQLRQV ZDV PXFK FOHDUHU %RWK 637 DQG )t6 KDYH D QXPEHU RI SXEOLFDWLRQV ZKLFK WDNH WKH IRUP RI PDJD]LQHV QHZVOHWWHUV HGXFDWLYH ERRNOHWV FDUWLOKDVf YLGHRV DERXW WKH RUJDQL]DWLRQ RU IRU HGXFDWLYH SXUSRVHV VXFK DV RQ VWHULOL]DWLRQ RU DERUWLRQ $OO RI WKHVH PDWHULDO FDQ EH DQG LQ 637nV YLHZ DUH HODERUDWHG ZLWK WKH LQWHQW WR EH XVHG E\ WKH OHDGHUVKLS RI QHLJKERUKRRG JURXSV RU E\ RWKHUV

PAGE 227

LQ WKHLU ZRUN ZLWK WKH JUDVVURRWV 1DUD LQVLVWHG RQ WKH LPSRUWDQFH RI LQVWUXPHQWDOL]DU DV DJRHV GDVSHVVRDV RIIHULQJ WKH QHFHVVDU\ VXSSRUW IRU SHRSOHnV DFWLRQVf 7KLV LV ZK\ DV IDU DV WKH %XOOHWLQ LV FRQFHUQHG ZH PDGH D JUHDW HIIRUW WR PDNH LW VXSHU DFFHVVLEOH DQG LQ WKH FDVH RI WKH HGXFDWLRQDO NLWV ZH DUH PDNLQJ D JUHDW HIIRUW WR SDVV WKHP RQ WR WKH JURXS >WKH QHLJKERUKRRG JURXSV WKDW ZHUH LQYROYHG LQ WKH HODERUDWLRQ RI WKRVH NLWV@ ZLWK D WUDLQLQJ FRXUVH QR" 7R LQWHJUDWH WKH SDVVLQJ RQ RI DW OHDVW SDUW RI WKH NLW WR WKH JURXSV ZLWK ZKLFK \RX ZRUN QR" DV WUDLQLQJ RI WUDLQHUV PXOWLSOLFDGRUHVf )t6 VLWXDWLRQ LV GLIIHUHQW VLQFH WKH JURXS ZDV QRW GHVLJQHG ZLWK WKH LQWHQW WR ZRUN VSHFLILFDOO\ ZLWK WKH JUDVVURRWV :KLOH VRPH RI WKHLU SXEOLFDWLRQV DUH HGXFDWLRQDO PDWHULDO IRU WKH WUDLQLQJ RI RWKHU ZRPHQ IRUPDJDRf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n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nVLVWHPDWL]DUn V\VWHPDWL]Hf LW 3XEOLFDWLRQV VHHPHG WKH ZD\ WR JR 1DUD H[SODLQV LW LQ WKRVH WHUPV :H DUH \HDUV ROG :KDW

PAGE 228

LV RXU UROH WRGD\" 637 ZKHQ MRLQHG >LQ @ DOUHDG\ KDG WKLV SUHRFFXSDWLRQ ZLWK WKH DUWLFXODWLRQ WKH V\VWHPDWL]DWLRQ DQG WKH SURGXFWLRQ RI HGXFDWLRQDO PDWHULDOV %XW 637 KDG QHYHU PDQDJHG WR WXUQ WKLV LQWR VRPHWKLQJ FRQFUHWH >@ 7KH %XOOHWLQ LV RXU ILUVW SRVLWLYH H[SHULHQFH 7KH GHVLUH WR V\VWHPDWL]H RQHnV H[SHULHQFH LV QRW XQLTXH WR 1*2V EXW LV D WUHQG DPRQJVW RUJDQL]DWLRQV WKDW KDYH DFFXPXODWHG H[SHULHQFH RYHU WKH \HDUV .DQQDELUDQ DQG .DQQDELUDQ f GHVFULEH D VLPLODU SURFHVV IRU D YROXQWHHU IHPLQLVW RUJDQL]DWLRQ LQ ,QGLD +RZHYHU LW LV OLNHO\ WR EH FRPSRXQGHG LQ 1*2V E\ WKH IDFW WKDW WKH\ PLJKW IHHO WKH SUHVVXUH WR UHPDLQ RQ WRS RI WKLQJV LI WKH\ DUH WR VHFXUH DQG PDLQWDLQ IXQGLQJ RU EHFDXVH WKH\ VHH WKHPVHOYHV DV WKH YDQJXDUG YDQJXDUGD VRFLDOf DV $QD 0DULD DQG 6DQGUD RI )t6 SXW LW )RU ZKDWHYHU UHDVRQ 1*2V LQFUHDVLQJO\ IHHO WKH QHHG WR GHHSHQ WKHLU NQRZOHGJH 1DUD 637f H[SODLQV WKDW WKH NQRZOHGJH SURGXFWLRQ SURFHVV KDV VKLIWHG SDUWO\ IURP DQ LQGXFWLYH HIIRUW VWDUWLQJ ZLWK WKH JUDVVURRWV WR D PRUH GHGXFWLYH SURFHVV ZKLFK VKH FDOOV WKHRUHWLFDO GHHSHQLQJ VR WRSLFV ZHUH GLVFXVVHG D ORW ZLWK WKH TXHVWLRQV WKDW FDPH RXW RI WKH UHJLRQ DQG QRW VR PXFK ZLWK WKLV LVVXH RI WKHRUHWLFDO GHHSHQLQJ RI WKLV nOHWnV VHH KRZ ZH FDQ OHDUQ WKHRUHWLFDOO\n 7KH GHVLUH IRU SHUVRQDO JURZWK IRU 1*2 PHPEHUV DOVR KDV WR EH WDNHQ LQWR DFFRXQW ZKHQ FRQVLGHULQJ ZK\ WKHUH LV OHVV DFWLRQ LQ WKH SHULSKHU\ ,QGHHG SURIHVVLRQDOL]HG DFWLYLVWV GR QRW KDYH DQRWKHU SURIHVVLRQDO DUHQD WR IXOILOO WKLV QHHG VHH FKDSWHU f 7KH QHHG WR H[SHULPHQW WR H[SORUH QHZ KRUL]RQV DQG WR WU\ RQHVHOI RXW DW QHZ FKDOOHQJHV WHQGV WR GULYH 1*2 SDUWLFLSDQWV DZD\ IURP ORFDO ZRUN 4XRWH IURP D UHVHDUFK UHSRUW GRQH RQ 637 LQ SDJH f

PAGE 229

7KH EHVW H[DPSOH LV SUREDEO\ WKDW RI 0DULQD RI 637 ZKR LV D GHYRWHG 1*2 DFWLYLVW FRPPLWWHG WR EXLOGLQJ XS WKH ZRPHQnV PRYHPHQW EDVH 6KH OHIW WKH (DVWHUQ SHULSKHU\ ZLWK D KHDUWDFKH FRP GRU QR FRUDQGRf EHFDXVH VKH NQHZ LW ZDV JRRG RSSRUWXQLW\ IRU KHU WKLQN WKDW LW ZDV LQ WKDW SK\VLFDOO\ OHIW WKH (DVWHUQ 3HULSKHU\ ZLWK SDLQ LQ P\ KHDUW >@ ZDV VWLOO LQ WKH RUJDQL]DWLRQ >@ UHVSRQGLQJ WR WKH GHPDQGV IRU IHPLQLVW WUDLQLQJ DQG DW WKDW WLPH ZDV DOVR D PHPEHU RI WKH FRRUGLQDWLRQ 6R WKLV ZDV D YHU\ GLIILFXOW FKDQJH IRU PH $W WKH VDPH WLPH ZDQWHG LW NQHZ WKDW LW ZDV LPSRUWDQW ,Q D ZD\ LW HQGV XS EHLQJ D FHUWDLQ OHYHO RI VSHFLDOL]DWLRQ HYHQ LI ZH GRQn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t6 DQG DQRWKHU LQ D SRSXODU IHPLQLVW JURXS FRJHQWO\ QRWHG RQH GD\ WKDW ZRPHQ IURP WKH QHLJKERUKRRGV VKRXOG VWDUW UHIOHFWLQJ XSRQ WKHLU GLIILFXOWLHV WR GHDO ZLWK WKH VLWXDWLRQ DQG ZLWK WKH ZRPHQ ZKR QHHG WR EH RUJDQL]HG WKHUH 'HLVH IURP 637 ZKR KDV ZRUNHG ZLWK ZRPHQ LQ SRSXODU PRYHPHQWV IRU VHYHUDO \HDUV QRZ KDG DQ RSLQLRQ RQ WKH PDWWHU ZKLFK FRQYLQFHG PH %DVLFDOO\ VKH VDLG WKH ZRPHQ VWLOO WKLQN WKDW WKH IHPLQLVWV DUH WKH RWKHUV DV IHPLQLVWDV VDR DV RXWUDVf ,QGHHG HQFRXQWHUHG QXPHURXV VLWXDWLRQV ZKLFK WHVWLILHG WR SRSXODU IHPLQLVWVn ODFN RI FRQILGHQFH LQ WKHLU DELOLWLHV WR OHDG D ZRUNVKRS RU D GHEDWH IRU ZRPHQ HWF )RU H[DPSOH VRPH ZRPHQ IURP WKH *UXSR GH 0XOKHUHV GD =RQD /HVWH ZHUH VXSSRVHG WR JLYH D ZRUNVKRS RQ ZRPHQ DQG YLROHQFH DW WKH ,' :RPHQnV 0HHWLQJ LQ 6DR 0DWHXV FHOHEUDWLQJ WKH ,QWHUQDWLRQDO :RPHQnV 'D\ 7KH\ HQGHG

PAGE 230

XS FDQFHOLQJ WKH ZRUNVKRS *ORULD WKH 637 WHFKQLFDO VWDII ZKR JLYHV WKHP DVVHVVRULD VXSSRUWf VDLG WKDW WKH ZRPHQ GLG QRW IHHO SUHSDUHG WR JLYH WKH ZRUNVKRS 6KH MRNLQJO\ DQG DIIHFWLRQDWHO\ DGGHG WKDW WKH\ ZHUH PHGURVDV FRZDUGVf 6LPLODUO\ 5RVD ZKR LV D PHPEHU RI 08 DQG ZRUNV LQ D QFOHR LQ D IDUDZD\ QHLJKERUKRRG UHSHDWHG VHYHUDO WLPHV GXULQJ KHU LQWHUYLHZ WKDW VKH GLG QRW KDYH WKH QHFHVVDU\ NQRZOHGJH WR FRQGXFW PHHWLQJV ZLWK WKH ZRPHQ DQG GLVFXVV ZRPHQnV FRQGLWLRQ 6KH XVXDOO\ LQYLWHV SHRSOH WR JLYH WDONV 6KH ZDV QRW FRQYLQFHG ZKHQ WROG KHU WKDW LW ZDV PDLQO\ D PDWWHU RI JHWWLQJ WKH ZRPHQ WRJHWKHU :KDW LV DW WKH URRW RI WKLV ODFN RI FRQILGHQFH" )LUVW RI DOO LW LV JRRG WR UHPHPEHU WKDW LI PRVW RI WKHVH ZRPHQ KDYH EHHQ SRSXODU DFWLYLVWV IRU VHYHUDO \HDUV WKH\ KDYH DVVXPHG WKHLU IHPLQLVW LGHQWLW\ RQO\ UHFHQWO\ XVXDOO\ LQ WKH V 7R VHH WKHPVHOYHV DV IHPLQLVWV DQG DFWXDOO\ SHUIRUP WKH FRQVFLRXVQHVVUDLVLQJ DQG RUJDQL]LQJ DURXQG ZRPHQnV LVVXHV SHU VH FDUULHV D ORW PRUH SHUVRQDO WKUHDWV WR WKHP EHFDXVH RI WKH DQWLPHQ ODEHO WKDW WKH\ IHDU EHLQJ VWXFN ZLWK $ FHUWDLQ GHJUHH RI GHSHQGHQF\ KDV DOVR GHYHORSHG EHWZHHQ WKHVH JURXSV DQG WKH JURXSV ZKLFK SURYLGH WKHP ZLWK DVVHVVRULD RU HYHQ ZLWK WKHLU SDLG DFWLYLVWV FDOOHG OLEHUDGRV 7ZR RI WKH PRVW VHDVRQHG SRSXODU IHPLQLVWV LQ WKH =RQD /HVWH DWWHVW WR WKLV SURFHVV )HUQDQGD VDLG GXULQJ D PHHWLQJ RI 0RYLPHQWR 0XOKHU H 6DGH 006f ZH DOZD\V OHW WKRVH ZKR DUH SDLG GR WKH MRE %HFDXVH RI WKLV ZH HQG XS QRW OHDUQLQJ VHPSUH GHL[DPRV TXHUQ UHFHEH ID]HU DV FRLVDV $VVLP GHL[DPRV GH DSUHQGHU f &HFLOLD IRU KHU SDUW DFNQRZOHGJHG WKDW VKH KDV QR LGHD DERXW WKH GRQRU DJHQF\ ZKLFK LV ILQDQFLQJ WKHLU FDPSDLJQ DJDLQVW J\QHFRORJLFDO FDQFHU 6KH VDLG GRQnW HYHQ ZRUU\ DERXW NQRZLQJ ZKDW WKLV DFURQ\P 7KLV LV QRW D VPDOO SKHQRPHQRQ $FFRUGLQJ WR $QD 0DULD 'RLPR b RI WKH SDUWLFLSDQWV LQ D SRSXODU PRYHPHQW QDWLRQDO FRQIHUHQFH LQ ZHUH SDUWWLPH RU IXOOWLPH OLEHUDGRV FRPSHQVDWHG ZLWK SURMHFW PRQH\ WR HQVXUH D SHUPDQHQW FRQWDFW DQGRU WR ZRUN ZLWK WKH EDVH f

PAGE 231

PHDQV \RX NQRZ ,WnV OLNH WKLV 'HLVH NQRZV VR ZH OHW KHU WDNH FDUH RI LW 1HP PH SUHRFXSR HP VDEHU R TXH TXHU GL]HU HVVD VLJOD YLX ( FRPR DVVLP D 'HLVH VDEH HQWDR D JHQLH GHL[D SUD HOD UHVROYHUf 'XULQJ WKH VDPH FRQYHUVDWLRQ D KLQW FUHSW XS DERXW DQRWKHU FRQWULEXWLQJ IDFWRU WR WKH VK\QHVV RI SRSXODU IHPLQLVWV LQ WDNLQJ XS WKH UROH RI WKH IHPLQLVWV IURP WKH &LW\ &HFLOLD LV RQH RI WKH SLRQHHUV RI SRSXODU IHPLQLVP DQG KDV EURNHQ PRUH WKDQ RQH JHQGHU WDERR LQ KHU SHUVRQDO OLIH
PAGE 232

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nV KHDOWK 1*2V ZLWK WKH H[FHSWLRQ RI 637 XVXDOO\ KDYH DFFHVV WR QHLJKERUKRRG ZRPHQ WKURXJK DQ HVWDEOLVKHG SRSXODU IHPLQLVW JURXS 7KLV LV WUXH RI )t6 ZRUNLQJ ZLWK 7KH &DVD DQG DQRWKHU JURXS WKH\ IRVWHUHG LQ WKH V 7KLV DOVR KDSSHQHG IRU D

PAGE 233

EODFN ZRPHQnV 1*2 ZKR GHYHORSHG RQH RI LWV SURMHFWV RQ $,'6FRQWUDFHSWLRQ SDUWLDOO\ ZLWK D IHPLQLVW YROXQWHHU RUJDQL]DWLRQ ZKLFK GRHV QRW IRFXV RQ HWKQLFUDFLDO LVVXHV 7KHVH HYHQWV KLQW DW WKH ZHDNQHVV RI PRVW 1*2 WLHV ZLWK SHULSKHULFDO QHLJKERUKRRG JURXSV 7KLV ZHDNQHVV LV DFNQRZOHGJHG E\ WKH OHDGHUV RI WKH ODUJHU IHPLQLVW 1*2V f§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n PRVW XELTXLWRXV ZRUNLQJ LQVWUXPHQWV QDPHO\ SURMHFWV QHHG WR EH FRQVLGHUHG *URXS&DSDFLW\ %XLOGLQJ ,W LV JRRG WR UHPHPEHU WKDW LW WDNHV WLPH WR IRUP D FRKHVLYH JURXS ,W WRRN %HDWUL] DQG 0RHPD RI 7KH &DVD RQH \HDU RI FRQWLQXRXV ZRUN WZLFH D PRQWKf WR FRQVROLGDWH D JURXS RI WHHQDJH JLUOV IRU D IXQGHG SURMHFW RQ VH[XDOLW\ DQG FRQWUDFHSWLRQ LQ DGROHVFHQFH (DUO\ LQ WKH SURFHVV WKH\ FRPSODLQHG RI KLJK WXUQRYHU EXW E\ WKH WLPH YLVLWHG WKHLU ZRUNVKRSV WKH\ KDG D FRUH JURXS RI UHJXODU SDUWLFLSDQWV 6LPLODUO\ 7DWLDQD 0XOKHUHV 8QLGDVf QRWHG KRZ HDVLO\ ZRPHQ FDPH WRJHWKHU IRU D PHHWLQJ ZLWK KHU LQ -DUGLP %RD (VSHUDQ]D DOWKRXJK WKHUH ZDV DQRWKHU PHHWLQJ JRLQJ RQ DW WKH VDPH WLPH DQG VKH KDG QRW EHHQ LQ WKDW QHLJKERUKRRG IRU VHYHUDO PRQWKV 7KLV QHLJKERUKRRG ZDV ERP \HDUV DJR DV DQ LQYDGHG

PAGE 234

VHWWOHPHQW 08 KDG EHHQ LQYROYHG ZLWK WKLV FRPPXQLW\ VLQFH WKH EHJLQQLQJ 7KLV ORQJWHUP LQYROYHPHQW H[SODLQHG WKH JRRG WXUQRXW 7KH GLIILFXOWLHV HQFRXQWHUHG E\ 5RVLPHLUH LQ FRQVROLGDWLQJ WKH JURXS PLJKW WKHUHIRUH GLVDSSHDU ZLWK ORQJWHUP LQYROYHPHQW %XW WKH SURMHFW LWVHOI GRHV QRW UHTXLUH ORQJWHUP LQYROYHPHQW RI )t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

PAGE 235

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nV JURXSV ,Q WKH VLWXDWLRQ ZKLFK REVHUYHG QRW RQO\ ZDV WKH WRSLF DOUHDG\ GHFLGHG EXW WKH IRUPDW ZDV DOVR H[WUHPHO\ UHVWULFWLYH WKH SDUWLFLSDQWV ZHUH WR DQVZHU D OHQJWK\ UHSHWLWLYH TXHVWLRQQDLUH WZLFH WKDW LV EHIRUH DQG DIWHU KDYLQJ SDUWLFLSDWHG LQ D VHULHV RI ZRUNVKRSV EDVHG RQ DQ HGXFDWLRQDO EURFKXUH SUHYLRXVO\ GHVLJQHG $FFRUGLQJ WR WKH SURMHFW SXW WRJHWKHU LQ FRQMXQFWLRQ ZLWK WKH GRQRU WKH SXUSRVH RI WKH ZKROH H[SHULPHQW ZDV WR WHVW WKH HIIHFWLYHQHVV RI WKH EURFKXUH DQG RI ZRPHQ RQO\ YHUVXV PL[HG JURXSV LQ $,'6 SUHYHQWLRQ 7KH WZR ZRPHQ UHVSRQVLEOH IRU WKLV SURMHFW ZHUH WKHPVHOYHV TXLWH GLVVDWLVILHG ZLWK WKH IRUPDW DQG KDG WULHG WR QHJRWLDWH ZLWK WKHLU GRQRU D QRUWKHUQ IHPLQLVW 1*2 D PHWKRGRORJ\ PRUH DSSURSULDWH WR WKH UHDOLW\ RI WKH QHLJKERUKRRG ZRPHQ 7R OLWWOH DYDLO ZDV SHUVRQDOO\ DSSDOOHG DW WKLV ODFN RI VHQVLWLYLW\ RQ WKH SDUW RI WKH QRUWKHUQ 1*2 ,Q IDFW OHDUQW ODWHU WKDW RULJLQDOO\ WKH %UD]LOLDQ 1*2 ZRPHQ LQWHQGHG WR FDSDFLWDU WUDLQf ZRPHQ LQ WKH PRYHPHQW WR ZRUN ZLWK WKH HGXFDWLRQDO PDWHULDO QRW WR FRQGXFW UHVHDUFK %XW WKH QRUWKHUQ GRQRU KDG RWKHU SODQV $W WKDW SRLQW WKH %UD]LOLDQ 1*2 DFWLYLVWV ZHUH KRSLQJ WR SURPRWH DW OHDVW VHOIn HVWHHP DQG HPSRZHUPHQW DPRQJ WKH SDUWLFLSDQWV DQG WR KDYH D IHZ RI WKHP MRLQ WKH SRSXODU IHPLQLVW JURXS WKH\ KDG EHHQ UHFUXLWHG WKURXJK ,Q RUGHU WR PDNH WKH SURMHFW PRUH SDODWDEOH WR WKH SDUWLFLSDQWV HVSHFLDOO\ WKH EHJLQQLQJ SDUW RI LW ZKLFK HQWDLOHG JRLQJ WKURXJK WKH TXHVWLRQQDLUH ZLWKRXW DQ\ SUHSDUDWLRQ WKH %UD]LOLDQ

PAGE 236

1*2 ZRPHQ FUHDWLYHO\ WKRXJKW RI RIIHULQJ WKH ZRPHQ DQ RILFLP GH EHOH]D EHDXW\ ZRUNVKRSf ZKLFK VKRZHG WKH ZRPHQ KRZ WR XVH FKHDS HYHU\GD\ SURGXFWV LQ DQ DOWHUQDWLYH ZD\ WR WDNH FDUH RI WKHPVHOYHV WKXV UHLQIRUFLQJ WKHLU VHOIHVWHHP /DWHU WKH SDUWLFLSDQWV ZHUH LQYLWHG WR OD\ RQ WKH IORRU DQG JXLGHG WR D UHOD[HG VWDWH VRPHWKLQJ PRVW RI WKHP SUREDEO\ KDG QHYHU GRQH EHIRUH 7KH EURDG VPLOHV RQ WKHLU IDFHV DV WKH\ OD\ RQ WKH FDUSHWHG IORRU ZHUH TXLWH WHOOLQJ RI WKHLU SRVLWLYH VWDWH RI PLQG 7KHQ FDPH WKH TXHVWLRQQDLUH 7KH LPSRVHG VFLHQWLILF PRGHO RI EHIRUH DQG DIWHU H[SHULPHQW ZDV DOVR WURXEOHVRPH WR RXU WZR WHFKQLFDO VWDII EHFDXVH WKH TXHVWLRQV UHJDUGLQJ $,'6 DQG VH[XDOLW\ ZHUH LQWUXVLYH DQG H\HRSHQLQJ WR WKH SDUWLFLSDQWV ZLWK UHJDUG WR WKH ULVNV RI JHWWLQJ WKH GLVHDVH EHFDXVH RI DQ XQIDLWKIXO KXVEDQG 3ULQFLSDOO\ VKRXOG WKH ZRPDQ QRW FRPH EDFN IRU WKH IROORZLQJ ZRUNVKRSV WKH ZRPDQ ZRXOG EH OHIW WR KHU GRXEWV DQG ZRQGHULQJ 7KH 1*2 KDG WULHG WR PLQLPL]H WKLV SUREOHP E\ ZRUNLQJ ZLWK ZRPHQ ZKR NQHZ D PHPEHU RI D QHLJKERUKRRG ZRPHQnV JURXS 7KH SURMHFW SURSRVDO ZDV H[WUHPHO\ SUHFLVH DV WR KRZ WKH ZRUNVKRSV VKRXOG EH FRQGXFWHG ,W ZHQW DV IDU DV WR VSHFLI\ WKDW WKH WHFKQLFDO VWDII VKRXOG DVN WKH ZRPHQ WR LQWURGXFH WKHPVHOYHV IURP ULJKW WR OHIW 7KH VWDII ZDV DOVR VXSSRVHG WR LQWURGXFH WKHPVHOYHV DQG H[SODLQ WKH SXUSRVH RI WKH SURMHFW RQO\ DIWHU WKH TXHVWLRQQDLUH KDG EHHQ JLYHQ IRU WKH ILUVW WLPH :KDWHYHU KDSSHQHG WR WKLV GRQRUn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

PAGE 237

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f DQG QHHG WR FRQWLQXH LQ WKLV GLUHFWLRQ &RPLQJ EDFN WR RXU RULJLQDO SDUDGR[ RI 1*2V KDYLQJ WURXEOH EULQJLQJ WRJHWKHU JURXSV WR ZRUN ZLWK ZKLOH QHLJKERUKRRG IHPLQLVWV DUJXH WKDW WKHUH LV QRZ OHVV LQWHUDFWLRQ LW PLJKW FRPH IURP WKH GLVFUHSDQF\ LQ H[SHFWDWLRQV DQG LQWHUHVWV EHWZHHQ WKH GLIIHUHQW DFWRUV ,QGHHG ZKHQ H[SHFWDWLRQ DQG LQWHUHVW PHHW WKH UHVXOW LV LPSUHVVLYH UHPHPEHU WZR ZRUNVKRSV ZKLFK ZHUH SDUWLFXODUO\ VXFFHVVIXO DOWKRXJK WKHUH ZHUH RWKHUV 2QH ZDV JLYHQ E\ 5RVLPHLUH )t6f DW

PAGE 238

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f 1R GRXEW WKH RUJDQL]LQJ VWUHQJWK RI WKH +HDOWK 0RYHPHQW RI WKH (DVWHUQ 3HULSKHU\ ZDV EHKLQG WKH QXPEHUV EXW WKH WRSLF ZDV REYLRXVO\ DSSHDOLQJ ,Q ERWK FDVHV WKHUH ZDV SOHQW\ RI URRP IRU WKH ZRPHQ WR H[SUHVV WKHPVHOYHV DQG DVN TXHVWLRQV ,W LV DOVR JRRG WR UHPHPEHU WKDW LI 1*2V FDQ EH FRQVWUDLQHG E\ GRQRUVn SUHIHUUHG WKHPHV DQG SUDFWLFHV YROXQWHHU RUJDQL]DWLRQV DOVR KDYH WKHLU DJHQGD DQG ZRUN DORQJ FHUWDLQ WKHPHV ZKLFK WKH\ GHHP LPSRUWDQW +RZHYHU LI WKH\ DUH WR PRELOL]H ZRPHQ WKH\ KDYH WR EH DWWHQWLYH WR WKH ODWWHUn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

PAGE 239

WR ZRUN RQ 0LOnV DFWLYLVWV PD\EH DV D UHVXOW RI WKHLU SROLWLFDO LGHRORJ\ f§WKH\ XVHG WR EH OLQNHG WR WKH &RPPXQLVW 3DUW\f§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

PAGE 240

OLWWOH HQWKXVLDVP RQ WKH SDUW RI QHLJKERUKRRG ZRPHQ 9ROXQWHHU IHPLQLVW RUJDQL]DWLRQV HYHQ LI WKH\ KDYH D JLYHQ DJHQGD PXVW HQVXUH WKH SDUWLFLSDWLRQ DQG WKH VDWLVIDFWLRQ RI ZRPHQ LQ DOO VWDJHV RI WKHLU DFWLYLWLHV RWKHUZLVH WKH ZRPHQ ZLOO QRW FRPH EDFN DQG WKH\ UHSUHVHQW WKHLU PDLQ UHVRXUFH DQG UHDVRQ IRU H[LVWHQFH 7KLV LVVXH JRHV EDFN WR WKH SROLWLFV RI QHHGV LQWHUSUHWDWLRQ LGHQWLILHG E\ 1DQF\ )UDVHU f )HPLQLVW JURXSV DQG 1*2V DUH FHUWDLQO\ LQ D SULYLOHJHG SRVLWLRQ WR GHIHQG DOO ZRPHQnV QHHGV DQG LQWHUHVWV YLV£YLV WKH 6WDWH 7KH\ DUH FRPSOHWLQJ D FUXFLDO WDVN +RZHYHU DV IHPLQLVW 1*2 OHDGHUVn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nV 1*2V LQFUHDVLQJ SDUWLFLSDWLRQ LQ QDWLRQDO DQG LQWHUQDWLRQDO SROLWLFV

PAGE 241

&+$37(5 3877,1* 21 7+( 522) %()25( /$<,1* 7+( )281'$7,216" )(0,1,67 1*2V 7+( 81,7(' 1$7,216 $1' 7+( 67$7( /RRNLQJ DW SLFWXUHV RI KHUVHOI WDNHQ GXULQJ D GHPRQVWUDWLRQ D IHZ \HDUV DJR D OHDGLQJ SURIHVVLRQDOL]HG DFWLYLVW UHPHPEHUHG ZLWK QRVWDOJLD KRZ KHDOWK\ DQG EHDXWLIXO VKH ZDV LQ WKRVH GD\V 6KH WXUQHG WR DQRWKHU ORQJWLPH DFWLYLVW :KHQ WKH LQVWLWXWLRQDO DJHQGD FDPH XSRQ XV WKDW ZDV WKH HQG RI XV 4XDQGR D DJHQGD LQVWLWXFLRQDO QVSHJRX QV IHUUDPRVf ,QWURGXFWLRQ 7KH SHULRG RI WUDQVLWLRQ SROLWLFV LQ %UD]LO DV LQ RWKHU /DWLQ $PHULFDQ QDWLRQV KDV RIIHUHG D UDSLG RSHQLQJ RI SRVVLELOLWLHV IRU GLDORJXH DQG QHJRWLDWLRQ ZLWK QDWLRQDO DXWKRULWLHV $OYDUH] f 7KH LQYROYHPHQW RI VHFWRUV RI FLYLO VRFLHW\ LQ WKH FRQVWLWXWLRQDO SURFHVV LQ YDULRXV QDWLRQDO DQG VWDWH &RXQFLOV DQG LQ 6DR 3DXOR WKH SDUWLFLSDWLRQ RI IHPLQLVW DFWLYLVWV LQ WKH &RRUGHQDGRULD GD 0XOKHU ZRPHQfV &RRUGLQDWLRQf RI /XLVD (UXQGLQDfV PXQLFLSDO JRYHUQPHQW SDYHG WKH ZD\ IRU SROLF\RULHQWHG DQG OREE\LQJ ZRUN RQ WKH SDUW RI VRFLDO PRYHPHQWV 5HFHQW \HDUV KDYH DOVR VHHQ DQ LQFUHGLEOH LQYROYHPHQW RI FLYLO VRFLHW\ DW WKH OHYHO RI WKH 81 $FFRUGLQJ WR *RUGHQNHU DQG :HLVV f WKLV IRUD\ RI 1*2V LQ WKH 81 PLOLHX LV QRW RQO\ D UHVXOW RI WKHLU UHSXWDWLRQ IRU FRVWHIIHFWLYHQHVV RU RI WHFKQRORJLFDO GHYHORSPHQWV VXFK DV ID[ DQG F\EHUFRPPXQLFDWLRQ EXW DOVR D FRQVHTXHQFH RI WKH HQG RI WKH FROG ZDU ,Q WKLV QHZ PRUH UHOD[HG LQWHUQDWLRQDO DWPRVSKHUH LQ ZKLFK IHDU RI QHRLPSHULDOLVW RU FRPPXQLVW LQWHUYHQWLRQV KDYH UHFHGHG WKH QHHG IRU KLJK SROLWLFV DQG VHFXULW\ SDUWLFXODUO\ RYHU QXFOHDU

PAGE 242

LVVXHV JDYH ZD\ WR WKH ULVH RI ORZ SROLWLFV LQ ZKLFK 1*2V KDG D FRPSDUDWLYH DGYDQWDJH GXH WR WKHLU FDSDFLW\ IRU GLUHFW DFWLRQ DQG DGYDQFHG NQRZOHGJH >@ RQ LVVXHV VXFK DV JHQGHU WKH HQYLURQPHQW $,'6 UHOLHI DVVLVWDQFH KXPDQ ULJKWV DQG FRPPXQLW\ GHYHORSPHQW *RUGHQNHU DQG :HLVV f ,Q WKH FDVH RI ZRPHQnV 1*2V WKH DFNQRZOHGJPHQW RI WKH QHHG WR LQFRUSRUDWH ZRPHQ LQ GHYHORSPHQW HIIRUWV SDUWO\ D UHVXOW RI WKH DEVRUSWLRQ E\ PXOWLODWHUDO LQVWLWXWLRQV RI WKH ZRPHQ LQ GHYHORSPHQW GLVFRXUVH VHH &KDSWHU f DOVR FRQWULEXWHG WR WKH QHHG IRU WKHLU H[SHUWLVH RQ JHQGHU LVVXHV 7KH LQYROYHPHQW RI 6DR 3DXOR IHPLQLVW 1*2V LQ QDWLRQDO DQG LQWHUQDWLRQDO SROLWLFV VKRXOG EH XQGHUVWRRG LQ WKLV FRQWH[W RI LQVWLWXWLRQV LQ QHHG RI JHQGHU VSHFLDOLVWV FDOOLQJ XSRQ IHPLQLVW DFWLYLVWV ,Q IDFW VRPH SURIHVVLRQDOL]HG DFWLYLVWV UHIHU WR WKH WLPH ZKHQ WKH LQWHUQDWLRQDO DJHQGD FDPH XSRQ XV DV LI WKH\ KDG EHHQ VHL]HG LQ WKLV WZLUOLQJ RI DFWLYLWLHV RQ WKH SROLWLFDO VFHQH ZLWKRXW KDYLQJ FKRVHQ WR
PAGE 243

WKH VWDWH VKRXOG QRW EH YLHZHG DV LQ PRVW :HVWHUQ IHPLQLVW SRVWVWUXFWXUDOLVW DSSURDFKHV DV KDYLQJ RQO\ >@ RQH RXWFRPH WKH SURGXFWLRQ RInUHJXODWHG VXERUGLQDWHG DQG GLVFLSOLQHG VWDWH VXEMHFWV 5DL f 2Q WKH RWKHU KDQG LQIOXHQFLQJ WKH VWDWH LQ WKH LQWHUHVW RI ZRPHQ E\ LQILOWUDWLQJ LW VKRXOG QRW EHFRPH WKH PDLQ VWUDWHJ\ IRU VRFLDO FKDQJH DV DPRQJ WKH $XVWUDOLDQ IHPRFUDWV LELGf $QDO\VHV RI WKH VWDWH E\ WKLUG ZRUOG IHPLQLVWV KDYH EHHQ PRUH QXDQFHG VKRZLQJ WKDW WKH VWDWH LV JHQHUDOO\ LQ V\PELRVLV ZLWK SDWULDUFK\ EXW WKDW LW FDQ EH XVHG E\ ZRPHQnV PRYHPHQWV WR SURPRWH JHQGHU HTXLW\ XQGHU JLYHQ UHJLPHV DQG FRQGLWLRQV HVSHFLDOO\ LI FRQWUDGLFWLRQV ZLWKLQ LW DUH H[SORLWHG LELG f ,Q RWKHU ZRUGV WKH VWDWH DQG VXSUDQDWLRQDO DXWKRULWLHV DUH LPSRUWDQW DUHQDV IRU VWUXJJOH IRU ZRPHQ DQG IRU WKDW PDWWHU IRU RWKHU RSSRVLWLRQDO VHFWRUV ZLWKLQ FLYLO VRFLHW\ +RZHYHU WKH\ VKRXOG QRW EHFRPH WKH SULRULW\ WR WKH GHWULPHQW RI WKH IHPLQLVW PLFUROHYHO FXOWXUDO FKDQJH SURMHFW ,Q WKLV FKDSWHU GLVFXVV KRZ WKLV LQFUHDVHG LQYROYHPHQW LQ SROLF\IRUPXODWLRQ DW WKH QDWLRQDO DQG LQWHUQDWLRQDO OHYHOV KDV EHHQ DFFRPSDQLHG E\ D PRYH DZD\ IURP WKH PRELOL]LQJ DQG VROLGDULW\EXLOGLQJ ZRUN RI WKH ZRPHQf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

PAGE 244

$ 0RYH $ZD\ IURP /RFDO DQG 6WUHHW $FWLYLWLHV $PRQJ WKH ZRPHQfV KHDOWK SURIHVVLRQDOL]HG JURXSV DFWLYH LQ WKH 6DR 3DXOR DUHD WKUHH RXW RI IRXU DUH SROLF\FHQWHUHG 637 LV WKH RQO\ RQH IRU ZKRP ORFDO RUJDQL]LQJ DQG FRQVFLRXVQHVVUDLVLQJ LV FRQVLGHUHG LPSRUWDQW E\ WKH OHDGHUVKLS
PAGE 245

1DWLRQDO (QFRQWURV KDG EHHQ RUJDQL]HG DQQXDOO\ IURP XQWLO DQG WZR PRUH ZHUH KHOG LQ DQG
PAGE 246

G\QDPLFV *UDQWHG WKH ILUVW SDUW RI WKH PHHWLQJ ZDV RUJDQL]HG DV D GHEDWH ZLWK WKH LQWHQW WR H[FKDQJH LGHDV ZLWK RXWVLGH SOD\HUV LQ WKH ILHOG RI UHSURGXFWLYH KHDOWK VXFK DV UHSUHVHQWDWLYHV RI WKH +HDOWK 0LQLVWU\ UHVHDUFKHUV DQG UHSUHVHQWDWLYHV RI WKH SXEOLF KHDOWK PRYHPHQW VDQLWDULVWDVf DV ZHOO DV WR SURYLGH D SXEOLF IRUXP IRU WKH 5HGHnV SRVLWLRQ 1HYHUWKHOHVV WKH RYHUDOO IRUPDW RI WKH GHEDWH KDG YHU\ IHZ FKDUDFWHULVWLFV RI D IHPLQLVW HYHQW EXW ZDV WKRXJKW RXW DV D WUDGLWLRQDO DFDGHPLF FRQIHUHQFH ZLWK SDQHOLVWV XS RQ D SRGLXP GHOLYHULQJ IDLUO\ OHQJWK\ SUHVHQWDWLRQV WR D OLVWHQLQJ DXGLHQFH 6RPH WLPH ZDV DOORFDWHG IRU TXHVWLRQDQVZHU VHVVLRQV 7LWOHV VXFK DV GRWRU DQG GRWRUD GRFWRUf ZHUH XVHG LQFOXGLQJ IRU VRPH RI WKH IHPLQLVW SDUWLFLSDQWV WKXV LQFUHDVLQJ WKH GLVWDQFH EHWZHHQ WKH SRGLXP DQG WKH DXGLHQFH $V D 6DR 3DXOR IHPLQLVW FRPPHQWHG WKH SHRSOH RQ WKH SRGLXP ZHUH SUHVHQWHG DV HVWUHODV VWDUVf 0\ ILHOG QRWHV UHDG 7KHUH ZDV QR SDXVH EHWZHHQ WKH WDONV DQG WKH GHEDWH ZKLFK PDGH WKH ZKROH VHVVLRQ H[WUHPHO\ WLUHVRPH $V D UHVXOW SHRSOH ZHUH OHDYLQJ WKH URRP FKDWWLQJ LQ WKH FRPHUV GULQNLQJ PXOWLSOH FRIIHHV > @ 6LPLODUO\ WR WKH (QFRQWU >WKH DFWXDO 5HGH DQQXDO PHHWLQJ ZKLFK WRRN SODFH LPPHGLDWHO\ DIWHU WKLV WZRGD\ GHEDWH@ WKHUH ZDV QR RSHQLQJ RU HQFHUUDPHQWR FORVLQJ FHUHPRQ\f DV IHPLQLVWV NQRZ KRZ WR GR WKHP ,W ZDV DQ H[WUHPHO\ IRUPDO IRUPDW ZHQW RQ FRPPHQWLQJ WKLV WLPH DERXW WKH G\QDPLFV XVHG GXULQJ WKH (QFRQWU LWVHOI (YHQ IRU WKH (QFRQWU WKHUH ZDV QR QHDW RSHQLQJ QRWKLQJ WR ZDUP XS WKH ZRPHQ WR PDNH WKH PRUH KXPLOGH >WKH PRUH TXLHW RQHV XVXDOO\ FRUUHODWHG ZLWK D ORZHU VRFLRn HFRQRPLF SRVLWLRQ@ IHHO FRPIRUWDEOH WKHUH WR HQWLFH WKHP WR WDON ODWHU $W OHDVW WKH FKDLUV ZHUH RUJDQL]HG LQ D FLUFOH 7KHUH ZDV QR HQFHUUDPHQWR HLWKHU ([FHSW IRU D FRIIHH EUHDNW\SH EXIIHW WR ZKLFK KDUGO\ DQ\RQH ZHQW DV IDU DV NQRZ EHFDXVH VDZ SHRSOH UXQQLQJ RXW WKH RQO\ PRPHQW ZKLFK VDZ DV FROOHFWLYH LGHQWLW\EXLOGLQJ ZDV WKH VNLW WKDW WKUHH ZRPHQ SUHSDUHG RQ

PAGE 247

6XQGD\ QLJKW GXULQJ ZKLFK WKH\ IRUPHG D FLUFOH DQG VDQJ 0DULD 0DULD 2WKHU WKDQ WKLV ULDGD >QRWKLQJ@ 7KH HYDOXDWLRQ RI WKH ZKROH IRXUGD\ HYHQW E\ D 6DR 3DXOR SRSXODU IHPLQLVW ZDV WKDW WKH ZD\ LW ZDV VWUXFWXUHG DQG WKH ODQJXDJH XVHG ZDV QRW PHDQW WR KDYH PDQ\ SHRSOH SDUWLFLSDWLQJ (UD SDUD SHUQHDV SHVVRDV SDUWLFLSDUHQ@f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fV 0DULD 0DULD FDQ EH VDLG WR KDYH WXUQHG LQWR D WUXH K\PQ RI WKH %UD]LOLDQ ZRPHQfV PRYHPHQW 5HOD[DWLRQ DFWLYLWLHV XVXDOO\ LQYROYLQJ LQWHUDFWLRQ RU PXWXDO WRXFKLQJ DPRQJ WKH SDUWLFLSDQWV 7KLV SRSXODU VRQJ HYRNHV WKH GDLO\ VWUXJJOH RI SRRU ZRPHQ OLNH 0DULD DV ZHOO DV WKHLU IDLWK LQ D EHWWHU IXWXUH ,Q WKLV VRQJ 0DULD LV D ZRPDQ ZKR GHVHUYHV WR OLYH DQG ORYH OLNH DQ\ RWKHU RQ WKH SODQHW 6KH DQG KHU SHRSOH ODXJK ZKHQ WKH\ VKRXOG EH FU\LQJ DQG GR QRW OLYH EXW KDUGO\ VXUYLYH
PAGE 248

DUH DQRWKHU H[DPSOH 3XUSOH SDSHU IORZHUV DOVR EORVVRPHG LQ ZRPHQfV KDLU DW PDQ\ VXFK JDWKHULQJV DV GLG WKH FRORU SXUSOH LQ JHQHUDO 7KH V\PEROLVP DWWDFKHG WR ZLWFKHV EURRP DQG SRLQW\ KDW LQFOXGHGf§ DSSURSULDWHG DQG VWULSSHG RI LWV QHJDWLYH FRQQRWDWLRQV LV DOVR D VWURQJ WKHPH LQ ZRPHQnV (QFRQWURV HVSHFLDOO\ RI WKRVH RUJDQL]HG E\ QHLJKERUKRRG ZRPHQ 7KHVH DUH JRRG H[DPSOHV RI WKH SDUDSKHUQDOLD RI ULWXDO ZKLFK .HUW]HU f DQG %OXPHU f KDYH LGHQWLILHG DV UHLQIRUFLQJ WKH IHHOLQJV RI EHORQJLQJ WR D VRFLDO PRYHPHQW ZKLFK PHQWLRQHG LQ &KDSWHU )RU H[DPSOH 637 SDUWLFLSDWHG LQ WKH RUJDQL]DWLRQ RI WKH ILUVW PHHWLQJ RI WKH ZRPHQ RI WKH &HQWUDO GRV 0RYLPHQWRV 3RSXODUHV RQ WKH WK 0DUFK $V ZH DQG VRPH ZRPHQ PHPEHUV RI YDULRXV SRSXODU PRYHPHQWV VWRRG XS IRU D PRYLQJ RSHQLQJ ULWXDO 1DUD RI 637 WXUQHG WR PH DQG VDLG ZLWK D WZLQNOH LQ KHU H\H $JRUD YDPRV UH]DU? 1RZ ZHfUH JRQQD SUD\f )ROORZHG VRQJV KDQGKROGLQJ DQG GHFODUDWLRQV RI LQWHQW IRU WKH GD\ 7KH XOWLPDWH LFHn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f 2Q DQ LQYLWDWLRQ WR RQH RI WKHLU SDUWLHV )t6 DOVR XVHG D SDSHU FOLSDUW UHSUHVHQWLQJ D VPLOLQJ ZLWFK IO\LQJ RII RQ KHU EURRP GUHVVHG RQO\ ZLWK KHU SRLQW\ KDW DQG FDSH IO\LQJ RII RQH RI KHU VKRXOGHUV SRLQWLQJ LQ RQH GLUHFWLRQ DV LI VKH VDLG FRPH WKLV ZD\

PAGE 249

ULWXDOV EULQJ SHRSOH FORVHU WRJHWKHU DQG WKDW WKH ZRUN WKH\ GR GXULQJ WKH GD\ LV LQIOXHQFHG E\ WKLV LQWURGXFWLRQ DOVR KDG WKH FKDQFH WR DFFRPSDQ\ ILYH ZRPHQ IURP 0RYLPHQLR 0XOKHU H 6FQnLGH WR D PHHWLQJ WKH\ KDG DUUDQJHG ZLWK WKH QHZO\ DSSRLQWHG 'LUHFWRU RI RQH +HDOWK $GPLQLVWUDWLYH 'LVWULFW RI WKH (DVWHUQ 3HULSKHU\ DW KLV KHDGTXDUWHUV $V VRRQ DV ZH HQWHUHG WKH VPDOO DXGLWRULXP WKH ZRPHQ FKDQJHG WKH SRVLWLRQ RI WKH FKDLUV ZKLFK ZHUH LQ WKH WUDGLWLRQDO OLQHDU DUUDQJHPHQW WR PDNH D FLUFOH DSSDUHQWO\ XQGLVWXUEHG E\ WKH GU\ FRPPHQWV RI WKH DGPLQLVWUDWLRQfV VWDII ZDV TXLWH LPSUHVVHG DW WKH ZD\ WKHVH ZRPHQ ZHUH GHWHUPLQHG WR PLQLPL]H DQG LQ D ZD\ GLG XQGHUPLQH WKH SRZHU RI WKH DXWKRULWLHV E\ FRPLQJ DV D JURXS DQG FUHDWLQJ WKLV FLUFOH LQ RWKHU ZRUGV E\ LPSRVLQJ WKHLU ZD\ RI GRLQJ UHIXVLQJ WR EH PROGHG LQWR WKH VXUURXQGLQJ EXUHDXFUDWLF FXOWXUH 7KH\ VWLOO KDG D ORW WR EDWWOH DJDLQVW LQ SDUWLFXODU WKH WHFKQRVFLHQWLILF ODQJXDJH XVHG E\ WKHVH DGPLQLVWUDWRUV DQG GRFWRUV VRPH RI WKHP GUHVVHG LQ ZKLWH RYHUFRDWV PHDQW WR LPSUHVV WKHP DQG NHHS WKHLU PRXWK VKXW 5HODWLRQV RI /RFDO 1DWLRQDO DQG 6XSUDQDWLRQDO $JHQGDV 7KH 8QLWHG 1DWLRQV FRQIHUHQFH RI JDYH D VHULRXV ERRVW WR ZRPHQfV RUJDQL]LQJ LQ %UD]LO ,Q IDFW DFWLYLVWV DUJXH WKH FRQVHTXHQFHV H[WHQGHG ZHOO EH\RQG ZKDW WKH 81 KDG LPDJLQHG 6FKXPDKHU t 9DUJDV f 7KLV VKRZV WKDW LQWHUQDWLRQDO WRSGRZQ HYHQWV FDQ DFW DV FDWDO\VWV IRU ORFDO PRYHPHQWV
PAGE 250

,Q WKH ORQJWHUP WKH WKUHH DJHQGDV ORFDO QDWLRQDO DQG JOREDOf§ DUH DQG VKRXOG EH OLQNHG +RZHYHU LW LV GLIILFXOW IRU DQ RUJDQL]DWLRQ WR FRQFHQWUDWH RQ DOO VLPXOWDQHRXVO\ EHFDXVH RI WKH FRQVWUDLQWV RQ UHVRXUFHV QDPHO\ RQ WKH QXPEHU RI PHPEHUV SDUWLFLSDWLQJ 7KH UHVXOWV RI WKLV WUDGHRII DUH TXLWH YLVLEOH 0RHPD RI 7KH &DVD 7KLV KDV EHHQ SUHWW\ GLIILFXOW WKHUH ZDV QR VSDFH OHIW LQ SHRSOHnV DJHQGDV IRU WKH 5HGH >DW WKH PXQLFLSDO OHYHO @ XQGHUVWDQG WKDW ODVW \HDU DQG WKLV \HDU KDYH EHHQ YHU\ GLIILFXOW WKHUH KDYH EHHQ VHYHUDO LPSRUWDQW HYHQWV DW WKH LQWHUQDWLRQDO OHYHO OLNH WKH &DLUR PHHWLQJ DQG WKLV \HDU ZLWK WKH HYDOXDWLRQ RI WKH GHFDGH LQ %HLMLQJ DQG LW LV QHFHVVDU\ IRU SHRSOH WR JR %XW WKLQN WKDW ZH FDQQRW OHW JR RI ORFDO LVVXHV WR WDNH FDUH RI WKH ELJ HYHQWV > @ $QG QH[W \HDU ZH KDYH WKH >WK@ LQWHUQDWLRQDO FRQIHUHQFH RQ ZRPHQnV KHDOWK >RUJDQL]HG DQG KHOG LQ 6DR 3DXOR @ $QG DP ZRUULHG EHFDXVH WKLQJV DUH JRQQD UXQ WKH VDPH ZD\ (GLPHLUH OHDGHU RI D IHPLQLVW 1*2 RQ KHU SDUW ZRQGHUV KRZ DQ H[WUHPHO\ FRQVHUYDWLYH ELOO FRQFHUQLQJ VWHULOL]DWLRQ PDGH LW WKURXJK WKH PXQLFLSDO +RXVH RI 5HSUHVHQWDWLYHV DQG DGPLWV WKDW IHPLQLVWV DUH LQ IDFW SD\LQJ PRUH DWWHQWLRQ WR ZKDW LV JRLQJ RQ LQ WKH QDWLRQDO FRQJUHVV /RRN GRQnW NQRZ ZK\ WKLV WKLQJ RI WKLV ELOO ZDV SDVVHG LQ VXFK DQ LPSHUFHSWLEOH ZD\ GRQnW NQRZ ZKDW DQG LQFOXGH P\VHOI LQ WKLV VWRU\ EHFDXVH DP UHVSRQVLEOH DP WKH UHSUHVHQWDWLYH RI WKH 5HGH GRQn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

PAGE 251

WKLV ZH KDYH WR GLVFXVV WKDW ZH KDYH WR WKLQN DERXW WKLV TXLFNO\ HYHU\WKLQJ PXVW EH TXLFN :KR LV LPSRVLQJ WKLV UK\WKP RQ XV" 7KLV GRHV QRW OHDYH XV DQ\ WLPH IRU GUHDPLQJ GDULQJ RU FUHDWLQJ &,0 f )LQDOO\ WKH SUHVWLJH DWWULEXWHG WR LQWHUQDWLRQDO ZRUN LV DQRWKHU GLPHQVLRQ ZKLFK FDQQRW EH LJQRUHG $W D VHPLQDU RUJDQL]HG E\ WKH 6DR 3DXOR ZRPHQfV )RUXP IRU %HLMLQJ LQ SUHSDUDWLRQ IRU %HLMLQJf D NH\QRWH VSHDNHU EDFN IURP VRPH 81 SUHSDUDWRU\ DFWLYLWLHV ZDUQHG WKH DFWLYLVWV WKHUH DVVHPEOHG WKDW DP TXRWLQJ P\ ILHOG QRWHV )LUVW ZRUOG ZRPHQ DUH DOUHDG\ LQYROYHG DW WKH LQWHUQDWLRQDO OHYHO ZRUNLQJ ZLWK WKH JOREDO FRPPXQLFDWLRQ V\VWHP ZKLOH ZH ODFN WKH PRQH\ DQG VR ZH DUH VKH VDLG VWXFN LQ WKH NLWFKHQ ZRUNLQJ DW ORFDO LVVXHV QD FR]LQKD WUDEDOKDQGR R ORFDOf 7KLV DQHFGRWH UHYHDOV WKH LPDJHV DQG IHHOLQJV WKDW VRPH OHDGLQJ DFWLYLVWV DVVRFLDWH ZLWK ORFDO YHUVXV LQWHUQDWLRQDO PRYHPHQW ZRUN GR V\PSDWKL]H ZLWK WKH QHHG IRU IHPLQLVW DFWLYLVWV IURP WKH 6RXWK WR JDLQ PRUH SRZHU ZLWKLQ WKH LQWHUQDWLRQDO ZRPHQfV PRYHPHQW
PAGE 252

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fW ZRUN RQO\ KHUH RU RQO\ WKHUH :H KDYH WR EULGJH WKH JDSf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

PAGE 253

ZKR ZRXOG UDWKHU EH SUHVVXULQJ WKURXJK HVWDEOLVKHG FKDQQHOV E\ VHQGLQJ OHWWHUV DFWLYDWLQJ WKHLU FRQQHFWLRQV WR SRZHUIXO LQGLYLGXDOV DQG ZRUNLQJ WKHLU ZD\ LQWR WKH SROLWLFDO V\VWHP 7KLV FRQWLQXXP WHQGV WR FRUUHODWH ZLWK WKH YROXQWHHUSURIHVVLRQDOL]HG FRQWLQXXP 3URIHVVLRQDOL]DWLRQ WHQGV WR FRUUHODWH ZLWK LQVWLWXWLRQDO SROLWLFV ZKLOH YROXQWHHU JURXSV WHQG WR SUHIHU SUHVVXUH IURP EHORZ DQG PRELOL]DWLRQ $V DQ H[DPSOH RI WKH ODWWHU SRVLWLRQ )ORUD RI LH &DVD DUJXHG ,Wn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

PAGE 254

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f 6RQLD $OYDUH] DUJXHV WKDW WKLV UHMHFWLRQ RI UHSUHVHQWDWLRQDO VWUXFWXUHV LV D E\SURGXFW RI IHPLQLVWVf GLVWDQFLQJ E\ WKH V IURP OHIWLVW SROLWLFDO SDUWLHV ZKLFK KDLOHG WKH WKHRU\ DQG SUDFWLFH RI GHPRFUDWLF FHQWUDOLVP )HPLQLVWV KDG XS WR WKDW SRLQW DGRSWHG VRPH RI WKHLU SUDFWLFHV DV WKH\ SXW WRJHWKHU FHQWUDOL]HG FRRUGLQDWLRQV LQ ZKLFK GLIIHUHQW VHFWRUV RI WKH ODUJHU ZRPHQnV PRYHPHQW ZDV UHSUHVHQWHG PDQLIHVWRV ZRXOG EH GUDIWHG DQG SDODYUDV GH RUGHP VORJDQVf ZRXOG EH FRQVHQVXDOO\ DJUHHG XSRQ $OYDUH] f 2Q WKH RWKHU KDQG GLUHFW SDUWLFLSDWLRQ ZDV D GLVWLQFWLYH HOHPHQW RI WKH SROLWLFDO FXOWXUH RI WKH JURXSV LQIOXHQFHG E\ OLEHUDWLRQ WKHRORJ\ DQG PRVW SRSXODU PRYHPHQWV 7KH VWURQJ HJDOLWDULDQ HWKLFV RI WKHVH PRYHPHQWV ZUDSSHG DQ\ LVVXH RI SRZHU ZLWK D WDERR WLQJH +RZHYHU FRQIOLFWV RYHU SRZHU DUH SUHVHQW LQ WKHVH FLUFOHV DV LQ DQ\ RWKHU KXPDQ RUJDQL]DWLRQV

PAGE 255

7RGD\ IHPLQLVW DFWLYLVW IHHOLQJV WRZDUGV UHSUHVHQWDWLRQ DUH GLYLGHG DQG DPELJXRXV ILHOGQRWHV@ $W WKH LQWHUQDWLRQDO OHYHO WKH &DLUR FRQIHUHQFH RQ 3RSXODWLRQ DQG 'HYHORSPHQW KHOG LQ SURYLGHV D SULPH H[DPSOH RI KRZ FHUWDLQ JURXSV RU LQGLYLGXDOV DUH SLFNHG RXW WR UHSUHVHQW WKH PRYHPHQW 7KH SUHSDUDWLRQ SURFHVV IRU WKLV FRQIHUHQFH ZDV TXLWH UHVWULFWHG ZLWK RQO\ 1*2V LQYROYHG ,Q WKH ZRUGV RI D YROXQWHHU DFWLYLVW &DLUR ZDV D JKHWWR &DLUR IRL XP JXHWRf $ VLPLODU SURFHVV ZRXOG KDYH RFFXUUHG IRU WKH )RXUWK 81 :RUOG &RQIHUHQFH RQ

PAGE 256

:RPHQ KHOG LQ %HLMLQJ LQ 6HSWHPEHU EXW WKDW ZDV FRXQWLQJ ZLWKRXW WKH UHDFWLRQ RI RWKHU VHFWRUV RI WKH ZRPHQnV PRYHPHQW 7KH LQIRUPDWLRQ SUHVHQWHG KHUH RQ WKH HDUO\ SURFHVV IRU WKH SUHSDUDWLRQ IRU %HLMLQJ ZDV FRPSLOHG PDLQO\ IURP WKH %XOOHWLQ SXEOLVKHG E\ &,0&HQWUR ,QIRUPD\DR 0XOKHU &,0 f DV ZHOO DV IURP LQIRUPDO GLVFXVVLRQV ZLWK DFWLYLVWV DQG REVHUYHUV RI WKH SURFHVV ,Q $SULO WKH 2(&' WKH 2UJDQL]DWLRQ IRU (FRQRPLF &RRSHUDWLRQ DQG 'HYHORSPHQWf GHFLGHG WKDW LQ RUGHU WR ILQDQFH WKLUG ZRUOG ZRPHQnV HIIRUWV IRU DQ HYDOXDWLRQ RI WKH ZRPHQfV TXHVWLRQ LQ WKH SDVW GHFDGH FRXQWULHV RI WKH 1RUWK VKRXOG ILQDQFH ZRPHQ LQ WKHLU JHRJUDSKLF ]RQH RI LQIOXHQFH &RQVHTXHQWO\ WKH 8QLWHG 6WDWHV WKURXJK 86$,' ZDV WR ILQDQFH WKH RUJDQL]DWLRQ HIIRUWV RI /DWLQ $PHULFDQ ZRPHQ 7R WKLV HIIHFW D 86$,' UHSUHVHQWDWLYH ZDV VHQW WR 5LR 6DR 3DXOR 3HUQDPEXFR DQG %UDVLOLD LQ -XO\ WR FRQWDFW D IHZ JURXSV WR XUJH WKHP WR DFFHOHUDWH WKHLU RUJDQL]DWLRQDO SURFHVV DQG WR FKRRVH RQH 1*2 ZKLFK ZRXOG EH 86$,'fV LQWHUORFXWRU IRU WKH ZKROH FRXQWU\ DQG ZRXOG UHFHLYH WKH IXQGLQJ 7KH JURXSV FRQWDFWHG LQ 6DR 3DXOR ZHUH DOO SURIHVVLRQDOL]HG WKH &ROHWLYR )HPLQLVWD 6H[XDOLGDGH H 6DGH *HOHGV DQG 5HGH 0XOKHU 7KH &,0 EXOOHWLQ GHVFULEHV WKH OHWWHU VHQW E\ 86$,' DV D JHP RI ILUVW ZRUOG EXUHDXFUDWLVP DXWKRULWDULDQLVP DQG nFRRSHUDWLRQn XUQDSUROD GRSULPHLURPXQGLVPR GH EXURFUDFLD DXWRULWDULVPR H FRRSHUDTDRUf &,0 f 7KH 0RYHPHQW 5HVLVWV +RZHYHU WKLV WLPH 6DR 3DXOR IHPLQLVW JURXSV 1*2V DQG YROXQWHHU JURXSV DOLNH LQFOXGLQJ DOO WKH VXSSRUW JURXSV ZRUNHG ZLWK UHDFWHG DJDLQVW WKLV WRSGRZQ VWUDWHJ\ 7KH\ ZHUH TXHVWLRQLQJ

PAGE 257

f 'LG 86$,' ZDQW WR LPSRVH DQ RUJDQL]DWLRQDO VWUXFWXUH RQ XV" f :K\ LV 86$,' QRW XVLQJ DQG FKDQQHOLQJ UHVRXUFHV YLD WKH VWUXFWXUHV DOUHDG\ EXLOW E\ ZRPHQ WKURXJKRXW WKHVH WZR GHFDGHV RI WKH H[LVWHQFH RI RXU PRYHPHQW" f 'RQnW /DWLQ $PHULFDQ IHPLQLVWV KDYH WKH ULJKW WR HVWDEOLVK WKHLU RZQ SURFHVV DQG WR GHFLGH LI WKH\ DUH JRLQJ WR KRZ WKH\ DUH JRLQJ WR DQG ZLWK ZKRP WKH\ DUH JRLQJ WR HYDOXDWH WKH GHFDGH DQG EXLOG WKHLU RZQ VWUXFWXUHV LI QHFHVVDU\f RU VWUHQJWKHQ WKRVH DOUHDG\ H[LVWLQJ &,0 f $V D UHVXOW RI WKLV TXHVWLRQLQJ DQ DOWHUQDWLYH RUJDQL]DWLRQDO VWUXFWXUH ZDV VXJJHVWHG E\ IHPLQLVWV IURP 5LR GH -DQHLUR 5DWKHU WKDQ VHWWLQJ WKH UHVSRQVLELOLW\ RI FRPPXQLFDWLRQ DQG LQWHUDFWLRQ ZLWK 86$,' ZLWK RQH 1*2 DORQH WKH PRYHPHQW VKRXOG EH UHSUHVHQWHG E\ D FRXQFLO RI HOHFWHG UHSUHVHQWDWLYHV QP FRQVHOKR GH UHSUHVHQWDQWHV HOHLWDVf &,0 f )XUWKHUPRUH 86$,' FDPH XQGHU FULWLFLVP IRU LWV WDUQLVKHG LPDJH IRU VXSSRUWLQJ WKH %UD]LOLDQ PLOLWDU\ UHJLPH LQ WKH V DQG V )HPLQLVWV ZKR IRU WKH PRVW SDUW EHORQJHG WR WKH RSSRVLWLRQ DW WKH WLPH f§PDQ\ RI WKHP VXIIHUHG LPSULVRQPHQW DQG WRUWXUH RU H[LOHf§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f ILQDQFLQJ IRU D ILUVW QDWLRQDO PHHWLQJ EHFDXVH LW QHHGHG WR FORVH LWV ILVFDO DFFRXQWV &,0 f 6RPH 5LR DFWLYLVWV HQGHG XS DFFHSWLQJ WKH LGHD DQG WKH ILQDQFLQJ ZKHUHDV PDQ\ HVSHFLDOO\ LQ 6DR 3DXOR IHOW WKDW LW ZDV WRR HDUO\ WR KROG VXFK D PHHWLQJ ZKLFK QHHGHG PXFK DUWLFXODWLRQ ZRUN ZLWK RWKHU RUJDQL]DWLRQV ,Q WKHLU ZRUGV WKH WUXWK LV WKDW ZH ZHUH VXUSULVHG DQG KLW E\ D PHHWLQJ

PAGE 258

ZKLFK LQ RXU YLHZ VKRXOG KDYH EHHQ RUJDQL]HG ODWHU DIWHU ZH KDG EURXJKW WR WKH SURFHVV D JUHDWHU QXPEHU RI RUJDQL]DWLRQV LQ WKH FRXQWU\ &,0 f ,Q D OHWWHU $ &DUWD GH 6DR 3DXOR QLQH 3DXOLVWD RUJDQL]DWLRQV RQO\ WZR RI ZKLFK ZHUH SURIHVVLRQDOL]HG DQG WZR DXWRQRPRXV IHPLQLVWV H[SUHVVHG WKHLU GLVDJUHHPHQW ZLWK WKH ZD\ WKH GHFLVLRQ WR KROG WKH PHHWLQJ KDG EHHQ WDNHQ LQ SDUWLFXODU KRZ WKH PRYHPHQWnV DJHQGD ZDV GHWHUPLQHG E\ XPD HOLWH GR PRYLPHQWRID]HQGR SURSRVWDV SDUD QV DQ HOLWH VHFWRU RI WKH PRYHPHQW PDNLQJ SURSRVDOV LQ RXU QDPHf &,0 f ,Q WKLV OHWWHU WKH\ FRPSODLQHG DERXW WKH WLPH VTXHH]H RI WKH LQWHUQDWLRQDO DJHQGD DV ZHOO DV DERXW WKH RUJDQL]DWLRQDO DXWKRULWDULDQLVP UHVXOWLQJ IURP WKH LQWHUDFWLRQ ZLWK ELODWHUDO DQG PXOWLODWHUDO GHYHORSPHQW DJHQFLHV 7KH\ DOVR H[SUHVVHG WKHLU GHVLUH WR RUJDQL]H PHHWLQJV LQ DOO WKH GLIIHUHQW VWDWHV RI WKH FRXQWU\ WR HQVXUH WKDW WKLV DJHQGD LPSRVWD FRQWULEXD SDUD D QRVVD PRELOL]DJ£R DUWLFXODJDR H IRUWDOHFLPHQWR WKLV LPSRVHG DJHQGD FRQWULEXWHV WR WKH VWUHQJWKHQLQJ PRELOL]LQJ DQG DUWLFXODWLRQ RI RXU PRYHPHQWf &,0 f 7KH )LUVW 1DWLRQDO 3UHSDUDWRU\ 0HHWLQJ IRU WKH ,
PAGE 259

IHPLQLVW 1*2V DQG LQ 1*2V QRW LGHQWLI\LQJ ZLWK WKH ZRPHQnV PRYHPHQW 7ZR RI WKHP ZHUH $IIR%UD]LOLDQ IHPLQLVWV %\ WKDW WLPH 6WDWHZLGH IRUD KDG EHHQ RUJDQL]LQJ LQ PRVW %UD]LOLDQ VWDWHV HQVXULQJ D ZLGHU SDUWLFLSDWLRQ $OWKRXJK WKH SUHSDUDWLRQ SURFHVV ZDV QRW IUHH IURP WHQVLRQV IURP WKDW SRLQW RQ LW GHILQLWHO\ UHIOHFWHG D PXFK EURDGHU SURFHVV LQ ZKLFK PRVW VHFWRUV RI WKH %UD]LOLDQ ZRPHQn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
PAGE 260

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f ,QGHHG WKH SURFHVV VKDUSHQHG WKH ZRUULHV RI D QXPEHU RI DFWLYLVWV UHJDUGLQJ WKH ZRPHQnV PRYHPHQWnV DXWRQRP\ LWV RUJDQL]DWLRQ WKH UK\WKP LPSRVHG E\ RXU LQVWLWXWLRQDOL]HG DJHQGDV WKH EXUHDXFUDWL]DWLRQ RI IHPLQLVP WKH H[FHVV RI SRZHU RI K\SHUILQDQFHG 1*2V ZKR KDYH WKH LQIRUPDWLRQ LQ RWKHU ZRUGV WKH QHHG WR GHPRFUDWL]H RXU PRYHPHQW &,0 f ,Q RWKHU ZRUGV LQYROYHPHQW ZLWK LQVWLWXWLRQDO SROLWLFV KDV EURXJKW WR WKH IRUH SRZHU GLIIHUHQWLDOV ZLWKLQ D PRYHPHQW ZKHUH SRZHU GLIIHUHQFHV DUH QRW VXSSRVHG WR H[LVW ,W DOVR DFFHOHUDWHG D SURFHVV RI KLHUDUFKL]DWLRQ VLQFH VRPH DUH GHVLJQDWHG DV UHSUHVHQWDWLYH RYHU RWKHUV %XW ZKHUH GRHV WKH 1*2V H[FHVV RI SRZHU VWHP IURP )LUVW RI DOO SURIHVVLRQDOL]HG IHPLQLVWV KDYH PRUH WLPH WR SDUWLFLSDWH LQ PRYHPHQWZLGH HYHQWV LQ JHQHUDO VLQFH WKH\ GHGLFDWH WKHLU IXOO ZHHN WR PDWWHUV RI WKH ZRPHQfV PRYHPHQW 3URIHVVLRQDOL]HG VXSSRUW JURXSV WKXV KDYH DQ HDVLHU WLPH IROORZLQJ WKH IDVW SDFH RI ZRUN UHTXLUHG E\ WKH LQWHUQDWLRQDO DJHQGD DOWKRXJK LW LV VWUHQXRXV IRU WKHP DV ZHOO 8VXDOO\ HDFK 1*2 LV UHSUHVHQWHG E\ RQH PHPEHU RI WKH JURXS ZKR IROORZV DFRPSDQKDf WKH SUHSDUDWLRQ DFWLYLWLHV 7KH PHPEHUV RI YROXQWHHU HQWLWLHV ZKR DUH RQO\ DUH DYDLODEOH RQ ZHHNHQGV DQG HYHQLQJV KDYH PRUH GLIILFXOWLHV 7KH IDFW WKDW 1*2 DFWLYLVWV FDQ GHGLFDWH PRUH WLPH WR WKHVH DFWLYLWLHV PHDQV WKDW WKH\ GR PRVW RI WKH ZRUN VXFK DV GUDIWLQJ SURSRVDOV IRU DFWLYLWLHV DQG RUJDQL]LQJ VXFK DFWLYLWLHV

PAGE 261

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
PAGE 262

7DEOH %XGJHW RI 6DR 3DXOR )HPLQLVW 6XSSRUW *URXSV 7\SH RI 6XSSRUW *URXS 1E RI PHPEHUV 3URIHVVLRQDOL]HG 3URIHVVLRQDOL]HG 3URIHVVLRQDOL]HG 3URIHVVLRQDOL]HG 6HPLSURIHVVLRQDOL]HG 3RSXODU 9ROXQWHHU FRUH 3RSXODU 9ROXQWHHU FRUH WRWDO 9ROXQWHHU FRUH WRWDO 9ROXQWHHU FRUH WRWDO $QQXDO %XGJHW LQ 86f EXW LQIUDVWUXFWXUDO VXSSRUW IURP SROLWLFDO SDUW\f WR WR 'LIIHUHQFHV LQ ILQDQFLDO UHVRXUFHV XQGHUVFRUH GLIIHUHQFHV LQ WKH SRWHQWLDO WR SDUWLFLSDWH LQ FRDOLWLRQ ZRUN DQG KHQFH WR SDUWLFLSDWH LQ WKH GHFLVLRQPDNLQJ 2QH FOHDU H[DPSOH RI WKLV W\SH RI G\QDPLF RFFXUUHG ZKHQ GHFLVLRQV KDG WR EH PDGH DERXW WKH 9,,, WK ,QWHUQDWLRQDO &RQIHUHQFH RQ :RPHQnV +HDOWK ZKLFK %UD]LOLDQ IHPLQLVWV ZHUH LQ FKDUJH RI RUJDQL]LQJ IRU 1RYHPEHU 7KH QDWXUH RI WKLV LQWHUQDWLRQDO FRQIHUHQFH ZDV WR EH GHFLGHG GXULQJ WKH $QQXDO PHHWLQJ RI WKH 5HGH PHQWLRQHG HDUOLHU 7KH PHHWLQJ ZDV WR ODVW IURP 6DWXUGD\ $SULO XQWLO 0RQGD\ $SULO LQ 5LR GH -DQHLUR %\ 0RQGD\ DW OXQFK WLPH PRVW YROXQWHHU DQG VRPH SURIHVVLRQDOL]HG DFWLYLVWV KDG OHIW 7KRVH FRPLQJ IURP 6DR 3DXOR WRRN WKH EXV EDFN RQ WKHLU KRXU ULGH KRPH LQ RUGHU WR EH DEOH WR VWDUW ZRUNLQJ WKH QH[W GD\ :KHQ WKH GLVFXVVLRQ FRQFHUQLQJ WKH 97+ WK ,QWHUQDWLRQDO &RQIHUHQFH RQ :RPHQnV +HDOWK VWDUWHG DW SP WKDW 0RQGD\ WKHUH ZHUH DSSUR[LPDWHO\ ZRPHQ SUHVHQW RXW RI WKH WKDW KDG SDUWLFLSDWHG LQ WKH PHHWLQJf $OWKRXJK WKHUH ZHUH HDUOLHU GLVDJUHHPHQWV DV WR KRZ SDUWLFLSDWRU\ DQG RSHQ WKH ,QWHUQDWLRQDO &RQIHUHQFH VKRXOG EH WKH PDWWHU ZDV VHWWOHG ZLWKRXW GHOD\ DPRQJ WKRVH SUHVHQW 7KRVH PHPEHUV RI WKH 6DR 3DXOR GHOHJDWLRQ VWLOO SUHVHQW DOO SURIHVVLRQDOL]HG IHPLQLVWV ZHUH

PAGE 263

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f§LH ZKR KDV DOUHDG\ GRQH LWf§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f 7RZDUGV WKH HQG WKH\ LQFOXGHG FDSDFLW\ RI LQWHUYHQWLRQ FDSDFLGDGH GH LQWHUYHQLGRf :KHQ D SURIHVVLRQDOL]HG IHPLQLVW PHQWLRQHG WKH QHHG WR VSHDN (QJOLVK WKH RWKHUV DOO ERRHG DP QRW

PAGE 264

VXUH KRZ WKLV OLVW RI FULWHULD ZDV XVHG FRQVLGHULQJ WKDW PRVW RI WKH IXQGLQJ IRU WUDYHO KDG DOUHDG\ EHHQ DOORFDWHG DW WKDW SRLQW ,W ZDV KRZHYHU DQ LPSRUWDQW VWHS WKDW WKH QHHG IRU UHSUHVHQWDWLYLW\ EH DFNQRZOHGJHG E\ WKH PRYHPHQW 7R VXP LW XS SDUWLFLSDWLRQ LQ LQWHUQDWLRQDO SROLF\PDNLQJ LV DFFHQWXDWLQJ WKH KLHUDUFKL]DWLRQ RI WKH PRYHPHQW HVSHFLDOO\ DORQJ WKH SURIHVVLRQDOL]HGYROXQWHHU FRQWLQXXP 6HL]LQJ DJDLQ RQ WKH DQDORJ\ EHWZHHQ ORFDO PRYHPHQW ZRUN DQG SK\VLFDO ZRUN WUDEDOKR EUD]DOf DQG H[SUHVVLQJ WKHLU UHVHQWPHQW WRZDUGV WKLV HPHUJLQJ IHPVHW QHLJKERUKRRG IHPLQLVWV DUJXHG WKDW WKH\ GLG QRW ZDQW WR EH DPDVVFPGR EDUURnn FROOHFWLQJ PXGf ZKLOH WKH RWKHUV DUH ZRUNLQJ nnOD HQFLPD XS WKHUHf RU WKDW WKH\ GLG QRW ZDQW WR EH FDUUHJDQGR R SLDQR SDUD DV RXWUDV WRFDUHP FDUU\LQJ WKH SLDQR IRU WKH RWKHUV WR SOD\f 6LPLODUO\ \RXQJHU QHZHU PHPEHUV RI 1*2V FRPSODLQHG DERXW EHLQJ FXW RXW IURP DVVXPLQJ QHZ UROHV 2QH FRPSODLQHG WKDW WKHUH ZDV QR URWDWLRQ RI WKRVH JRLQJ DQG VSHDNLQJ LQ WKH QDPH RI WKH RUJDQL]DWLRQ 6KH WKRXJKW LW ZDV D SUREOHP WKDW WKRVH ZKR UHSUHVHQW ZRPHQ LQ LQWHUQDWLRQDO PHHWLQJV DUH QRW WKH RQHV ZKR GR WKH ZRUN LQ WKH QHLJKERUKRRGV $QRWKHU SURIHVVLRQDOL]HG DFWLYLVW UHIHUUHG WR WKH IDFW WKDW DV PDHV VH DFKDP XQJLGDV SHODV 'HXVDV WKH PRWKHUV WKLQN WKH\ DUH EOHVVHG E\ WKH *RGGHVVHVf DQG WKH\ GR QRW WUXVW DQ\ERG\ WR GR 0D[ 6FKHOHU GHILQHV 5HVVHQWLPHQW >DV@ DQ DWWLWXGH ZKLFK DULVHV IURP D FXPXODWLYH UHSUHVVLRQ RI IHHOLQJV RI KDWUHG UHYHQJH HQY\ DQG WKH OLNH :KHQ D SHUVRQ LV XQDEOH WR UHOHDVH WKHVH IHHOLQJV DJDLQVW WKH SHUVRQV RU JURXS HYRNLQJ WKHP WKXV GHYHORSLQJ D VHQVH RI LPSRWHQFH DQG ZKHQ WKHVH IHHOLQJV DUH FRQWLQRXVO\ UHH[SHULHQFHG RYHU WLPH WKHQ UHVVHQWLPHQW DULVHV 6FKHOHU FLWHG LQ 5ROOLQV f 7KH QRWLRQV RI KDWUHG RU UHYHQJH DUH VRPHZKDW WRR VWURQJ WR GHSLFW WKH UHODWLRQVKLS EHWZHHQ PRYHPHQW DFWLYLVWV
PAGE 265

WKH WDVN DV ZHOO DV WKH\ GR VR WKH\ GR QRW GHOHJDWH DQG HQG XS FRPSODLQLQJ WKDW WKH\ KDYH WRR PDQ\ WKLQJV WR GR $V D UHVXOW LQ DOO WKH JURXSV WKHUH DUH WHQVLRQV DQG WKH \RXQJHU ZRPHQ FRQVSLUD FRQWUD DV P£HV SORW DJDLQVW WKH nPRWKHUVnf 2UJDQL]LQJ D FOHDU WUDQVPLVVLRQ RI NQRZOHGJH ERWK WHFKQLFDO DQG FXOWXUDO LQFOXGLQJ RQ WKH VSRNHQ DQG XQVSRNHQ HWLTXHWWH LQ GLSORPDWLF DQG JRYHUQPHQWDO FLUFOHVf§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nV VFKHGXOH %HVLGHV WKH WLPH FRQVWUDLQWV WKDW 0RHPD LV UHIHUULQJ WR WKHUH DUH DOVR SROLWLFDO LVVXHV UHJDUGLQJ ZKR WKH FXUUHQW OHDGHUV ZDQW WR WDNH RYHU LH ZKR LQ WKHLU XQGHUVWDQGLQJ ZLOO GR D JRRG MRE DW VXFFHHGLQJ WKHP :LWK YHU\ SUDJPDWLF FRQVLGHUDWLRQV LQ PLQG WKHVH ZRPHQ DUH PRUH OLNHO\ WR FRQVLGHU ZRPHQ ZKR DUH VLPLODU WR WKHP LH ZKR KDYH WKH SURSHU IRUPDO HGXFDWLRQ DQG FXOWXUDOVRFLDO FDSLWDO WR LQWHUDFW ZLWK HOLWH ZRUOG GLSORPDWV RU QDWLRQDO SROLF\n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f ZH DUH JRLQJ WR WUDLQ SHRSOH LQ WKH KLVWRU\ RI IHPLQLVP DQG ZLWK SXEOLF VSHDNLQJ ZRUNVKRSV DQG RQ WKH >VRFLR

PAGE 266

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f QRWHG VLPLODU SURFHVVHV ZLWKLQ WKH 86 SURFKRLFH PRYHPHQW ZKHQ LW FDPH WR FRDOLWLRQ ZRUN 6KH VKRZHG WKDW LW LV HDVLHU IRU IRUPDOL]HG RUJDQL]DWLRQV WR PDLQWDLQ FRDOLWLRQV )RUPDOL]HG 602V >VRFLDO PRYHPHQW RUJDQL]DWLRQV@ SOD\ DQ LPSRUWDQW UROH LQ PDLQWDLQLQJ FRDOLWLRQV EXW WKH\ DOVR LQIOXHQFH FRDOLWLRQV WRZDUG QDUURZHU LQVWLWXWLRQDOL]HG VWUDWHJLHV DQG WDFWLFV DQG PDNH WKH SDUWLFLSDWLRQ RI 602V GLIILFXOW f 7KLV LV EHFDXVH IRUPDOL]HG JURXSV FDQ DVVLJQ RQH PHPEHU DV UHSUHVHQWDWLYH WR WKH FRDOLWLRQ DQG WKH\ KDYH QR VFKHGXOLQJ FRQIOLFW ZLWK WKH DXWKRULWLHVf ZRUNLQJ KRXUV 2Q WKH RWKHU KDQG LQIRUPDO JURXSV KDYH VFKHGXOLQJ FRQIOLFWV WKH\ DUH LQWLPLGDWHG E\ WKH NQRZOHGJH JDS ZLWK IRUPDO JURXS PHPEHUV DQG KDYH KLJKHU H[SHFWDWLRQV RI ZKDW FDQ EH DFKLHYHG ZKLOH SDLG VWDII ZDQW WR ZRUN RQ SURMHFWVf ZKRVH IHDVLELOLW\ LV FOHDU ZLWK GHILQHG JRDOV DQG WLPH OLPLWV 5HODWLRQV ZLWK WKH 6WDWH 2QH RI WKH GLFWDWRUVKLSfV OHJDF\ WR %UD]LOLDQ SRSXODU DQG IHPLQLVW PRYHPHQWV LV WKHLU ZDULQHVV RI FRRSWDWLRQ E\ WKH 6WDWH 7KH\ ZHUH ERP RXWVLGH DQG LQ RSSRVLWLRQ WR WKH

PAGE 267

DXWKRULWDULDQ VWDWH DOWKRXJK WKH\ UHFRJQL]HG LW DV D SULYLOHJHG LQWHUORFXWRU RQ ZKLFK WR PDNH GHPDQGV &DUGRVR 'RLPR 6FKXPDKHU t 9DUJDV f :LWK WKH UHWXUQ WR FLYLOLDQ UXOH DQG FRPSHWLWLYH HOHFWLRQV UHODWLRQV ZLWK ORFDO OHYHO 6WDWH DJHQFLHV LQWHQVLILHG DQG IDFLOLWDWHG VXFFHVVHV IRU WKH PRYHPHQWV DQG IRU WKH 1*2V ZKR DFFRPSDQLHG WKHP LQ WKHLU VWUXJJOHV %HEELQJWRQ HW DO &DUGRVR f 0RUHRYHU DV DSSHDUHG FOHDUO\ LQ WKH FUHDWLRQ RI WKH 1DWLRQDO &RXQFLO IRU :RPHQnV 5LJKWV &1'0f GHVFULEHG LQ &KDSWHU WKH FRPLQJ WR SRZHU RI IRUPHU RSSRVLWLRQ SDUWLHV VXFK DV WKH 30'% f§RU WKH 37 DW WKH ORFDO OHYHOf§ SURYLGHG QHZ SDUWLFLSDWRU\ RSSRUWXQLWLHV IRU ZRPHQ DQG IRU RWKHU PRYHPHQWV DW WKH PXQLFLSDO VWDWH DQG IHGHUDO OHYHOV $W WKH )HGHUDO OHYHO WKHVH FRXQFLOV ZHUH XQIRUWXQDWHO\ ODUJHO\ LJQRUHG XQGHU WKH SUHVLGHQF\ RI -RV 6DPH\ f DQG GLVDSSHDUHG RU ZHUH LQFDSDFLWDWHG XQGHU WKH &ROORU DGPLQLVWUDWLRQ f +RFKVWHWOHU VHH FKDSWHU IRU VSHFLILFV RQ WKH ZRPHQnV FRXQFLOVf ,W ZDV RQO\ ZKHQ )HUQDQGR +HQULTXH &DUGRVR ZDV HOHFWHG 3UHVLGHQW RI %UD]LO LQ 1RYHPEHU WKDW KH FDOOHG XSRQ FLYLO VRFLHW\ DQG 1*2V WR ZRUN LQ FROODERUDWLRQ ZLWK KLV JRYHUQPHQW 3DUFHULD SDUWQHUVKLSf DQG QHJRWLDWLRQ EHFDPH SURPLQHQW RQ WKH %UD]LOLDQ DJHQGD D PLUURU WR WKH FRQFHUWDFLFP HPSKDVLV LQ RWKHU /DWLQ DQG &HQWUDO $PHULFDQ FRXQWULHV $%21* WKH $VVRFLDWLRQ RI %UD]LOLDQ 1*2Vf VWDWHG LWV ZLOOLQJQHVV WR JR DORQJ ZKHQ WKH 3ODQDOWR ILUVW PDGH LWV ZLVKHV NQRZQ 6LOYLR &DFFLD %DYD 3UHVLGHQW RI $%21* DUJXHG WKDW 5HFHQWO\ WKH FRQTXHVW E\ RUJDQL]HG SRSXODU VHFWRUV RI QHZ LQVWLWXWLRQDO VSDFHV SDUWLFLSDWLRQ LQ FRQJUHVV DQG LQ PXQLFLSDO DGPLQLVWUDWLRQVf KDV EURDGHQHG WKH UHVSRQVLELOLW\ RI 1*2V )URP D FULWLFDO DQDO\VLV RI VRFLHW\ DQG WKH 6WDWH WKH\ ZHUH FDOOHG WR SDUWLFLSDWH LQ WKH HODERUDWLRQ RI FRQFUHWH SURSRVDOV RI SXEOLF SROLFLHV &DFFLD %DYD D f

PAGE 268

7KH IDFW WKDW )HPDQGR +HQULTXH &DUGRVR ZDV IRU PDQ\ \HDUV D PHPEHU RI WKH ZHOO NQRZQ 1*2WKLQN WDQN &(%5$3 DQG WKH OHDGHU RI WKH VPDOO FHQWHUOHIW 3DUWLGR 6RFLDO 'HPRFPWD GR %UDVLO 36'%f RU %UD]LOLDQ 6RFLDO 'HPRFUDWLF 3DUW\f ZHUH LPSRUWDQW IDFWRUV LQ 1*2V KRSHV IRU LPSURYHG UHODWLRQV DQG FRRSHUDWLRQ 1*2Vn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f LQFOXGLQJ /DWLQ $PHULFD %HEELQJWRQ HW DO 0LUDIWDE f 7ZR PDMRU FRQVHTXHQFHV WR WKLV UDSSURFKHPHQW GHVHUYH DWWHQWLRQ 2QH LV SROLWLFDOHFRQRPLF LQ QDWXUH ZKLOH WKH RWKHU LV PRUH VWULFWO\ SROLWLFDO 7KH ILUVW PDMRU FRQFHUQ LV WKDW LQ WKLV HUD RI WKH 1HZ 3ROLF\ $JHQGD ZKLFK IDYRUV QHROLEHUDO HFRQRPLFV DQG OLEHUDO GHPRFUDWLF WKHRU\ f§ERWK PRYLQJ DZD\ IURP WKH 6WDWHf§ +XOPH DQG (GZDUGV f 1*2V DUH EHFRPLQJ IXQFWLRQDO WR WKH QHROLEHUDO HFRQRPLF SURMHFW %HEELQJWRQ HW DO f 7KLV FRQFHUQ EHFRPHV SDUWLFXODUO\ SUHVVLQJ ZKHQ 1*2V DUH VXEFRQWUDFWHG E\ 6WDWHV WR LPSOHPHQW VRFLDO HPHUJHQF\ SURJUDPV WKURXJK VRFLDO LQYHVWPHQW IXQGV SURYLGHG ODUJHO\ E\ PXOWLODWHUDO DJHQFLHV ZKLFK DUH GHVLJQHG WR OLPLW WKH QHJDWLYH FRQVHTXHQFHV RI VWUXFWXUDO DGMXVWPHQW SURJUDPV %HEELQJWRQ HW DO 0LUDIWDE f ,Q VXFK VLWXDWLRQV WKH 6WDWH VWRSV FDUU\LQJ RXW FHUWDLQ DFWLYLWLHV RI LWV UHVSRQVLELOLW\ DQG WKXV UHGHILQHV WKH VRFLDO FRQWUDFW ZLWK FLYLO VRFLHW\ HVSHFLDOO\ WRZDUGV WKH SRRUHVW VHFWRUV RI WKH SRSXODWLRQ LELG f %HEELQJWRQ HW DO IXUWKHU DUJXH WKDW WKH 6WDWH UDUHO\ RSHQV GHFLVLRQ

PAGE 269

PDNLQJ FKDQQHOV LQ VXEFRQWUDFWLQJ UHODWLRQV ZLWK 1*2V VR WKDW 1*2V HQG XS LQ D VXERUGLQDWH SRVLWLRQ 7KURXJK VXEFRQWUDFWLQJ DQG UHJXODU IXQGLQJ PHFKDQLVPV WKH GHSHQGHQF\ RI 1*2V RQ RIILFLDO IXQGV KDV ULVHQ VKDUSO\ LQ D QXPEHU RI FRXQWULHV DURXQG WKH ZRUOG LQFOXGLQJ QRUWKHUQ 1*2V VHH +XOPH t (GZDUGV f ,Q %UD]LO KRZHYHU VXEFRQWUDFWLQJ DQG RWKHU W\SHV RI RIILFLDO ILQDQFLQJ KDYH LQ IDFW UHPDLQHG YHU\ OLPLWHG %RVFK f 6R IDU PRVW DIILOLDWHV WR $%21* LQFOXGLQJ IHPLQLVW 1*2V VHH FKDSWHU f KDYH UHFHLYHG YHU\ OLWWOH JRYHUQPHQW IXQGLQJ /DQGLP t &RWULP [YLLLf UHSRUW WKDW $%21* PHPEHUVn GHSHQGHQF\ RQ JRYHUQPHQW IXQGLQJ LQ ZDV DV ORZ DV b RI WKHLU DQQXDO EXGJHW 7KLV ZDV EHIRUH WKH &DUGRVR DGPLQLVWUDWLRQ 6WLOO D IHZ PRQWKV DIWHU &DUGRVRnV FDOO IRU SDUWQHUVKLS DQG DIWHU EHJLQQLQJ QHJRWLDWLRQV RQ WKH PRGDOLWLHV RI WKHLU SDUWLFLSDWLRQ DQG DV WKH QHROLEHUDO FKDUDFWHU RI PXFK RI WKH QHZ JRYHUQPHQW SROLFLHV DSSHDUHG PRUH FOHDUO\ $%21* DGRSWHG D PRUH FULWLFDO VWDQFH WRZDUGV ZKDW WKH\ VDZ DV D SRVVLELOLW\ RI FRRSWDWLRQ 1*2V ZHUH WR SDUWLFLSDWH LQ WKH )HGHUDO VRFLDO LQYHVWPHQW IXQG SURJUDP FDOOHG &RPXQLGDGH 6ROLG£ULD 'XH WR WKH H[WUHPHO\ YDJXH GHILQLWLRQ RI 1*2V WKH SURSRUWLRQ RI JRYHUQPHQW IXQGLQJ FDQ EH PXFK KLJKHU WKDQ WKLV b $%21* GRHV QRW LQFOXGH DVVLVWHQWLDOLVW SKLODQWURSLF RUJDQL]DWLRQV WKLQN WKDW WKLV H[SODLQV ZK\ RWKHU VRXUFHV FODLP WKDW DQ DVWRXQGLQJ b RI %UD]LOLDQ 1*2V >DUH@ UHSRUWLQJ VRPH NLQG RI SDUWQHUVKLS ZLWK JRYHUQPHQW DJHQFLHV LQ 1*2V LQIOXHQFH RU FRQWURO 56 ELOOLRQ FORVH WR 86 ELOOLRQf LQ IXQGV DGPLQLVWHUHG E\ WKH 0LQLVWU\ RI WKH (QYLURQPHQW WKH 0LQLVWU\ RI 6RFLDO 6HFXULW\ DQG :HOIDUH DQG LQWHUQDWLRQDO EDQNV )ROKD GH 6DR 3DXOR -XQH f +RFKVWHWOHU f %\ $XJXVW QHJRWLDWLRQV KDG EHHQ PDLQWDLQHG FRQFHUQLQJ WKH SDUWLFLSDWLRQ RI 1*2V LQ WKH &RPXQLGDGH 6ROLG£ULD 3URJUDP DQG WKHLU DFFHVV WR SXEOLF IXQGV &DFFLD %DYD Ff 7KHVH QHJRWLDWLRQV GLG QRW IDLO WR JHQHUDWH KHDWHG GHEDWH ZLWKLQ WKH IHGHUDWLRQ DV VRPH IHOW WKDW DFFHSWLQJ WKH PRQH\ ZRXOG DPRXQW WR DQ HQGRUVHPHQW RI WKH JRYHUQPHQWnV VRFLDO SROLFLHV 3DOXGR f ,Q IDFW RYHU WLPH $%21* DV D ZKROH JUHZ LQFUHDVLQJO\ FULWLFDO RI WKH JRYHUQPHQWnV SROLFLHV VHH -RUQDO GD $%21* $XJXVW f DQG 0D\ ff $V RI 2FWREHU QR IXUWKHU VWHSV KDG EHHQ PDGH LQ WKH GLUHFWLRQ RI JRYHUQPHQWDO IXQGLQJ 5 3D] $VVLVWDQW 'LUHFWRU $%21* SHUVRQDO FRPPXQLFDWLRQf

PAGE 270

&RPXQLGDGH 6ROLG£ULD ZDV FULWLFL]HG E\ $%21* IRU EHLQJ FOHDUO\ FRPSHQVDWRU\ LQ QDWXUH 8QGHU D VLQJOH XPEUHOOD SURJUDP KHDGHG E\ D &RXQFLO LW FRRUGLQDWHV H[LVWLQJ IHGHUDO SRYHUW\ DOOHYLDWLRQ SURJUDPV DQG WDUJHWV EROVRHV GH SREUH]D SRFNHWV RI SRYHUW\f OLNHO\ WR EH H[DFHUEDWHG E\ WKH UHGXFWLRQ RI VRFLDO VHUYLFHV EXGJHWV VXFK DV LQ WKH DUHD RI KHDOWK DQG HGXFDWLRQ XQGHU WKH DGYLFH RI WKH ,0) &DFFLD %DYD Ef )XQGLQJ DQG SURJUDPV DUH WR EH LPSOHPHQWHG E\ *RYHUQPHQW DJHQFLHV SULYLOHJLQJ VWDWH DQG PXQLFLSDOOHYHO LQLWLDWLYHV LQ DQ HIIRUW WR GHFHQWUDOL]H LQ SDUWQHUVKLS ZLWK FLYLO VRFLHW\ RUJDQL]DWLRQV ZKR KDYH EHHQ VWURQJO\ HQFRXUDJHG WR SDUWLFLSDWH WKURXJK SXEOLF FRPSHWLWLRQ 5HFHQWO\ REVHUYHUV KDYH QRWHG WKDW >SURJUDPV IRU WKH PRELOL]DWLRQ RI FLYLO VRFLHW\ LQFOXGLQJ QRQJRYHUQPHQWDO RUJDQL]DWLRQV WR DOOHYLDWH SRYHUW\ >LQ ZKLFK &RPXQLGDGH 6ROLG£ULD VKRXOG EH LQFOXGHG@ KDYH KDG OLWWOH VXFFHVV VR IDU :RRGURZ :LOVRQ ,QWHUQDWLRQDO &HQWHU IRU 6FKRODUV f 7KH\ IXUWKHU DJUHH WKDW ZKHQ DQ RSSRUWXQLW\ LV FUHDWHG E\ LQGLYLGXDOV RU E\ QRQJRYHUQPHQWDO RUJDQL]DWLRQV LW UHFHLYHV D JUHDW GHDO RI VXSSRUW >EXW@ WKDW VXFK LQLWLDWLYHV PXVW RULJLQDWH ORFDOO\ DQG FDQQRW FRPH IURP %UDVLOLD LELG f 7KLV ZRXOG LQGLFDWH DJDLQ WKDW %UD]LOLDQ 1*2Vn UHVSRQVH WR WKH 6WDWH KDV EHHQ OLPLWHG ,Q WKH FDVH RI %UD]LOLDQ ZRPHQnV 1*2V VSHFLILFDOO\ LQYROYHPHQW ZLWK WKH 6WDWH LV DOVR PXFK PRUH OLPLWHG WKDQ LQ RWKHU FRXQWULHV VXFK DV &RORPELD RU &KLOH 6 $OYDUH] SHUVRQDO FRPPXQLFDWLRQf ,Q &KLOH IRU H[DPSOH 6(51$0 WKH HTXLYDOHQW RI WKH %UD]LOLDQ &1'0 KDV EHHQ VXEFRQWUDFWLQJ D QXPEHU RI LWV DFWLYLWLHV WR ZRPHQnV 1*2V ZKLFK KDV OHG WR DFFXVDWLRQV WKDW 6(51$0 KDV D FOLHQWHOLVWLF UHODWLRQVKLS ZLWK 1*2V FRPIRUWDEO\ FRH[LVWLQJ ZLWK WKHP DQG SURYLGLQJ nMREV IRU WKH JLUOVn :D\OHQ f
PAGE 271

DUHD RI $,'6 SUHYHQWLRQ 2WKHU ZRPHQnV 1*2V ZHUH DOVR IXQGHG WKURXJK &RPXQLGDGH 6ROLGDULD IRU SURMHFWV ZLWK \RXQJ SHRSOH )DFHG ZLWK VHYHUH ILQDQFLDO GLIILFXOWLHV VHH &KDSWHU f WKHUH ZDV PXFK WDON E\ WKH WLPH OHIW %UD]LO DPRQJ ZRPHQnV 1*2V RI VHFXULQJ IXQGLQJ IURP WKH JRYHUQPHQW 7KLV RI FRXUVH GRHV QRW FRPH ZLWKRXW IHDUV RI D ORVV RI DXWRQRP\ RQ WKH SDUW RI DFWLYLVWV ZKR DUH DOVR DZDUH WKDW WKH\ GR QRW ZDQW WR VXEVWLWXWH IRU WKH VWDWH %HVLGHV WKH LVVXH RI GHSHQGHQFH RQ RIILFLDO IXQGLQJ DQG VXEFRQWUDFWLQJ D VHFRQG PDMRU FRQFHUQ LV WKH 6WDWHnV HIIRUWV WR EHKHDG RUJDQL]HG FLYLO VRFLHW\ /LNH 3URQDVRO 1DWLRQDO 3URJUDP RI 6ROLGDULW\f IRU 6DOLQDV DQG WKH 35, LQ 0H[LFR &RPXQLGDGH 6ROLGDULD KDV EHHQ XQGHUVWRRG E\ LWV FULWLFV DV DQ HIIRUW RI WKH 36'% WR HVWDEOLVK DQG VWUHQJWKHQ LWV EDVH FRQVWLWXHQF\ GH 2OLYHLUD RQ 3URQDVRO VHH 0LUDIWDE f ,W KDV EHHQ IXUWKHU XQGHUVWRRG DV D SRSXOLVW HIIRUW WR EHKHDG RUJDQL]HG FLYLO VRFLHW\ WKURXJK WKH ZD\ LWV &RXQFLO ZDV FRQVWLWXWHG E\ DSSRLQWLQJ IDPRXV LQGLYLGXDOV VXFK DV WKH ODWH %HWLQKR D QDWLRQDO ILJXUH DQG OHDGHU RI '%$6( D ODUJH GHYHORSPHQW 1*2f RU VLQJHU *LOEHUWR *LO RU 'HQLVH 'RXUDGR PHPEHU RI WKH ZRPHQnV 1*2 7HPLV FDOOLQJ XSRQ WKHP DV LQGLYLGXDOV DQG QRW LQ WKHLU TXDOLW\ DV PHPEHUV RI RUJDQL]HG VHFWRUV RI VRFLHW\ GH 2OLYHLUD f $ VLPLODU DSSURDFK ZDV XVHG ZLWK UHJDUG WR WKH ZRPHQfV KHDOWK PRYHPHQW ZKHQ 0DUJDUHWK $ULOKD D ORQJWLPH IHPLQLVW DQG PHPEHU RI WKH 36'% ZDV QRW DFFHSWHG DV &RRUGLQDWRU RI WKH :RPHQ DQG &KLOG +HDOWK 'LYLVLRQ RI WKH +HDOWK 0LQLVWU\ ZKHQ VKH ZDV VXJJHVWHG E\ WKH ZRPHQfV PRYHPHQW RU SDUW RI LWf +RZHYHU VKH ZDV ODWHU DSSRLQWHG WR WKH &RQVHOKR 1DFLRQDO GH 6DGH 1DWLRQDO +HDOWK &RXQFLOf 6KH ZDV QRW VXSSRVHG WR FRQVXOW ZLWK DQ\ERG\ LQ WKH PRYHPHQW DQG VKH GLG QRW 6KH ZDV DSSRLQWHG DV 0DUJDUHWK $ULOKD DQ LQGLYLGXDO DQG QRW DV D UHSUHVHQWDWLYH RI WKH PRYHPHQW

PAGE 272

7KH LQFOXVLRQ RI IRUPHUO\ RSSRVLWLRQDO LQGLYLGXDOV LQ WKH VWDWH LV QRW ZLWKRXW SUREOHPV 'U\]HN f ZDUQV XV WKDW WKH KLVWRU\ RI GHPRFUDWL]DWLRQ LQGLFDWHV WKDW SUHVVXUHV IRU JUHDWHU GHPRFUDF\ DOPRVW DOZD\V HPDQDWH IURP RSSRVLWLRQDO FLYLO VRFLHW\ UDUHO\ RU QHYHU IURP WKH VWDWH LWVHOIn f 7KLV FRQWHQWLRQ QHHGV WR EH WDNHQ VHULRXVO\ DQG ZH ZLOO VHH DV LQ WKH FDVH RI &KLOH WKDW WKH LQFOXVLRQ RI IHPLQLVWV LQ WKH VWDWH LQGHHG KDV SURYHQ EHQHILFLDO \HW SUREOHPDWLF IRU WKH PRYHPHQW
PAGE 273

UHQHZHG YLWDOLW\ DQG OHJLWLPDF\ ZLWK WKH PRYHPHQW RQFH WKH FRQVHUYDWLYH JRYHUQPHQW RI )HPDQGR &ROORU GH 0HOOR ZDV RXVWHG IURP RIILFH LQ 6HSWHPEHU f DQG HVSHFLDOO\ VLQFH WKH FRPLQJ WR SRZHU RI WKH &DUGRVR WHDP ,Q D YHWHUDQ 5LR IHPLQLVW 5RVLVND 'DUF\ GH 2OLYHLUD ZDV DSSRLQWHG DV KHDG RI WKLV UHQHZHG &RXQFLO ZKRVH PHPEHUV DUH OHDGLQJ PHPEHUV RI WKH PRYHPHQW f§PRVW RI WKHP SURIHVVLRQDOL]HG DFWLYLVWV ,W ZLOO EH LQWHUHVWLQJ WR VHH ZKDW ZLOO KDSSHQ QRZ 0DLQWDLQLQJ D GXDO VWUDWHJ\ LV DOVR FKDOOHQJLQJ EHFDXVH WKH VSDFH RI PDQHXYHULQJ DIIRUGHG IHPLQLVWV ZRUNLQJ LQ LQVWLWXWLRQDO VHWWLQJV LV OLPLWHG WKH\ IDFH PXFK RSSRVLWLRQ DQG WKXV WKH JUHDWHVW VSDFH WR DFKLHYH FKDQJH KDV H[LVWHG RQ WKRVH LVVXHV ZKLFK DUH FRQVLGHUHG OHDVW FRQWURYHUVLDO :D\OHQ f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n WKHUDS\ DQG ODUJHO\ LJQRUHV WKH JHQGHUHG SRZHU UHODWLRQV VR FHQWUDO WR IHPLQLVW XQGHUVWDQGLQJV RI WKH FDXVHV DQG UHPHGLHV IRU WKLV GUDPDWLF DQG V\VWHPDWLF YLRODWLRQ RI ZRPHQnV KXPDQ ULJKWV f 0RVW LPSRUWDQW LQ WHUPV RI SURPRWLQJ D VWURQJ ZRPHQnV PRYHPHQW LV WKDW $Q LPSRUWDQW UROH ZDV SOD\HG LQ WKLV UHYLYDO E\ ULVLQJ H[SHFWDWLRQV OLQNHG WR WKH SUHVHQFH RI 5XWK &RUUHD /HLWH &DUGRVR WKH 3UHVLGHQWfV ZLIH D UHVSHFWHG IHPLQLVW VFKRODU DQG DFWLYLVW 6KH KHDGHG WKH RIILFLDO %UD]LOLDQ GHOHJDWLRQ WR %HLMLQJ 1HHGOHVV WR VD\ KHU YHU\ H[LVWHQFH KDV DOVR H[DFHUEDWHG WHQVLRQV EHWZHHQ IHPLQLVWV DORQJ SROLWLFDO OLQHV

PAGE 274

SROLF\ DGYRFDWHV IRFXVLQJ RQ WKH SROLWLFDO GLPHQVLRQ RI SROLF\ ZRUN RIWHQ IDLO WR VHH LWV FXOWXUDO GLPHQVLRQ WKH\ KDYH D UROH WR SOD\ LQ JHQHUDWLQJ GHEDWH LQ WKH ODUJHU SXEOLF RSLQLRQ ZKLFK FRQWULEXWHV WR UHGHILQLQJ JHQGHU UROHV DQG WKH JHQHUDOO\ DFFHSWHG PHDQLQJV DQG WKHUHIRUH SUDFWLFHV RI WKH QDWXUDOL]HG FXOWXUDO RUGHU RI WKLQJV LQ %RXUGLHXnV WHUPV GR[Df 7KHVH UHGHILQLWLRQV QHHG WR EH PDGH DV WUDQVJUHVVLYH DV SRVVLEOH LQ WKH VHQVH RI JHQGHU HTXLW\ 7KLV SURFHVV RI UHGHILQLWLRQ LV KDPSHUHG E\ GLVFXUVLYH DFFRPPRGDWLRQV $OYDUH] f ,Q RWKHU ZRUGV LQWHUDFWLRQ ZLWK WKH VWDWH LV IUDXJKW ZLWK GLIILFXOWLHV IRU IHPLQLVW DFWLYLVWV DV PDQ\ RI WKRVH LQYROYHG DUH RIWHQ NHHQO\ DZDUH
PAGE 275

7KH 1DWLRQDO &RQIHUHQFH LQ DSSURYLQJ SURSRVDOV DQG FHOHEUDWLQJ WKH VHULRXVQHVV RI WKH SURFHVV EHFDPH D EHQFKPDUN DQG WKH SHUIRUPDQFHV HODERUDWHG E\ WKH VWDWH GHOHJDWLRQV DQG WKH DUWLVWV HVSHFLDOO\ LQYLWHG IRU WKLV HYHQW EHFDPH D GHPRQVWUDWLRQ RI ZK\ IHPLQLVP EH\RQG D SROLWLFDO PRYHPHQW LV D FXOWXUDO PRYHPHQW FRQFHUQHG ZLWK WKH PDWHULDO DQG VSLULWXDO QHFHVVLWLHV RI KXPDQ EHLQJV $UWLFXODGR GH 0XOKHUHV %UDVLOHLUDV f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f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f RU PRUH UHFHQWO\ WKH ELOO HQVXULQJ WKH DFWXDO LPSOHPHQWDWLRQ LQ SXEOLF KRVSLWDOV RI WKH ODZ ZKLFK DOORZV DERUWLRQ LQ FDVHV RI WKUHDW WR WKH OLIH RI WKH PRWKHU UDSH RU LQFHVW 7KH

PAGE 276

GRFXPHQWV HPHUJLQJ IURP WKH %HLMLQJ DQG HVSHFLDOO\ WKH &DLUR FRQIHUHQFH ZLWK ZKLFK %UD]LOLDQ IHPLQLVWV KDYH EHHQ SDUWLFXODUO\ LQYROYHG DQG ZKLFK KDYH EHHQ UDWLILHG E\ WKH %UD]LOLDQ JRYHUQPHQW KDYH DOORZHG IHPLQLVW SROLF\ DGYRFDWHV WR SUHVVXUH WKH &RQJUHVV QRW WR YHWR WKH DIRUHPHQWLRQHG ELOO 0RUHRYHU LQYROYHPHQW LQ WKH LQWHUQDWLRQDO ZRPHQnV PRYHPHQW DPRQJ RWKHU WKLQJV KDV DOVR VWUHQJWKHQHG WLHV EHWZHHQ IHPLQLVW DFWLYLVWV WKURXJKRXW /DWLQ $PHULFD DQG LQ WKH ZRUOG ,W KDV DFFHOHUDWHG WKH SURFHVV RI SDUWLFLSDWLRQ LQ ORFDO /DWLQ $PHULFDQ IHPLQLVW PRYHPHQWV RI $IUR/DWLQ $PHULFDQ OHVELDQV GLVDEOHG ZRPHQ DQG LQGLJHQRXV ZRPHQ HPEROGHQHG E\ JOREDO GLVFRXUVHV RQ nGLYHUVLW\n DQG E\ FRQWDFWV ZLWK DFWLYLVWV ZLWK VLPLODU EDFNJURXQGV LQ RWKHU SDUWV RI WKH ZRUOG ZLWK DOWHUQDWLYH IHPLQLVW GLVFRXUVHV $OYDUH] f ,Q WKHLU HIIRUW WR UHDFK D FRQVHQVXV DQG ZLQ OHJLVODWLYH EDWWOHV E\ OHDUQLQJ WR VSHDN WKH VDPH ODQJXDJH DV OHJLVODWRUV DQG GLSORPDWV LQ RUGHU WR EH XQGHUVWRRG DQG OLVWHQHG WR IHPLQLVWV PXVW EH FDUHIXO QRW WR JLYH ZD\ WR D IHPLQLVPR DSODQDOWDGR RU IHPLQLVPR GH EOD]HU IODWWHQHG IHPLQLVP RU IHPLQLVP LQ EOD]HUf *DUFLD &DVWUR f /LNH WKH ZRPHQ IURP 0RYLPHQWR H 6DGH WKH\ PXVW ILQG D ZD\ RI FUHDWLQJ WKH FLUFOH RI FKDQJLQJ WKH G\QDPLFV RI SROLWLFV DV XVXDO RI UHVLVWLQJ GLVFXUVLYH DFFRPPRGDWLRQ RXWVLGH RI SROLF\ DUHQDV RU JHQXLQHO\ HQJDJLQJ LQ WKH FULWLFDOQHJRWLDWLQJ SRVWXUH LQ UHODWLRQ WR WKH 6WDWH WKDW 9LUJLQLD 9DUJDV SURPLQHQW 3HUXYLDQ IHPLQLVW DGYRFDWHV $OYDUH] Ef ,W LV RI FRXUVH D WDOO RUGHU FRQVLGHULQJ WKHLU OLPLWHG QXPEHUV DQG WKH RSSRVLWLRQ WKH\ DUH IDFLQJ 7KH\ FDQ RQO\ GR VR ZLWK 0DU\ *DUFLD &DVWUR FDOOV WKLV IHPLQLVP SRXFR RQGXODGR ZLWK IHZ ZDYHVf 6KH VD\V LW LV WKH IHPLQLVP ZKLFK KDV EHHQ ZHOFRPH DW WKH 8QLWHG 1DWLRQV DGRSWHG E\ LQWHUQDWLRQDO DJHQFLHV DQG E\ WKH PRVW GLYHUVH JRYHUQPHQWV UHJDUGOHVV RI WKHLU UHFRUG RQ DXWKRULWDULDQ DQG H[FOXGLQJ SUDFWLFHV 6KH LV DOVR PDNLQJ D SOD\ RQ ZRUGV VLQFH WKH 3ODQDOWR DOVR UHIHUV WR WKH ORFDWLRQ RI WKH %UD]LOLDQ &RQJUHVV DQG SUHVLGHQWLDO RIILFHV LQ %UDVLOLD

PAGE 277

WKH KHOS RI D YLEUDQW DXWRQRPRXV PRYHPHQW SUHVVXULQJ WKH DXWKRULWLHV DQG E\ FRQVWDQWO\ UHVRXUFLQJ WKHPVHOYHV WKURXJK GLDORJXH ZLWK IHPLQLVWV ORFDWHG LQ RWKHU ZLQJV RI WKH ZRPHQnV PRYHPHQW VRFLDO PRYHPHQW ILHOG

PAGE 278

&+$37(5 83 7+( 3856(f6 675,1*6 1*2 5(/$7,216 :,7+ '2125 $*(1&,(6 7KH HPSKDVLV RQ SROLF\FHQWHUHG ZRUN ZDV D FKRLFH PDGH E\ VRPH ZRPHQnV JURXSV DV WKH\ H[SHFWHG WR SURPRWH PRUH HIIHFWLYH FKDQJHV WKURXJK WKHLU LQYROYHPHQW LQ WKH SROLWLFDO VSKHUH DIWHU WKH UHWXUQ WR GHPRFUDF\ 7KH\ WKXV QHHGHG RUJDQL]DWLRQDO IRUPV EHWWHUVXLWHG WR WKLV W\SH RI ZRUN DQG RSWHG IRU PRUH IRUPDOL]HG DQG SURIHVVLRQDOL]HG RUJDQL]DWLRQV
PAGE 279

WKH SUREOHPV UHVXOWLQJ IURP WKH LQKHUHQW SRZHU GLIIHUHQWLDO EHWZHHQ WKHVH WZR DFWRUV +RZHYHU ZLOO EHJLQ WKH FKDSWHU E\ SUHVHQWLQJ WKH DJHQFLHV ZKLFK ILQDQFH ZRPHQnV KHDOWK JURXSV DQG WKH UHFHQW FKDQJHV LQ WKLV LQWHUQDWLRQDO FRRSHUDWLRQ ODQGVFDSH ZKLFK KDYH WUDQVODWHG LQ WKH GLIILFXOWLHV DQG VDFULILFHV RQ WKH SDUW RI %UD]LOLDQ IHPLQLVW 1*2V 'RQRU $JHQFLHV $ 'LYHUVH &RPPXQLW\ 7KH DJHQFLHV ZKLFK ILQDQFH 6DR 3DXORnV ZRPHQnV KHDOWK JURXSV IRUP D GLYHUVH FRPPXQLW\ 6WLOO WKH RYHUZKHOPLQJ PDMRULW\ RI WKH IXQGLQJ FRPHV IURP QRQJRYHUQPHQWDO VRXUFHV DV LV WUXH IRU WKH PDMRULW\ RI %UD]LOLDQ 1*2V )HUQDQGHV /DQGLP t &RWULP f ,Q IDFW WKH SURSRUWLRQ RI QRQJRYHUQPHQWDO IXQGLQJ LV KLJKHU IRU WKH ZRPHQnV 1*2V ZRUNHG ZLWK WKDQ IRU 1*2V LQ JHQHUDO ,Q b RI $%21* PHPEHUV IXQGLQJ FDPH IURP WKH QRQJRYHUQPHQWDO LQWHUQDWLRQDO FRRSHUDWLRQ VHFWRU 7KLV ILJXUH ZDV b DQG b IRU 637 DQG )t6 UHVSHFWLYHO\ 7KH UHVW RI WKHLU ILQDQFLQJ FRQVLVWHG LQ PRQH\ IRU VHUYLFHV UHQGHUHG /DQGLP t &RWULP f 7KLV PHDQV WKDW WKHVH ZRPHQnV KHDOWK 1*2V UHFHLYHG OLWWOH IXQGLQJ IURP PXOWLODWHUDOELODWHUDO DJHQFLHV 7KLV LV JHQHUDOO\ WUXH IRU PRVW %UD]LOLDQ ZRPHQfV 1*2V ZLWK D IHZ H[FHSWLRQV VHH 7DEOH f 7KLV VLWXDWLRQ DSSHDUHG WR EH FKDQJLQJ VRPHZKDW %\ WKH WLPH FRQGXFWHG P\ UHVHDUFK )t6 ZDV DOVR UHFHLYLQJ ILQDQFLQJ IURP D :RUOG %DQN%UD]LOLDQ 0LQLVWU\ RI +HDOWK SURMHFW IRU ZRPHQ DQG $,'6 7KLV SURMHFW GLG QRW KRZHYHU UHSUHVHQW D VXEVWDQWLDO SHUFHQWDJH HLWKHU LQ WHUPV RI )t6 EXGJHW RU SHUVRQQHO WLPH 7KH &DVD GD 0XOKHU 6DQGH DQG RWKHU ZRPHQnV KHDOWK JURXSV ZHUH VLPLODUO\ ILQDQFHG XQGHU WKH VDPH SURMHFW

PAGE 280

7DEOH 7\SHV RI )LQDQFLQJ IRU VRPH %UD]LOLDQ :RPHQnV 1*2V ,Q SHUFHQWDJH RI WRWDO EXGJHW QXPEHUV IRU f ,QWnO 1RQJRYHUQPHQWDO &RRSHUDWLRQ ,QWHUQDWLRQDO *RYHUQPHQWDO 6DOH RI 3URGXFWV t 6HUYLFHV &(0,1$ &(3/$ &)(0($ 626 &2532 5('(+ 637 )t6 $OO $%21* PHPEHUVr 6RXUFH /DQGLP t &RWULP 1RWH r 2WKHU VRXUFHV IRU $%21* PHPEHUV DUH %UD]LOLDQ JRYHUQPHQW DJHQFLHV b ,QGLYLGXDO GRQDWLRQV b &RUSRUDWH HQWLWLHV b 2WKHUV b &HUQLQD UXQV UDGLR SURJUDPV RQ ZRPHQnV LVVXHV :K\ LWV ILQDQFLQJ VRXUFHV DUH VR GLIIHUHQW IURP RWKHU JURXSV LV QRW FOHDU 1RQJRYHUQPHQWDO LQWHUQDWLRQDO FRRSHUDWLRQ DJHQFLHV FDQ EH FODVVLILHG LQ WZR EURDG FDWHJRULHV WKHUH DUH $PHULFDQ SULYDWH IRXQGDWLRQV ZLWK WKHLU RULJLQV LQ VHFXODU FRUSRUDWH SKLODQWKURS\ VXFK DV 7KH )RUG )RXQGDWLRQ RU WKH 0DF$UWKXU )RXQGDWLRQ DQG (XURSHDQ QRQJRYHUQPHQWDO DJHQFLHV f§PDQ\ RI ZKLFK KDYH UHOLJLRXV DIILOLDWLRQVf§ VXFK DV ,&&2 &HEHPR 1RYLE 0HPLVD DQG =:' 1HWKHUODQGVf &KULVWLDQ $LG 8.f RU 0LVHUHRU *HUPDQ\f %UD]LOLDQ IHPLQLVW 1*2V KDYH KDG OLQNV WR WKHVH (XURSHDQ 1*2V IRU D ORQJ WLPH 1RUWK $PHULFDQ IRXQGDWLRQV UHSUHVHQW D PRUH UHFHQW WUHQG IRU ZRPHQnV DFWLYLVW JURXSV DOWKRXJK )RUG KDV EHHQ VXSSRUWLQJ %UD]LOLDQ 1*2V VXFK DV WKH ZHOONQRZQ UHVHDUFKWKLQNWDQN &(%5$3 IRU RYHU \HDUV KHOSLQJ RSSRVLWLRQ LQWHOOHFWXDOV WR SXUVXH WKHLU DFWLYLWLHV GXULQJ WKH GLFWDWRUVKLS DV ZHOO DV UHVHDUFK E\ IHPLQLVW DFDGHPLFV %ULDQ 6PLWK f KDV ZULWWHQ D GHWDLOHG DFFRXQW RI WKH GLIIHUHQFHV EHWZHHQ WKHVH WZR W\SHV RI GRQRU DJHQFLHV WUDFLQJ WKHLU RULJLQV KLVWRU\ DQG YLVLRQV IURP :RUOG :DU ,, XS XQWLO DV ZHOO DV WKH SROLWLFDO DQG FXOWXUDO UHDVRQV EHKLQG WKHVH GLIIHUHQFHV

PAGE 281

$ IHZ QRUWKHUQ IHPLQLVW 1*2V DOO 86EDVHG KDYH DOVR DSSHDUHG RQ WKH VFHQH VXFK DV WKH ,QWHUQDWLRQDO &HQWHU IRU 5HVHDUFK RQ :RPHQ ,&5:f WKH *OREDO )XQG IRU :RPHQ WKH ,QWHUQDWLRQDO 5HSURGXFWLYH 5LJKWV 5HVHDUFK $FWLRQ *URXS ,555$*f DQG WKH ,QWHUQDWLRQDO :RPHQnV +HDOWK &RDOLWLRQ ,:+&f &RUSRUDWH ILQDQFLQJ LV VORZO\ ZHDYLQJ LWV ZD\ LQ LQ )t6 UHFHLYHG IXQGLQJ IURP WKH /YL6WUDXVV FRPSDQ\ IRU D VPDOO SURMHFW RQ $,'6 SUHYHQWLRQ /HLODK /DQGLP KDV QRWHG WKDW VLJQLILFDQW FKDQJHV KDYH EHJXQ WR RFFXU >@ GXULQJ WKH ODVW WZR RU WKUHH \HDUV ZKHQ QHZ FRUSRUDWH LQVWLWXWLRQV KDYH EHJXQ WR DSSHDU LQ WKH DUHQD RI QRQSURILW SULYDWH DFWLRQ IRU SXEOLF EHQHILW E f 6KH PHQWLRQV WKH UHFHQW FUHDWLRQ RI *,)( *UXSR GH ,QVWLWXWRV H )XQGDUHV (PSUHVDULDO *URXS RI &RUSRUDWH ,QVWLWXWHV DQG )RXQGDWLRQVf 7DEOHV VKRZV WKH VRXUFHV RI ILQDQFLQJ RI WKH IRXU JURXSV ZKR ZHUH SDUW RI WKLV UHVHDUFK :KLOH 08 DQG 7KH &DVD GHDO ZLWK D OLPLWHG QXPEHU RI GRQRUV 637 DQG HVSHFLDOO\ )t6 KDYH WR MXJJOH QXPHURXV ILQDQFLQJ VRXUFHV 1RWH WKDW 637 UHOLHV PRVWO\ RQ (XURSHDQ DJHQFLHV ZKLOH )t6 KDV PRUH OLQNV WR 1RUWK $PHULFDQ SKLODQWKURSLF DQG IHPLQLVW GRQRUV 7KH UDSSURFKHPHQW ZLWK WKH FRUSRUDWH ZRUOG LPSUREDEOH LQ DQ HDUOLHU SHULRG LV DOVR LQGLFDWHG E\ WKH IDFW WKDW $YRQ &RPSDQ\ SDLG IRU WUDLQLQJ E\ IHPLQLVW DFWLYLVWV IURP WKH 6DR 3DXORnV ZRPHQnV ULJKWV FRXQFLO &(&)f $YRQ VWDII ZLOO VSHQG PLQXWHV DW WKH EHJLQQLQJ RI HDFK VHVVLRQ ZLWK WKHLU UHWDLOHUV WDONLQJ DERXW ZRPHQnV KHDOWK LVVXHV HVSHFLDOO\ EUHDVW FDQFHU SUHYHQWLRQ

PAGE 282

7DEOH *URXSVf 6RXUFHV RI )LQDQFLQJ LQ 0XOKHUHV 8QLGDV &DVD GD 0XOKHU 637 )t6 0DF$UWKXU 0DF$UWKXU +HDOWK 0LQLVWU\ ,&&2 0DF$UWKXU 0DF$UWKXU )RUG &KULVWLDQ $LG *OREDO )XQG IRU :RPHQ 0HPLVD &DUORV &KDJDV )RXQGDWLRQ =:' ,&5: ,&&2 ,555$* /YL6WUDXVV +HDOWK 0LQLVWU\ /DWLQ $PHULFDQ 1*2V LQ &ULVLV 7KHUH LV QR GRXEW DPRQJ DFWLYLVWV DQG REVHUYHUV DOLNH WKDW UHVRXUFHV IURP GRQRU DJHQFLHV IRU /DWLQ $PHULFDQ 1*2V KDYH EHFRPH PRUH VFDUFH LQ UHFHQW \HDUV 7KH %UD]LOLDQ PDJD]LQH 9HMD DQQRXQFHG LQ WKDW b RI 1*2V ZHUH FXWWLQJ HPSOR\HHV DQG SURJUDPV 0D\ FLWHG LQ +RFKVWHWOHU f %HIRUH JHWWLQJ LQWR KRZ VXFK FXWV KDYH DIIHFWHG WKH JURXSV ZLWK ZKLFK ZRUNHG ZDQW WR FRQVLGHU WKH FDXVHV RI WKLV ILQDQFLDO FULVLV ,W LV QRW FOHDU ZKHWKHU WKHUH KDV EHHQ D VWUDLJKWIRUZDUG GHFOLQH LQ QRQJRYHUQPHQWDO ILQDQFLQJ IRU WKH UHJLRQ DV LV FODLPHG E\ PDQ\ %UD]LOLDQ 1*2V DQG VHHPV WR EH FRQILUPHG E\ /DQGLP t &RWULPnV ILQGLQJ RI D VPDOO UHODWLYH GHFOLQH RI DYDLODEOH UHVRXUFHV EHWZHHQ DQG f RU ZKHWKHU IXQGLQJ KDV EHHQ LQFUHDVLQJ DW D VORZHU SDFH WKDQ LQ WKH V DQG HDUO\ V FRXSOHG ZLWK DQ LQFUHDVH LQ WKH QXPEHU RI JURXSV EHLQJ IXQGHG 7KH ODWWHU ZDV WKH H[SODQDWLRQ $V IDU DV JRYHUQPHQWDO DLG LV FRQFHUQHG WKH GHFOLQH LV FOHDU WKH WRWDO UHVRXUFHV LQ IURP WKH 1RUWK WR WKH 6RXWK ZHQW GRZQ E\ ELOOLRQ GROODUV FRPSDUHG WR SUHYLRXV \HDUV IURP WR ELOOLRQ GROODUV 5HLFK f PLOOLRQ GROODUV IRU $%21* PHPEHUV LQ YHUVXV PLOOLRQ GROODUV IRU RUJDQL]DWLRQV LQ /DGLP t &RWULP [YLLf

PAGE 283

E\ D SURJUDP RIILFHU RI D *HUPDQ QRQJRYHUQPHQWDO DJHQF\ (=(f DW D PHHWLQJ EHWZHHQ %UD]LOLDQ 1*2V DQG WZR GRQRU DJHQFLHV 0GLDV 21*V f 2QH WKLQJ LV FHUWDLQ ZRPHQnV 1*2V LQ %UD]LO DQG /DWLQ $PHULFD LQ JHQHUDO DUH GHILQLWHO\ IHHOLQJ WKH SLQFK 6R PXFK VR WKDW WKH\ GHFLGHG WR VWDJH D VLOHQW SURWHVW LQVLGH WKH RIILFLDO IRUXP RI WKH )RXUWK 81 &RQIHUHQFH RQ :RPHQ LQ %HLMLQJ LQ 6HSWHPEHU RI DVNLQJ IRU LQFUHDVHG IXQGLQJ IRU /DWLQ $PHULFDQ ZRPHQnV LVVXHV LGHQWLILHG WKUHH PDLQ UHDVRQV IRU 1*2Vn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f %H\RQG WKLV JHRSROLWLFDO VKLIW WKH SULRULWLHV RI (XURSHDQ QRQJRYHUQPHQWDO GRQRU DJHQFLHV KDYH WUDGLWLRQDOO\ EHHQ RULHQWHG E\ LVVXHV RI QHHGV FDUHQFLDf RU SROLWLFV UDWKHU WKDQ VWULFW FRVWEHQHILW FDOFXODWLRQV ,W IROORZV WKDW /DWLQ $PHULFDQ FRXQWULHVf UHWXUQ WR IRUPDO GHPRFUDF\ PDGH WKHP OHVV DSSHDOLQJ WR DJHQFLHV ZKLOH $IULFDQ DQG $VLDQ FRXQWULHV DUH VHHQ DV QHHGLQJ PRUH DVVLVWDQFH )HUQDQGHV f 0RUHRYHU LQ UHFHQW \HDUV (XURSHDQ JRYHUQPHQWV DQG SXEOLF RSLQLRQ KDYH EHHQ SXWWLQJ SUHVVXUH RQ WKHLU FRRSHUDWLRQ DJHQFLHV TXHVWLRQLQJ WKH VXSSRUW WR /DWLQ $PHULFDnV GHYHORSPHQW FRQVLGHULQJ WKDW IXQGV KDYH EHHQ SRXUHG GRZQ WKH GUDLQ IRU \HDUV DQG WKDW

PAGE 284

WKH VLWXDWLRQ GRHV QRW VHHP WR JHW DQ\ EHWWHU :ROIJDQJ .DLVHU UHSUHVHQWDWLYH RI (=( H[SODLQHG LW LQ WKHVH WHUPV WR %UD]LOLDQ 1*2V 7KHQ TXHVWLRQV VWDUWHG EHLQJ UDLVHG E\ JRYHUQPHQWDO DJHQFLHV WKH PHGLD SXEOLF RSLQLRQ ZKDW \RX DUH GRLQJ WKHVH SKLODQWKURSLF SURMHFWV" $UH WKH\ SROLWLFDO LQWHUYHQWLRQV LQ D IRUHLJQ FRXQWU\" &DQ ZH WUXVW WKH ZD\ \RX DUH DOORFDWLQJ WKH IXQGV" ZKDW DUH WKH UHVXOWV LQ FRQFUHWH WHUPV" $UH WKH UHVXOWV EHWWHU WKDQ WKRVH RI JRYHUQPHQWDO FRRSHUDWLRQ" 0GLDV 21*V f 1*2 OHDGHUV DUH ZHOO DZDUH RI WKHVH SROLF\ VKLIWV $QD 0DULD )t6f ZDV TXLWH FOHDU RQ WKH VXEMHFW :KDW WKH\ DUH VD\LQJ LV WKH IROORZLQJ WKDW WKH DJHQFLHV KDYH EHHQ LQYHVWLQJ LQ /DWLQ $PHULFD IRU \HDUV DQG WKDW SRYHUW\ KDV QRW FKDQJHG RQH ELW 7KLV KDYH KHDUG D QXPEHU RI WLPHV > @ 1RZ LQ WKHVH PRUH UHFHQW FKDQJHV ZKDW WKH (XURSHDQ DJHQFLHV DQG WKH :RUOG &RQJUHVV RI &KXUFKHV DUH GRLQJ WKH\ DUH UHGLUHFWLQJ WKH PRQH\ WR $IULFD WR (DVWHUQ (XURSH DQG VR RQ 7KH 6KRFN RI WKH 3ODQR 5HDO 7KH LQWHUQDO HFRQRPLF SROLFLHV RI ,WDPDU )UDQFRnV JRYHUQPHQW f DQG PRUH VSHFLILFDOO\ WKH LQWURGXFWLRQ RI D QHZ FXUUHQF\ OLQNHG WR WKH GROODU R 5HDO 5f LQ -XO\ DIWHU D WUDQVLWLRQ SHULRG VWDUWLQJ LQ ODWH f ZKLFK EURXJKW DERXW D PXFK ORZHU LQIODWLRQ UDWH GHDOW VHYHUH EORZV WR 1*2Vf EXGJHWV RQ VHYHUDO DFFRXQWV 7KH 3ODQR 5HDO GLG ORZHU LQIODWLRQ EXW LW DQFKRUHG WKH %UD]LOLDQ FXUUHQF\ WR WKH 86 GROODU 7KLV QHZ SROLF\ WUDQVODWHG LQWR DQ H[WUHPHO\ XQIDYRUDEOH H[FKDQJH UDWH IRU WKH JUDQW PRQH\ ZKLFK 1*2V UHFHLYHG LQ GROODUV DQG RWKHU KDUG FXUUHQFLHV )RU H[DPSOH XVLQJ -DQXDU\ DV D EDVH OLQH WKH UHYHQXH UHFHLYHG E\ 1*2V LQ GROODUV LQ -DQXDU\ IHOO E\ b WKH UHYHQXH UHFHLYHG LQ 'XWFK )ORULQV IHOO E\ 2Q WKH 3ODQR 5HDO DQG PRUH JHQHUDOO\ RQ %UD]LOnV SROLLWLFDO HFRQRP\ LQ WKH V VHH .RU]HQLHZLF] DQG 0DFLDV

PAGE 285

b DQG WKH UHYHQXH UHFHLYHG LQ 'HXWVFKPDUNV IHOO E\ b 5RVDQJHOD 3D] $%21* $VVLVWDQW 'LUHFWRU SHUVRQDO FRPPXQLFDWLRQf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n FRORQLDOLVP DQG WHUFHLURPXQGLVPRn )RFXVLQJ RQ WKH %UD]LOLDQ VLWXDWLRQ /HLODK /DQGLP ZULWHV (XURSHDQ DQG &DQDGLDQ DJHQFLHV ZKLFK DUH RI LQWHUHVW WR XV KHUH ZHUH ERP UDWKHU LQGHSHQGHQWO\ IURP WKHLU JRYHUQPHQWV DQG HVSHFLDOO\ VWDUWLQJ LQ WKH V ZLWK D VWURQJ LQIOXHQFH RI )$2nV FDPSDLJQ DJDLQVW +XQJHU FRPPLWWHHVf LQWHQVLILHG WKHLU UHODWLRQV ZLWK WUDGHXQLRQV DQG SROLWLFDO DFWLYLVW JURXSV LQ WKHLU RZQ FRXQWULHV +HQFH WKH\ GHYHORSHG LGHDV DQG DFWLRQV FULWLFL]LQJ WKH LQWHUQDWLRQDO SROLFLHV RI WKHLU JRYHUQPHQWV Df /DQGLP DOVR HPSKDVL]HV KRZ /DWLQ H[LOHV LQWHJUDWHG WKHVH DJHQFLHV DQG KHOSHG UHGHILQH WKHLU SROLFLHV 7KH\ FRQVLGHUHG WKHPVHOYHV WR EH DFWLYLVWV 7KH\ KRSHG WR FKDQJH WKH ZRUOG DQG FUHDWHG 1*2V LQ RUGHU WR EXLOG VROLGDULW\ DFURVV WKH JOREH )HUQDQGHV f 7KH\ DOVR $ WHUP ZKLFK KDV QR (QJOLVK WUDQVODWLRQ EXW PHDQV DFWLYLVP LQ IDYRU RI FKDQJHV LQ WKH 6RXWK DQG LQ WKH 1RUWK LQ RUGHU WR DOORZ IRU D FKDQJH LQ SRZHU UHODWLRQV EHWZHHQ WKHP

PAGE 286

HQJDJHG LQ HGXFDWLRQ DERXW WKH VWUXFWXUDO FDXVHV RI 7KLUG :RUOG SRYHUW\ LQ WKHLU RZQ FRXQWULHV 6PLWK f
PAGE 287

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nV D VXUSULVH 0DULHNH :DJHV DW 1RYLE DUH QRW KLJK VR WKRVH ZKR ZDQW WR HDUQ D ORW RI PRQH\ LW LV EHWWHU IRU WKHP WR ORRN IRU D ILUP 1 2I FRXUVH 6R LW LV D VLPLODU G\QDPLF DV DPRQJ ZRPHQnV 1*2V 0DULHNH ,W LV QRW RQO\ EHFDXVH RI VROLGDULW\ WKDW ZH DUH ZRUNLQJ ZH DOVR KDYH D FHUWDLQ OHYHO RI SURIHVVLRQDOLW\ @ 6R ZH DUH QRZ SD\LQJ PRUH DWWHQWLRQ WR ZKDW LV KDSSHQLQJ ,W LV QRW OLNH EHIRUH ZKHQ ZH VDLG :HOO JUHDW :H JLYH \RX WKH PRQH\ DQG \RX VWDUW ZRUNLQJ DQG RQH GD\ ZH ZLOO PHHW VR \RX FDQ WHOO XV ZKDW KDV EHHQ GRQH ZLWK WKH PRQH\ DQG WKDWnV ILQH 7KDWnV ILQHn DP H[DJJHUDWLQJ D ELW EXWEXW LQ VRPH FDVHV IRU PRUH WKDQ

PAGE 288

\HDUV \HDUV LW ZDV OLNH WKLV :H YLVLWHG D FRXQWU\ ORRNLQJ IRU RUJDQL]DWLRQV ZH FRXOG KHOS DQG WKH\ WROG XV ZKDW WKH\ ZDQWHG WR GR DQG WKH GLUHFWRU ZDONHG DURXQG ZLWK WKH FKHFNERRN LQ KLV SRFNHW DQG ZRXOG JLYH WKHP WKH FKHFN VD\LQJ nVHQG XV VRPH LQIRUPDWLRQ VRPHGD\n ,W ZDV OLNH WKLV LQ VRPH FDVHV WKDW ZH VSHQW RXU PRQH\ 7RGD\ LWnV QR ORQJHU OLNH WKLV 2QH PDMRU IDFWRU WKDW KDV ZRUNHG LQ IDYRU RI WKLV UHRULHQWDWLRQ RI (XURSHDQ QRQJRYHUQPHQWDO DLG LV WKH TXHVWLRQLQJ WKH\ KDYH UHFHQWO\ VXIIHUHG E\ (XURSHDQ JRYHUQPHQWV DQG SXEOLF RSLQLRQ $V :ROIJDQJ .DLVHU (=(f DUJXHG LQ WKH VHPLQDU PHQWLRQHG DERYH )DFHG ZLWK DOO WKLV TXHVWLRQLQJ DJHQFLHV KDYH RIWHQ KDG GLIILFXOWLHV LQ H[SODLQLQJ WKH LPSDFW RI WKHLU RZQ ZRUN RI WKH SULRULWLHV ZKLFK DUH PRUH UHODWHG WR TXDOLWDWLYH VRFLDO FKDQJHV WKDQ WR TXDQWLWDWLYH > @ 7KLV LV ZKHUH WKH TXHVWLRQV WKH $JHQFLHV DUH DVNLQJ WR WKHLU SDUWQHUV DUH FRPLQJ IURP ZKDW FDQ \RX WHOO XV DERXW \RXU ZRUN DERXW LWV LPSDFW DERXW WKH UHVXOWV RI \RXU DFWLYLWLHV" 0GLDV 21*V f ,W LV FOHDU WKDW (XURSHDQ DJHQFLHV DUH PRGLI\LQJ WKHLU DFFRXQWDELOLW\ UHTXLUHPHQWV )RU %UHQW D 86 IRXQGDWLRQ UHSUHVHQWDWLYH WKLV FKDQJH FDPH DV D VKRFN EHFDXVH WKH (XURSHDQ GRQRUV IRU D ORQJ WLPH GLG D ORW RI VRUW RI VROLGDULW\ IXQGLQJ XVHG WR ZRUN IRU ,$) >,QWHUDPHULFDQ )RXQGDWLRQ@ DQG LW ZDV UHDOO\ IXQQ\ PHDQ ,fG VHH WKH VDPH SURMHFW WKH ZD\ WKH SURSRVDO ZDV ZULWWHQ IRU WKH (XURSHDQV DQG WKH ZD\ LW ZDV ZULWWHQ IRU WKH $PHULFDQV :LWK D KLQW RI VDUFDVP LQ KLV YRLFH KH DGGHG 7KH RQHV IRU WKH (XURSHDQV \RX NQRZ ZHUH DOO DERXW UHYHUVLQJ DXWKRULWDULDQLVP ILJKWLQJ IRU VRFLDO MXVWLFH
PAGE 289

WKH 86 JRYHUQPHQW WKHVH HQWLWLHV KDYH QHYHUWKHOHVV EHHQ XQGHU WKH VFUXWLQ\ RI SXEOLF RSLQLRQ DQG RI WKH 86 &RQJUHVV ZKLFK UHJXODWHV DQG SDUWLDOO\ PRQLWRUV WKHLU DFWLYLWLHV PDLQO\ WKURXJK WD[ H[HPSWLRQ OHJLVODWLRQV )LQDOO\ 86 FXOWXUH LV JHQHUDOO\ PRUH WKRURXJKO\ SHUPHDWHG E\ PDUNHW SULQFLSOHV DQG LWV FRVWEHQHILW FDOFXODWLRQV :ROIH f 'DQLHO 5HLFK QLFHO\ VXPPHG XS WKH FXUUHQW WUHQG RI LQWHUQDWLRQDO FRRSHUDWLRQ LQ /DWLQ $PHULFD :H DUH LQ D QHZ HUD RI FKDQJH 7KH V ZDV WKH GHFDGH RI GHYHORSPHQW DQG RI WKH n*UHHQ 5HYROXWLRQn WKH V WKDW RI VROLGDULW\ 7KH V ZDV WKDW RI SDUWQHUVKLS DQG QRZ LQ WKH V ZKDW LV PRVW VDOLHQW LV SURIHVVLRQDOLVP LPSDFW DQG UHVXOWV 5HLFK f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nV KHDOWK SODQ DQG DQ\ DX[LOLDU\ VXSSRUW ZHUH DOVR FXW GRZQ H[FHSW IRU VXSSRUW IRU FKLOG FDUH H[SHQVHV ,Q -XO\ 637 VWDII ZHQW $IWHU D VHULHV RI FRQJUHVVLRQDO KHDULQJV LQ WKH ODWH V RYHU WD[ DEXVHV DQG SRWHQWLDOO\ GLVUXSWLYH DFWLYLWLHV RI IRXQGDWLRQV QHZ QRQSURILW WD[ UHJXODWLRQV ZHUH SDVVHG 1LHOVHQ ZULWHV WKHLU >ODUJH IRXQGDWLRQV@ W\SLFDOO\ FRQVHUYDWLYH ERDUGV KDYH GHYHORSHG D QHZ SUHRFXSDWLRQ ZLWK WKH SRVVLEOH UHDFWLRQ RI &RQJUHVV DQG WKH ,QWHUQDO 5HYHQXH 6HUYLFH WR WKHLU JUDQW GHFLVLRQV f 6HH DOVR *RXOGHQ RQ VDPH LVVXH 6LPRQ f UHSRUWV RQ FRQWLQXHG FRQWURYHUVLHV LQ WKH 5HDJDQ HUD DQG RQ WKH YDULRXV OLPLWDWLRQV LPSRVHG E\ WKH QRQSURILW WD[ ODZ RQ SKLODQWKURSLF DFWLYLWLHV

PAGE 290

ZLWKRXW SD\ IRU RQH PRQWK ZKLOH WKH\ ZHUH ZDLWLQJ IRU WKH FDVK DGYDQFH D ILQDQFLQJ DJHQF\ KDG SURPLVHG WKHP 6WDII PHPEHUV ZKR ZHUH OHDYLQJ WKH RUJDQL]DWLRQ ZHUH QRW UHSODFHG $V D UHVXOW 637 KDG D WHFKQLFDO VWDII RI ZKHQ VWDUWHG WKH UHVHDUFK LQ %\ $XJXVW LW ZDV GRZQ WR )t6 KDG QRW JRWWHQ WR VXFK D FULWLFDO SRLQW EXW E\ WKH WLPH ZDV OHDYLQJ LQ 2FWREHU WKH\ ZHUH GLVFXVVLQJ ZD\V WR UHGXFH WKHLU ZDJHV 7KURXJKRXW DOO WKHVH GLIILFXOWLHV FDUH ZDV WDNHQ WR OLPLW WKH FRQVHTXHQFHV IRU WKH DGPLQLVWUDWLYH VWDII DQG WR PDLQWDLQ WKHLU ULJKWV DV HPSOR\HHV 1HYHUWKHOHVV DW 637 WKHLU KRXUV KDG WR EH FXW GRZQ DV ZHOO 7LDR 637nV PDLQWHQDQFH VSHFLDOLVW UHPDUNHG WR PH DV ZDV DVNLQJ KLP KRZ WKLQJV ZHUH JRLQJ WKDW LW ZDV GLIILFXOW EHFDXVH RI WKH ILQDQFLDO VLWXDWLRQ DW 637 EXW WKDW HYHU\ERG\ ZDV LQ WKH VDPH ERDW 7R GHDO ZLWK WKH FUXQFK DQG DQ LQVHFXUH IXWXUH D QXPEHU RI PHPEHUV HQJDJHG LQ VHFRQGDU\ DFWLYLWLHV -DQDLQD )t6f RSHQHG D FORWKLQJ VWRUH 0DUOHQH )t6f VWDUWHG JLYLQJ (QJOLVK OHVVRQV DOWKRXJK WKLV ZDV DOVR D UHVXOW RI FKDQJHV LQ KHU SHUVRQDO VLWXDWLRQf 5RVLPHLUH VWDUWHG DQRWKHU MRE RQ 6DWXUGD\V 'HLVH 637f VKDUHG KHU RQH URRP DSDUWPHQW ZLWK DQRWKHU ZRPDQ DQG VWDUWHG VHOOLQJ KRPHPDGH JUDQROD 3DXOR DGPLQLVWUDWLYH VWDII DW 637f WRRN HYHQLQJ FODVVHV WR EH HOLJLEOH IRU D VSHFLDOL]HG HGXFDWLRQ MRE %\ WKH WLPH OHIW WKUHH PHPEHUV RI 637 DQG RQH RI )t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nV 1*2 RQH GD\

PAGE 291

H[SODLQHG WR DQRWKHU 1*2 DFWLYLVW WKH\ ZHUH QRW JRLQJ WR DEDQGRQ WKH VKLS DV LW VDQN %XW WKH\ NQHZ WKDW WKH\ ZRXOG EH ORVLQJ D ORW RI JRRG SHRSOH LQ WKH SURFHVV $W WKH RUJDQL]DWLRQDO OHYHO RQH FRQVHTXHQFH RI WKH FULVLV LV WKDW 1*2 OHDGHUV VSHQG DQ LQFUHDVLQJ DPRXQW RI WLPH VHDUFKLQJ IRU IXQGV ZULWLQJ SURMHFW SURSRVDOV DQG UHSRUWV DQG DUH PRUH FRQFHUQHG ZLWK WKH DVVHVVPHQW RI UHVXOWV LQ RUGHU WR UHIOHFW SRVLWLYHO\ IRU IXWXUH SURSRVDOV $V $QD 0DULD )t6f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t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

PAGE 292

&RPSHWLWLRQ EHWZHHQ 1*2V IRU IXQGLQJ LV XQGHUVWDQGDEOH DQG VHHPV WR DOZD\V KDYH EHHQ SUHVHQW WR D FHUWDLQ H[WHQW )RU H[DPSOH DV HDUO\ DV -DFTXHOLQH 3LWDQJ\ D ZHOO NQRZQ IHPLQLVW DFDGHPLF DQG DFWLYLVW IURP 5LR GH -DQHLUR RUJDQL]HG D PHHWLQJ IRU 5LR RUJDQL]DWLRQV ZLWK D SDUWLFXODU ILQDQFLQJ DJHQF\ $FFRUGLQJ WR D 6DR 3DXOR 1*2 OHDGHU WKLV ZDV LQWHUSUHWHG E\ WKH 6DR 3DXOR ZRPHQnV PRYHPHQW DV D JHVWXUH WR GHVDJXDU GLQKHLUR QR 5LR WR JHW PRQH\ WR SRXU GRZQ RQWR 5LRfV JURXSVf 7KLV DFWLYLVW EHOLHYHV WKDW ZKDW UHDOO\ SLWV 6DR 3DXOR DQG 5LR IHPLQLVWV DJDLQVW HDFK RWKHU LV WKH LVVXH RI WKH UHODWLRQVKLS DQG DFFHVV WR WKH 6WDWH DQG LQWHUQDWLRQDO DJHQFLHV DQG QRW WKH UHJLRQDO DQWDJRQLVP ZKLFK LV ZHOONQRZQ WR VWXGHQWV RI %UD]LOLDQ FXOWXUH 6LPLODUO\ DQ DJHQF\ SURJUDP RIILFHU UHFRXQWHG KDYH KDG D FRQYHUVDWLRQ >ZLWK ZRPHQfV 1*2V@ ,fYH KDG D FRXSOH UHDOO\ ZKHUH WKH DUJXPHQW ZDV QRW nKHUH LV RXU SURMHFW KHUH LV D JRRG LGHD ZH ZDQW \RX WR IXQGn EXW WKH DUJXPHQW ZDV n\RX JDYH WKHP WKDW PXFK PRQH\ ZH ZDQW WKDW PXFK PRUHn 7KDW ZDV WKH SULQFLSDO DUJXPHQW DQG LWfV QRW DFFHSWDEOH 2I FRXUVH WKLV W\SH RI EHKDYLRU LV QRW DQ\WKLQJ VSHFLDO WR ZRPHQfV 1*2V 7KLV RIILFHU UHFDOOHG EHLQJ KRUULILHG E\ WKH LQILJKWLQJ RI 1*2V IRFXVHG RQ +,9 SUHYHQWLRQ DQG ORVLQJ KHU SURIHVVLRQDO FRRO LQ WKH SURFHVV 6KH HQGHG XS WHOOLQJ WKHP \RX DUH RUJDQL]HG WR ILJKW D GLVHDVH \HW \RX DUH VSHQGLQJ \RXU UHVRXUFHV \RXU WLPH \RXU PRQH\ WR FRPH KHUH DQG ILJKW RQH DQRWKHU MXVW ILQG LW GLVJXVWLQJ +RZHYHU WKH SUHVHQW FULVLV GHILQLWHO\ JDYH D PRUH DFXWH VHQVH RI WKH FRPSHWLWLRQ HYHQ DPRQJ 6DR 3DXORnV JURXSV KHDUG RQH 1*2 DFWLYLVW IURP 5HGH 0XOKHU WHOO RWKHU DFWLYLVWV WKDW VKH ZRQGHUHG KRZ PDQ\ JURXSV FRXOG VXUYLYH LQ 6DR 3DXOR 'XULQJ D VWDII PHHWLQJ 1DUD RI 637 WROG KHU VWDII WKDW JURXSV ZRUNLQJ LQ WKH DUHD RI ZRPHQnV KHDOWK QHHGHG WR GHILQH YHU\ FOHDUO\ ZKDW WKHLU VSHFLDOW\ HVSHFLDOLGDGHf ZDV LI WKH\ ZDQWHG WR VHFXUH IXQGLQJ FRQVLGHULQJ WKH ODUJH QXPEHU RI JURXSV WKDW H[LVW $QRWKHU 1*2 PHPEHU PHQWLRQHG WKH IDFW WKDW UHODWLRQV

PAGE 293

EHWZHHQ JURXSV ZHUH QRW DOZD\V JRRG GHVSLWH VWURQJ DIIHFWLRQ OLJDJDR DIHWLYDf EHWZHHQ LQGLYLGXDOV 6KH PHQWLRQHG WKH UHFHQW ,555$* SURMHFW ZKLFK EURXJKW WRJHWKHU D QXPEHU RI WKH PRVW LPSRUWDQW ZRPHQnV KHDOWK JURXSV LQ %UD]LO 7KURXJKRXW WKH ZKROH SURFHVV D JDPH RI H[FOXVLRQLQFOXVLRQ ZDV DW SOD\ EHWZHHQ JURXSV 7KH YHUVLRQ WKDW ZH KHDUG IURP WKH SHRSOH IURP ; LV WKDW WKH SHRSOH IURP < KDG VXJJHVWHG WKDW ZH GR QRW SDUWLFLSDWH LQ WKH SURMHFW $QG DFFRUGLQJ WR WKH SHRSOH RI < WKDW WKH SHRSOH RI ; ZHUH WKH RQHV ZKR VXJJHVWHG WKDW ZH GRQn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nV LQMXQFWLRQ GXULQJ D VWDII PHHWLQJ WKDW LW ZRXOG EH QHFHVVDU\ IRU 637 VWDII WR VWDUW WKLQNLQJ QRW RQO\ LQ WHUPV RI KRXUV ZRUNHG EXW LQ WHUPV RI WDVNV WDUHIDVf WR EH FRPSOHWHG 6KH DVNHG HDFK SHUVRQ WR LGHQWLI\ ZKDW ZRXOG EH WKH WDVN WR ZKLFK VKH ZRXOG FRPPLW XQWLO WKH HQG RI WKH \HDU 6KH VDLG LW ZRXOG EH D ZD\ WR ZRUN DJDLQVW WKHLU XVXDO VORZ SDFH ^D QRVVD OHQWLGDRf :H KDYH GLVFXVVHG LQ &KDSWHU WKH UROH RI WKH FULVLV LQ WKH SRVVLEOH LQWURGXFWLRQ RI VXEFRQWUDFWLQJ LQGLYLGXDOL]HG UHZDUGV DQG FDUHHU SODQV LQ WKHVH RULJLQDOO\ FROOHFWLYLVW RUJDQL]DWLRQV 6RFLDO PRYHPHQWV DUH ERP RXWVLGH RI WKH SULYDWH VHFWRU 1RW RQO\ DUH WKH\ QRQSURILW EXW FRPPLWPHQW DQG YDOXHUDWLRQDOLW\ DUH W\SLFDOO\ GULYLQJ WKH EHKDYLRU RI SDUWLFLSDQWV 7KH

PAGE 294

YHU\ DYDLODELOLW\ RI GRQRU PRQH\ FRQWULEXWHG WR WKH FRPPRGLILFDWLRQ RI PRYHPHQW DFWLYLWLHV WR VHWWLQJ D SULFH RQ PRYHPHQW DFWLYLWLHV ZKLFK ZHUH HDUOLHU GRQH IRU WKH FDXVH RU LQ VROLGDULW\ ZLWK RWKHUV 1HHGOHVV WR VD\ WKH ILQDQFLDO FULVLV WKDW 1*2V DUH JRLQJ WKURXJK DQG WKH JHQHUDO HFRQRPLF GLIILFXOWLHV %UD]LOLDQV DUH IDFLQJ DUH SXVKLQJ LQ WKH VDPH GLUHFWLRQ 1RERG\ ZDQWV WR GR DQ\WKLQJ IRU IUHH DQ\PRUH 7KLV ZDV D UHFXUULQJ UHIUDLQ DPRQJ YROXQWHHU DFWLYLVWV ,W ZDV DOVR DQ H[DJJHUDWLRQ )t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

PAGE 295

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fV 1*2V DUH VWLOO RYHUZKHOPLQJO\ GHSHQGHQW RQ LQWHUQDWLRQDO FRRSHUDWLRQ DJHQFLHV IRU WKHLU ILQDQFLDO VXUYLYDO 7KH QH[W VHFWLRQV ZLOO SUREH IXUWKHU LQWR WKH JRDOV RI DJHQFLHV WKDW ILQDQFH ZRPHQfV JURXSV DQG KRZ ZRPHQf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

PAGE 296

IROORZLQJ SDUDJUDSKV ZLVK WR GHWDLO IXUWKHU ZKDW WKHVH JRDOV DUH EDVHG RQ SROLF\ GRFXPHQWV RI YDULRXV RUJDQL]DWLRQV FROOHFWHG GXULQJ ILHOGZRUN DQG RQ LQWHUYLHZV RI DJHQF\ UHSUHVHQWDWLYHV )URP (IILFLHQF\ WR (PSRZHUPHQW 1DLOD .DEHHU f UHYLHZV WKH YDULRXV DSSURDFKHV WR ZRPHQ DQG GHYHORSPHQW LVVXHV DQG KRZ WKH\ DURVH 'UDZLQJ RQ %XYLQLF f DQG 0RVHU f VKH GLVWLQJXLVKHV EHWZHHQ WKH ZHOIDUH HIILFLHQF\ HTXLW\ DQG HPSRZHUPHQW DSSURDFKHV WR JHQGHU DQG GHYHORSPHQW 7KH HDUOLHVW ZHOIDUH DSSURDFK FRQVLGHUHG ZRPHQ SULPDULO\ DV PRWKHUV DQG ZLYHV GLVUHJDUGLQJ WKHLU SURGXFWLYH FRQWULEXWLRQ ZKLFK MXVWLILHG WKHLU H[FOXVLRQ IURP PDLQVWUHDP GHYHORSPHQW HIIRUWV :RPHQnV SURGXFWLYH UROH ZDV ILQDOO\ UHFRJQL]HG LQ WKH V 6LQFH WKH V RQ D EDFNGURS RI LQFUHDVHG UHOLDQFH RQ PDUNHW IRUFHV ZKHUH ZRPHQ DUH VHHQ DV WKH QHZ PLFURn HQWUHSUHQHXUV WKH HIILFLHQF\ DUJXPHQW HPHUJHG LH LQFOXGLQJ ZRPHQ LQ GHYHORSPHQW LV QHFHVVDU\ EHFDXVH LW ZLOO HQVXUH D EHWWHU RXWFRPH RI GHYHORSPHQW HIIRUWVf DQG KDV UHPDLQHG SUHYDOHQW DPRQJ GHYHORSPHQW RIILFLDOV .DEHHU f 6HHNLQJ WR WUDQVIRUP JHQGHU DQG SRZHU UHODWLRQV .DEHHUnV HTXLW\ DUJXPHQW LQYROYHV DFNQRZOHGJLQJ GLIIHUHQFHV EHWZHHQ PHQ DQG ZRPHQ LQ WHUPV RI QHHGV SULRULWLHV DQG SRVVLELOLWLHV ZLWK DQ DWWHQWLRQ IRU VRFLDO MXVWLFH DQG EDVLF QHHGV DQG SODQQLQJ WKHLU SDUWLFLSDWLRQ LQ GHYHORSPHQW HIIRUWV DFFRUGLQJO\ LELG f $FFRUGLQJ WR .DEHHU VRPH PDLQVWUHDP GHYHORSPHQW DJHQFLHV KDYH DFNQRZOHGJHG WKH HTXLW\ DUJXPHQWV IRU PHHWLQJ ZRPHQnV SUDFWLFDO JHQGHU QHHGV ZLWKLQ WKH H[LVWLQJ GLYLVLRQ RI FRQGXFWHG SDUWLFLSDQW REVHUYDWLRQ LQ WKH VHPLQDU HQWLWOHG 'HYHORSPHQW &RRSHUDWLRQ 5HODWLRQV DQG *HQGHU 3ROLWLFV ([SHULHQFHV DQG 3HUVSHFWLYHV IURP %UD]LO KHOG 2FWREHU LQ 5HFLIH 3HUQDPEXFR 'XULQJ WKLV VHPLQDU DOVR KDG D FKDQFH WR LQWHUYLHZ SURJUDP RIILFHUV RI YDULRXV GRQRU DJHQFLHV

PAGE 297

UHVRXUFHV DQG UHVSRQVLELOLWLHV >EXW@ IHZ DUH SUHSDUHG WR DGGUHVV WKH XQGHUO\LQJ LQHTXDOLWLHV IUHTXHQWO\ DVVRFLDWHG ZLWK WKLV GLYLVLRQDOf 7KH ODVW DSSURDFK ZKLFK LV PRVW WUDQVJUHVVLYHO\ WUDQVIRUPDWLRQDO LV WKH HPSRZHUPHQW DSSURDFK ZKLFK KDV \HW WR EH WDNHQ VHULRXVO\ E\ WKH RIILFLDO GHYHORSPHQW DJHQFLHVf %DVHG RQ WKH QRWLRQ RI WKH QHHG WR EXLOG RQ nWKH SRZHU ZLWKLQn DV D QHFHVVDU\ DGMXQFW WR LPSURYLQJ WKHLU >ZRPHQ DQG RWKHU VXERUGLQDWHG JURXSV@ DELOLW\ WR FRQWURO UHVRXUFHV WR GHWHUPLQH DJHQGDV DQG PDNH GHFLVLRQV f WKH HPSRZHUPHQW DSSURDFK UHOLHV RQ SURFHVVHV RI FRQVFLRXVQHVVUDLVLQJ DQG FROOHFWLYH DFWLRQ WR DFKLHYH JHQGHU HTXLW\ DJDLQ FRXSOHG ZLWK D FRQFHUQ IRU EURDGHU VRFLDO MXVWLFH $FFRUGLQJ WR .DEHHU f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f
PAGE 298

XQOHVV LQHTXDOLWLHV EHWZHHQ PHQ DQG ZRPHQ EH FRQVLGHUHG WKHUH ZLOO EH QR FRQVROLGDWLRQ RI VXVWDLQDEOH GHYHORSPHQW DQG RI SRYHUW\ DOOHYLDWLRQ 2[IDP f 7KLV FRPHV DIWHU UHFRJQL]LQJ WKH SRZHU GLIIHUHQWLDOV EHWZHHQ PHQ DQG ZRPHQ DQG HPSKDVL]LQJ WKH QHHG IRU HTXDO EHQHILWV RI GHYHORSPHQW IRU PHQ DQG ZRPHQ LELG f )XUWKHUPRUH (XURSHDQ QRQJRYHUQPHQWDO DJHQFLHVf VWDWHPHQWV UHIOHFW WKH LQIOXHQFH RI WKH HPSRZHUPHQWIRFXVHG ZRUN RI WKH 7KLUG :RUOG )HPLQLVW QHWZRUN '$:1 'HYHORSPHQW $OWHUQDWLYHV ZLWK :RPHQ IRU D 1HZ (UDf 6HQ t *URZQ f '$:1 LWVHOI LV PHQWLRQHG LQ WKH GRFXPHQWV RI ERWK 1RYLE DQG ,&&2 )RU H[DPSOH 1RYLE ZULWHV 7KH DFNQRZOHGJPHQW RI ZRPHQnV ULJKW WR VHOIGHWHUPLQDWLRQ LV WKHUHIRUH PRUH WKDQ DQ\WKLQJ HOVH D ORJLFDO FKDUDFWHULVWLF RI 1RYLEnV JHQHUDO SROLF\ 2I FRXUVH 1RYLE DOVR DFNQRZOHGJHV WKH VXEVWDQWLDO FRQWULEXWLRQ WKDW ZRPHQ PDNH WR SURFHVVHV RI GHYHORSPHQW DQG WKH ULJKW IRU DOO WR HTXDO RSSRUWXQLWLHV 1RYLE f $V D UHVXOW RI WKHLU HPSKDVLV RQ HPSRZHUPHQW DW OHDVW DW WKH OHYHO RI GLVFRXUVH WKHVH (XURSHDQ QRQJRYHUQPHQWDO DJHQFLHV HPSKDVL]H ZRUNLQJ ZLWK SRSXODU PRYHPHQWV DQG ZRPHQfV JURXSV $JDLQ ZLOO XVH 2[IDP DV DQ H[DPSOH 3RLQW RI WKHLU VWUDWHJ\ VWDWHV WKDW WKH\ ZLOO 6XSSRUW WKH GHYHORSPHQW RI VHOIFRQILGHQFH E\ VWUHQJWKHQLQJ ZRPHQnV JURXSVRUJDQL]DWLRQV E\ SURPRWLQJ GLDORJXHV DQG VXSSRUW QHWZRUNV >3RLQW UHDGV@ 7R FRQWLQXH WR KHOS DQG VWUHQJWKHQ UHODWLRQV EHWZHHQ ZRPHQnV JURXSV DQG RUJDQL]DWLRQV QDWLRQDOO\ DQG LQWHUQDWLRQDOO\ LQ RUGHU WR LQWHQVLI\ PXWXDO XQGHUVWDQGLQJ DQG VROLGDULW\ LQ FROOHFWLYH DFWLRQV 2[IDP f 0DQ\ VXFK DJHQFLHV KDYH VWDUWHG SURJUDPV ZLWKLQ WKHLU RZQ LQVWLWXWLRQ WKURXJK WUDLQLQJ ZRUNVKRSV DQG WKH LQFUHDVLQJ KLULQJ RI ZRPHQ WR HQVXUH D PRUH JHQGHUVHQVLWLYH FXOWXUH ZLWKLQ WKHLU LQVWLWXWLRQ 1RUWKHUQ IHPLQLVW 1*2V JHQHUDOO\ ZRUN DORQJ WKH OLQHV RI WKH HPSRZHUPHQW PRGHO )RU H[DPSOH WKH ,QWHUQDWLRQDO :RPHQfV +HDOWK &RDOLWLRQ VHHV LWV PLVVLRQ DV

PAGE 299

WR VXSSRUW WKH EXLOGLQJ RI QDWLRQDO DQG LQWHUQDWLRQDO ZRPHQfV KHDOWK PRYHPHQWV :H PDNH JUDQWV XQGHUWDNH SXEOLF HGXFDWLRQ ZRUN ZLWK D JOREDO QHWZRUN RI RYHU 1*2V DQG LQGLYLGXDOV SXEOLVK ERRNV DQG HVVD\V FRQYHQH LQWHUQDWLRQDO PHHWLQJV DQG IRVWHU DOOLDQFHV DPRQJ ZRPHQ LQWHUQDWLRQDOO\ ,:+& LQVLGH FRYHUf 8QIRUWXQDWHO\ DV ZH KDYH VHHQ LQ &KDSWHU VRPH RI WKHVH IHPLQLVW 1*2Vf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f $OWKRXJK VRPH 86 RUJDQL]DWLRQV ZRUN DORQJ WKH OLQHV RI WKH HPSRZHUPHQW PRGHO HYHQ WKHVH f§FRQWUDU\ WR (XURSHDQ DJHQFLHVf§ DUH QRW ZLOOLQJ WR H[SOLFLWO\ DFNQRZOHGJH WKH SROLWLFDO QDWXUH RI WKHLU ZRUN HPSKDVL]LQJ LQVWHDG LWV WHFKQLFDO DVVLVWDQFH RU KXPDQLWDULDQ DVSHFW 6PLWK UHDGV LQ WKLV DYRLGDQFH RI SROLWLFDO JRDOV D IHDU RI EHLQJ DFFXVHG RI 86 LQWHUYHQWLRQLVP DV ZHOO DV D FRQVHTXHQFH RI WKH ODFN RI SROLWLFDO DZDUHQHVV LQ WKH 86 JHQHUDO SXEOLF DERXW WKH VWUXFWXUDO FDXVHV RI WKLUG ZRUOG SRYHUW\ ,QGHHG HYHQ WKH LQVWLWXWLRQV ZKLFK 6PLWK ODEHOHG PXOWLVHUYLFH LQVWLWXWLRQ EXLOGHUV f ZKR GR HPSKDVL]H SRSXODU SDUWLFLSDWLRQ DQG VWUHQJWKHQLQJ ORFDO FRPPXQLW\ RUJDQL]DWLRQV DV SDUW RI WKHLU JRDOV GR QRW DFNQRZOHGJH WKH SROLWLFDO QDWXUH RI WKHLU ZRUN 6PLWK LQFOXGHV )RUG LQ WKLV FDWHJRU\ DQG FRQVLGHULQJ KLV GHILQLQJ FULWHULD ZRXOG DGG 0DF$UWKXU $ ORRN DW WKH VWDWHG JRDOV RI WKH 0DF$UWKXU )RXQGDWLRQ LQ LWV 5HSRUW RQ $FWLYLWLHV FRQILUPV 6PLWKfV DQDO\VLV

PAGE 300

6HYHUDO DVVXPSWLRQV XQGHUOLH WKH SROLFLHV RI WKH )RXQGDWLRQ WKDW WKH PRVW LPSRUWDQW HIIRUWV WR LPSURYH WKH KXPDQ FRQGLWLRQ DUH WKRVH WKDW VHHN V\VWHPDWLF DQG VXVWDLQDEOH FKDQJH WKDW KXPDQ SURJUHVV UHTXLUHV UHGXFLQJ LQHTXLWLHV LQ WKH GLVWULEXWLRQ RI SRZHU DQG UHVRXUFHV WKDW WKH KHDOWK\ HGXFDWHG FUHDWLYH LQGLYLGXDO LV DQ HVVHQWLDO LQVWUXPHQW RI FRQVWUXFWLYH FKDQJH DQG WKDW WKH )RXQGDWLRQfV HIIHFWLYHQHVV GHSHQGV LQ SDUW RQ LWV FDSDFLW\ WR OHDUQ IURP RWKHUV LQFOXGLQJ JUDQWHHV DERXW WKH SUREOHPV FRQIURQWLQJ JOREDO VRFLHW\ f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fV YRLFHV LQ SROLF\ GLVFXVVLRQV WKH GHPDUJLQDOL]DWLRQ RI SRRU SHRSOH RI JD\ SHRSOH RI LQGLJHQRXV SHRSOH WKHVH DUH WKH FXOWXUH FKDQJHV WKDW ZH WKLQN RXJKW WR WDNH SODFH )RUG DFFRUGLQJ WR LWV UHSUHVHQWDWLYH LQ %UD]LO LV OHVV VK\ DERXW LW :KHQ DVNHG KLP ZKDW WKH JRDOV RI )RUG LQ %UD]LO ZHUH KH VDLG 7KHUH LV D WUHPHQGRXV FRQFHUQ ZLWK YDOXHV ZLWK SHRSOHfV YDOXHV 7KH LQVWLWXWLRQ SODFHV D ORW RI HPSKDVLV DQG FUHGHQFH LQ YDOXHV VXFK DV DJDLQ HTXDO RSSRUWXQLW\ WROHUDQFH WKDW WKHUH VKRXOG QRW EH UDFLVP RU VH[LVP WKDW WKHUH VKRXOG EH IUHH VSHHFK /LEHUDO *RDOV 7KH QRWLRQ WKDW GHPRFUDF\ DQG WKHUHIRUH D VWURQJ FLYLO VRFLHW\ JRHV KDQGLQKDQG ZLWK D VWURQJ PDUNHW HFRQRP\ V\VWHP LV D FRPPRQ DVVXPSWLRQ ZKLFK FDQ EH UHIOHFWHG LQ DJHQFLHVf JRDOV )RU H[DPSOH DFFRUGLQJ WR D )RUG UHSUHVHQWDWLYH LQWHUYLHZHG DIWHU KHDY\ GHEDWHV ZLWKLQ WKH IRXQGDWLRQ WKH OLQH LQ )RUGfV PLVVLRQ VWDWHPHQW DERXW VXSSRUWLQJ LQQRYDWLYH DQG FUHDWLYH LQGLYLGXDOV KDG UHSODFHG D VWDWHPHQW KLJKOLJKWLQJ WKH OLQN EHWZHHQ GHPRFUDF\ DQG WKH

PAGE 301

GHYHORSPHQW RI D VWURQJ PDUNHW HFRQRP\ 6XFK D SROLWLFDO RULHQWDWLRQ LV FOHDUO\ H[SUHVVHG LQ RWKHU $PHULFDQ DLG DJHQFLHV VXFK DV $IULFDUH ZKRVH DQQXDO UHSRUW FDXJKW P\ H\H ,W VWDWHV WKDW 6HYHUDO LPSRUWDQW SURJUDPV RI $IULFDUH GLUHFWO\ VXSSRUW SURFHVVHV RI GHPRFUDWL]DWLRQ DQG GHYHORSPHQW RI WKH SULYDWH VHFWRU DV ZHOO DV LQ JHQHUDO WUDLQ JRYHUQPHQWV WR LPSURYH KXPDQ TXDOLW\ RI OLIH $IULFDUH f >UHODWULR DQXDO GH @ $IULFDUH GRHV QRW ZRUN ZLWK WKH JURXSV ZRUNHG ZLWK 7KH 3RSXODWLRQ &RQWURO ,VVXH 7UDGLWLRQDOO\ FRQFHUQV ZLWK SRSXODWLRQ FRQWURO KDYH EHHQ VWURQJO\ DVVRFLDWHG ZLWK WKH ZRUN RI LQWHUQDWLRQDO FRRSHUDWLRQ ZLWK 7KLUG ZRUOG ZRPHQ .DEHHU f 6XFK FRQFHUQV ZHUH SUHVHQW LQ VRPH RI WKH DJHQFLHV WKDW ILQDQFH WKH JURXSV ZRUNHG ZLWK EXW QRW LQ RWKHUV ,W ZDV WRWDOO\ DEVHQW IURP WKH VWDWHPHQWV E\ 1RYLE &HEHPR DQG 2[IDP EXW ZDV SUHVHQW LQ ,&&2nV JHQHUDO SROLF\ VWDWHPHQW RQ GHYHORSPHQW 7KH QH[WWRODVW LWHP LQ WKLV GRFXPHQW GHDOV ZLWK JHQGHU ,WV ODVW SDUDJUDSK VWDWHV WKDW ,Q D JUHDW QXPEHU RI FRXQWULHV RI WKH 6RXWK SRYHUW\ DQG GHPRJUDSKLF LQFUHDVH LQIOXHQFH HDFK RWKHU QHJDWLYHO\ ,&&2 IDYRUV DQ DFWLYH GHPRJUDSKLF SROLF\ +RZHYHU WKLV SROLF\ PXVW EH SDUW RI D ODUJHU YLVLRQ RI WKH SRYHUW\ LVVXH DQG PXVW EH RULHQWHG WRZDUGV JUHDWHU GLJQLW\ IRU PHQ DQG ZRPHQ ,&&2 f $V IDU DV $PHULFDQ IRXQGDWLRQV DUH FRQFHUQHG WKH JURXSV ZRUNHG ZLWK ZHUH IXQGHG XQGHU D 3RSXODWLRQ 3URJUDP LQ WKH FDVH RI 0DF$UWKXU DQG D 5HSURGXFWLYH +HDOWK DQG 3RSXODWLRQ 3URJUDP IRU )RUG
PAGE 302

OHDGLQJ %UD]LOLDQ IHPLQLVW VFKRODU LV QRZ KHDGLQJ 0DF$UWKXUnV 3RSXODWLRQ SURJUDP ,W EHFDPH FOHDU GXULQJ P\ LQWHUYLHZ ZLWK WKH 0DF$UWKXU SURJUDP RIILFHU WKDW 0DF$UWKXU UHFRJQL]HV DQG ZLVKHV WR FDSLWDOL]H RQ WKH OLQN EHWZHHQ ZRPHQfV HPSRZHUPHQW DQG WKH GLPLQLVKLQJ QXPEHU RI FKLOGUHQ WKH\ ZLOO KDYH 7KLV PHDQV WKDW WKHLU SRSXODWLRQ SROLF\ LV EDVHG RQ D EURDG FRQFHUQ IRU WKH ZHOIDUH RI ZRPHQ DQG WKHLU HPSRZHUPHQW ZLWKLQ WKH IDPLO\ DQG VRFLHW\ $FFRUGLQJ WR WKHLU SURJUDP RIILFHU WKH UROH DQG VWDWXV RI ZRPHQ FRPHV ILUVW ZKLFK KDV LPSRUWDQW GHPRJUDSKLF FRQVHTXHQFHV ,Q VXP ZRPHQfV JURXSV DQG WKH QRQJRYHUQPHQWDO DJHQFLHV WKDW ILQDQFH WKHP f§DW OHDVW WKRVH WR ZKRP KDG D FKDQFH WR WDONf§ DUH QRW DW RGGV ZLWK HDFK RWKHU ZKHQ FRQVLGHULQJ WKHLU VSHFLILHG JRDOV WKH\ VKDUH WKH EHOLHI WKDW WKH HPSRZHUPHQW RI ZRPHQ RU D FKDQJH LQ SRZHU GLIIHUHQWLDOV EHWZHHQ ZRPHQ DQG PHQ LV D SRVVLEOH DQG QHFHVVDU\ FKDQJH +RZHYHU DV ZLOO GHWDLO LQ WKH FRPLQJ VHFWLRQV DJHQFLHVf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fV LQWHUHVWV 7KHUH LV QR GRXEW WKDW WKHVH JURXSV DUH EHWWHU SRVLWLRQHG WKDQ DQ\ RWKHU WUDGLWLRQDO DFWRUV RQ WKH SROLWLFDO VFHQH WR UHSUHVHQW ZRPHQ DQG WKDW WKH\ KDYH VHFXUHG YDOXDEOH DGYDQFHV IRU ZRPHQ EXW DV KDYH GLVFXVVHG LQ FKDSWHU WKH\ DOVR KDYH GLIIHUHQW LQWHUHVWV DQG FRQFHUQV WKDQ PDQ\ RI WKH ZRPHQ WKH\ DUH VXSSRVHG WR UHSUHVHQW

PAGE 303

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f ZHUH (XURSHDQV RU RI (XURSHDQ GHVFHQW 2QH ZDV $IULFDQ$PHULFDQ DQRWKHU 86 /DWLQD DQG WZR ZHUH %UD]LOLDQV RI (XURSHDQ GHVFHQW 7KLV LV DOVR D PRUH PDVFXOLQH ZRUOG WKDQ WKDW RI IHPLQLVW 1*2V DV LV WR EH H[SHFWHG DJHQF\ UHSUHVHQWDWLYHV ZHUH PHQ ,W FDPH RXW FOHDUO\ IURP WKHVH FRQYHUVDWLRQV WKDW DJHQF\ SURJUDP RIILFHUV DFWLYHO\ VHDUFK IRU WKH ULJKW JUDQW ,W LV QRW VLWWLQJ DURXQG ZDLWLQJ IRU WKHP WR FRPH KHUH VD\V 'RQQD KDUGO\ DQ\RQH GRHV WKDW &HUWDLQO\ QRW IRXQGDWLRQV WKDW KDYH ILHOG RIILFHV
PAGE 304

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f VFKHGXOHV :KLOH WKH ILUVW HQFRXUDJHV IRUPDOL]DWLRQ DQG KLHUDUFKL]DWLRQ RI JURXSV WKH ODVW WZR ZRUN LQ IDYRU RI ILQDQFLQJ EHWWHUNQRZQ DQG FHQWUDOO\ ORFDWHG RUJDQL]DWLRQV ZKR DUH PRUH OLNHO\ WR HQJDJH LQ LQVWLWXWLRQDO SROLWLFV 7KLV DOVR GHHSHQV WKH JDS EHWZHHQ WKH nHOLWHn RI WKH PRYHPHQW DQG RWKHUV &RQWULEXWLQJ WR )RUPDOL]DWLRQ DQG +LHUDUFKL]DWLRQ $ JURXS QHHGV WR KDYH LQGHSHQGHQW VWDWXV LH WR EH UHJLVWHUHG ZLWK WKH ORFDO DXWKRULWLHV DV D OHJDOO\ UHFRJQL]HG HQWLW\ LQ RUGHU WR UHFHLYH JUDQW PRQH\ 7KH\ QHHG WR EH DEOH WR RSHQ D EDQN DFFRXQW LQ WKH RUJDQL]DWLRQf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

PAGE 305

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

PAGE 306

,Q RWKHU ZRUGV WKHUH LV YDULDWLRQ IURP RQH DJHQF\ WR WKH QH[W @ 'RQQD PHDQ WKHUH LV QR ZULWWHQ UXOH EXW EDVLFDOO\ \RX GRQfW GLVEXUVH \RXU PLOOLRQ GROODUV D \HDU WKDW HDFK SURJUDP RIILFHU KDV WR RUJDQL]DWLRQV DW VD\ HDFK RU PXFK OHVV WR RUJDQL]DWLRQV DW HDFK
PAGE 307

,QGHHG D ORRN DW WKH )RUG DQG 0DF$UWKXU DQQXDO UHSRUWV VKRZV WKDW WKH PDMRULW\ RI WKH JUDQWV DUH IRU RU PRUH 6HH 7DEOHV DQG f H[FHSW ZKHQ WKH\ DLP DW ILQDQFLQJ D SDUWLFXODU HYHQW 0DF$UWKXUfV VWUDWHJ\ RI ILQDQFLQJ D JURXS IRU RU HYHQ \HDUV LV PLWLJDWLQJ WKLV WHQGHQF\ 7KH 0DF$UWKXU 3URJUDP RIILFHU WDONHG WR ZDV SDUWLFXODUO\ SOHDVHG LQ WR KDYH EHHQ DEOH WR PDNH D QXPEHU RI VPDOOHU JUDQWV DQG LW VKRZV LQ WKH DQQXDO UHSRUW ZKHUH VHYHUDO JURXSV UHFHLYHG RYHU \HDUV 7DEOH f +RZHYHU WKH UHSRUW VKRZV D UHWXUQ WR D SDWWHUQ RI ILQDQFLQJ ZHOONQRZQ LQVWLWXWLRQV IRU VXEVWDQWLDO DPRXQWV 7DEOH f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fV EXGJHW SURMHFWLRQV 7DEOH f LW VHHPV WKDW WKH\ WHQG WR JLYH VPDOOHU DPRXQWV ,W LV LQWHUHVWLQJ WR QRWH WKDW /DQGLP DQG &RWULP LQ WKHLU VXUYH\ RI $%21* PHPEHUV IRXQG D QRWDEOH UHGXFWLRQ RI WKH QXPEHU RI RUJDQL]DWLRQV ZLWK D EXGJHW RI RU OHVV DPRQJ WKHLU DIILOLDWHV WKH\ UHSUHVHQWHG b RI WKH WRWDO LQ GRZQ WR b LQ [YLLf 7KLV W\SH RI EXGJHW GHQRWHV D YROXQWHHU RUJDQL]DWLRQ VLQFH LW ZRXOG QRW EH

PAGE 308

VXIILFLHQW IRU D SURIHVVLRQDOL]HG RUJDQL]DWLRQ ZKLFK UHPXQHUDWHV LWV VWDII HYHQ LI WKH SD\ LV ORZf $OVR UHLQIRUFLQJ HVWDEOLVKHG JURXSV LV GRQRUVn VDIH EHW SROLF\ GRQRUV DUH PRUH LQFOLQHG WR ILQDQFH D JURXS LI LW KDV DOUHDG\ EHHQ ILQDQFHG 7KLV LV D FRQILUPDWLRQ WKDW WKH JURXS FDQ EH WUXVWHG VLQFH DQRWKHU PHPEHU RI WKH GRQRU FRPPXQLW\ DOUHDG\ JDYH LW D VHDO RI DSSURYDO 7KLV JDPH FDQ WDNH D FRPLFDO GLPHQVLRQ DW WLPHV ZLWK D VOLJKW WLQJH RI LQWHUGRQRU ULYDOU\ $ SURJUDP RIILFHU WROG PH 9LUWXDOO\ HYHU\WKLQJ WKDW ZH IXQG IRU H[DPSOH ; ZLOO DOVR IXQG XVXDOO\ DIWHU D ZHHN RU WZR ODXJKWHUf >@ ,WfV OLNH HYHU\WKLQJ LQ OLIH WKH PRUH PRQH\ \RX JHW WKH PRUH PRQH\ \RX JHW WKH PRUH PRQH\ \RX JHW ,WfV QRW RK WKH\ DOUHDG\ JRW IXQGHG ZK\ VKRXOG ZH ,WfV WKLV VDIH EHW WKLQJ 7KH\ OLNH WR IXQG WKLQJV WKDW ZH RSHQ EHFDXVH WKH\ NQRZ WKDW WKH\ PXVW EH \RX NQRZ UHDG\ WR WDNH RQ D ODUJH SURMHFW /HWfV 6WDQGXS DQG 'HQRXQFH ,V 2XW ,QIOXHQFLQJ 3ROLF\0DNHUV ,V ,Q )URP D PRUH SROLWLFDO VWDQGSRLQW DOO RI WKH GRQRUV LQWHUYLHZHG DUH ZRUNLQJ DJDLQVW WKH /HWfV 6WDQG XS DQG 'HQRXQFH SRVLWLRQ DV RQH UHSUHVHQWDWLYH SXW LW 7KLV LV RQH RI WKH IHZ JHQHUDOL]DWLRQV IHHO FRPIRUWDEOH PDNLQJ DERXW GRQRUV $QD 0DULD 'RLPR DOVR QRWHG WKLV WHQGHQF\ VKH VD\V WKH SUHVVXUH RQ WKH SDUW RI WKH LQWHUQDWLRQDO FRRSHUDWLRQ WR SUHYHQW DQ\ RSSRVLWLRQDO SRVLWLRQ DSRVLJDR GR FRQWUDf LV SDOSDEOH f 7KLV OHWfV VWDQG XS DQG GHQRXQFH SRVLWLRQ ZDV YHU\ FRPPRQ DPRQJ VRFLDO PRYHPHQW JURXSV DQG HYHQ 1*2V GXULQJ DQG LPPHGLDWHO\ DIWHU WKH GLFWDWRUVKLS LQ %UD]LO 1RZ GRQRUV ZDQW FLYLO VRFLHW\ WR PDNH FRQVWUXFWLYH SURSRVLWLRQV WR SXEOLF DXWKRULWLHV )RU RQH (XURSHDQ GRQRU WKLV VLPSO\ PHDQV JHWWLQJ JURXSV WR EH PRUH FRQFUHWH DQG SUHFLVH LQ WKHLU GHPDQGV WR ORFDO DXWKRULWLHV

PAGE 309

7DEOH )RUG )RXQGDWLRQ *UDQWV $ZDUGHG WR %UD]LOLDQ 2UJDQL]DWLRQV XQGHU WKHLU 5HSURGXFWLYH +HDOWK DQG 3RSXODWLRQ 3URJUDP 6RFLDO VFLHQFH UHVHDUFK DQG WUDLQLQJ 6WDWH 8QLYHUVLW\ RI &DPSLQDV 6DR 3DXORf ,QVWLWXWH IRU 6WXGLHV RI 5HOLJLRQ ,6(5f 5LRf &RPPXQLW\ LQYROYHPHQW &LWL]HQVKLS 5HVHDUFK ,QIRUPDWLRQ DQG $FWLRQ &(3,$f 5LRf 'LVVHPLQDWLRQ RI LQIRUPDWLRQ *UXSR 3HOD 9,''$ 5LRf ,QVWLWXWH IRU 6WXGLHV RI 5HOLJLRQ ,6(5f 5LRf (WKLFV ODZ DQG SROLF\ DQDO\VLV &DWKROLFV IRU )UHH &KRLFH &DWOLFDV SHOR 'LUHLWR D 'HFLGLUf 6RXUFH )RUG )RXQGDWLRQ $QQXDO 5HSRUW 7DEOH 0DF$UWKXU )RXQGDWLRQ *UDQWV $ZDUGHG WR %UD]LOLDQ 2UJDQL]DWLRQV XQGHU WKHLU 3RSXODWLRQ 3URJUDP :RPHQfV 5HSURGXFWLYH +HDOWK $VVRFLDJDR GH PXOKHUHV GR *UDMDX RYHU \HDUVf 6DR 3DXORf &DVD GD 0XOKHU /LOLWK RYHU \HDUVf 6DR 3DXORf &HQWUR %UDVLOHLUR GH $Q£OLVH H 3ODQHMDPHQWR &HEUDSf RYHU \HDUVf 6DR 3DXORf &HQWUR GDV 0XOKHUHV GR &DER 3HUQDPEXFRf &HQWUR ,QIRUPDJDR 0XOKHU RYHU \HDUVf 6DR 3DXORf &ROHWLYR )HPLQLVWD 6H[XDOLGDGH H 6DGH RYHU \HDUVf 6DR 3DXORf &RPLVVDR GH &LGDGDQLD H 5HSURGXJDR RYHU \HDUVf 6DR 3DXORf *HOHGV ,QVWLWXWR GD 0XOKHU 1HJUD RYHU \HDUVf 6DR 3DXORf 3UR0XOKHU RYHU WKUHH \HDUVf 6DR 3DXORf 8QLDR GH 0XOKHUHV GR 0XQLFLSLR GH 6DR 3DXOR RYHU \HDUVf 6DR 3DXORf &RPPXQLFDWLRQV DQG 3RSXODU (GXFDWLRQ &HQWUR )HPLQLVWD GH (VWXGRV H $VVHVVRULD &IHPHDf RYHU \HDUVf %UDVLOLDf &HQWUR ,QIRUPDJDR 0XOKHU 6DR 3DXORf (VWXGRV H &RPXQLFDJDR HP 6H[XDOLGDGH H 5HSURGXJDR +XPDQD (&26f RYHU \HDUVf 6DR 3DXORf *UXSR GH $SRLR D 3UHYHQJDR £ $,'6%DKLD RYHU \HDUVf 6DOYDGRUf *UXSR GH $SRLR D 3UHYHQJDR £ $,'6 5LR *GH GR 6XO \HDUVf 3RUWR $OHJUHf *UXSR GH 7UDEDOKR H 3HVTXLVD HP 2ULHQWDJDR 6H[XDO RYHU \HDUVf 6DR 3DXORf 8QLYHUVLGDGH (VWDGXDO GH &DPSLQDV 1(32f RYHU \HDUVf 6DR 3DXORf &HQWUR GH (GXFDJDR 6H[XDO RYHU \HDUVf 5LR GH -DQHLURf &HQWUR GH (VWXGRV H 3HVTXLVD HP 6DGH &ROHWLYD 5LR GH -DQHLURf &HQWUR GH 3HVTXLVDV H &RQWUROH GDV 'RHQJDV 0DWHPR,QIDQWLV 6DR 3DXORf 6RXUFH 0DF$UWKXU )RXQGDWLRQ 5HSRUW RQ $FWLYLWLHV

PAGE 310

7DEOH 0DF$UWKXU )RXQGDWLRQ *UDQWV $ZDUGHG WR %UD]LOLDQ 2UJDQL]DWLRQV XQGHU WKHLU 3RSXODWLRQ 3URJUDP &RPPXQLFDWLRQV DQG 3RSXODU (GXFDWLRQ &HQWUR GH UHIHUHQGD LQWHJUDO SDUD DGROHVFHQWHV RYHU \HDUVf 6DOYDGRUf *UXSR GH $SRLR D 3UHYHQJR £ $,'6%DKLD RYHU \HDUVf 6DOYDGRUf *UXSR SHOD 9LGGD RYHU \HDUVf 5LR GH -DQHLURf *UXSR 7UDQVDV GR &RUSR $JRHV (GXFDWLYDV HP 6DGH H 6H[XDOLGDGH RYHU \HDUVf *RL£QLDf 626 DGROHVFHQWH 6DR 3DXORf 6HPSUHYLYD 2UJDQL]DJDR )HPLQLVWD RYHU \HDUVf 6DR 3DXORf :RPHQfV 5HSURGXFWLYH +HDOWK DQG 5HSURGXFWLYH 5LJKWV $VVRGDJDR %UDVLOHLUD GH (VWXGRV 3RSXODFLRQDLV $%(3f RYHU \HDUVf %HOR +RUL]RQWHf &HQWUR GH 3HVTXLVDV H &RQWUROH GDV 'RHQFDV PDWHPRLQIDQWLV GH &DPSLQDV 6DR 3DXORf &LGDGDQLD (VWXGR 3HVTXLVD ,QIRUPDJDR H $JDR &HSLDf RYHU \HDUVf 5LRf &ROHWLYR )HPLQLVWD 6H[XDOLGDGH H 6DGH RYHU \HDUVf 6DR 3DXORf 1DWLRQDO )HPLQLVW 1HWZRUN IRU +HDOWK DQG 5HSURGXGLYH 5LJKWV 6DR 3DXORf 626 &RUSR *UXSR GH 6DGH GD 0XOKHU RYHU \HDUVf 3HUQDPEXFRf 6RXUFH 0DF$UWKXU )RXQGDWLRQ 5HSRUW RQ $FWLYLWLHV 7DEOH 637 3URMHFWLRQ RI %XGJHW IRU @ WKURXJK WKDW SURFHVV RI FRPLQJ WRJHWKHU DQG WDONLQJ WKLQN \RX FDQ DFFRPSOLVK D JUHDW GHDO ,W LV YHU\ GLIILFXOW WR FULWLFL]H D SHUVRQ IDFHWRIDFH >@ WKH LVVXH WDNHV RQ D KXPDQ GLPHQVLRQ )XQGLQJ DQ RUJDQL]DWLRQ HYHQ JLYHV DQ DGGHG OHYHUDJH IRU GRQRUV WR FRPSOHWH WKLV UROH EHFDXVH LI \RX IXQG DQ RUJDQL]DWLRQ WKH\ DUH JRLQJ WR IHHO FRPSHOOHG EHFDXVH WKH\ DUH JRLQJ WR ZRQGHU ZHOO SHUKDSV LI GRQfW JR WKH\fUH JRLQJ WR WKLQN QHJDWLYHO\ DERXW XV WKH QH[W WLPH ZH DVN IRU D JUDQW >@ 6KDZQ DGGHG WKDW KH GRHV QRW OLNH HPSKDVL]LQJ WKHVH H[SHFWDWLRQV ZLWK WKH JURXSV KH ILQDQFHV EXW WKH\ GR H[LVW ,QHYLWDEO\ WKLV HPSKDVLV RQ DGYRFDF\ ZRUN PHDQV LQFUHDVHG LQWHUDFWLRQ ZLWK SXEOLF DXWKRULWLHV 'RQRUV ZDQW WR ILQDQFH RUJDQL]DWLRQV WKDW DUH DEOH WR FRPPXQLFDWH SHRSOHfV QHHGV WR WKH HOLWH 7KLV ZDV FDOOHG ZRUNLQJ XSZDUG E\ DQRWKHU GRQRU UHSUHVHQWDWLYH 'RQQD DJDLQ >7KLV LQVWLWXWLRQ@ LV ORRNLQJ IRU 1*2V ZKR FDQ ZRUN XSZDUGWKDW LV WR VD\ WKDW HVWDEOLVK OLQNV WR SROLF\PDNHUV DQG WR SXEOLF RSLQLRQ IRUPHUV DQG WR SXEOLF DXWKRULWLHV DW WKH QDWLRQDO DQG LQWHUQDWLRQDO OHYHO DQG LGHDOO\ \RXf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

PAGE 312

WKDW LW LV QHFHVVDU\ IRU DQ DGYRFDF\ 1*2 GRLQJ OREE\LQJ WR KDYH WLHV WR FRPPXQLWLHV 7KLV LV KRZ WKLQN 7R GR D JRRG OREE\LQJ MRE DW WKH QDWLRQDO OHYHO \RX GRQn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
PAGE 313

EHOLHYH EHFDXVH WKH\ DUH WKH RQHV WKDW KDYH DFFHVV WR WKH JRYHUQPHQW RIILFLDOV DQG FDQ ZRUN ZLWK WKHP EHFDXVH WKH\ KDYH WKH QHFHVVDU\ FXOWXUDO FDSLWDO ,W ZDV D JUHDW VRXUFH RI VDWLVIDFWLRQ IRU KLP WR VHH WKH LQYROYHPHQW RI WKH ZRPHQ RI WKH UHSURGXFWLYH KHDOWK PRYHPHQW QRZ LQ WKH JRYHUQPHQW +H DGGHG LWfV D SRVLWLYH FKDQJH %XW LWfV KDSSHQHG DW WKH JRYHUQPHQW OHYHO QRW IURP WKH IRXQGDWLRQfV VLGH >@ 7KHVH JURXSV QRZ KDYH OHJLWLPDF\ DQG FXUUHQF\ DQG REYLRXVO\ WKH\ DUH QRW RQO\ OLVWHQHG WR EXW DUH VRXJKW RXW IRU WKHLU DGYLFH DQG WKHLU RSLQLRQ PHDQ LWfV D VLJQLILFDQW FKDQJH >@ DQG WKHVH SHRSOH KDYH RXU VXSSRUW DQG LWfV JUHDW WR VHH WKH OLQN WKH EULGJH EHLQJ FRQVWUXFWHG EHWZHHQ WKH QRQJRYHUQPHQWDO VHFWRU DQG WKH JRYHUQPHQWDO VHFWRU 7KH JRYHUQPHQW UHDOL]HG WKDW WKHVH 1*2V ZHUH D ULFK VRXUFH RI LQIRUPDWLRQ $QG LQGHHG WKH LQYROYHPHQW RI IHPLQLVWV LQ UHSURGXFWLYH KHDOWK SROLF\PDNLQJ LQ %UD]LO KDV WUXO\ EHHQ UHPDUNDEOH DV GLVFXVVHG LQ FKDSWHU ,W LV DQ DFFRPSOLVKPHQW ZKLFK FDQQRW EH PLQLPL]HG 3URJUDP RIILFHUV IURP RWKHU GRQRUV ZHUH TXLWH EOXQW DERXW WKH UHDVRQV ZK\ WKHLU LQVWLWXWLRQ IDYRUV RUJDQL]DWLRQV WKDW ZRUN XSZDUG 'RQQD 7KHUH LV DQ LPSHUDWLYH WR PDNH WKH PRQH\ UHQGHU EHDU IUXLWf LQ D VHQVH LQ WKH VHQVH RI YLVLELOLW\ LQ WKH VHQVH RI LPSDFW ,PSDFW XQGHUVWRRG LQ D SDUWLFXODU ZD\ LPSDFW XQGHUVWRRG DV HOLWHEDVHG VRFLDO FKDQJH EDVLFDOO\ LQIOXHQFLQJ HOLWHV ,WfV QRW WKDW \RX IXQG HOLWHV QHFHVVDULO\ EXW \RX IXQG SHRSOH ZKR FDQ JHW WR HOLWHV DV ZHOO DV SHRSOH ZKR FDQ JHW WR WKH JUDVVURRWV .DUHQ >7KLV LQVWLWXWLRQ@ ZDQWV WR EH DEOH WR FDOO RQ LWV JUDQWHHV RQ RFFDVLRQV >@ 'RQQD RQ LPSRUWDQW LQWHUORFXWRUV RQ WKH QDWLRQDO DQG LQWHUQDWLRQDO VFDOH P\ HPSKDVLVf 1*2 OHDGHU (GLPHLUHfV IHHOHUV DERXW WKH LPSRUWDQFH RI YLVLELOLW\ IRU GRQRU DJHQFLHV GLVFXVVHG LQ FKDSWHU f SURYHG ZHOOWDNHQ $FFRUGLQJ WR .DUHQ DQG 'RQQD ZRUNLQJ XSZDUG LV EDVLFDOO\ D IXQFWLRQ RI JHWWLQJ VRPH YLVLEOH SD\EDFN RQ WKH PRQH\ GLVEXUVHG VRPHWKLQJ WKDW FDQ EH VKRZQ WR QDWLRQDO FRQJUHVVHV RU FRQVWLWXHQFLHV LQ GRQRU FRXQWULHV WR JDPHU VXSSRUW IRU WKHLU ZRUN

PAGE 314

$JDLQ GRQRUV DUH QRW RQH PRQROLWKLF EORFN WKHUH DUH DJHQFLHV VXFK DV WKH ,QWHUQDWLRQDO :RPHQfV +HDOWK &RDOLWLRQ ZKR VHHN RXW \RXQJ QHZ JURXSV JLYLQJ WKHP VPDOO JUDQWV DQG SUHSDU>LQJ@ VPDOOHU QHZHU JURXSV WR UHFHLYH ODUJHU JUDQWV .DUHQfV LQWHUYLHZf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fV YHU\ WULFN\ PHDQ KDG RQJRLQJ FRQYHUVDWLRQV ZLWK 0XOKHUHV 8QLGDV ZKHQ ILUVW FDPH KHUH DQG WKH\ VHQW PH D QXPEHU RI VPDOO SURSRVDOV IRU WKLQJV OLNH \RX NQRZ D &DPSDQKD FRQWUD D ,PSXQLGDGH FRQWUD D YLROHQFLD &DPSDLJQ DJDLQVW GRPHVWLF YLROHQFHf $QG LW MXVW ZDVQfW WKH NLQG RI SURMHFW WKDW ZRXOG EH IXQGHG KHUH EHFDXVH LW LQYROYHG OLNH VHOOLQJ 7VKLUWV DQG GLVWULEXWLQJ SRVWHUV DQG JRLQJ WR WDON WR SHRSOH LQ WKH VWUHHWV ,W GLG QRW ORRN OLNH D WKLQJ WKDW ZRXOG JHW IXQGHG KHUH XQOHVV LW KDG D PHGLD FRPSRQHQW ,W KDG WR EH D ORW PRUH VSHFLILF DQG WULHG WR H[SODLQ LW $QG LW ZDV RQO\ IRU VDLG \RX NQRZ GHYHORS VRPHWKLQJ PRUH DPELWLRXV VHQG VRPHWKLQJ WKDWfV DQG WKH\ GLG %XW LW ZDV VWLOO WKH VDPH NLQG RI HVVHQFLDOPHQWH PLOLW£QFLD HVVHQWLDOO\ DFWLYLVPf 1DWKDOLH EHFDXVH WKDWfV ZKR WKH\ DUH >WR ZKLFK 'RQQD IXOO\ DJUHHG@ &HUWDLQ W\SHV RI FDPSDLJQV LQ SDUWLFXODU LQIRUPDWLRQDO FDPSDLJQV ZHUH IXQGHG ZKLOH ZDV LQ %UD]LO $ JRRG H[DPSOH LV WKH FDPSDLJQ IRU WKH SUHYHQWLRQ RI J\QHFRORJLFDO FDQFHU ILQDQFHG E\ D VPDOO (XURSHDQ RUJDQL]DWLRQ 0HPLVDf DQG RUJDQL]HG LQ FROODERUDWLRQ E\ WKH 0RYLPHQWR 0XOKHU H 6DLLGH DQG 637 7KLV FDPSDLJQ ZDV GHYLVHG WR UDLVH DZDUHQHVV DPRQJ QHLJKERUKRRG ZRPHQ RI WKH QHHG IRU SXEOLF J\QHFRORJLFDO VHUYLFHV RIIHULQJ IUHH H[DPLQDWLRQV DV ZHOO DV IRU VHOIH[DPLQDWLRQ

PAGE 315

'RQRU DJHQFLHV GHVSLWH WKHLU GLYHUVLW\ GR WHQG WR VXSSRUW DQ DGYRFDF\FHQWHUHG DQG FRQVHQVXDO SRVLWLRQ RQ WKH SDUW RI VRFLDO PRYHPHQW RUJDQL]DWLRQV1*2V DV ZHOO DV WR SURPRWH DW WLPHV XQLQWHQWLRQDOO\ WKH LQVWLWXWLRQDOL]DWLRQ RI WKH PRYHPHQW ZKLFK KDV FRQWULEXWHG WR JHQGHU HTXLW\ EXW QHHGV WR EH EDFNHG XS ZLWK D VWURQJ PDVV PRYHPHQW WR HQVXUH LPSOHPHQWDWLRQ RI PRUH WKDQ V\PEROLF JDLQV /HWfV QRZ FRQVLGHU KRZ IHPLQLVW DFWLYLVWV RI YDULRXV VWUDQGV SHUFHLYH GRQRUVf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t6 VDLG WR PH :H QHYHU KDG DQ\ GHPDQGV RQ WKH SDUW RI DJHQFLHV WR GR WKLQJV WKDW ZH GLG QRW ZDQW WR GR ,W QHYHU KDSSHQHG DQG DOVR ZH GR QRW DFFHSW SURSRVDOV WKDW UHTXHVW WKDW ZH IRU H[DPSOH GR WKLQJV OLNH XVLQJ D ,8' RQ DOO ZRPHQ RU W\LQJ WKH WXEHV RI ZRPHQ RU UHFRPPHQGLQJ ZRPHQ WR KDYH KHU WXEHV WLHG RUQRW FRXQVHOLQJ ZRPHQ UHJDUGLQJ DERUWLRQ 7KLV QHYHU KDSSHQHG 2QFH RQO\ WKHUH ZDV DQ DJHQF\ ZKLFK IRUELG )t6 WR ZRUN ZLWK DERUWLRQ QRW RQO\ QRW SHUIRUPLQJ DERUWLRQV EXW DOVR QRW FRXQVHOLQJ WKHQ ZH GLG QRW DFFHSW WKH ILQDQFLQJ 2. 2WKHU VXFK VWDWHPHQWV WKH\ QHYHU LQWHUIHUH LQ RXU EURDG ZRUNLQJ GLUHFWLYHV :H GR ZKDW ZH ZDQW 5DFKHO )t6f 7KHUH DUH QR SUREOHPV :KHQ WKHUH LV D SUREOHP ZH FXW WKH UHODWLRQ IRU H[DPSOH LI WKH\ LPSRVH WKHLU YLHZ 6LQFH KDYH EHHQ KHUH LW KDSSHQHG ZLWK 3DWKILQGHU 7KH\ ZDQWHG WR IXQG XV EXW LW ZDV YHU\ VSHFLILF ZLWK D SUREOHPDWLF SURSRVDO DQG

PAGE 316

ZH GHFLGHG QRW WR GR ZKDW WKH\ ZDQWHG XV WR GR $QG LW ZDV D WLPH ZKHQ ZH QHHGHG PRQH\ &ODXGLD 637f 6LPLODUO\ DPRQJ YROXQWHHU RUJDQL]DWLRQV ZDV WROG 7KH\ GRQnW LQIOXHQFH XV LQ DQ\ ZD\ 08f GRQnW HYHQ VHH WKHP $OHVVDQGUD 08f 6R IDU ZH KDYH ZRUNHG ZLWKRXW SUREOHPV 0RHPD 7KH &DVDf 6XFK VWDWHPHQWV RI LQGHSHQGHQFH DUH WKH UHVXOW RI WKH PXFK FKHULVKHG DXWRQRP\ RI VRFLDO PRYHPHQW RUJDQL]DWLRQV ZKLFK PDNHV LW GLIILFXOW WR DFNQRZOHGJH RQHfV RZQ GHSHQGHQF\ DOVR EHOLHYH WKDW WKH LQIOXHQFH RI GRQRU DJHQFLHV LV JUHDWHVW DW WKH WLPH RI VHOHFWLRQ RI SURMHFWV DOWKRXJK DV ZH KDYH MXVW VHHQ WKLV LV QRW WKH DJHQFLHVf RQO\ SRLQW RI OHYHUDJH )LQDOO\ WKH WZR YROXQWHHU JURXSV KDG EHHQ UHFHLYLQJ IXQGLQJ LQGHSHQGHQWO\ IRU RQO\ RQH \HDU DQG KHQFH KDG OLWWOH H[SHULHQFH ZLWK GRQRUV 7KHVH VWDWHPHQWV RI DXWRQRP\ GR QRW PHDQ WKDW DFWLYLVWV DUH QDLYH DERXW DJHQFLHVf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nV ZK\ ZH KDYH VR OLWWOH PRQH\ $OO EXW WZR )t6 PHPEHUV HPSKDVL]HG WKH SUDFWLFDO GLIILFXOWLHV VXFK DV FXOWXUDO PLVFRPPXQLFDWLRQ WLPH ORVW RQ UHSRUW DQG SURSRVDO ZULWLQJ HWF WR EH GLVFXVVHG IXUWKHU RQf UDWKHU WKDQ IRFXVLQJ RQ WKH SROLWLFDO GLPHQVLRQ RI WKH UHODWLRQVKLS 0HPEHUV RI WKH &DVD GD 0XOKHU ZHUH DOVR DZDUH RI WKHVH SULRULWLHV EHFDXVH WKH SURMHFW WKH\ JRW IXQGHG RULJLQDOO\ LQFOXGHG ZRPHQ DQG DGROHVFHQW JLUOV DQG WKH DJHQF\ GHFLGHG WR ILQDQFH RQO\ WKH DGROHVFHQW SDUW ; VXSSRUW JLYHQ WRSLFV RU WKH\ GLG QRW ILQDQFH WKH SDUW

PAGE 317

RI WKLV ZRUN WKDW GHDOV ZLWK ZRPHQ RQO\ WKH ZRUN ZLWK WHHQDJHUV %HDWUL] &DVDf ODXQFKHG LQWR D SROLWLFDO HFRQRPLF DQDO\VLV RI 1*2V DQG LQWHUQDWLRQDO UHODWLRQV 6KH VXJJHVWHG WKDW FRQVLGHU LVVXHV RI LQVWLWXWLRQDOL]DWLRQ RI WKH PRYHPHQW DQG WKHLU OLQN WR WKH QHZ SKDVH LQ ZKLFK FDSLWDOLVP ILQGV LWVHOI 7R KHU JRYHUQPHQWV LQ WKH 1RUWK DUH IXQGLQJ VRXWKHUQ 1*2V ZKR DUH WKHUHIRUH FRRSWHG 6KH GRXEWV WKDW 1*2V KDYH DQ\ LQGHSHQGHQFH 2Q DQRWKHU RFFDVLRQ %HDWUL] H[SODLQHG WKDW WR KHU 1*2V DUH IDFLOLWDWLQJ WKH 6WDWHnV LPSOHPHQWDWLRQ RI VWUXFWXUDO DGMXVWPHQW SROLFLHV E\ RIIHULQJ VHUYLFHV ZKLFK GDPSHQ VRFLDO SUHVVXUH 6XFK D SRVLWLRQ LV TXLWH FRPPRQ DPRQJ PRYHPHQW DFWLYLVWV ,W ZDV DPRQJ 08 PHPEHUV WKDW IRXQG WKH VWURQJHVW IHHOLQJV DJDLQVW GRQRU LQIOXHQFH 6RPH PHPEHUV VXFK DV 7DWLDQD DQG 0DXUD EDVLFDOO\ VHH DJHQFLHV DV DQ LPSHULDOLVW FRQVSLUDF\ PHDQW WR XQGHUPLQH WKH ZRPHQf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f LQWHUYHQWLRQ LQ VRFLDO PRYHPHQW DFWLYLWLHV ZDV GHOLYHUHG SXEOLFO\ E\ 9DQHWH $OPHLGD UHSUHVHQWDWLYH RI WKH 0RYLPHQWR GH 0XOKHUHV 7UDEDOKDGRUDV 5XUDLV GR 1RUGHVWH 0RYHPHQW RI :RPHQ 5XUDO :RUNHUV RI WKH 1RUWKHDVWf DW WKH VHPLQDU RQ GHYHORSPHQW FRRSHUDWLRQ DQG JHQGHU SROLWLFV KHOG LQ 5HFLIH LQ 2FWREHU $IWHU WKDQNLQJ WKH RUJDQL]HUV IRU LQYLWLQJ KHU RUJDQL]DWLRQ WR SDUWLFLSDWH LQ WKLV HYHQW ZKLFK VKH VDLG ZDV UDUR H LPSRUWDQWLVVLPR UDUH DQG YHU\

PAGE 318

LPSRUWDQWf 9DQHWH D YLEUDQW $IIR%UD]LOLDQ ZRPDQ RI PRGHVW RULJLQ ZLWK \HDUV RI DFWLYLVP SURFHHGHG WR H[SUHVV KHU IUXVWUDWLRQ ZLWK GRQRUfV SHQVDPHQWR GH FRORQL]DGRUnn FRORQL]HUnV PHQWDOLW\f 6KH GHVFULEHG KHU RUJDQL]DWLRQfV GLIILFXOWLHV WR RQ WKH RQH KDQG PHHW RXU QHHGV WKH TXDVL LPSRVVLELOLW\ WR ZRUN ZLWKRXW UHVRXUFHV IURP RXWVLGH 2Q WKH RWKHU WKH VHDUFK IRU RXU DXWRQRP\ RXU UHVSHFW RXU SULGH RXU GLJQLW\ 6KH SROLWHO\ EXW VTXDUHO\ GHFODUHG +RZ ZRQGHUIXO LI ZH FRXOG ZRUN ZLWKRXW LQWHUQDWLRQDO FRRSHUDWLRQ 7KLV QHHG IRU GLJQLW\ DQG UHVSHFW HFKRHG LQ PXFK VWURQJHU WRQHV $QD 0DULDfV )t6f FRPSODLQWV DERXW KRZ HPRWLRQDOO\ GUDLQLQJ LW LV WR FRQVWDQWO\ KDYH WR SURYH RQHfV VHOIZRUWK LQ RUGHU WR UHFHLYH IXQGLQJ 9DQHWHfV HYDOXDWLRQ RI WKH VLWXDWLRQ LV WKDW DJHQFLHV EHOLHYH WKDW WKH\ PHQ DQG ZRPHQ KDYH WKH FRUUHFW SHUVSHFWLYH RQ RXU SUREOHPV DQG ZH DUH WKH SRRU VRXOV ZKR GRQnW NQRZ DQ\WKLQJ 7KLV FRPHV RXW YHU\ VWURQJO\ DQG LW LV D FRORQL]HUnV PHQWDOLW\ 7KLV LV SDUWLFXODUO\ WUXH ZKHQ WKH DJHQF\ KDV DQ RIILFH LQ WKH FRXQWU\ 9DQHWH FODLPHG 6KH JDYH FRQFUHWH H[DPSOHV RI DJHQFLHV ZLWK ZKRP WKH\ KDYH EHHQ ZRUNLQJ WHOOLQJ WKHP 7KLV LV QR ORQJHU RXU REMHFWLYH 1RZ LW LV WKDW )RU H[DPSOH 1RZ LWnV QR ORQJHU WKH UXUDO ZRUOG EXW WKH FLWLHV RU FHUWDLQ VWDWHPHQWV VXFK DV WKLV VKRXOG QRW EH RU :KDW \RX DUH WU\LQJ WR GR LV WRR VRRQ RU WKLV RUJDQL]DWLRQ LV VWXFN LQ WKH ORFDO RU DJDLQ WKLV RUJDQL]DWLRQ LV JRLQJ WR EXUHDXFUDWL]H LW LV QRW JRLQJ WR VWUHQJWKHQ WKH EDVH 0RYHPHQWV NQRZ ZKDW WKH\ DUH GRLQJ HYHQ LI LW LV QRW LQ WKH SDXWD GD PRGD GH YRFV? WKH ODWHVW IDG RQ WKH DJHQGDf 9DQHWHfV YHU\ FRXUDJHRXV REMHFWLYH ZLWK WKLV VKRUW EXW HIIHFWLYH VSHHFK ZDV WR DLU VRPH RI WKH FULWLFLVPV ZKLFK ZHUH YRLFHG LQ PXWHG WRQHV LQ RWKHU SODFHV $SSURSULDWLQJ DQG FDUU\LQJ WR LWV IXOO ORJLF WKH SDUWLFLSDWRU\ GLVFRXUVH RI SDUFHULD DQG GLDORJDU SDUWQHUVKLS DQG GLDORJXHf RI GHYHORSPHQW DJHQFLHV VKH ZDV FDUHIXO WR HPSKDVL]H WKH QHHG IRU WDONLQJ WKLV RYHU

PAGE 319

LQ RUGHU WR LPSURYH WKH VLWXDWLRQ :LWKRXW VXFK D SDUWLFLSDWRU\ GLVFRXUVH LW ZRXOG SUREDEO\ KDYH EHHQ LPSRVVLEOH IRU KHU WR IHHO VDIH HQRXJK WR GHOLYHU VXFK D EOD]LQJ WLUDGH EHOLHYH LW LV QR FRLQFLGHQFH WKDW 9DQHWH LV QRW D PHPEHU RI D SURIHVVLRQDOL]HG RUJDQL]DWLRQ EXW RI WKH 0RYHPHQW RI :RPHQ 5XUDO :RUNHUV LQ WKH 1RUWKHDVW $V VKH KHUVHOI SRLQWHG RXW SRSXODU PRYHPHQWV GR QRW HODERUDWH DV ZHOO DV DQ 1*2 IXOO RIfGRFWRUVn 1RW RQO\ GR SRSXODU PRYHPHQWV KDYH OHVV WR ORVH EHFDXVH WKH\ DUH QRW VR GHSHQGHQW RQ WKH PRQH\ JUDQWHG EXW DP FRQYLQFHG WKDW WKHLU RUJDQL]DWLRQDO FXOWXUH LV MXVW WKDW PXFK PRUH UHPRYHG IURP LQWHUQDWLRQDO GRQRUVf ZKHQ FRPSDUHG ZLWK WKH RUJDQL]DWLRQDO FXOWXUH RI 6RXWKHUQ %UD]LOfV XUEDQ HGXFDWHG ZRPHQfV JURXSV 3RSXODU PRYHPHQW PHPEHUVf FXOWXUDO FDSLWDO SXWV WKHP DW D GLVDGYDQWDJH ZKHQ DWWHPSWLQJ WR ILQG RXW ZKDW GRQRUVf XQGHUO\LQJ PRWLYHV DUH DQG WR ZULWH VHQWHQFHV WKDW SOHDVH WKH GRQRUV WR TXRWH 9DQHWH DJDLQ 1*2Vn 5HVLVWDQFH 'HVSLWH WKHLU FDXWLRQ DW YRLFLQJ FULWLFLVPV ZRPHQfV 1*2V KDYH QRW EHHQ SDVVLYH LQ WKLV UHODWLRQVKLS :RPHQfV 1*2V KDYH UHVLVWHG FHUWDLQ GRQRU WUHQGV FROOHFWLYHO\ DQG DORQJVLGH RWKHU 1*2V )RU H[DPSOH %UD]LOLDQ 1*2V KDYH FRQVLVWHQWO\ DUJXHG ZLWK (XURSHDQ GRQRUV VLQFH WKH\ VWDUWHG HPSKDVL]LQJ LQGLFDWRUV PHDVXULQJ WKH LPSDFW RI WKHLU ZRUN $ VHULHV RI URXQGWDEOHV DQG VHPLQDUV KDYH EHHQ RUJDQL]HG WR DW OHDVW GLVFXVV ZKDW FULWHULD FRXOG EH XVHG WR PHDVXUH WKLV LPSDFW :RPHQfV KHDOWK 1*2V IRU WKHLU SDUW KDYH KDG WR FRQWHQG ZLWK GRQRUVf ZLVKHV WR LQFOXGH PHQ LQ UHVHDUFK DQG SLORW SURMHFWV RQ UHSURGXFWLYH KHDOWK GRQH E\ ZRPHQfV 1*2V 7KLV UHFHQW WUHQG GHULYHV IURP IROORZLQJ WKH FDOO IRU D WUXH JHQGHU SHUVSHFWLYH ,W LV XQGHUVWDQGDEOH FRQVLGHULQJ WKH UROH RI PHQ LQ PRVW ZRPHQfV UHSURGXFWLYH DQG VH[XDO

PAGE 320

OLYHV +RZHYHU ZRPHQfV JURXSV KDYH EHHQ UHVLVWLQJ LQ DQ HIIRUW WR SURWHFW DUGXRXVO\ZRQ ZRPHQfV VSDFHV ,W LV RI FRXUVH DQ XQHTXDO EDWWOH KRZHYHU GHVSLWH WKH UKHWRULF RI SDUWLFLSDWRU\ GHYHORSPHQW VLQFH GRQRUV KROG WKH SXUVHfV VWULQJV DQG 1*2V DUH LQ WKH SRVLWLRQ RI UHFLSLHQWV $V (GLPHLUH RQH RI WKH DFWLYLVWV ZRUNHG ZLWK WROG PH \RXfOO VHH SUHWW\ VRRQ HYHU\ERG\ ZLOO EH ZRUNLQJ ZLWK PHQ %HVLGHV FROOHFWLYH UHVLVWDQFH 1*2V DOVR PDNH XVH RI WKH ILLOOUDQJH RI WKH ZHDSRQV RI WKH ZHDN WR XVH 6FRWWfV SKUDVH f UHIHUULQJ WR VPDOOVFDOH QRQ SXEOLF DFWV RI UHVLVWDQFH $V 9DQHWH KHUVHOI UHFRJQL]HG DQG DV GRQRUVf SURJUDP RIILFHUV NQRZ YHU\ ZHOO 1*2V f§ HVSHFLDOO\ VWDU 1*2Vf§ KDYH WKH NQRZKRZ DQG IRUPDO HGXFDWLRQ WR ZULWH VHQWHQFHV WKDW SOHDVH WKH GRQRUV ,Q RWKHU ZRUGV WKH\ GR ZKDW ZH DFDGHPLFV GR ZKHQ ZH ZULWH UHVHDUFK SURSRVDOV WKDW LV WR WDLORU LW WR WKH SUHIHUHQFHV RI WKH SDUWLFXODU ILQDQFLQJ DJHQF\ ZH VHQG LW WR +RZHYHU DJDLQ WKLV LV QRW DV HDV\ WR GR IRU QHLJKERUKRRG ZRPHQf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f \RX GRQnW GR WKLV"

PAGE 321

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n UHQW DQG HOHFWULFLW\ ELOO $FFRUGLQJ WR WKH VDPH SURMHFW D ODUJH SDUW RI WKH PRQH\ UHFHLYHG ZDV VXSSRVHG WR FRPSHQVDWH WKH ZRUNVKRS OHDGHUV LH WKH JURXSVf PHPEHUV $JDLQ WKH JURXS XVHG WKH PRQH\ WR SD\ IRU KHDGTXDUWHUVf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
PAGE 322

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f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

PAGE 323

ZRPHQ LQ UHSURGXFWLYH KHDOWK GHFLVLRQV 7KH %UD]LOLDQ ZRPHQ VDLG WR PH LW ZDV D ELW DV LI WKH\ VSRNH D GLIIHUHQW ODQJXDJH DQG GLG QRW XQGHUVWDQG ZKDW WKH RWKHU ZDV VD\LQJ $QRWKHU PDMRU W\SH RI FRPSODLQW FRQFHUQHG WKH EXUHDXFUDWLF SUREOHPV WKH JURXSV ZHUH HQFRXQWHULQJ LQ WKHLU UHODWLRQVKLSV ZLWK GRQRUV 7KHUH ZHUH SDSHUZRUN SUREOHPV DQG PRQH\ SUREOHPV 3DSHUZRUN SUREOHPV RFFXUUHG ZKHQ DQ DJHQF\ ZDV EDJXQJDGD GLVRUJDQL]HGf DQG ORVW GRFXPHQWV 1*2V KDG DOUHDG\ VHQW $ SRSXODU IHPLQLVW JURXS DFNQRZOHGJHG WKDW LQ D ZD\ LW PDGH WKHP IHHO EHWWHU EHFDXVH WKH\ KDG EHHQ LQWLPLGDWHG E\ WKH IRUPDOLW\ WKDW DJHQFLHV UHTXLUHG +RZHYHU VXFK EXUHDXFUDWLF PLVKDSV FDQ KDYH GLUH FRQVHTXHQFHV IRU ZRPHQf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fV JURXSV LQ WKHLU ZRUNLQJ SDUWQHUVKLSV ZLWK LQWHUQDWLRQDO GRQRU DJHQFLHV DUH LQ IDFW UHODWLYHO\ PLQRU ZKHQ FRPSDUHG WR WKH EXURFUDFLD YLROHQWD YLROHQW EXUHDXFUDWLF PLUHf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

PAGE 324

DFFRPSDQ\ WKHP WR WKH DFFRXQWDQWf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£R LQWHOHFWXDO WKH GRQRUfV FRQVXOWDQWV WKURXJK VHYHUDO GUDIWV RI WKH SURMHFW LPSRVHG WKHLU YLVLRQ DQG WKHLU PHWKRGRORJ\ RQ WKH %UD]LOLDQ 1*2 PHPEHUV *LYHQ WKH SRZHU GLIIHUHQWLDO EHWZHHQ GRQRU DQG UHFLSLHQW WKH %UD]LOLDQVf UHVLVWDQFH ZDV RQO\ PHW E\ UHMHFWLRQ RI WKHLU SURSRVDO DQG D IRUFHG UHWXUQ WR WKH GUDZLQJ ERDUG 'HVSLWH WKHVH FRQFUHWH H[DPSOHV IHZ ZRPHQ FRPSODLQHG DERXW WKH UHODWLRQVKLS RI KLHUDUFK\ WKDW H[LVWV EHWZHHQ WKRVH ZKR JLYH WKH PRQH\ DQG WKRVH ZKR UHFHLYH LW 6LQFH WR H[SRVH \RXUVHOI WR VD\ ZKDW \RX WKLQN PHDQV UXQQLQJ WKH ULVN RI QR ORQJHU UHFHLYLQJ IXQGLQJ WR TXRWH 9DQHWH $OPHLGD DJDLQ 1*2V@ ZKR KDYH PDGH LW VR IDU NQRZ WKDW WKH EHQHYROHQFH RI

PAGE 325

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f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

PAGE 326

QXUWXULQJ DQG JUDGXDO TXDOLWDWLYH UHVXOWV WKDW FKDUDFWHUL]H VXFFHVVIXO LQVWLWXWLRQDO GHYHORSPHQW >@ 6XFK ZRUN LV GLIILFXOW WR nVHOOn WR SROLWLFLDQV f $Q HOHPHQW ZKLFK KDYH QRW PHQWLRQHG H[SOLFLWO\ VR IDU LV WKH UROH ODUJH SKLODQWKURSLF IRXQGDWLRQV KDYH SOD\HG LQ HIIRUWV WR VWDELOL]H VRFLDO V\VWHPV $IWHU DOO UHVHDUFK RQ WKH VRFLDO RULJLQV DQG QHWZRUNV RI ODUJH 86 IRXQGDWLRQV KDV VKRZQ WKDW WKH\ DUH FORVHO\ UHODWHG WR WKH KLJKHU FLUFOHV LQ WKH HFRQRPLF VRFLDO DQG SROLWLFDO HOLWH &ROZHOO f /LQNV WKURXJK IDPLO\ WLHV HGXFDWLRQDO LQVWLWXWLRQV VRFLDO FOXEV PHPEHUVKLS RQ FRUSRUDWH ERDUGV RI GLUHFWRUV DUH VRPH RI WKH ZD\V IRXQGDWLRQ WUXVWHHV DUH OLQNHG WR WKH HFRQRPLF VRFLDO DQG SROLWLFDO HOLWH LQ WKLV FRXQWU\ LELG f 7KLV LV OLNHO\ WR FRQWULEXWH WR WKH LPSRUWDQFH WKH\ SODFH RQ EULQJLQJ GLIIHUHQW VRFLDO DFWRUV WRJHWKHU WR GLVFXVV DQ LVVXH RU RQ SDWFKLQJ XS JODULQJ VRFLDO LQHTXDOLWLHV WKDW DUH OLNHO\ WR OHDG WR JUHDW GLVUXSWLRQ RI VRFLDO SHDFH ,Q WKH V IRU H[DPSOH WKH )RUG )RXQGDWLRQ ILQDQFHG D ODUJH SDUW RI WKH UHVWUXFWXULQJ RI SROLWLFDO VFLHQFH LQWR D EHKDYLRUDO VFLHQFH PHDQW WR GHYHORS DQ XQGHUVWDQGLQJ RI VRFLDO GLVRUJDQL]DWLRQ LQ WKH IDFH RI UDSLG VRFLDO FKDQJH 6H\EROG f 7KH\ IHDUHG WKDW LQ VXFK D SHULRG RI FKDQJH GLVORFDWLRQV DQG EUHDNGRZQV RFFXU ZLWK UHVXOWLQJ SROLWLFDO HFRQRPLF DQG VRFLDO XQUHVW IURP )RUG GRFXPHQW RI WKH WLPH LELGff 2Q WKH RWKHU KDQG )RUG DOVR ILQDQFHG WKH 86 EODFN FLYLO ULJKWV PRYHPHQW DQG ZDV FULWLFL]HG E\ WKH 86 &RQJUHVV IRU VXFK DFWLYLWLHV ,Q RWKHU ZRUGV RQ D JLYHQ LVVXH IRXQGDWLRQV FDQ EH WDNHQ DGYDQWDJH RI E\ VXSSRUWHUV RI UDGLFDO GHPRFUDF\ VXFK DV VRFLDO PRYHPHQW RUJDQL]DWLRQV SURYLGHG WKH ODWWHU DUH DZDUH RI WKH XQLQWHQGHG FRQVHTXHQFHV RI VXFK IXQGLQJ 0RUHRYHU P\ HQFRXQWHUV ZLWK SURJUDP RIILFHUV ZRUNLQJ RQ WKH JURXQG OHG PH WR EHOLHYH WKDW IRXQGDWLRQV VKRXOG QRW EH YLHZHG DV PRQROLWKV VLQFH WKHVH RIILFHUV GR QRW QHFHVVDULO\ VKDUH WKH OLQHV DQG REMHFWLYHV RI WKHLU %RDUG RI 7UXVWHHV ,Q RWKHU ZRUGV PRVWO\ DJUHH ZLWK -HQNLQV DQG

PAGE 327

(FNHUW f WKDW GRQRUVn LQIOXHQFH VKRXOG EH FRQVLGHUHG PRUH LQ WHUPV RI FKDQQHOLQJ RI WKH PRYHPHQW WKDQ LWV VLPSOLVWLF FRRSWDWLRQ DQG FRQWURO DQG WKDW ZH QHHG WR GLVVRFLDWH FRQWURO DV WKH LQWHQWLRQ RI SDWURQV YV FRQWURO DV WKH FRQVHTXHQFHV RI SDWURQDJH f +RZHYHU XQOLNH LQ WKHLU VWXG\ RI WKH ILQDQFLQJ RI WKH %ODFN PRYHPHQW LQ WKH V LQ WKH 86 KRSH WR KDYH VKRZQ WKDW ILQDQFLQJ DJHQFLHV GLG DOVR VWLPXODWH LQWHQWLRQDOO\ WKH UHRULHQWDWLRQ RI ZRPHQn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

PAGE 328

&+$37(5 &21&/86,21 5HODWLRQVKLS 1*2V 6RFLDO 0RYHPHQW 7KLV VWXG\ VKRZV WKDW WKHUH LV PXFK DPELJXLW\ DQG K\EULGLW\ LQ WKH ZRUOG RI IHPLQLVW DFWLYLVWV SURIHVVLRQDOL]HG DQG YROXQWHHU WKDW HDFK FRQWULEXWH WR WKH PRYHPHQW LQ WKHLU RZQ ZD\ DQG WKDW WKHUH DUH QR HDV\ DQVZHUV WR WKH FKDOOHQJHV SRVHG E\ SURIHVVLRQDOL]DWLRQ 7KHVH FKDOOHQJHV GR QHHG WR EH DGGUHVVHG LI WKH ZRPHQnV PRYHPHQW ZDQWV WR FRQWULEXWH WR WKH IXUWKHU GHHSHQLQJ RI GHPRFUDF\ LQ %UD]LO 7KLV VWXG\ GHPRQVWUDWHV WKDW IHPLQLVW 1*2V EHFDXVH RI WKH RULJLQ RI WKHLU PHPEHUV LQ WKH PRYHPHQW DQG WKHLU VHQVH RI FROOHFWLYH LGHQWLW\ DV ZRPHQ VKRXOG EH FRQVLGHUHG DV SDUW RI WKH IHPLQLVW DQG KHQFH RI WKH ODUJHU ZRPHQnV PRYHPHQW 7KLV LV GLIIHUHQW IURP PRVW GHYHORSPHQWIRFXVHG 1*2V EXW VLPLODU WR 1*2V ERUQ RXW RI RWKHU LGHQWLW\EDVHG PRYHPHQWV VXFK DV WKH $IUR%UD]LOLDQ PRYHPHQW $V D UHVXOW IHPLQLVW 1*2V KDYH D K\EULG LGHQWLW\ :LWK UHJDUG WR WKHRUL]LQJ WKH SURIHVVLRQDOL]DWLRQ RI VRFLDO PRYHPHQWV WKLV FDVH VWXG\ DUJXHV DJDLQVW 0F&DUWK\ DQG =DOGnV f FRQWHQWLRQ WKDW PHPEHUV RI SURIHVVLRQDOL]HG PRYHPHQW RUJDQL]DWLRQV DUH LQGLYLGXDOV ZLWK D VRFLDO UHIRUP DJHQGD EXW ZLWK QR FRQQHFWLRQ WR WKH PRYHPHQW 2Q WKH FRQWUDU\ LW VXSSRUWV 3DP 2OLYHUnV f FRQWHQWLRQ WKDW WKH OHDGHUV RI SURIHVVLRQDOL]HG RUJDQL]DWLRQV VWHP IURP WKH PRYHPHQW DQG WKDW WKH\ DUH QR OHVV FRPPLWWHG WR LW +RZHYHU WKH SUHVHQFH RI H[WULQVLF UHZDUGV DQG

PAGE 329

PRWLYDWRUV GRHV DOWHU WKH PHDQLQJ RI PHPEHUVn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n PRGHOV RI SODQQLQJ UHTXLUHPHQWV IRU JUDQW DQG SURMHFW DFFRXQWLQJ DQG PRUH UHFHQWO\ WKHLU SUHIHUUHG SROLWLFDO VWUDWHJ\ DV ZHOO DV WKH QHHG RQ WKH SDUW RI 1*2V WR VHFXUH IXUWKHU IXQGLQJ DOVR JUHDWO\ FRQWULEXWHG WR WKH WUDQVIRUPDWLRQ RI ZRPHQnV JURXSV LQWR SURIHVVLRQDOL]HG ZRPHQnV 1*2V 3URIHVVLRQDOL]HG DFWLYLVP ZDV DOVR DV 0HOXFFL DUJXHV f D UHVXOW RI WKH VXFFHVV RI WKH PRYHPHQW WKH DEVRUSWLRQ WKRXJK OLPLWHG E\ WKH LQWHUQDWLRQDO HVWDEOLVKPHQW DQG E\ VWDWHV RI VRPH RI WKH WHQHWV RI IHPLQLVP RIWHQ DV LW ILWV WKHLU SXUSRVHf JHQHUDWHG WKH YHU\ DYDLODELOLW\ RI IXQGLQJ IRU ZRPHQnV JURXSV DQG JHQGHU LVVXHV $ WKLUG HOHPHQW ZKLFK FRQWULEXWHG JUHDWO\ DOWKRXJK LQGLUHFWO\ WR WKH SURIHVVLRQDOL]DWLRQ RI WKH IHPLQLVW PRYHPHQW LQ %UD]LO LV WKH QHZ VWUXFWXUH RI SROLWLFDO RSSRUWXQLWLHV WKDW FDPH LQ WKH IRUP RI WKH GHPRFUDWL]DWLRQ RI WKH UHJLPH ,QGHHG DV QHZ FKDQQHOV RI H[SUHVVLRQ RSHQHG VRPH DFWLYLVWV VWDUWHG FRQVLGHULQJ WKH SROLF\ DUHQD DV D YLDEOH RSWLRQ IRU VXFFHVVIXO VRFLDO FKDQJH HVSHFLDOO\ WKRVH ZKR KDYH KDG H[SHULHQFH ZLWK VWDWH ZRPHQnV PDFKLQHULHV 7KH\ WKHQ QHHGHG WR DGDSW WKHLU RUJDQL]DWLRQDO IRUPV WDFWLFV

PAGE 330

DQG VNLOOV WR WKLV QHZ UHDOP RI DFWLYLWLHV E\ PDLQWDLQLQJ UHJXODU RIILFH KRXUV DQG SHUPDQHQW FRQWDFW E\ RIIHULQJ D VSHFLDOL]HG VWDII XSWRGDWH RQ WKH YDVW OLWHUDWXUH QRZ DYDLODEOH RQ JHQGHU LVVXHV DV ZHOO DV E\ SUHVHQWLQJ D GHSHQGDEOH UHVSHFWDEOH DQG SURIHVVLRQDO RXWORRN WKDW ZRXOG EULQJ SROLF\PDNHUV WR WDNH WKHP VHULRXVO\ ,PSDFW RI 3UDFWLFHV RQ &ROOHFWLYH ,GHQWLW\ +RZHYHU DV KRSH WR KDYH VKRZQ SUDFWLFHV DUH QRW DOZD\V VLPSO\ D UHIOHFWLRQ RI JURXSVn LGHDV WKH\ FDQ DOVR PRGLI\ JRDOV DQG SUHIHUHG WDFWLFV KRSH WR KDYH VKRZQ DV 6WDJJHQERUJ KDG GRQH LQ WKH FDVH RI WKH 86 SURFKRLFH PRYHPHQW WKDW RUJDQL]DWLRQDO IHDWXUHV RI SURIHVVLRQDOL]HG DFWLYLVW RUJDQL]DWLRQV OLQNHG WR WKH ORJLF RI SURMHFWV LQKHUHQW WR GRQRU IXQGLQJ DV LW LV GLVEXUVHG WRGD\ UHLQIRUFH 1*2 SUHIHUHQFH IRU LQVWLWXWLRQDOL]HG DUHQDV LI QRW VWHHU IHPLQLVW 1*2V DZD\ IURP PRYHPHQW RUJDQL]LQJ DQG PLFUROHYHO FRQVFLRXVQHVVUDLVLQJ ,QGHHG D QXPEHU RI DVSHFWV RI RUJDQL]DWLRQDO IRUPV OLQNHG WR SURIHVVLRQDOL]DWLRQ WHQG WR LQKLELW YROXQWHHU PRELOL]DWLRQ 7KH FHQWUDOLW\ RI WKH SODQQLQJ LPSHUDWLYH LQ SURMHFW ZRUN SUHVVHV 1*2V WR NHHS RQ WUDFN DQG WR EH XQGLVWXUEHG E\ SRWHQWLDOO\ KRW PRELOL]LQJ LVVXHV DQG E\ XQH[SHFWHG RXWVLGH LQFXUVLRQV LQ WKHLU ZRUN 7KH SK\VLFDO DEVHQFH RI OHDGHUV IURP WKH ORFDO OHYHO VFKHGXOH FRQIOLFWV ZLWK JUDVVURRWV DFWLYLWLHV WKH OLPLWHG JURZWK RI WKHLU RZQ RUJDQL]DWLRQ GXH WR SURIHVVLRQDO DQG EXGJHWDU\ FRQVWUDLQWV WKH PRUH SXQFWXDO DQG WRSGRZQ FRQWHQWIRUP RI UHVHDUFK RU SLORW SURMHFWV DV RSSRVHG WR DVVHVVRULD DQG ILQDOO\ WKH WLPH FRQVWUDLQWV ZKLFK OHDG WKHP WR GR DZD\ ZLWK XVEXLOGLQJ DFWLYLWLHV DOO SRWHQWLDOO\ QHJDWLYHO\ LPSDFW YROXQWHHU PRELOL]DWLRQ 7KLV FDVH VWXG\ WKXV ZRXOG VHHP WR DUJXH LQ IDYRU RI WKH LQKLELWLRQ PRGHO HODERUDWHG E\ .OHLGPDQ f +RZHYHU OLNH

PAGE 331

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nV QHLJKERUKRRGV WRZDUGV PRUH YLVLEOH IRUPV RI PRELOL]DWLRQ VXFK DV LQ WKH &HQWUDO GRV 0RYLPHQWRV 3RSXODUHV RU ZRPHQnV VHFWLRQV RI WUDGHXQLRQV 7KH\ DOVR ZLVK WR SOD\ D PRUH DFWLYH UROH LQ WKH SROLF\ DUHQD .HHSLQJ WKH %DODQFH EHWZHHQ 3ROLF\ )RUPXODWLRQ DQG 0RELOL]LQJ &XOWXUDO &KDQJH 'HYHORSPHQW 1*2V KDYH EHHQ FULWLFL]HG IRU EHLQJ DSROLWLFDO ZKHQ WKH\ OLPLW WKHPVHOYHV WR WKH ORFDO VFDOH RI DFWLRQ DQG H[SORLW WKH SRRU EHFDXVH WKH\ PDNH D OLYLQJ DW SURYLGLQJ WKHP ZLWK VHUYLFH GHOLYHU\ 3HWUDV f ,W LV LQGHHG LPSRUWDQW IRU 1*2V WR JR EH\RQG WKHLU SDURFKLDO WXUIn DQG WR VFDOH XS %HVLGHV VWLULQJ SXEOLF GHEDWH WR FKDOOHQJH FXOWXUDO QRUPV ZRUNLQJ LQ QHWZRUNV DQG FDXWLRXVO\ LQ WKH SROLWLFDO DUHQD WR UHIRUP WKH 6WDWH LV FUXFLDO WR WKLV WDVN %UD]LOLDQ SURIHVVLRQDOL]HG IHPLQLVWV KDYH EHHQ VXFFHVVIXOO\

PAGE 332

DFWLYH LQ WKHVH IRUPDO SROLWLFDO DUHQDV WKHLU LQYROYHPHQW ZLWK WKH 81 FRQIHUHQFH SURFHVVHV LQ &DLUR f DQG LQ %HLMLQJ f DQG PRUH UHFHQWO\ ZLWK DERUWLRQ UHJXODWLRQ OHJLVODWLRQ DW KRPH DUH D JRRG H[DPSOHV RI WKHLU VXFFHVVHV :H KDYH GLVFXVVHG WKDW D WZRSURQJHG VWUDWHJ\ LQYROYLQJ D VWURQJ PRYHPHQW RXWVLGH WKH VWDWH ZKLOH VRPH ZRUN IURP ZLWKLQ VHHPV WR EH WKH PRVW DSSURSULDWH WR HQVXUH HIIHFWLYH VRFLDO FKDQJH 1DLOD .DEHHU UHPLQGV XV WKDW WKH PXOWLGLPHQVLRQDO QDWXUH RI SRZHU VXJJHVWV WKDW HPSRZHUPHQW VWUDWHJLHV IRU ZRPHQ PXVW EXLOG RQ nWKH SRZHU ZLWKLQn DV D QHFHVVDU\ DGMXQFW WR LPSURYLQJ WKHLU DELOLW\ WR FRQWURO UHVRXUFHV WR GHWHUPLQH DJHQGDV DQG PDNH GHFLVLRQV f 7KLV FDQ RQO\ EH DFKLHYHG WKURXJK D JURXQGXS DSSURDFK ZKLFK PHDQV WKDW OREE\LQJ LV QRW VXIILFLHQW DV D VWUDWHJ\ IRU JHQXLQH JHQGHU HTXLW\ LELG f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£

PAGE 333

WHPRV PXLWRV H[HPSORV GLVVR PXLWDV FRLVDV TXH HVW£R QD FRQVWLWXLGR TXH QDR UHVSHLWDGD ( TXH VH D JHQWH HQTXDQWR PRYLPHQWR IHPLQLVWD QDR IL]HU SUHVV£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f PRUH RIWHQ LQ RUGHU WR FUHDWH D FRXQWHUEDODQFH ,QGHHG WKH JUHDWHU SRZHU RI SURIHVVLRQDOL]HG SROLF\FHQWHUHG DFWLYLVWV DSSHDUHG FOHDUO\ LQ D PHHWLQJ RI WKH 6DR 3DXOR UHJLRQDO 5HGH DV WKH\ ZHUH VXSSRVHG WR GLVFXVV KRZ WR SUHYHQW WKH FRQVHUYDWLYH PD\RUnV SULYDWL]DWLRQ SODQ IRU WKH PXQLFLSDO KHDOWK V\VWHP 3$6f 7KLV PHDQW D ORW WR PRYHPHQW RULHQWHG ORFDO SRSXODU IHPLQLVW JURXSV ,W ZDV D SUHVVLQJ LVVXH WRR DV WKH ELOO ZDV VRRQ WR EH YRWHG RQ DW WKH PXQLFLSDO OHJLVODWXUH ,W WXUQHG RXW WKDW DQ LVVXH FRQFHUQLQJ WKH SDUWLFLSDWLRQ RI D PHPEHU RI WKH 5HGH LQ WKH 1DWLRQDO +HDOWK &RXQFLO &RQVHOKR 1DFLRQDO GH 6DGHf LQ %UDVLOLD MXVW KDG FRPH XS 7KLV WRSLF FRQVXPHG PRVW RI WKH WLPH RI WKH PHHWLQJ OHDYLQJ RQO\ LWV WDLOHQG WR GLVFXVV WKH 3$6 7KLUG LW LV HVVHQWLDO IRU D JHQXLQHO\ GHPRFUDWLF FKDQJH WR HQVXUH WKH SDUWLFLSDWLRQ RI SRRU ZRPHQ EH\RQG WKH SURMHFW OHYHO WR LQWHUYHQLQJ LQ WKH EURDGHU SROLF\PDNLQJ DJHQGD >VR@ WKDW WKHLU VWUDWHJLF LQWHUHVWV FDQ EHFRPH DQ HQGXULQJ LQIOXHQFH RQ WKH FRXUVH RI GHYHORSPHQW DV .DEHHU QRWHV f +HQFH WKH UROH RI IHPLQLVW 1*2V LV HVVHQWLDO LQ VWUHQJWKHQLQJ WKH YRLFHV RI SRRU ZRPHQ $IUREUD]LOLDQ ZRPHQ DQG RWKHU XQGHUSULYLOHJHG JURXSV VR WKDW WKH\ KDYH DFFHVV WR WKH SROLF\ DUHQD WKHPVHOYHV 8QWLO WKDW

PAGE 334

WLPH ZKLWH PLGGOH FODVV IHPLQLVWV PXVW EH SDUWLFXODUO\ YLJLODQW ZKHQ WKH\ DUH FDOOHG XSRQ WR UHSUHVHQW ZRPHQ WR LQFRUSRUDWH DV EHVW WKH\ FDQ WKH SRLQW RI YLHZ RI RWKHUV 7KH HIIRUWV RI WKH 5HGH WR LQFOXGH QHLJKERUKRRG JURXSV DUH FRPPHQGDEOH DQG WKLV IRUXP VKRXOG EH FRQVROLGDWHG WR HQVXUH WKDW DOO WKH YRLFHV LQ WKH ZRPHQnV KHDOWK PRYHPHQW DUH KHDUG E\ WKRVH ZKR JHW WR UHSUHVHQW LW 7KLV ZLOO VWUHQJWKHQ LWV UROH DV GHPRFUDWL]LQJ DJHQW *HWWLQJ WKH %HVW RI %RWK :RUOGV 0DQ\ SURIHVVLRQDOL]HG DFWLYLVWV DV KRSH WR KDYH VKRZQ WKURXJKRXW WKLV ZRUN DUH DZDUH RI DQG FRQFHUQHG DERXW WKH FKDOOHQJHV RI WKH ZRUN WKH\ GR 6R DUH D QXPEHU RI GRQRU UHSUHVHQWDWLYHV GLG QRW FRPH XS ZLWK DQ\ RI WKLV RQ P\ RZQ LW ZDV SLHFHG WRJHWKHU IURP ZKDW OHDUQHG KHUH DQG LQ WKH OLWHUDWXUH RQ 1*2V DQG RQ VRFLDO PRYHPHQWV ,Q WKLV VHFWLRQ VHH P\ UROH DV GLVVHPLQDWLQJ ZKDW KDYH OHDUQHG DQG SRLQWLQJ DW VRPH SRVVLEOH VROXWLRQV DOWKRXJK LW LV QRW DOZD\V SRVVLEOH WR ILQG D VROXWLRQ WR VRPH RI WKH PRUH SDUDGR[LFDO GLIILFXOWLHV DW KDQG $V IDU DV SURIHVVLRQDOL]HG DFWLYLVWV DUH FRQFHUQHG LW LV QHFHVVDU\ WR EH DZDUH RI WKH SXVK WRZDUGV IRUPDOL]DWLRQ DQG KLHUDUFKL]DWLRQ RI WKH PRYHPHQW DQG DZD\ IURP RUJDQL]LQJFRQVFLRXVQHVVUDLVLQJ DQG JURXSFDSDFLW\ EXLOGLQJ WKDW IXQGLQJ HQWDLOV 7KLV LV DOVR SDUWLFXODUO\ FDOOHG IRU LQ WKH FDVH RI JURXSV VXFK DV 7KH &DVD VWLOO D YROXQWHHU DQG SRSXODU IHPLQLVW RUJDQL]DWLRQ ZKR DUH VWDUWLQJ WR UHFHLYH IXQGLQJ DQG ZDQW WR PDLQWDLQ WKHLU PRYHPHQWRULHQWHG VWUDWHJ\ 6RPH PLJKW DUJXH LW ZRXOG EH EHWWHU IRU VXFK JURXSV WR UHPDLQ WRWDOO\ LQGHSHQGHQW IURP GRQRU IXQGLQJ WR HQVXUH WKHLU DXWRQRP\ ,QGHHG WKLV LV DQ LPSRUWDQW FRQVLGHUDWLRQ 7KH IDFW LV WKRXJK WKDW HYHQ RUJDQL]LQJ DFWLYLWLHV DUH H[SHQVLYH LQ

PAGE 335

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nV PRYHPHQW ILHOG LV HVVHQWLDO LQ VXFK PRYHPHQWn ZLGH IRUD VXFK DV WKH 5HGH 7KLV LV DOVR QHHGHG IRU SROLF\FHQWHUHG IHPLQLVWV WR UHVRXUFH WKHPVHOYHV DQG WR OLPLW WKH GDQJHUV RI GLVFXUVLYH DSSURSULDWLRQ RI EHFRPLQJ SDUW RI D IHPLQLVPR DSODQDOWDGR WR XVH 0DU\ *DUFLD &DVWURnV f SKUDVH DJDLQ 5HLQWURGXFLQJ WKH XVEXLOGLQJ PHFKDQLVPV DQG SDUWLFLSDWLRQIRVWHULQJ WHFKQLTXHV WKDW IHPLQLVWV KDYH SHUIHFWHG LQ WKHLU \HDUV RI H[SHULHQFH ZLWK ZRUNVKRSV ZLOO EH SDUWLFXODUO\

PAGE 336

XVHIXO WR HQVXUH WKDW HYHU\ERG\nV YRLFHV ZLOO EH KHDUG QRZ WKDW VXFK IRUD KDYH EHHQ VXFFHVVIXO DW EULQJLQJ LQ D SOXUDOLW\ RI DOWHUQDWLYH IHPLQLVPV $W WKH OHYHO RI 6DR 3DXOR LW LV HVVHQWLDO WR PDLQWDLQ IRUD IRU GLVFXVVLRQ VXFK DV WKH ZHHNO\ &DI )HPLQLVWD RU WKH )UXP GH 0XOKHUHV GH 6DR 3DXOR ZKLFK PHW UHJXODUO\ WR SUHSDUH IRU WKH %HLMLQJ FRQIHUHQFH RU LQ WKH FDVH RI WKH ZRPHQnV KHDOWK PRYHPHQW WKH IRUXP RUJDQL]HG DURXQG WKH IHPLQLVW PDJD]LQH (QIRTXH )HPLQLVWD $V (GZDUGV DQG +XOPH SRLQW RXW f PXOWLSOH DFFRXQWDELOLW\ WR WKHLU GLIIHUHQW FRQVWLWXHQFLHV ZLOO EH FUXFLDO IRU WKH SRVLWLYH IXWXUH RI 1*2V )HPLQLVW 1*2V WKH XOWLPDWH K\EULG 1*2V D QRQPHPEHUVKLS RUJDQL]DWLRQ EDVHG RQ D JHQGHUHG FROOHFWLYH LGHQWLW\ ZRXOG JUHDWO\ VWUHQJWKHQ WKHLU SRVLWLRQ E\ LQWURGXFLQJ PHFKDQLVPV RI GRZQZDUG DFFRXQWDELOLW\ WR WKHLU EHQHILFLDULHV 637nV HIIRUWV WR EROVWHU WKHLU %RDUG RI 'LUHFWRUVn VRFLDO FRQWURO IXQFWLRQ LV PRVW ZHOFRPH DQG VKRXOG EH IXUWKHU SXUVXHG 7KHLU %RDUG RI 7UXVWHHV LQFOXGHV VRPH ZRPHQ EHQHILFLDULHV 6LPLODUO\ )t6nV XVHUVn DVVHPEO\ DVVHPEOLD GH XVXDULDVf LI WXUQHG LQWR D UHJXODUO\ VFKHGXOHG RSHQ RQFHD PRQWK PHHWLQJ ZLWK SURPRWLRQ DFWLYLWLHV IRU WKH FOLQLF DQG RWKHU DFWLYLWLHV ZRXOG DOVR JUHDWO\ KHOS NHHSLQJ WKH ERQG DOLYH ZLWK WKHLU FRQVWLWXHQF\ DQG KHQFH HQVXUH D PRUH ERWWRPXS LQWHUSUHWDWLRQ RI ZRPHQnV QHHGV 7KLV PLJKW DW ILUVW VWUDLQ WKH DOUHDG\ OLPLWHG UHVRXUFHV RI 1*2V ZKR DUH VWUXJJOLQJ ZLWK FXUUHQW UHGXFHG IXQGLQJ SRVVLELOLWLHV EXW VKRXOG DOVR RSHQ QHZ GRRUV IRU DFWLRQ ,QGHHG WKHVH PHDVXUHV WR LQFUHDVH GRZQZDUG DFFRXQWDELOLW\ FRXOG EH FRXSOHG ZLWK RWKHU PHDVXUHV ZKLFK FRXOG SRWHQWLDOO\ KHOS 1*2V DFKLHYH D EDODQFH EHWZHHQ WKHLU VWUHQJWKHQLQJ RI WKH PRYHPHQWFXOWXUDO SURMHFW RI WUDQVIRUPDWLRQ DQG WKHLU ZRUN LQ WKH SROLF\ DUHQD EHOLHYH LW LV LPSRUWDQW IRU LQGLYLGXDO RUJDQL]DWLRQV WR DFKLHYH VXFK D EDODQFH EHFDXVH WKLV SUDFWLFH ZLOO LQIOXHQFH WKHLU

PAGE 337

LQWHUYHQWLRQ LQ WKH SROLF\ DUHQD DQG PRVWO\ EHFDXVH FRQWUDU\ WR ZKDW VRPH PLJKW WKLQN PRYHPHQWZLGH IRUD DW WKLV SRLQW GR QRW SURYLGH IRU WKLV EDODQFH DV D UHVXOW RI WKH SRZHU GLIIHUHQWLDOV DQG WKH GLIILFXOWLHV QRWHG LQ WHUPV RI WKH TXDOLW\ RI SDUWLFLSDWLRQ LQ WKHVH IRUD E\ WKH PRUH PRYHPHQWRULHQWHG JURXSV WUXVW WKDW VRRQ IRUD VXFK DV WKH 5HGH ZLOO SURYLGH VXFK QHWZRUNV DQG DOOLDQFHV WKDW ZRUN V\QHUJLVWLFDOO\ WR DFKLHYH EURDG EXW FRPPRQ JRDOV +XOPH DQG (GZDUGV f 2QH ILUVW VXJJHVWLRQ WR KHOS 1*2V UHDFK D EDODQFH EHWZHHQ PRYHPHQW VWUHQJWKHQLQJ DQG SROLF\ IRUPXODWLRQ LV WR VWDUW ZRUNLQJ ZLWK YROXQWHHUV 'HVSLWH WKH WHQVLRQV SUHVHQW LQ VXFK D VHWXS WKLV LV RQH RI WKH RQO\ ZD\V WR JHW DURXQG 1*2Vn EXGJHWDU\ DQG SURIHVVLRQDO OLPLWDWLRQV RQ WKH JURZWK RI WKHLU RZQ PHPEHUVKLS EDVH DQG WKHUHIRUH RQ WKDW RI WKH PRYHPHQW DFWLYLVW SRRO 6HFRQG LW LV LPSRUWDQW IRU IHPLQLVW 1*2V WR HQVXUH VRPH PHDVXUH RI ERWWRPXS GHILQLWLRQ RI WKH SURMHFWV WKH\ FKRRVH WR ZRUN ZLWK E\ WKH QHLJKERUKRRG ZRPHQ LQYROYHG KDYH H[SODLQHG WKDW WKH WRSGRZQ FKDUDFWHULVWLFV RI VRPH UHVHDUFK DQG SLORW SURMHFWV SUHFOXGH QHLJKERUKRRG ZRPHQnV JHQXLQH LQSXW RQ WKH FRQWHQW RU WKH IRUP RI WKH LQWHUYHQWLRQ 7KLV LV QRW FRQGXFLYH WR WKHLU IXUWKHU SDUWLFLSDWLRQ LQ VXFK SURMHFWV ,GHDOO\ D SDWWHUQ RI VXVWDLQHG ORQJWHUP DVVHVVRULD DV RSSRVHG WR VSRUDGLF FRQWDFWV ZLWK JLYHQ QHLJKERUKRRG FRPPXQLWLHV DQG ZRPHQnV JURXSV LV PRVW OLNHO\ WR SURGXFH WKH W\SH RI JURXSFDSDFLW\ EXLOGLQJ ZKLFK ZLOO OHDG WR VWURQJHU ZRPHQnV OHDGHUVKLS LQ WKH QHLJKERUKRRGV DQG SXW WKHLU LWHPV RQ WKH QDWLRQDO DJHQGD 6LQFH QRWKLQJ LV VLPSOH WKLV DOVR PHDQV EHLQJ DZDUH RI DYRLGLQJ GHSHQGHQF\ $V IDU DV GRQRUV DUH FRQFHUQHG (GZDUGV DQG +XOPH f DQG +XOPH DQG (GZDUGV f DPRQJ RWKHUV KDYH FRPH XS ZLWK UHFRPPHQGDWLRQV IRU PRUH DGHTXDWH

PAGE 338

SROLFLHV IRU GRQRU IXQGLQJ LI WKH\ ZDQW WR KDYH D SURJUHVVLYH LPSDFW 2QH UHFXUULQJ WKHPH ZKLFK FDQ RQO\ UHLWHUDWH KHUH LV WKDW 1*2V QHHG ORQJHU WHUP PRUH VWDEOH PRUH SUHGLFWDEOH IXQGLQJ LQVWLWXWLRQDO IXQGLQJ LV PRUH DSSURSULDWH WKDQ SURMHFWEDVHG ILQDQFLQJ VLQFH LW OLEHUDWHV 1*2V IURP DQ XQFHDVLQJ JULQGLQJ VHDUFKLQJ UHSRUWLQJ DQG DFFRXQWLQJ ZRUN /HVV SURMHFWEDVHG ILQDQFLQJ ZRXOG DOVR DOORZ 1*2V WR UHPDLQ PRUH RSHQ WR WKH GHPDQGV JHQHUDWHG E\ QHLJKERUKRRG ZRPHQnV JURXSV (GZDUGV DQG +XOPH VXJJHVW WKDW WR HQVXUH DFFRXQWDELOLW\ DQG WKH SURSHU XVH RI IXQGV IXQGLQJ EH FKDQQHOOHG WKURXJK QHWZRUNV WKDW HQVXUH TXDOLW\ FRQWURO WKURXJK VHOIn UHJXODWLRQ DQG SHHU SUHVVXUH f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nV SKUDVH f GRQRUV VKRXOG FRQVLGHU ORQJHU ODVWLQJ UHODWLRQV ZLWK WKHLU EHQHILFLDULHV QRW EDVHG RQ D VSHFLILFDWLRQ RI RXWSXWV DQG WDUJHWV >EXW UDWKHU@ RQ FRQWLQXDO GLDORJXHV DERXW REMHFWLYHV DQG VWUDWHJLHV &DUUROO f 6RPH GRQRUV VXFK DV ,&&2 KDYH VWDUWHG WR GR WKLV ZLWK 637 DQG RWKHU 1*2V 7KH UHODWLRQVKLS VKRXOG EH EDVHG DV LW ZDV GXULQJ WKH GLFWDWRUVKLS RQ WUXVW 'RQRUV VKRXOG DOVR HDUPDUN D SHUFHQWDJH RI WKHLU ILQDQFLQJ RI

PAGE 339

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nV QHJRWLDWLRQ ZLWK WKH JRYHUQPHQW WR SURYLGH WKH VWDWXV RI HQWLWLHV RI SXEOLF XWLOLW\ WR PRUH 1*2V 7KLV PRYH ZRXOG RI FRXUVH IXUWKHU HQWUHQFK WKH SURIHVVLRQDO FKDUDFWHU RI 1*2V DQG DWWUDFW SHRSOH ZKR PLJKW QRW KDYH RWKHUZLVH HQWHUHG WKH PRYHPHQW ,Q WKDW VHQVH ZH DUH IDFLQJ \HW DQRWKHU GLOHPPD ZDQW WR FRQFOXGH E\ UHWXUQLQJ WR WKH LVVXH RI WKH FRQWULEXWLRQ RI 1*2V WR WKH GHHSHQLQJ RI GHPRFUDF\ LQ %UD]LO 7KH 9,, )HPLQLVW (QFRQWU RI /DWLQ $PHULFD DQG WKH &DULEEHDQ LQ 1RYHPEHU LQ &DUWDJHQD &KLOHf ZDV KRPH WR D UDJLQJ GHEDWH RQ WKH UROH RI LQVWLWXWLRQDOL]HG IHPLQLVP DQG 1*2V ZKLFK DLUHG PDQ\ RI WKH VDPH TXHVWLRQV UDLVHG LQ WKLV VWXG\ VHH $OYDUH] E *DUFLD &DVWUR f 6XFK D GHEDWH LI SDLQIXO LV DOVR VDOXWDU\ EHFDXVH LW FDOOV DWWHQWLRQ WR WKH GDQJHUV RI EHLQJ WRR FORVH IRU FRPIRUW +XOPH DQG (GZDUGV f ZLWK WKH SRZHUVWKDWEH ,QGHHG 1*2V DQG WKHLU FXUUHQW WHQGHQF\ WR IRFXV WRZDUG LQVWLWXWLRQDO DUHQDV DUH PRUH DPELJXRXV DJHQWV RI GHPRFUDWL]DWLRQ WKDQ DUH YROXQWHHU PRYHPHQW RUJDQL]DWLRQV 2Q WKH RQH KDQG WKHLU VXSSRUW IRU PRELOL]DWLRQ DQG FRQVFLRXVQHVVUDLVLQJ DUH FXUUHQWO\ OLPLWHG DQG WKHLU 7KLV VWDWXV H[RQHUDWHV QRQSURILW RUJDQL]DWLRQV IURP SD\LQJ HPSOR\HHVn GXHV WRZDUGV VRFLDO VHFXULW\ 6HH FKDSWHU

PAGE 340

LQWHUDFWLRQ ZLWK DQG VXSSRUW RI QHLJKERUKRRG PRYHPHQWV KDYH EHHQ UHGXFHG 2Q WKH RWKHU KDQG 1*2Vn OHJLVODWLYH JDLQV DQG QHWZRUNLQJ DELOLWLHV FRQWULEXWH WR D PRUH HJDOLWDULDQ %UD]LO 1*2V KDYH PDGH LW SRVVLEOH IRU IHPLQLVW DFWLYLVWV WR EHFRPH IDPLOLDU ZLWK WKH LQWHUQDO IXQFWLRQLQJ RI LQVWLWXWLRQDO DUHQDV DQG WR OHDUQ WR PDNH WKHLU YRLFHV KHDUG ZLWKLQ VXFK FRQWH[WV
PAGE 341

$33(1',; $ 25,*,1$/ 4827(6 ,1 32578*8(6( &KDSWHU 1RQJRYHUQPHQWDO 2UJDQL]DWLRQV DQG 7KH :RPHQnV 0RYHPHQW EHOLHYH WKDW 1*2V DUH WKH IDFH RI VRFLDO PRYHPHQWV LQ WKH V WKLQN WKDW WKH GLVWLQFWLRQ PDGH EHWZHHQ PRYHPHQW DQG 1*2 LV RIWHQ DUWLILFLDO >@ :RPHQfV 1*2V IRU H[DPSOH WRGD\ WKLQN WKDW WKH\ DUH QRW UHDOO\ VXSSRUW RUJDQL]DWLRQV IRU WKH ZRPHQfV PRYHPHQW 7KH\ DUH WKH ZRPHQfV PRYHPHQW 7KH ZRPHQfV PRYHPHQW WRGD\ LV PDGH XS RI ZRPHQfV 1*2V DQG D IHZ DVVRFLDWLRQV (X DFKR TXH DV 21*V VDR D IDFH GRV DQRV HX DFKR GRV PRYLPHQWRV VRFLDLV (X DFKR TXH D VHSDUDQGR HQWUH PRYLPHQWR H 21* HOD PXOWDV YH]HV DUWLILFLDO $V 21*V GH PXOKHUHV KRMH SRU H[HPSOR HX DFKR TXH HODV QDR VDR H[DWDPHQWH 21*V GH DVVHVVRULD DR PRYLPHQWR GH PXOKHUHV HODV VDR R PRYLPHQWR GH PXOKHUHV 2 PRYLPHQWR GH PXOKHUHV KRMH FRQVWLWXLGR SRU 21*V GH PXOKHUHV H DOJXPDV DVVRFLDWHV :KDW LV WKH EDVLF GLIIHUHQFH EHWZHHQ DQ 1*2 LQ %UD]LO DQG D VRFLDO PRYHPHQW RUJDQL]DWLRQ" ,W LV WKDW LQ WKH HQG LQ WKH YHU\ HQG DQ 1*2 LV D PLFUR RU D PHGLXPVL]HG ILUP >@ SURIHVVLRQDO IHPLQLVWV@ KDYH D SODFH LQ RXU KHDUWV \RX DUH OHJLWLPDWH PHPEHUV RI WKLV PRYHPHQW EXW \RXfUH QRW WKH ERVV 4XDO D GLIHUHQJD E£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f 7KH UHILQHG WUDQVODWLRQ RI PDU[LVP WR LWV SUDFWLFH RI KRZ WR WUDQVODWH LW LQWR D PHWKRG ,Q WHUPV RI LQWHUYHQWLRQ OHDUQW D ORW (X WLQKD R PDU[LVPR 0DV DSUHQG FRP HOHV RV MHVXWDV GR &($6 HP 3HUQDPEXFRf R PWRGRSURFHVVR ( XP HQIRTXH SULYLOHJLDGR QRV VHWRUHV SRSXODUHV FRPR VXMHLWR $ ILQH]D QD WUDGXJDR GR PDU[LVPR SDUD D SU£WLFD GH FRPR WUDGX]LU LVVR HP PWRGR 1R SODQR GD LQWHUYHQJDR DSUHQG PXLWD FRLVD TXRWHG LQ /DQGLP f

PAGE 342

7KHUH LV D PRGHUQL]LQJ SURMHFW LQ WKH VHQVH WKDW WKH\ WDNH WR SRSXODU JURXSV WKH XQGHUO\LQJ DVVXPSWLRQV RI XQLYHUVDOLVW UDWLRQDOLVP WKH ORJLF RI HTXDOLW\ DXWRQRP\ LQGLYLGXDOLVP SDUWLFLSDWLRQ GLDORJXH f§ RI FLWL]HQVKLS (VW£ SUHVHQWH XUQ SURMHWR PRGHPL]DGRU HP TXH VH OHYDP DRV JUXSRV SRSXODUHV RV SUHVVXSRVWRV GH XP UDFLRQDOLVPR XQLYHUVDOLVWD D OJLFD GD LJXDOGDGH GD DXWRQRPD GR LQGLYLGXDOLVPR GD SDUWLFLSDGR H GL£ORJR GD FLGDGDQLD /DQGLP f $Q QRQSURILW HQWLW\ ZKRVH IXQGDPHQWDO REMHFWLYH LV WR GHYHORS D GHPRFUDWLF VRFLHW\ WKDW LV D VRFLHW\ EDVHG RQ GHPRFUDWLF YDOXHV IUHHGRP HTXDOLW\ GLYHUVLW\ SDUWLFLSDWLRQ DQG VROLGDULW\ 8PD HQWLGDGH VHP MLQV GH OXFUR FXMR REMHWLYR MLLQGDPHQWDO GHVHQYROYHU XUQD VRFLHGDGH GHPRFU£WLFD LVWR XPD VRFLHGDGH IXQGDGD QRV YDORUHV GD GHPRFUDFLD OLEHUGDGH LJXDOGDGH GLYHUVLGDGH SDUWLFLSDQGR H VROLGDULHGDGHf GD 6RX]D f 7KH ZRPHQfV TXHVWLRQ D PDFURSUREOHP WR EH UHVROYHG ZLOO QRW ILQG D VROXWLRQ LQ D IUDJPHQWHG PDQQHU ZKLFK LV RQH RI WKH FKDUDFWHULVWLFV RI DFDGHPLF GLVFLSOLQHV DQG JRYHUQPHQWDO SROLFLHV ,W FDQQRW EH GHDOW ZLWK DV D PHUH WHFKQLFDO SUREOHP RU E\ VSHFLDOL]LQJ LQ WKLV RU WKDW LVVXH $ TXHVWGR GD PXOKHU XP PDFURSUREOHPD D VHU UHVROYLGR QDR SRGHU£ VHU HQFDPLQKDGD GH IRUPD IUDJPHQWDGD XPD FDUDFWHUVWLFD GDV GLVFLSOLQDV DFDGPLFDV H GDV SROWLFDV JRYHPDPHQWDLV 1DR VH SRGH WUDW£OD FRPR XP PHUR SUREOHPD WFQLFRSURILVVLRQDO RX DSHQDV VH HVSHFLDOL]DQGR HP DOJXQV WHPDV 7HOHV f :H PDGH WKLV SROLWLFDO HYDOXDWLRQ VLQFH WKH EHJLQQLQJ DQG ZH GHFLGHG WKDW RXU RUJDQL]DWLRQV VKRXOG QRW EHFRPH FODVVLF 1*2V > @ PHDQ ZH FDQ REWDLQ IXQGLQJ DV D VRFLDO PRYHPHQW RUJDQL]DWLRQ IURP ZKRPHYHU ZH ZDQW EXW ZH GR QRW OLYH IURP WKLV PRQH\ ZH GR QRW QHHG WKLV ILQDQFLQJ WR H[LVW (VVD DYDKDQGR SROWLFD QV IL]HPRV GHVGH R FRPHQR H IL]HPRV D DYDKDQGR GH TXH QRVVVDV HQWLGDGHV QDR GHYHULDP VH WUDQVIRUPDU HP 2QJV FO£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fW LW" :KDWf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

PAGE 343

'LUHWRULD GD HQLGDGH TXHP GHILQH LVVR XUQD $VVHPEOLD *HUDO GD HQWLGDGH 4XHU GL]HU PDQGD WRGR PXQGR QDR TXDO D GLIHUHQJD E£VLFD HQWUH XUQD 2QJ GR %UDVLO H XUQD HQWLGDGH GR 0RYLPHQWR 6RFLDO" ‹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£R SROWLFD QRVVD ,W ZDV XV ZRPHQ ZKR UDLVHG WKH TXHVWLRQ RI QHZ YDOXHV RI VH[XDOLW\ ILUVW DV DQ RUJDQL]HG PRYHPHQW WKHQ DV ZRPHQfV 1*2V nn4XHUQ FRORFRX D TXHVWDR GRV QRYRV YDORUHV GD VH[XDOLGDGH IRPRV QV PXOKHUHV SULPHLUR HQTXDQWR PRYLPHQWR RUJDQL]DGR GHSRLV FRPR 21*V GH PXOKHUHV 51)6'5 f 1*2V DUH VWURQJO\ K\EULG GRQfW NQRZ LI LW LV RQO\ KHUH LQ %UD]LO EXW WKH\ KDYH D VHULRXV LGHQWLW\ SUREOHP 7KH\ KDYH WR DVVXPH WKDW WKH\ DUH SURIHVVLRQDOV RI IHPLQLVP RU RI WKH %ODFN PRYHPHQW 5LJKW" $V 2QJV WHUQ XP KLEULGLVPR PXLWR JUDQGH HX QDR VHL VH V QR %UDVLO PDV HODV WHUQ XP SUREOHPD GH LGHQWLGDGH VULD (ODV WP TXH DVVXPLU TXH HODV VDR SURILVVLRQDLV GR IHPLQLVPR RX GR 0RYLPHQWR 1HJUR HQWHQGHX7 :H LQYROYHG ZRPHQfV JURXSV ZLWK D FOHDU IHPLQLVW RULHQWDWLRQ RU QRW IHPLQLVW 1*2V 1*2V ZKR ZRUN SULQFLSDOO\ ZLWK ZRPHQ RU QRW ZRPHQfV JURXSV DFWLYH LQ WUDGHXQLRQV SURIHVVLRQDO RU QHLJKERUKRRG DVVRFLDWLRQV SROLWLFDO SDUWLHV FKXUFKHV DFDGHPLF FHQWHUV EHVLGHV RWKHU RUJDQL]DWLRQV RI FLYLO VRFLHW\ (QYROYHPRV JUXSRV GH PXOKHUHV FRP PDUFDGD RULHQWDJ£R IHPLQLVWD RX QDR 21*V IHPLQLVWDV 21*V TXH WP DV PXOKHUHV FRPR JUXSR FHQWUDO GH VHXV WUDEDOKRV RX QDR JUXSRV GH PXOKHUHV DWXDQWHV HP VLQGLFDWRV DVVRFLDJRHV SURILVVLRQDLV H GH EDLUURV SDUWLGRV SROWLFRV LJUHMDV FHQWURV DFDGPLFRV DOP GH RXWUDV RUJFPL]DJRHV GD VRFLHGDGH FLYLO $UWLFXODJ£R GH 0XOKHUHV %UDVLOHDV f
PAGE 344

WHP TXH ILFDU 3URILVVDR IHPLQLVWD TXDO D YHUJRQKD GLVVR" (X DFKR TXH QVSUHFLVDPRV GH PXLWRV SURILVVLRQDLV FRPR VH GL] PDV HODV QDR SUHFLVDP WHU YHUJRQKD GH GL]HU TXH VDR GRQfW WKLQN WKDW EHFDXVH \RX DUH DQ 1*2 PHDQV WKDW \RX VWRS EHLQJ SURJUHVVLYH WKDW \RX VWRS FRQWULEXWLQJ WR WKH PRYHPHQW (X QDR DFKR TXH SHOR IDWR GH TXH YRF XUQD 2QJ YRF GHL[D GH VHU DYDQ]DGR TXH YRF GHL[D GH FRQWULEXLU SUD R DYDQJR GR 0RYLPHQWR 7KH DUWLFXODWLRQV ZRUNHG ZHOO WKH DUWLFXODWLRQ RI LQGLJHQRXV ZRPHQ ZRPHQ ZLWK GLVDELOLWLHV EODFN ZRPHQ HYHU\ERG\ LW ZDV D YHU\ ULFK SURFHVV WKLQN LW LV SURGXFWLYH $V DUWLFXODJRHV DQGDUDP OHJDO D DUWLFLGDJ£R GDV PXOKHUHV LQGLDV DV PXOKHUHV GHILFLHQWHV DV PXOKHUHV QHJUDV WXGR PXQGR IRL XP SURFHVVR PXLWR ULFR DFKR TXH LVVR SURGXWLYR QRZ QRW RQO\ SUHVHQW DW WKH PHHWLQJV LQ RUGHU WR GHQRXQFH WKH DEVHQFH RI WKHLU LVVXHV RQ WKH DJHQGD EXW SDUWLFLSDWLQJ LQ WKH HODERUDWLRQ >RI WKH 'HFODUDWLRQ RI %UD]LOLDQ :RPHQ@ HQVXULQJ YLVLELOLW\ WR WKH UDFH LVVXH 1DR PDLV DSHQDV DV UHXQLGHV SDUD PXQLUVH GH IRUJDV SDUD GHPPFLDU D DXVHQFLD GH VXDV TXHVWRHV QD SDXWD PDV D EXVFD GH HODERUDJ£R FRQMXQWD GDQGR YLVLELOLGDGH £ TXHVW£R UDFLDO 5LEHLUR f :H GRQfW GLVFULPLQDWH LI LW LV D SURVWLWXH D GRPHVWLF ZRUNHU DQ LQGLDQ ZRPDQ D EODFN ZRPDQ D OHVELDQ D IHPLQLVW $ JHQWH QDR GLVFULPLQD VH XUQD SURVWLWXWD VH HPSUHJDGD GRPVWLFD VH LQGLD VH QHJUD VH XUQD PXOKHU OVELFD VH XUQD IHPLQLVWD 7KLV >SUHSDUDWLRQ@ SURFHVV ZDV UHPDUNDEOH IRU LWV UHVSHFW RI GLYHUVLWLHV DQG IRU LWV PXOWLSOLFLW\ RI RUJDQL]DWLRQDO IRUPV D SURRI RI WKH ZRPHQfV PRYHPHQWnV ULFKQHVV :H FRPH IURP GLIIHUHQW UHJLRQV UDFHHWKQLF JURXSV DJHV ZH KDYH GLIIHUHQW VH[XDO SUHIHUHQFHV SK\VLFDO DQG PHQWDO FKDUDFWHULVWLFV UHOLJLRXV DQG SDUW\ DOOHJLDQFHV ZKLFK H[SUHVV RXU FXOWXUDO DQG VRFLDO GLIIHUHQFHV (VWH SURFHVVR >GH SUHSDUDJGR@ WHP VLGR PDUFDGR SHOR UHVSHLWR DV GLYHUVLGDGHV H SHOD PXOWLSOLFLGDGH GDV IRUPDV GH RUJDQL]DJDR HYLGHQFLDQGR D ULTXH]D GR PRYLPHQWR GH PXOKHUHV 6RPRV GH GLIHUHQWHV UHJLGHV UDJDHWQLD LGDGH SUHIHUHQFLD VH[XDO FDUDFWHUVWLFDV IVLFDV H PHQW£LV RSJRHV UHOLJLRVDV H SDUWLG£ULDV H[SUHVVDQGR GLIHUHQJDV FXOWXU£LV H VRFLDLV WH[W DSSURYHG DW WKH &RQIHUHQFH SOHQDU\ VHVVLRQ RQ -XQH f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nW

PAGE 345

NQRZ XS WR ZKDW SRLQW ZH DUH DEOH WR FUHDWH DQ DOWHUQDWLYH RUJDQL]DWLRQ VLQFH LQ IDFW ZH DUH SULVRQHUV RI D SDUWLFXODU VWUXFWXUH (P WHUPRV GD IRUPD RUJDQL]DWLYD GH WUDEDOKR DFKR TXH HVVD IRL D JUDQGH PXGDQ]D HX DFKR TXH D LGLD D LGHRORJD TXH D JHQWH WLQKD GH FRQVWLWXLU XUQD HQWLGDGH XP FROHWLYR RQGH WRGR PXQGR ID] WXGR GHVGH YDUUHU R FKDR UHFROKHU RV SDSLV GR EDQKHLUR TXH D JHQWH IH] LVVR QR LQLFLR HX DFKR TXH D JHQWH YLX TXH QD SU£WLFD D JHQWH WLQKD TXH ID]HU DOJXPDV RSJRHV H DVVLP RV SDSLV DL RV SDSLV VH GHOLPLWDUDP IRUDP VH GHOLPLWDQGR GH DOJXPD IRUPD HPERUD DFKR TXH LVVR VHPSUH IRL XUQD IRQWH GH DQJXVWLD FROHWLYD PDV D JHQWH HX DFKR TXH D JHQWH YHP WHQWDQGR QHVVH SURFHVVR FROHWLYR VHPSUH WHQWDU ID]HU LVVR GH XUQD PDQHLUD WDOYH] GLIHUHQFLDGD 1DR VHL DW TXH SRQWR D JHQWH WHP HVVD FDSDFLGDGH GH ID]HU XUQD RUJDQL]DQGR GLIHUHQFLDGD QD PHGLGD HP TXH D JHQWH HVW£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£ QD UHJLGR GOD HQWGR DL VH GHEDWHX WHYH WRGD D SROPLFD H VH YRWRX 7KH IURQWOLQH LV FORVH PLQGHG D OLQKD GH IUHQWH HVWD IHFKDGDnn :H >VRPH PHPEHUV@ VDLG WKDW ZH WKRXJKW WKDW WKHUH VKRXOG EH D GHFHQWUDOL]DWLRQ RI >GHFLVLRQV DQG D FODULILFDWLRQ RI@ WKH VXEWOH ZD\ LQ ZKLFK GHFLVLRQV DUH VDLG WR EH PDGH E\ WKH WHDP :H ZRXOG QHHG PRUH, GRQnW NQRZ LQ VRPH IXQGDPHWDO FDVHV WKLQN WKDW GHFLVLRQV VKRXOG VWLOO EH PDGH E\ WKH WHDP 1V >DOJXQV PHPEURV@ FRORFDPRV TXH DGLDPRV TXH GHYH GHVFHQWUDOL]DU XP SRXFR D IRUPD VXWLO TXH WHP GH YRF IDODU TXH DV GHFLVGHV VDR WLUDGDV GD HTXLSH 3UHFLVDUD WHU PDLV VHL O£ HP DOJXQV FDVRVILPGDPHQWDLV HX DFKR TXH GHYH DQGD SDVVDU SRU HTXLSHnn KDWH LW ZKHQ SHRSOH PDNH D GHFLVLRQ DQG WKHQ GRQnW GR ZKDW KDV EHHQ DJUHHG XSRQ DQG KHUH *HH ,nP WLUHG RI VHHLQJ WKLV KDSSHQLQJ 6RPHERG\ VD\V VKH LV JRLQJ WR GR WKLV EXW DEVROXWHO\ QRWKLQJ KDSSHQV GR \RX XQGHUVWDQG" %HFDXVH WKH\ GR PRUH ZKDW WKH\ IHHO OLNH RQ WKH VSXU RI WKH PRPHQW > @ 6R LW LV UHDOO\ ZHLUG LVQn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nV WUXH

PAGE 346

$JRUD WHUQ HVVD YDQWDJHP GDV SHVVRDV ID]HUHP WDPEP R TXH WHP YRQWDGH HQWDR ID]HP FRP PDLVJRVWR VDEH" ,VVR HX DFKR :H OLYH LQ D VRFLHW\ ZKLFK LV YHU\ GHVWUXFWLYH QRERG\ ZDQWV WR WDNH WKH LQLWLDWLYH WR WDNH FDUH RI WKH FROOHFWLYH RI D FROOHFWLYH FDXVH \RX NQRZ" ,WnV HYHU\RQH IRU RQHVHOI %XW QRW XV ,Q WKDW ZD\ DV ZHOO ZH DUH GLIIHUHQW ZH GR FROOHFWLYH ZRUN 1V YLYHPRV WPPD VRFLHGDGH PXLWR GHVWUXWLYD QLQJXP TXHU WRPDU LQLFLDWLYD SDUD FXLGDU GR FROHWLYR XUQD FDXVD FROHWLYD HQWHQGHX" FDGD XP SDUD VL H QV QDR QV WHPRV WDPEP HVVD GLIHUHQFLD QV ID]HPRV WUDEDOKR FROHWLYR $K KDYH DOZD\V GRQH FROOHFWLYH ZRUN KDYH QHYHU GRQH LQGLYLGXDO ZRUN > @ ZKHQ UHDOL]HG WKDW LW ZDV PRUH GLIILFXOW IRU ZRPHQ > @ WKHQ GHFLGHG WR GR FROOHFWLYH ZRUN WR EULQJ ZRPHQ WRJHWKHU 7KLV LV ZK\ ZHQW IRU RUJDQL]LQJ KDYH DOZD\V WULHG WR RUJDQL]H $K HX VHPSUH IL] WUDEDOKR FROHWLYR PPFDIL] WUDEDOKR LQGLYLGXDO >@ TXDQGR HX YL TXH DV PXOKHUHV HUD PDLV GLIFLO D VLWXDJDR >@ HQWDR HX UHVROY ID]HU XP WUDEDOKR FROHWLYR MXQWDU DV PXOKHUHV IRL SRU LVVR TXH HX EXVTXHL D RUJDQL]DQGR VHPSUH EXVTXHL D RUJDQL]DQGR DP WKH VHFUHWDU\ LQ WHUPV RI EXUHDXFUDF\ RI WKH 6WDWXHV RI WKH &DVD >@ EXW ZH IXQFWLRQ LQ D ZD\ OHWnV VD\ PRUH FROOHFWLYHO\ $QG WKHVH UROHV RI VHFUHWDU\ JHQHUDO SUHVLGHQW WUHDVXUHU WKLV LV QRW WKH ZD\ ZH ZRUN 6R KHUH LW LV PRUH KRUL]RQWDO ZH ZRUN DV D FROOHFWLYH $QG DP D PHPEHU RI WKLV FROOHFWLYH DQ DFWLYH PHPEHU RI WKLV FROOHFWLYH SUHVHQW LQ WKH HYHU\GD\ OLIH RI WKH RUJDQL]DWLRQ IURP D SUDFWLFDO SRLQW RI YLHZ IURP WKH SRLQW RI YLHZ RI VRPH FRQWULEXWLRQV RI WKLQNLQJ DQG VXFK EXLOGLQJ DQG SXVKLQJ IRUZDUG WKH ZRUN WKDW WKH &DVD GHYHORSV (X VRX VHFUHWDULD EXURFU£WLFDPHQWH D QLYHO GR HVWDWXWR GD &DVD >@ PDV D JHQWH IXQFLRQD QXP UHJLPH GLJDPRV DVVLP PDLV FROHWLYR HP TXH HVVHV SDSLV DVVLP VHFUHWDULD JHUDO SUHVLGHQWH WHVRXUHLUD HVVDV FRLVDV QDR VDR D QRVVD IRUPD GH WUDEDOKDU DL DTXL PDLV KRUL]RQWDO D JHQWH WUDEDOKD HP XP FROHWLYR HQWGR DVVLP HX VRX XP HOHPHQWR GHVVH FROHWLYR XP HOHPHQWR DWLYR GHVVH FROHWLYR TXH HVW£ QR GLDDGLD QR SRQWR GH YLVWD SU£WLFR QR SRQWR GH YLVWD GD DOJXPDV FRQWULEXLQHV GH UHIH[GHV H WDO FRQVWUXLQGR H OHYDQGR D IUHQWH R WUDEDOKR TXH D &DVD GHVHQYROYH :HOO WRGD\ DP PRUH LQYROYHG ZLWK UHVHDUFK ZLWK WZR UHVHDUFK SURMHFWV 2QH RQ ZRPHQ DQG $,'6 DQG WKH RWKHU RQ PDWHUQLW\ DQG ZRUN PHDQ WKHVH DUH WZR YHU\ GLIIHUHQW WKHPHV $QG DP DOVR LQ FKDUJH RI WKH ILQDQFLDO FRRUGLQDWLRQ RI WKH RUJDQL]DWLRQ %DVLFDOO\ WKDWnV LW %RP KRMH HX HVWRX PDLV HQYROYLGD FRP R GHVHQYROYLPHQWR GH SHVTXLVD GH GXFWV SHVTXLVDV 8UQD SHVTXLVD VREUH PXOKHU H $,'6 H XUQD SHVTXLVD VREUH PDWHPLGDGH H WUDEDOKR 4XHU GL]HU DVVLP GRLV WHPDV EHP GLYHUVRV H HX HVWRX WDPEP UHVSRQV£YHO SHOD FRRUGHQDQGR ILQDQFHLUD GD HQWLGDGH E£VLFDPHQWH LVVR 0\ VLWXDWLRQ LV YHU\ XQGHILQHG RU LW WRRN D ZKLOH WR ILJXUH RXW ZKDW P\ UROH ZDV RU LQ WKH EHJLQQLQJ P\ WDVNV ZHUH YHU\ XQGHILQHG 0LQKD VLWXDQGR PXLWR LQGHILQLGD 'HPRUHLSDUD DFKDU R PHXSDSHO QR LQLFLR DV PLQKDV WDUHIDV QGR HVWDYDP PXLWR GHILQLGDV

PAGE 347

:KHQ \RX KLUH D VHFUHWDU\ RU D J\QHFRORJLVW WKLV TXHVWLRQ LV PRUH LPSRUWDQW WKH QHHG WR KDYH D SHUVRQ ZKR XQGHUVWDQGV D ELW EHWWHU ZKHUH VKH LV JRLQJ WR ZRUN KRZ VKH ZLOO EH LQWHJUDWHG LQ WKH ZRUN GRQH ZKLFK LV D OLWWOH ELW ZKLFK ZH FRQVLGHU D OLWWOH ELW GLIIHUHQW IURP WKDW RI DQRWKHU RUJDQL]DWLRQ WKHUH LQ WKH SULYDWH VHFWRU 4XDQGR YRF FRQWUDWD PDLV XUQD VHFUHW£ULD RX >@ XUQD JLQHFRORJLVWD DV YH]HV HVVD TXHVW£R DSDUHFH PDLV D QHFHVVLGDGH GH YRFH WHU XUQD SHVVRD TXH HQWHQGD XP SRXFR PDLV DRQGH TXH HOD YDL WUDEDOKDU FRPR HOD YDL VH LQVHULU QHVVH WUDEDOKR TXH XP SRXFR TXH D JHQWH FRQVLGHUD XP SRXFR GLIHUHQFLDGR GH XUQD RXWUD HQWLGDGH DL GR PHUFDGR :HOO WKHUH LV QR GRXEW FKDQJHG TXLWH D ELW *HH (YHQ GLVFRYHULQJ FHUWDLQ YDOXHV WKDW ZKHQ \RX ZRUN RXWVLGH >RI )t6@ \RX GRQn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£R D PLQKD SHVVRD DR IDWR GH HX VHU PXOKHU R TX TXH VLJQLILFDYD SUD VRFLHGDGH FRPR TXH HX FRQVHJXD PH ORFDOL]DU QHVVD VRFLHGDGH WRGD DVVLP TXDO HUD D PLQKD LPSRUWDQFLD SUD HVVD VRFLHGDGH WRGDI@ (X SRU H[HPSOR PXGHL QD OLEHUGDGH TXH HX VLQWR SRU H[HPSOR GH FRQYHUVDU VREUH VH[R FRP PHX QDPRUDGR LVVR HX KRMH HX FRQVLJR FRQYHUVDU FODUDPHQWH &RQVLJR WDPEP FRQYHUVDU XP SRXFR VREUH DERUWR XP SRXFR PDLV GH OLEHUGDGH GR TXH HX FRQYHUVDYD DQWHV FRQVLJR WDPEP -DODU XP SRXFR GHVVD FRLVD D PLQKD ILOKD SRU H[HPSOR HVW£ FRP GR]H DQRV M£ M£ YDL ILFDU PRFLQKD FRPR VH IDOD (QW£R HX FRQVLJR FRQYHUVDU EDVWDQWH FRP HOD D UHVSHLWR ,W HQGV XS HQJHQGHULQJ DFWLRQV ZKLFK DUH YHU\ LPSURYLVHG 6R ZH DOZD\V HQG XS LPSURYLVLQJ 6R IRU H[DPSOH ZKHQ ZH RUJDQL]H DQ DFWLYLW\ ZLWK DQRWKHU 1*2 IRU H[DPSOH ZH DUH ZRUNLQJ RQ D ZRPHQ DQG $LGV SURMHFW ZLWK )t6 7KDWnV ZKHQ ZH SHUFHLYH WKH GLIIHUHQFH EHWZHHQ DQ LQWHUYHQWLRQ WKDW LV RQO\ PRUH RU OHVV VWUXFWXUHG DQG DQ LQWHUYHQWLRQ ZKLFK LV ZHOO VWUXFWXUHG DQG LQ WKLV VLWXDWLRQ ZH FOHDUO\ UHDOL]H WKDW ZH DUH DW D GLVDGYDQWDJH RU WKDW ZH KDYH JUHDWHU GLIILFXOWLHV *UHDWHU GLIILFXOWLHV ZLWK WKH SDSHUZRUN :H KDYH GLIILFXOWLHV ZLWK RXU DGPLQLVWUDWLYH RUJDQL]DWLRQ VR WKLQJV GR QRW IORZ HDVLO\ $FDED JHUDQGR WDPEP XUQD DT£R PXLWR LPSURYLVDGD HQW£R D JHQWH DFDED VHPSUH LPSURYLVDQGR HQW£R SRU H[HPSOR TXDQGR D JHQWH ID] XUQD DWLYLGDGH FRP XUQD RXWUD 21* SRU H[HPSOR >@ D JHQWH SDUWLFLSD GHVWH SURMHWR GH 0XOKHU H $,'6 FRP R SHVVRDO GH )t6 (QW£R QHVVDV KRUDV D JHQWH YRF SHUFHEH EDVWDQWH HVVD GLIHUHQFD GH XUQD DT£R PDLV RX PHQRV HVWUXWXUDGD FRP XUQD DT£R EHP HVWUXWXUDGD ( DVVLP D JHQWH SHUFHEH FODUDPHQWH TXH DJHQWH WHP XUQD GHVYDQWDJHP RX XUQD GLILFXOGDGH PDLRU Q 8UQD GLILFXOGDGH PDLRU HP OLGDU FRP RV SDSLV RV SDSLVQ£R SDSLV VRFLDLV PDLV FRP RV SDSLV IROKD GH SDSHO 9RF WHP XUQD GLILFLGGDGH GH WHU XUQD RUJDQL]DT£R DGPLQLVWUDWLYD HQW£R DVVLP R IOX[R GHELOLWDGR

PAGE 348

$Q 1*2 EHFDXVH RI WKH LVVXH RI SURMHFW ILQDQFLQJ DQG RI SURMHFWV ZKLFK JLYH D PRUH V\VWHPDWLF FKDUDFWHU WR WKH ZRUN ZLOO WHQG WR EH PRUHWR KDYH PRUH D PRUH SURIHVVLRQDO RUJDQL]DWLRQ WKLQJV KDYH PRUH VSHFLILF GHDGOLQHV PRUH VSHFLILF UHVSRQVLELOLWLHV PRUH VSHFLILF JRDOV DQG LW LV QRW DOZD\V WKH FDVH WKDW \RXU ZRUN LV JXLGHG E\ FRQMXQFWXUDO HPHUJHQFLHV 8UQD 21* SRU WHU HVWD TXHVWDR GR ILQFPFLDPHQWR GH SURMHWRV H GH RV SURMHWRV GDQGR XP FDU£WHU PDLV VLVWHP£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nV IRU VXUH 6R ZH KLUHG DQ DFFRXQWDQW UHDOO\ EHFDXVH RI WKDW 6R LW KDSSHQHG LQ VWDJHV XV IURP WKH WHFKQLFDO WHDP f§WKH KHDOWK WHDP HQGHG XS WDNLQJ FDUH RI WKH FRRUGLQDWLQJ SDUW RI WKH ZRUN WKH SDUW WKDWnV UHODWHG WR WKH SURMHFWV DQG UHSRUWV $QG ZH GHOHJDWHG WKH GD\ WRGD\ ZRUN ZKLFK LV UHDOO\ DOVR WKH ELJJHVW SDUW RI WKH ZRUN WR &OHXVD $QWHV GOD >D FRQWDGRUD@ HUDPRV QV PHVPR TXH ID]LDPRV R PLGR GD FRQWDELOLGDGH HVVH FRWLGLDQR GD FRQWDELOLGDGH H QV WLQKDPRV XPD DVVHVVRULD FRQW£ELO GH XP HVFULWRULR PDV QR HVFULWRULR YRF WHP TXH SUDWLFDPHQWH OHYDU DV FRLVDV DUUXPDGDV RUJDQL]DGDV SDUD HOHV V IHFKDU D FRQWDELOLGDGH (QW£R QDR GDYD D JHQWH WLQKD TXH FDGD YH] PDLV VH RFXSDU GHVVD WDUHID TXH SUD TXDO D JHQWH QDR HVWRYD DTXL SDU LVVR FRP FHUWH]D (QW£R D FRQWUDWDQGR GD FRQWDGRUD YHLR PXLWR QHVVH VHQWLGR (QW£R IRL SRU HWDSDV DVVLP R SHVVRDO GD HTXLSH WFQLFD GD HTXLSH GH VFQLGH D JHQWH DFDERX ILFDQGR FRP D SDUWH PDLV GH FRRUGHQDJ£R QD SDUWH PDLV OLJDGD DRV SURMHWRV H UHO£WRULRV (QW£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£R HVW£R DFRVWXPDGDV FRP D IRUPD GH XPD HPSUHVD WUDEDOKDU 3RU PDLV TXH QRV QV UHXQDPRV YDPRV R TXH HUD QHFHVV£ULR R TXH WHD TXH PXGDU SRUTXH WHD TXH PXGDU GDYDPRV VXJHVWRHV WLU£YDPRV FRQFOXVHV H FRORFDYDPRV XPD GHILQLJ£R ( FRORFDYD QR PXUDO GH JHUHQFLDPHQWR 0DV LVVR PH[HX PXLWRHXSHUFHEL TXH PH[HX PXLWRFRP HODV GD QV SDUDPRV GH QRV UHXQLU >@ +HOHQD SDUWLFXODUPHQWH Q£R TXHULD FULDU FRQIOLWRV

PAGE 349

,W LV FOHDU IRU PH WKDW )t6 ZDQWV PH WR ZDON XS WR WKLV OLQH VR LW LV XS WR PH WR GHFLGH LI ZDQW WR FRQWLQXH KHUH ZLWK WKLV OLPLWDWLRQ RU LI ZDQW WR ORRN IRU VRPHWKLQJ ZKHUH ZDQW WR JURZ PRUH (VW£ VHQGR FODUR SUD PLP TXH R )t6 TXHU TXH HX DQGH DW DTX DL FDEH D PLP DYDKDU VH HX TXHUR FRQWLQXDU DLQGD QR )t6 FRP HVVD OLPLWDQGR RX VH HX TXHUR SURFXUDU DOJXPD FRLVD TXH HX TXHLUD PH H[SDQGLU PDLV Q GR QRW IHHO UHVWUDLQHG KHUH DW )t6 LQ ZKDW GR JLYH LGHDV DQG WKH\ XVH P\ LGHDV DQG VLJQ XQGHU (X DW TXH HX QDR VRX UHVWULQJLGD DTXL QR )t6 HP ID]HU DV FRLVDV QDR VRX W£ 'RX PLOLWDV LGLDV DV LGLDV VDR DW DFDWDGDV DVVLQDGDV SRU HODV 6R LQ WHUPV RI RXU GLIIHUHQFHV WKLQN WKDW ZH DUH FRQVWDQWO\ OHDUQLQJ HYHU\ WLPH WR GHDO ZLWK RXU GLIIHUHQFHV GLIIHUHQFHV RI SRZHU GLIIHUHQFHV RI FDSDFLW\ (QWGR DV QRVVDV GLIHUHQTDV HX DFKR TXH D JHQWH HVW£ DSUHQGHQGR LVVR VHPSUH FDGD YH] OLGDU FRP DV QRVVDV GLIHUHQTDV GLIHUHQTDV GH SRGHU DV GLIHUHQTDV GH FDSDFLGDGH &KDSWHU 7KH /DERU RI /RYH DQG %UHDG 2UJDQL]DWLRQDO 3UDFWLFHV ,QGLYLGXDO DQG &ROOHFWLYH ,GHQWLWLHV )RRWQRWH WKLQN WKDW WKH SRVLWLYH DVSHFW >RI WKLV PRGHO RI GHFLVLRQPDNLQJ@ LV WKDW SHRSOH KDYH WR WDNH FKDUJH HDFK SHUVRQ KDV WR WDNH FKDUJH RI D UHVSRQVLELOLW\ ULJKW" PHDQ RI ZKDW LV JRLQJ RQ LQ )t6 PHDQ LQ UHDOLW\ WKLQN WKDW WKLV IRUFHV SHRSOH WR JHW LQYROYHG PRUH WR PDNH GHFLVLRQV DQG WR MXPS LQ ULJKW" (X DFKR TXH R ODGR SRVLWLYR >GHVVH PRGHOR GH WRPDGD GH GHFLV£R@ GH TXH DV SHVVRDV WHP TXH DVVXPLU TXH FDGD XUQD GDV SHVVRDV WHP TXH DVVXPLU XP SHGDTR GD UHVSRQVDELOLGDGH Q 4XHU GL]HU XP SHGDTR GR TXH DFRQWHFH QR )t6 4XHU GL]HU QD YHUGDGH HX DFKR TXH LVVR IRUTD XP SRXFR DV SHVVRDV D HODV VH HQYROYHUHP PDLV D HODV WRPDU HP GHFLVRHV D HODV VH MRJDUHP XP SRXFR Q 1
PAGE 350

0DULQD (X DFKR TXH XUQD FRLVD PHVFODGD QDR G£ SDUD VHSDUDU (X VRX FRQWUDWDGD SHOR 637SDUD WUDEDOKDU VHLV KRUDV SRU GLD WHQKR TXH SUHVWDU FRQWD GDV PLQKDV KRUDV WHQKR TXH ID]HU UHODWULR SODQLOKD GH KRUDV VHJXLU R FURQRJUDPD GD HQWLGDGH HQILP HVWH R ODGR SURIHVLRQDO 7HQKR TXH VHU FRPSHWHQWH SDUD ID]HU RV WUDEDOKRV WHQKR TXH PH SUHSDUDU SDUD ID]HU RV WUDEDOKRV WDO $JRUD R WLSR GH TXHVWDR TXH R 637 WHP FRPR HL[R SDUD VXD LQWHUYHQLGR DFDED SX[DQGR R ODGR PLOLWDQWH (QW£R DSHVDU GH JDQKDU VHLV KRUDV SRU GLD WHP GLD TXH HX WUDEDOKR H HX FRQVLGHUR TXH XUQD PVHOD 0DV TXDQGR HX IDOR GDV DWLYLGDGHV TXH HX H[HUJR QR 637 HX QDR FRORFR GLUH ODPHQWH FRPR XUQD DWLYLGDGH PLOLWDQWH (X FRORFR FRPR XUQD DWLYLGDGH SURILVVLRQDO ( DL QR PRYLPHQWR GH PXOKHUHV HX IDJR D SDUWLU GR 637 D SDUWLU GH GHIPLJDR LQWHUQD GD HQWLGDGH V TXH DL HX YRX FRP PLQKD H[SHULHQFLD GH PLOLWDQWH WDPEP HX FRQVLJR GHILQLU DVVLP 1RZ WKH UDFH LVVXH IURP WKH PRPHQW VWDUWHG WR EH LQYROYHG ZLWK WKLV LVVXH WKLV LQIOXHQFHG P\ OLIH ZLWKLQ 637 $L D TXHVWDR UDFLDO D SDUWLU GR PRPHQWR TXH HX FRPHFHL D HQYROYHUPH FRP HOD WHYH LQWHUIHUHQFLD QD PLQKD YLGD GHQWUR GR 637 6R JRW WKHUH KDOI ZLWK WKH VWDWXV RI OHDGHUVKLS JRW WKHUH DVVXPLQJ SRVLWLRQV ZULWLQJ GRFXPHQWV GRQnW NQRZ ZKDW HOVH FRRUGLQDWLQJ URXQGWDEOHV ULJKW" DQG UDSLGO\ ZDV LQYROYHG LQ WKH SURFHVV ZLWK WKH SHRSOH 7KHVH ZHUH YHU\ LQWHQVH PRPHQWV LQ P\ OLIH (QWDR M£ FKHJHL ,G PHLR FRP VWDWXV GH OLGHUDQJD QD KLVWRULD FKHJXHL OD DVVXPLQGR IXQJRHV HVFUHYHQGR WH[WRV QDR VHL R TXH FRRUGHQDQGR PHVDV Q H U£SLGDPHQWH PH HQYROY FRP R SURFHVVR FRP DV SHVVRDV )RUDP PRPHQWRV PXLWR LQWHQVRV QD PLQKD YLGD WKLQN WKDW )t6 LV D JURXS ZKLFK ZRUNV VLPXOWDQHRXVO\ ZLWK ERWK ZLWK ERWK SRVVLELOLWLHV $ UHPXQHUDWHG SURIHVVLRQDO ZRUN DQG D QRQSURIHVVLRQDO DFWLYLW\ > @ )RU H[DPSOH WRGD\ WRQLJKW WKHUH LV D GLVFXVVLRQ DERXW >WKH FRQIHUHQFH RI@ &DLUR ZDV WKHUH DUH DOZD\V RWKHU W\SHV RI DFWLYLWLHV GLIIHUHQW IURP WKH ZRUN LWVHOI (X DFKR TXH R )t6 XP JUXSR TXH WUDEDOKD VLPXOW£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

PAGE 351

DUJXPHQWR HX QDR W GL]HQGR TXH VHMD XUQD OLQKD FHUWD >@ SUD PLP QDR ID] >VHQWLGR@ QHQKXP ,W LV D FKRLFH \RX PDNH QRZ GRQnW NQRZ PH IRU H[DPSOH LI KDG WR VHSDUDWH IURP P\ KXVEDQG LI ZRXOG QRW KDYH WR PDNH RWKHU SURIHVVLRQDO RSWLRQV DV ZHOO ( XPD HVFROKD TXH YRF ID] DJRUD VHL O£ HX VH HX PH VHSDUDU VH HX QDR YRX WHU TXH ID]HU RXWUDV HVFROKDV SURILVVLRQDLV WDPEP :H KDYH D GHJUHH RI DFWLYLVP ZKLFK LV YHU\ GLIIHUHQW IURP RQH SHUVRQ WR WKH QH[W KHUH DW )t6 $ JHQWH WHUQ XUQD FRWD GH PLOLW£QFLD TXH EHP GLIHUHQWH GH SHVVRD SUD SHVVRD DTXL GHQWUR GR )t6 6LOYLD 3HRSOH NQRZ PH WKH\ NQRZ P\ OLIH >@ ,WnV QRW OLNH QHHG WR SXQFK WKH WLPHFDUG >@ DOUHDG\ KDG H[SHULHQFHG WKLV ZLWK P\ FRPUDGHV >RI WKH JURXS VKH PLOLWDWHV LQ@ OHWnV VD\ DOUHDG\ KDG WKLV H[SHULHQFH EXW LQ D VLWXDWLRQ RI DFWLYLVP ZKLFK LV GLIIHUHQW 1 $ VLWXDWLRQ RI DFWLYLVP ZKLFK LV GLIIHUHQW" 6R \RX FRQVLGHU \RXU SDUWLFLSDWLRQ KHUH DV D MRE" 6LOYLD ,WnV ERWK LW HQGV XS EHLQJ LWn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£ WLQKD FRP DV PLQKDV FRPSDQKHLUDV >GH XP RXWUR JUXSR@ YDPRV FKDPDU DVVLP HX M£ WLQKD LVVR PDV XPD FRLVD GH PLOLW£QFLD TXH GLIHUHQWH 1 8PD FRLVD GH PLOLW£QFLD TXH GLIHUHQWH" (QW£R DTXL YRF FRQVLGHUD FRPR HPSUHJR" 6LOYLD ( DV GXDV FRLVDV DFDED VHQGR FRPSOLFDGR ( HX VLQWR TXH DV SHVVRDV TXH HVW£R DTXL QDR WHP LVVR SRUTXH HODV SHOR FRQWU£ULR WHP XPD YLYQFLD VHPSUH DTXL >@ HQW£R DV YH]HV IDOWD XP SRXFR HVVD H[SHULQFLD HVVD YLYQFLD GH FRPR TXH XPD UHSDUWLJ£R SEOLFD VDEH DTXHOD FRLVD FKDWD EXURFU£WLFD H WDO PDV TXH DMXGD D YRF HVWDEHOHFHU FHUWRV SDSLV GHILQHP PDLV RV SDSLV FODUHLDP PDLV FHUWDV FRLVDV 1 FODUR QDR FRPR XPD HPSUHVD TXDOTXHU 6LOYLD 0DV DR PHVPR WHPSR XPD HPSUHVD TXHU GL]HU QDR G£ WDPEP SUD WUDWDU WRGR FRPR VH IRVVH 1 &RPR VH IRVVH R TXH" 6LOYLD 8PD PLOLW£QFLD XPD DWLYLGDGH GH PLOLWDQWH %DVLFDOO\ WKLQN WKDW WKH JUHDWHVW GLIIHUHQFH LV WKDW DV DFWLYLVWV SHRSOH GR WKH WKLQJV WKH\ ZDQW WKH\ DUH PRELOL]HG RQO\ E\ WKHLU FRQVFLRXVQHVV LW LV WKH JUHDW OLPLW 1RZ KHUH QR

PAGE 352

KHUH WKHUH LV DOVR D UHODWLRQ RI GHOLYHULQJ VRPH VHUYLFH RI VRPHWKLQJ +HUH DQG LQ DQ\ SODFH ZKHUH SHRSOH DUH SDLG IRU ZKDW WKH\ GR GRQnW NQRZ >@ WKHUH DUH SHRSOH HYHQ WKH PRQH\ WKDW WKH\ UHFHLYH WR OLYH GRQnW NQRZ KRZ WR SXW LW LW GRHV QRW PDWWHU LI WKH\ DUH SDLG RU QRW WKH\ GR WKLQJV %XW WKLV LV D YHU\ VSHFLDO VLWXDWLRQ GRQnW NQRZ RI VRPH YHU\ VSHFLDO OHDGHUV ,Q JHQHUDO ZKHQ VRPHERG\ UHFHLYHV PRQH\ PHDQ ZKHQ VKH OLYHV IURP WKLV ZRUN WKLQN WKDW WKH UHODWLRQ FKDQJHV 7KHQ DP QRW GRLQJ LW RQO\ EHFDXVH WKLV LV LPSRUWDQW DP JRLQJ WR GR LW DOVR EHFDXVH LI GRQnW GR LW ZRQnW EH SDLG LI GRQnW GR LW WKH\nOO ILUH PH LI GRQnW GR LW WKLV SURMHFW ZLOO QRW EH UHQHZHG ,Q RWKHU ZRUGV WKLV RWKHU FRPSRQHQW %£VLFDPHQWH HX DFKR TXH D JUDQGH GLIHUHQJD TXH QD PLOLW£QFLD DV SHVVRDV ID]HP DV FRLVDV VH HODV TXHUHP HODV HVW£R PRELWL]DGDV QLFDPHQWH SHOD FRQVFLHQFLD GODV R JUDQGH OLPLWH $JRUD DTXL QDR DTXL H[LVWH XUQD UHODJDR TXH WDPEP GH SUHVWDQGR GH DOJXP VHUYLJR GH DOJXPD FRLVD $TXL TXDOTXHU OXJDU RQGH KDMD HVVD FRLVD GH DSHVVRD UHFHEHU SRU DTXLOR TXH HOD ID] (X QDR VHL >@ WHP SHVVRDV TXH R GLQKHLUR TXH HODV UHFHEHP SUD YLYHU QDR VHL FRPR GL]HU LQGHSHQGHQWH GHVVH GLQKHLUR HODV ID]HP DV FRLVDV ( XUQD VLWXDJDR SDUWLFLGDU VHL O£ DOJXQV TXDGURV PXLWR GHVWDFDGRV 'H XP PRGR JHUDO TXDQGR D SHVVRD UHFHEH TXHU GL]HU HOD YLYH GDTXHOH WUDEDOKR HX DFKR TXH HVVD UHODJDR PXGD $L HX QDR YRX ID]HU V SRUTXH DTXLOR LPSRUWDQWH HX YRX ID]HU WDPEP SRUTXH VH HX QDR IL]HU HX QDR UHFHER VH HX QDR IL]HU PH PDQGDP HPERUD VH QDR IL]HU HX QDR FRQVLJR TXH HVVH SURMHWR VHMD UHQRYDGR (QILP HVVH RXWUR FRPSRQHQWH KDYH DOZD\V ORRNHG IRU D JURXS WR ZKLFK FRXOG EHORQJ (X VHPSUH SURFXUHL XPD FRLVD GH SHUWHQFHU £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nV JURXS LQ ZKLFK \RX SDUWLFLSDWH 1
PAGE 353

RQO\ RQ KHU SDUW EXW DOVR RQ WKH SDUW RI RWKHUV RI ZKDW WKH\ H[SHFW IURP KHU 6R LW LV D GLIIHUHQW UHODWLRQ DQG WKLQN WKDW DQ HVVHQWLDO HOHPHQW WKDW GLYLGHV WKHP LV UHPXQHUDWLRQ ,W LV QRW ZKHWKHU LW LV DQ 1*2 LI LW FDOOV LWVHOI DQ 1*2 D JURXS RU D PRYHPHQW 7KH IDFW LV WKDW WKLV LV UHDOO\ FRPSOLFDWHG $FKR TXH QR 637UHIRUJRX PDLV LVVR TXH HX M£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£R GD PXOKHU 1 0XLWR LQWHUHVVDQWH R TXH YRF PH IDORX DJRUD 3RUTXH HX M£ SHUFHEL DV 21*V VDR XUQD FRLVD PLVWD DV RXWUDV RUJDQL]DJRHV GH PLGKHUHV TXH QDR VDR SURIHVLRQDOL]DGDV WHP HVVD FRLVD GH SHUWHQFHU WRWDOPHQWH Q" (VVD FRLVD 'HLVH ( GLIHUHQWH RXWUD UHODJ£R 4XH PDLV SU[LPD GR PRY PHQW XP JUXSR SRGH VHU XP JUXSR RUJDQL]DGR SRGH WHU XUQD URWLQD SRGH PDV H HX DFKR TXH DL D GLIHUHQJD VH G£ PXLWR YLD UHPXQHUDJ£R TXH PHVPR VH IRU XP PRYLPHQWR RQGH WHP SHVVRDV OLEHUDGDV HVVD UHODJ£R FRP R GLQKHLUR WUDQVIRUPD PXLWR D LQVHUJ£R GHVVD SHVVRD QR PRYLPHQWR QDR V GR ODGR GOD FRPR GR ODGR GDV RXWUDV SHVVRDV GR TXH DV RXWUDV SHVVRDV HVSHUDP GOD (QWDR XUQD UHODJ£R GLIHUHQFLDGD H HX DFKR TXH XP HOHPHQWR TXH XP GLYLVRU GH £JXDV D UHPXQHUDJ£R Q£R VH 21* TXH VH LQWLWXOD FRPR 21* FRPR JUXSR RX FRPR PRYLPHQWR ( TXH XP fPHOf PXLWR FRPSOLFDGR 'RUD 1RZ DP TXLWH FULWLFDO RI RXU SRVLWLRQ \RX NQRZ UHJDUGLQJ WKLQN WKDW ZH KDYH WR GR VRPHWKLQJ GRQnW NQRZ KDYH QRW GLVFRYHUHG ZKDW \HW EXW WRJHWKHU ZH ZLOO ILQG RXW DOO WKH 1*2V %XW ZH KDYH WR SURJUHVV RQ WKLV LVVXH ZH ZRUN IRU D FHUWDLQ TXDOLW\ RI OLIH DQG ZH GR QRW JXDUDQWHH LW IRU RXUVHOYHV VRXQGV RI DSSUREDWLRQ IURP WKH RWKHUVf 1 ,W LV )XOYLD ZKR EURXJKW WKLV WR P\ DWWHQWLRQ VKH VDLG, FDQn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£R HX DFKR TXH D JHQWH WHP TXH GDU XP MHLWR Q£R VHL Q£R GHVFREUL DLQGD TXDO PDV D JHQWH GHVFREUH MXQWRV WRGDV DV 21*V 0DV D JHQWH WHP TXH FDPLQKDU SRU HVVD FRLVD D JHQWH WUDEDOKD SRU D TXDOLGDGH GH YLGD H D JHQWH Q£R JDUDQWH SDUD D JHQWH LQFOXVLYH 1DWKDOLH TXHUQ PH FKDPRX D DWHQJ£R SUD HVVH SUREOHPD H D )OYLD TXH PH IDORX GLVVR VHL O£ GH XUQD DPLJD GOD TXH WLQKD FRPHQWDGR TXH Q£R LD WHU DSRQVHQWDGRULD

PAGE 354

'RUD HX IXL IUHHODQFH GH SHVTXLVD GHVGH RV DQRV WUDEDOKHL DQRV QR (VWDGR GHSRLV HQWUHL HP 21* YRF LPDJLQD TXDQWR TXH YRX UHFHEHU ULVRf >@ DJRUD D JHQWH DEUH PXL WR PDLV PDR GH DOJXQV GLUHLWRV TXH MD HVW£R PDLV FRQVROLGDGRV SRUTXH D JHQWH SULRUL]D PXGR PDV R WUDEDOKR TXH WHP TXH VHU UHDOL]DGR XUQD YLV£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f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£R O£ DQRV TXH DEULUDP PDR GH WXGR H TXDOTXHU RXWUR SURMHWR SURILVVLRQDO GDV VXDV SURILVVRHV SUD VH GHGLFDU DV 2QJV (X DFKR LVVR XP PULWR DFKR PHVPR >@ 7HP JHQWH TXH DEULX PDR GH VHU DSRVHQWDGD TXH K£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nW QHHG DQ\ERG\nV FKDULW\ 1DR WHP SURMHWR TXH PH IDJD VDLU GRV PHXV HPSUHJRV TXH PH JDUDQWH LVVR HX DFKR TXH HVWRX SUHVHUYDQGR DW PHX SRWHQFLDO GH OXWD QDR YDL GHPRUDU WDQWR YRX WHU PDLV WHPSR SUD R PRYLPHQWR H DV PLQKDV FXVDV HX GRQD GH PLP 9RX RQGH TXLVHU QDR YRX SUHFLVDU GD FDULGDGH GH QLQJXP ZRXOG QHYHU ZRUN RQO\ KHUH DW )t6 EHFDXVH RI P\ NLGV DQG DP QRW WKH W\SH RI SHUVRQ ZKR PDQDJHV WR OLYH LQ VHUHQLW\ ZLWKRXW NQRZLQJ ZKDW WRPRUURZ ZLOO EULQJ DP NLQG RI DQ[LRXV WR ZDQW WR KDYH WKLQJV

PAGE 355

(X MDPDLV LFDULD V DTXL QR )t6 SRUTXH SRU FDXVD GRV PHXV ILOKRV H QDR VRX XUQ WLSR GH SHVVRD TXH FRQVHJXLVVH YLYHU FRP VDWLVDJ£R GLVVR GH QDR VDEHU R TXH YDL VHU DPDQK£ HX VRX PHLR DQJXVWLDGD GH TXHUHU WHU DV FRLVDV $ PRELOL]LQJ RUJDQL]DWLRQ OLPD HQWLGDGH GH PRELOL]DJ£R $ PDVV RUJDQL]DWLRQ 8UQD HQWLGDGH GH PDVVD 08 LV D VSRQWDQHRXV PRYHPHQW WKH RWKHU >LWnV@ D WUDLQ EHFDXVH SHRSOH JHW RQ DQG WKHQ JHW RII WKHQ JHW RQ DJDLQ >@ LW GRHV QRW UHDOO\ KDYH WKH VWDWLF FKDUDFWHULVWLFV RI DQ RUJDQL]DWLRQ LW LV PRUH OLNH D PRYHPHQW LW IOXFWXDWHV DW WKH UK\WKP RI WKH PRYHPHQW DW WKH UK\WKP RI ZRPHQnV QHHGV 6R ZKHQ LWnV PRYLQJ DQG VKDNLQJ RXW WKHUH DPRQJ ZRPHQ LW LV PRYLQJ DQG VKDNLQJ LQ KHUH DV ZHOO GR \RX XQGHUVWDQG" 08 PRYLPHQWR HVSRQW£QHR WKH RWKHU >@ XP WUHP SRUTXH DVSHVVRDV HQWUDP H GHSRLV GHVFHP DL HQWUD GH QRYR >@ HOD QDR WHUQ PXL WR FDU£WHU HVW£WLFR GH HQWLGDGH HOD PDLV PRYLPHQWR PHVPR HOD YDL DR VDERU GR PRYLPHQWR DR VDERU GDV QHFHVVLGDGH GDV PXOKHUHV (QW£R WXGR TXDQGR HVW£ HP DOWD DOJXPDV FRLVDV GDV PXOKHUHV HVW£ HP DOWD DTXL GHQWUR HQWHQGHO 7KHUH LV D WRQ >LWnV@ D VSDFH IRU ZRPHQ WR WDNH WKHLU SUREOHPV DQG UHVROYH WKHP WR VWUXJJOH IRU UHDO FLWL]HQVKLS IRU ZRPHQ WR ILJKW GLVFULPLQDWLRQ HQVXUH FLWL]HQVKLS DQG QRW RQO\ RI ZRPHQ >IRU@ SRVLWLYH GLVFULPDWLRQ VR WKDW ZRPHQ EH UHVSHFWHG ULJKWV EH UHDOO\ UHVSHFWHG )RU EODFN SHRSOH LQGLDQV FKLOGUHQ ULJKWV DV ZHOO WR LPSURYH WKH VLWXDWLRQ RI ZRPHQ DV FLWL]HQV WKURXJK WKLV RUJDQL]DWLRQ WKH\ SHUFHLYH ZKDW WKHLU SRWHQWLDO LV 7HUQ XP PRQW£R HVSDTR SDUD DV PXOKHUHV WHU OXJDU SDUD OHYDU RV SUREOHPDV GODV H UHVROYHU KLWDU SHOD FLGDGDQLD UHDO GDV PXOKHUHV FRPEDWHU D GLVFULPLQDQGR JDUDQWLU D FLGDGDQLD QDR V GDV PXOKHUHV GLVFULPLQDQGRSRVLWLYD D PXOKHU VHU UHVSHLWDGD GLUHLWRV UHVSHLWRV QD UHDOLGDGH 3DUD QHJURV LQGLRV H GLUHLWR GD FULDQQD WDPEP PHOKRUDU D VLWXDQGR GDV PXOKHUHV HQTXDQWR FLGDGG DWUDYV GD HQWLGDGH HODV SHUFHEHP R VHX SRWHQFLDO 6WDEOH RUJDQL]DWLRQ ZLWK VWDEOH HPSOR\PHQW DQG D VROLG H[SHULHQFH DQG NQRZKRZ JRRG FRQWDFWV DQG LQIOXHQWLDO LW LV D UHIHUHQFH DW WKH OHYHO RI /DWLQ $PHULFD ZKLFK FRPPDQGV JUHDW UHVSHFW LQ WKH ZRPHQnV PRYHPHQW DQG DPRQJ KHDOWK SURIHVVLRQDOV 2UJDQL]DQGR FRP HVWDELOLGDGHn FRP nHVWDELOLGDGH GH HPSUHJRn H nVROLGH] GH H[SHULHQFLD GH FRQWDWRV GH NQRZn KRZn DQG nWDPDQKR GH SRUWHn LW LV nXUQD UHIHUHQFLD DR QLYHO GD $PULFD /DWLQDn ZKLFK FRPPDQGV nJUDQGH UHVSHLWR DR QLYHO GR PRYLPHQWR GH PXOKHUHV H GRV SURILVVLRQDLV GH VDGH $ GLVWLQJXLVKHG SRVLWLRQ LQ WHUPV RI NQRZOHGJH 8P OXJDU GHVWDFDGR HP WHUPRV GH FRQKHFLPHQWR 6HULRXV DQG SURIHVVLRQDO 6ULR HSURILVVLRQDO 7U\LQJ WR LPSURYH LWV SHUIRUPDQFH 3URFXUD VH DSHUIHLQRDU $ JUHDW H[SHULHQFH DQG DPRXQW RI LQIRUPDWLRQ DQG DFWLYLWLHV KDG EHFRPH D UHIHUHQFH SRLQW ZLWK UHJDUG WR ZRPHQnV KHDOWK VHUYLFHV DQG ZDV VHULRXV YHU\ ZHOOFRQVLGHUHG E\ RWKHU JURXSV $ OHDGHU VDLG )t6 OLNH RWKHU 1*2V >@ WKHVH DUH JURXSV ZKLFK DUH LQ WKH YDQJXDUG LQ WKH IURQWOLQH ZLWK UHJDUG WR HYHU\WKLQJ RI WKH KHDOWK TXHVWLRQ ([SHULHQFLD H XPD EDJDJHP JUDQGH GH LQIRUPDQGHV H WUDEDOKRV KDG EHFRPH SRQWR GH UHIHUHQFLD FRP DWHQGLPHQWR D VDGH GD PXOKHU DQG ZDV VULR PXLWR EHP YLVWR SRU RXWURV

PAGE 356

JUXSRV )t6 FRPR RXWUDV 21*V Q >@ VDR JUXSRV TXH HVWDRGH YDQJXDUGD D IUHQWH GDV GH WXGRGD TXHVWGR GD VDGH 7KH FOLQLF LV VWLc@ D YHU\ LPSRUWDQW UHIHUHQFH IRU XV 9HU\ XVHIXO LQ WHUPV RI SURGXFLQJ QHZ SUDFWLFHV DQG EHIRUH >RXU@ SURILOH ZDV PRUH FHQWHUHG RQ WKH FOLQLF RU WKH FOLQLF LV VIL D SULRULW\ DPEXODWRULR DQGD XUQD UHIHUHQFLD PXL WR LPSRUWDQWH 0XL WR YDOLRVD DR QLYHO GH SURGX]LU QRYDVSU£WLFDV H DQWHV R SHUILO HUD PDLV FHQWUDGR VREUH R DPEXODWRULR RU R DWHQGLPHQWR DQGD D SULRULGDGH 7KH WUDLQLQJ DVSHFW FDPH LQ 5HVHDUFK DQG SROLWLFDO DUWLFXODWLRQ FDPH LQ (QWURX R ODGR GD IRUPDQGR (QWURX D SHVTXLVD H D DUWLFXODQGR SROWLFD )RRWQRWH f ,QIOXHQFH WKH FKDQJHV LQ WKH FRXQWU\ DOZD\V LQ WHUPV RI ZRPHQ SURPRWH ZRPHQnV FLWL]HQVKLS EHOLHYLQJ LQ WKH WUDQVIRUPDWLRQ RI VRFLHW\ LQ WKH ORQJUXQ 7HU LQIOXHQFLD DV PXGDQTDV GR SDV YLVDQGR VHPSUH D PXOKHU HVWLPXODU D FLGDGDQLD GDV PXKHUHV DFUHGLWDU QD WUDQVIRUPDQGR GD VRFLHGDGH DR ORQJRSUD]R $ PRUH VROLGDU\ VRFLHW\ GHQRXQFLQJ WKH LQMXVWLFH RI JHQGHU UHODWLRQV VRFLHGDGH PDLV VROLGDULD GHPPFLDU DV LQMXVWLFLDV GDV UHODQGHV GH JQHUR %HFDXVH )t6 LV D D VSDFH ZKHUH ZH GHOLYHU VHUYLFHV WKDW LV ZH SURYLGH PHGLFDO VHUYLFHV PHDQ WKH PDMRULW\ WKLV LV WKH RQO\ VHUYLFH LQ %UD]LO ZKHUH WKLV LV GRQH >@ WKH PDMRULW\ RI ZRPHQnV 1*2V WKH\ KDYH D PRUH SROLWLFDO UROH ZKHUH WKH\ RUJDQL]H 7KHQ VKH DGGHG PHDQ KHUH EHVLGHV WKLV SROLWLFDO UROH f§ZH DUH YHU\ DFWLYH LQ WKH ZRPHQnV PRYHPHQW DW WKH QDWLRQDO UHJLRQDO DQG JOREDO OHYHO >ZH SURYLGH VHUYLFHV@ 3HOR )t6 VHU XPXP ORFDO RQGH SUHVWD VHUYLQR RX VHMD HOH DWHQGH Q TXHU GL]HU D PDLRULD R QLFR VHUYLQR GR %UDVLO TXH ID] DWHQGLPHQWR >@ D PDLRLUD GDV RUJDQL]DQRHV QDRJRYHPDPHQWDLV GH PXOKHUHV HODV WHUQ XP SDSHO PDLV SROWLFR YDPRV GL]HU DVVLP Q (OD WHUQ XP SDSHO PDLV SROWLFR RQGH HOD RUJDQL]D ID] 7KHQ VKH DGGHG TXHU GL]HU DTXL DOP GD JHQWH WHU HVVH SDSHO SROWLFR WDPEP f§QRV WHPRV XUQD DWXDQDR PXLWR JUDQGH QR 0RY PHQW GH 0XOKHUHV WDQWR D QLYHO QDFLRQDO FRPR ODWLQR FRPR PXQGLDO >@ ,W PDNHV WKLQJV PRUH GLIILFXOW EHFDXVH VRPHWLPHV \RX DUH EXV\ ZLWK RWKHU WKLQJV EXW RQ WKH RWKHU KDQG \RX JXDUDQWHH WKDW \RXU DFWLYLWLHV DUH LQ V\QF ZLWK UHDOLW\ ZLWK D GHPDQG \RX NQRZ" ,WnV QRW VRPHWKLQJ ZH DUH FRPLQJ XS ZLWK WKDW ZH DUH ORRNLQJ IRU RQ WKH FRQWUDU\ KHUH ZH GR QRW ORRN IRU DQ\WKLQJ KHUH WKLQJV FRPH WR XV \RX VHH" 'LILFXOWD SRUTXH DV YH]HV YRF WHUQ RXWUDV FRLVDV WDPEP TXH YRF W£ WRFDQGR GD PHVPD IRUPD PDV SRU RXWUR ODGR YRF JDUDQWH XUQD DWXDQDR FRODGD PLPD UHDOLGDGH PLPD GHPDQGD VDEH" 1DR XUQD FRLVD TXH QV HVWDPRV LPDJLQDQGR TXH QV HVWDPRV EXVFDQGR SHOR FRQWU£ULR DTXL QV QDR EXVFDPRV QDGD DTXL DV FRLVDV YHP HQWHQGHX" WKLQN WKDW ZKDW HQVXUHV SDUWLFLSDWLRQ RUJDQL]LQJ LW LV \RXU ZLOOLQJQHVV WR EH DOZD\V RSHQ DQG UHFHLYLQJ UHFHLYLQJ WKH GHPDQGV IURP VRFLHW\ (X DFKR TXH R TXH JDUDQWH DSDUWLFLSDQGR D RUJDQL]DQGR D VXD YRQWDGH PHVPR GH HVWDU VHPSUH DEHUWD H UHFHEHQGR UHFHEHUXLR D GHPDQGD GD VRFLHGDGH

PAGE 357

6R IRU H[DPSOH ZH GHFLGH WKDW IRU WZR \HDUV ZH ZLOO OHDG D FDPSDLJQ DJDLQVW QRW DJDLQVW EXW IRU FDQFHU SUHYHQWLRQ LQ WKH (DVWHUQ 3HULSKHU\ 0HPLVD GHFLGHV WR ILQDQFH WKLV DFWLYLW\ DQG GXULQJ WZR \HDUV \RX DUH JRLQJ WR PDNH WKLV KDSSHQ ,Q WKH PHDQWLPH WKH +HDOWK 0RYHPHQW KDV D EXQFK RI WKLQJV WR GR EXW \RX VWD\ WKHUH LQ WKLV OLWWOH FRPHU ZKHUH \RX GHFLGHG \RX ZHUH JRLQJ WR ODXQFK D WZR\HDU FDPSDLJQ (QW£R QRV GHILQLPRV XP H[HPSOR HP GRLV DQRV YDPRV ID]HU XUQD FDPSDQKD FRQWUD FRQWUD QDR SHOD SUHYHQJ£R GH F£QFHU QD =RQD /HVWH DL D 0HPLVD ILQDQFLD HVWH WUDEDOKR H YRF WHP GRLV DQRV SDUD ID]HU HVWH WUDEDOKR DFRQWHFHU 1HVWH SHURGR R 0RYLPHQWR GH 6DGH WHP XP PRQWH GH FRLVD SDUD ID]HU PDV YRF YDL ILFDU O£ QDTXHOH FDQWLQKR HP TXH YRF VH SURSV GH ID]HU D FDPSDQKD GH GRLV DQRV ZDQW \RX WR VWD\ ZLWK PH QRW \RX WR WDNH PH WR ZRUN ZLWK \RX ( SDUD YRF ILFDU FRPLJR QDR SDUD YRF PH OHYDU SUR VHX WUDEDOKR )LJXUH 2ULJLQDO RI 6DQGHnV PHPEHUV GHILQLWLRQ RI WKHLU DFWLYLWLHV 1 (QW£R YRFV FRQVLGHUHP TXH WUDEDOKDU SUD 6DQGH FRPR TXH YRFV FRQVLGHUDP LVVR PLOLW£QFLD" WUDEDOKR" RV GRLV" 9£ULDV YRFHV 2V GRLV /LOLDf WUDEDOKR SDUD FDUDPED ULVRf D PLOLW£QFLD DOJXPf VDR DV GXDV FRLVDV 'RUDf HX DFKR TXH D JHQWH WUDEDOKD PXLWR FRP D SHUVSHFWLYD GH TXH QDR VHL VH GH VH WRUQDU PDLV SURIHVVLRQDO PDV TXH D JHQWH SRVVD JDUDQWLU HVVDV FRLVDV TXH D JHQWH VHQWH IDOWD TXH WRGR PXQGR SUHFLVD R VHJXURVDGH VHU PDV HILFLHQWH GH LU VH DSHUIHLFRDQGR PDV FRQWLQXDQGR SHQVDQGR ID]HQGR DV FRLVDV TXH D JHQWH DFUHGLWD >@ $JRUD XUQD RSJ£R GH YLGD TXH SRVVLELOLWD YRF GHVHQYROYHU VXDV LGLDV >@ 1DGLD HX SDUWLFXODUPHQWH YHMR FRPR XPDHVWRX FRQWULEXLQGRSDUD XUQD FRLVD TXH HX DFKR LPSRUWDQWH VH QDR HX QDR HVWDUD DTX DW HVVD KRUD >VDR TXDVL SP@ 1 3RLV ULVR GH WRGDVf 1DGLD (X DFKR TXH WHP DW HX LD FRPSOHWDU Q WDPEP QDR YDPRV GHL[DU HVVD FRLVD GHVVD WULVWH]D GHVVH SHVR TXH R WUDEDOKR QDR UHPXQHUDGR GDQGR GLUHLWRV GR MHLWR TXH D JHQWH JRVWDULD SRUTXH HX DFKR TXH DV SHVVRDV TXH HVW£R DTXL GH DOJXPD IRUPD HODV HODV SDUWLFLSDUDP GH PRPHQWRV PXLWR GLIFLO GR SDV > 'HUDP D PDLRULD GDV VXDV YLGDV SRU FRQWD GD PXGDQTD VRFLDO GR SDV 4XHU GL]HU HX DFKR TXH D (GLPHLUH D GLUHJ£R GHVVD LQVWLWXLJ£R GH RXWUDV LQVWLWXLJRHV HX SDUWLFXODUPHQWH H RXWUDV SHVVRDV DTXL GHQWUR HODV WUDEDOKDUDP VHP JDQKDU QDGD ODUJDUDP VXDV IDPLOLDV Q (QW£R Q£R R GLQKHLUR TXH KRMH Q£R R PDLRU 4XHU GL]HU WUDEDOKDU SUD PLP QD SUHIHLWXUD H DTXL DR PHVPR WHPSR H QR ILQDO GH VHPDQD XUQD TXHVW£R GH SULQFLSLR VDEH GH HVFROKDSROWLFD GH TXHUHU TXH D KXPDQLGDGH DYDQFH HYROXD (QW£R HX DFKR HVWDU DTXL VLJQLILFD HX HVWDU UHDOL]DQGR R LGHDO GH PXGDQFD GD VRFLHGDGH GH HYROXJ£R GD KXPDQLGDGH GH FRODERUDU FRP SD] SRU LVVR SRU DTXLOR 'RUD DW ERQLWR GHPDLV ULVR GH WRGDVf >@ /LOLD (X DFKR TXH XP VHUYLFR (GLPHLUH GH DOWD UHOHYDQFLD VRFLDO ULVRf > EDUXOKR@f (X DFKR GH FHUWD PDQH LUD HX HVWRX SUHVWDQGR VHUYLFR LVVR TXH D JHQWH ID]

PAGE 358

3RUTXH $JRUD D PDQH LUD FRPR D JHQWH ID] LVVR TXH YDL GDU R D LGLD GH TXH WLSR GH VHUYLGR TXH HX IDJR 3RU H[HPSOR HX IDJR HX WHQKR TXH WUDEDOKDU KRUDV 7DO WDO WDO (QW£R VHULD XUQD TXHVWDR GH VHUYLJR QHP SXUD H VLPSOHV 9RX O£ YRX GDU RILFLQD >@ D JHQWH FRQYHUVD PLQKDV KRUDV DFDERX 3RUTXH DVVLP XUQD FRLVD TXH WHP TXH VHU IHLWD ‹ XUQD FRLVD TXH SUHFLVD VHU IHLWD XP VHUYLJR TXH HVWDPRV ID]HQGR ILQDQFLDGR SRU TXHP QDR VHL PDV XUQD FRLVD TXH D JHQWH VH SURSXV D ID]HU XUQD DJ£R HGXFDWLYD $JRUD TXDO D SHUVSHFWLYD GOD TXDQWR WHPSR YRX JDVWDU GH TXH PDQHLUD YRX ID]HU LVVR TXDO D SROWLFD TXH HVW£ SRU WUDV TXDO D PLQKD LGLD TXH HVW£ SRU WUDV TXDO R PHX LGHDO>I $L TXH YDOH XP RXWUR QLYHO XUQD RXWUD TXDOLGDGH 0DV HX SHQV DVVLP TXH XP VHUYLJR GH DOWD ULVR GH /LOLDf UHOHYDQFLD VRFLDO &KDSWHU (QFRXQWHUV DQG 0LVHQFRXQWHUV &LW\ DQG 1HLJKERUKRRG )HPLQLVPV %DVLFDOO\ FROOHFWLYH FODLP PDGH E\ D FRPPXQLW\ IRU ZKROH RI LWV PHPEHUVf WKH\ GR QRW DLP WKHUHIRUH DW WKH H[SDQVLRQ RI LQGLYLGXDO ULJKWV %£VLFDPHQWH FROHWLYRV UHLYLQGLFDJ£R IHLWD SRU XUQD FRPXQLGDGH SDUD R FRQMXQWR GH VHXV PHPEURVf QDR VH WUDWDQGR SRU WDQWR GH H[SFPV£R GH GLUHLWRV LQGLYLGX£LV &LWHOL f 6RPHWKLQJ KDG GRXEW DERXW ZDV DERXW MRLQLQJ WKLV FRPPLVVLRQ ZDV PL[LQJ XS WKH ZRPHQnV FRPLVVLRQ ZLWK WKH IHPLQLVWV 6RPHWLPHV VDZ WKH IHPLQLVWV DV EHLQJ YHU\ UDGLFDO >@ %HLQJ D PHPEHU RI WKH ZRPHQnV FRPLVVLRQ GRHV LW PHDQ EHLQJ D IHPLQLVW" GRQnW ZDQW WR EH RQH RI WKHVH IHPLQLVWV QR ZDQW WR EH IHPLQLQH 1RW WKHVH IHPLQLVWV VR GRQnW NQRZ VR >@ GRQnW NQRZ LI \RX NQRZ ZKDW ZDQW WR VD\ 6R WKDW ZRPHQ KDYH WR ZRUN DORQJVLGH PHQ 7KH LVVXH RI UHVSHFW WKDW PHQ KDYH IRU ZRPHQ >@ VLQFH \RX ZDQW WR KDYH \RXU ULJKWV KHUH WKH\ DUH EH HTXDO ZLWK PHQ $QG VR ZH DUH WUHDWHG ZLWK PXFK GLVUHVSHFW :H DUH QRW WUHDWHG DV ZRPHQ DQ\PRUH 8UQD FRLVD TXH HX WLQKD GYLGD GH FRPR HQWUDU QHVVD FRPLVV£R HX ID]LD HVVD FRQIXVDR GH FRPLVV£R GH PXOKHU FRP DV IHPLQLVWDV DV YH]HV HX YLD DV IHPLQLVWDV PXL WR UDGLF£LV >@ 6HU£ TXH ID]HU SDUWH GD FRPLVV£R GH PXOKHUHV WHP TXH ID]HU SDUWH GDV IHPLQLVWDV" (X QDR TXHUR VHU DTXHODVIHPLQLVWDV QDR (X TXHUR VHU IHPLQLQD 1DR DVIHPLQLVWDV DVVLP W£RVHL O£PXLWR>@ QDR VHL VH YRF HVW£ HQWHQGHQGR R TXH HX HVWRX TXHUHQGR GL]HU 0XLWR DVVLP TXH D PXOKHU WHP TXH DQGDU MXQWR FRP R KRPHP $ TXHVWDR GR UHVSHLR GR KRPHP WHU FRP D PLGKHU >@ -£ TXH YRFHV TXHUHP WHU GLUHLWRV VHXV GLUHLWRV VDR HVVHV VHMD LJXDO DR KRPHP (QW£R D JHQWH WUDWDGD FRP PXLWD JURVVXUD Q£R WUDWDGD FRPR PXOKHU PDLV ,Q WKH IHPLQLVW (QFRQWURV WKH DWWHQGDQFH FKDQJHG DQG QRERG\ ZDQWV WR FKDQJH WKH G\QDPLF RI WKH )HPLQLVW (QFRQWURV 7KH\ SUHIHU SXWWLQJ DQ HQG WR WKH )HPLQLVW (QFRQWURV WR VD\ WKDW WKH\ GR QRW KDYH D UROH WR SOD\ DQ\PRUH WKDQ WR FKDQJH WKH G\QDPLF WR DFFRPRGDWH WKH UHDOLW\ RI SRSXODU ZRPHQ 1RV HQFRQWURV IHPLQLVWDV PXGRX R SEOLFR H QLQJXP TXHU PXGDU D GLQ£PLFD GRV HQFRQWURV IHPLQLVWDV SUHIHUHP DFDEDU FRP RV HQFRQWURV IHPLQLVWDV GL]HU TXH HOHV Q£R WHP PDLV SDSHO GR TXH PXGDU D GLQ£PLFD SDUD SRGHU DGHTXDU £ UHDOLGDGH GDV PXOKHUHV SRSXODUHV %XW WKLV LV D SUREOHP GR \RX NQRZ ZK\ 1DWKDOLH" %HFDXVH ZKHQ ZH RUJDQL]H D PHHWLQJ LQ D ORFDWLRQ ZKLFK LV QRW JRRG SHRSOH VD\ LWnV RQO\ EHFDXVH LW LV D PHHWLQJ

PAGE 359

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£ JDVWDQGR GLQKHLUR DWRD >@ (QWDR WHP XUQDXUQD FRLVD FUWLFD GHQWUR GR 0RYLPHQWR H R FOLPD DFHUFDYHLR D OXWD GH FODVVH VH UHLQVFUHYH GHQWUR GH FDGD FRQWH[WR GH FODVVH HQWHQGHX" :KDW ZH IHHO LQ WKH QHLJKERUKRRGV LV WKLV DQG WKLV LV VRPHWKLQJ RI ZKLFK ZH FRPSODLQ D ORW LQ D IHZ PHHWLQJV LQ ZKLFK ZH KDYH EHHQ LQ WKH ZRPHQnV PRYHPHQW DQG WKDW LV WKDW WKH SHULSKHU\ ZDV DEDQGRQHG E\ WKH RUJDQL]HG JURXSV RU E\ WKH 1*2V WKDWnV ULJKW 6R WKH LQLWLDWLYHV LQ WKH QHLJKERUKRRGV KDYH EHHQ LQ WHUPV RI ZRPHQnV LVVXHV KDYH EHHQ LQGLYLGXDO LQLWLDWLYHV 1 )URP QHLJKERUKRRG ZRPHQ" &HFLOLD @ WKLQN WKDW D ORW RI WKLQJV FKDQJHG IRU WKH EHVW EXW VRPH FKDQJHG IRU WKH ZRUVH 6R IRU H[DPSOH LQ \RX FRXOG VHH D PXFK PRUH DFWLYLVW LQWHUYHQWLRQ RQ WKH SDUW RI WKH OHDGHUVKLS RI WKH ZRPHQnV PRYHPHQW PRUHVSRQWDQHRXV DQG PXFK PRUH FRPPLWWHG /HWn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£R GDV OLGHUDQJDV GR PRYLPHQWR GH PXOKHUHV PXLWR PDLV PLOLWDQWH PXLWR PDLVQR HVSRQW£QHR PDLV PXLWR PDLV FRPSURPHWLGD YDPRV GL]HU DVVLP HUD XUQD FRLVD TXH HUD D GLVSRQLELOLGDGH GDV SHVVRDV SDUD DV FRLVDV SDUD DV DWLYLGDGHV HOD HUD PXLWR JUDQGH HQWDR D GLVSRQLELOLGDGH SDUD DV WURFDV WURFDV HQWUH RV JUXSRV HQWDR DVVLP HPERUD KRXYHVVH M£ XUQD KLHUDUTXLD D QLYHO GD HVWUXWXUDJ£R D QLYHO GH FRQGLJRHV PDWHULDLV HQWUH RV JUXSRV >@

PAGE 360

([LVWLD XUQD UHODJ£R DFKR TXH PDLV GH SDUFHUD QD SU£WLFD PHVPR HX DYDOLR TXH HUD PDLRU GR TXH KRMH KRMH DFKR TXH VH DSURIXQGRX EDVWDQWH R HVVD GLIHUHQFLDQGR HQWUH DV HQWLGDGHV ZRXOG WUDYHO DQG LW ZDVQnW RQO\ WZR KRXUV OLYHG RYHU WKHUH LQ &DPSR /LPSR DQG ZDV JRLQJ WR ,WDTXHUD VHH ZKDW PHDQ" EURXJKW DQ H[SHUW DORQJ >RQ VRPH SDUWLFXODU LVVXH@ > @ :Hn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£ YRF Y R TXH G SUD ID]HU 0DV YRF OHYDU XUQD HVSHFLDOLVWD KRMH H LPSRVVYHO HQWHQGHX" 7KH ZD\ VHH LW 1DWKDOLH DP SUHWW\ ZRUULHG EHFDXVH VHH D JUHDWHU DQG JUHDWHU JDS VHH QHLJKERUKRRG ZRPHQ ZKR DUH GRLQJ UHDOO\ LPSRUWDQW ZRUN ZKLFK FRXOG HQULFK WKH WKHVLV RI DQ\ DFDGHPLF ZRPDQ WKH\ DUH GRLQJ WKLQJV ZKLFK DUH RIWHQ OHIW WR WKH VLGH GRQnW WKLQN WKDW WKLV LV JRRG IRU WKH PRYHPHQW ,W LV JRLQJ WR PLVUHSUHVHQW IHPLQLVP DQG SHRSOH ORYH WR WDON DERXWORYH WR VD\ VXFK WKLQJV (X YHMR DVVLP 1DWKDOLH HX W PXLWR SUHRFXSDGD SRUTXH HX YHMR FDGD YH] PDLV DVVLP XP GLVWDQFLDPHQWR YHMR DV PXOKHUHV SRSLGDUHV TXH WHP XP WUDEDOKR LPSRUWDQWVVLPR TXH SRGHULD HQULTXHFHU D WHVH GH TXDOTXHU XUQD GDV PXOKHUHV DFDGPLFDV TXH HVW£R ID]HQGR DV FRLVDV PXLWDV YH]HV ILFDP GR ODGR (X DFKR TXH LVVR QDR ERP SUR PRYLPHQWR 9DL DVVLP GHVFDUDWHUL]DU R IHPLQLVPR TXH DV SHVVRDV DGRUDP IDODU DGRUDP FRORFDU GHIHLWR GL]HQGR WDLV FRLVDV %HIRUH 08 ZDV ZRUNLQJ D ORW ZLWK WKH QXFOHL 08 JDYH D ORW RI LPSRUWDQFH WR WKLV ZRUN QRW WRGD\ EXW WKHUH ZDV D WLPH ZKHQ ZH GLGDQWHV 08 WLQKD PXLWR WUDEDOKR FRP RV QFOHRV 08 GDYD PXLWD LPSRUWDQFLD D LVVR DWXDOPHQWH QDR PDV WHYH XUQD SRFD TXH GHX :RUNVKRSV ZH GR OHVV DQG OHVV RI WKRVH RI UHDOO\ EDVLF ZRUNVKRSV %HIRUH ZH XVHG WR GR D VHULHV RI ZRUNVKRSV LQ IDFW LW ZDV VRPHWKLQJ TXLWH HQRUPRXV ,W ZDV EDVLF WUDLQLQJ UHDOO\ EHFDXVH LW ZDV KHOSLQJ WR FUHDWH D JURXS VR WKDW WKH JURXS FRQWLQXHG DIWHUZDUGV @ ZH WU\ WR IRUZDUG D ELW RI ZKDW LV WKH IHPLQLVW DJHQGD WR SURYLGH D PRUH FRQFHSWXDO GLVFXVVLRQ RI ZKDW JHQGHU UHODWLRQV DUH > @ RI WKH PHWKRGRORJ\ ZH KDYH EHHQ XVLQJ LQ ZRUNLQJ ZLWK ZRPHQ 2ILFLQDV DJHQWH ID] FDGD YH] PHQRV $ RILFLQD EHP E£VLFD PHVPR4XH DQWHV QRV ID]LDPRV RILFLQDV GH GR]H HQFRQWURV QD YHUGDGH HUD XP WURFR DVVLP HQRUPH (UD XUQD IRUPDQGR E£VLFD PHVPR SRUTXH LVVR DMXGDYD D JUXSDOL]DU DR JUXSR FRQWLQXDU GHSRLV 9RF ILFDYD O£ WUHV PHVHV ID]HQGR XUQD RILFLQD H GHSRLV GLVFXWD FRPR R JUXSR FRQWLPLDU (QW£R KRMH PHVPR

PAGE 361

DV RILFLQDV TXH D JHQWH ID] PDLV GHQWUR GH HYHQWRV RX XUQD RILFLQD GH PHQRV HQFRQWURV ( ID] FDGD YH] PDLV VHPLQDULRV FXUVRV FXUVRV SRU WHPDV WDQWR FXUVRV JHUDLV >@ VH WHQD SDVVDU XP SRXFR GR TXH H D SODWDIRUPD IHPLQLVWD GDU XUQD GLVFXVV£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nV TXHVWLRQ VR DV IDU DV WKH >KHDOWK@ PRYHPHQW JRHV LW KDV ORVW D ELW RI LWV FDSDFLW\ WR SURYLGH VXSSRUW 1RZ RQ ZRPHQn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£R GD PXOKHU HQW£R HQTXDQWR PRYLPHQWR >GH VDGH@ HOH SHUGH XP SRXFR D FDSDFLGDGH GH HVWDU DVVHVVRUDQGR DJRUD SUD DVVXQWR GD PXOKHU DQGD XPD HQWLGDGH TXH WHP FDSDFLGDGH GH DVVHVVRUDU 7KHQ DOVR ZLWK P\ SK\VLFDO GLIILFXOWLHV WKLV DFWLYLW\ ZKLFK HQMR\HG VR PXFK LQ ZKLFK SDUWLFLSDWHG D ORW PHDQ LQ WKH VWUHHWV KDYH D ORW RI GLIILFXOWLHV WR SDUWLFLSDWH > @ FDQnW EH VWDQGLQJ IRU YHU\ ORQJ P\ OHJV KXUW DQG P\ EDFN WRR DQG FDQQRW FDUU\ EDQQHUV DQ\PRUH %HFDXVH XVHG WR SUHSDUH D ORW IRU WKH GHPRQVWUDWLRQV DQG WKH VWUHHW FDUQLYDOV WKDW ZH XVHG WR RUJDQL]H 'HSRLV WDPEP FRP PLQKD OLPLWDQGR IVLFD HQW£R HVVD DWLYLGDGH TXH HX JRVWDYD PXLWR TXH HXSDUWLFLSDYD PXLWR TXH HUD GH UXD HX HVWRX FRP GLILFXOGDGH HPSDUWLFLSDU >@ QDR FRQVLJR ILFDU HP S GR DV SHPDV D FROLPD WDPEP M£ GRW H QDR FRQVLJR FDUUHJDU DV IDL[DV 3RUTXH HX PH SUHSDUDYD PXLWR SURV SDVVHDWDV H SURV FDPDYDLV GH UXD TXH D JHQWH ID]LD 7KRVH ZKR NQRZ WKH ZRUN ZKR VKRXOG EH JXLGLQJ XV WKHVH SHRSOH GR QRW JLYH XV WKHLU VXSSRUW WKH\ DUH WKH ILUVW WR EH QHJDWLYH nQR WKLV ZRQnW ZRUNn RU nWKLV GRHVQnW ZRUN WKLV ZD\n $TXHODVSHVVRDV TXH VDEHP FRQKHFHP R WUDEDOKR TXH GHYHULDP HVWDU RULHQWDQGR D JHQWH HVVDV SHVVRDV QDR HVWDR GDQGR DSRLR VDR DV SULPH LUDV D VHU QHJDWLYDV nQDR LVVR QDR YDL IXQFLRQDUn RX nLVVR QDR IXQFLRQD DVVLPn 7KH\ DUH WLUHG RI JRLQJ WKHUH >WR WKH QHLJKERUKRRGV@ ,PDJLQH $QDEHO ZLWK WKH OHYHO ZKHUH VKH LV DW JRLQJ WR GR D FRQVFLRXVQHVVUDLVLQJ JURXS HODV QDR DJXHQW£R PDLV LU OD >WR WKH SHULSKHU\@ ,PDJLQD D $QDEHO FRP R QLYHO DRQGH HOD HVW£ ID]HU JUXSR GH UHIOH[DR 7KH SHRSOH ZKR DUH LQ WKH VHFUHWDU\ RI WKH 5HGH QRW DOO RI WKHP EXW WKH PDMRULW\ EHOLHYH WKDW WKH\ DUH DERYH DOO WKLV WKDW LW LV QRW WKHLU UROH WR JR WR WKH VWUHHW ZLWK D SDPSKOHW LQ KHU KDQG DQG WR WDON WR WKH SRSXODWLRQ

PAGE 362

$V SHVVRDV TXH HVW£R QD VHFUHWDULD GD 5HGH QHP WRGDV PDV D PDLRULD M£ VH VHQWH DFLPD GHVVD FRQGDGR TXH HOD QDR PDLV SDUD HVWDU FRORFDQGR R S QD UD FRP SDQIOHWR QD P£R -DODQGR SDUD D SRSXODQGR :RPHQ VWDUW DV DFWLYLVWV LQ WKHLU RUJDQL]DWLRQV WKHQ ZLWK SXEOLFDWLRQV DQG JRLQJ IRUWKH QDWLRQDO DQG LQWHUQDWLRQDO OHYHO DQG WKHUH LV QR RQH WR UHSODFH WKH DEVHQFH RI WKHVH SHRSOH DW WKH ORFDO OHYHO QR" $V PXOKHUHV FRPHJDP D PLOLWDU DV VXDV HQWLGDGHV FRPSXEOLFDJGHV H VDLQGRSUDSUD QYHLV QDFLRQDO H LQWHUQDFLRQDO H QGR WHUQ JHQWH TXH FREUH D IDOWD GHVVDV SHVVRDV QR QLYHO ORFDO Q $W WKLV WLPH KDG WKH LGHD RI VWDUWLQJ D VWXG\ JURXS EXW ZH KDG WR SRVWSRQH RUJDQL]LQJ WKLV JURXS EHFDXVH HYHU\ERG\ ZDQWHG WR EH SDUW RI LW ( UQTXHOD SRFD PH SLQWRX D LGHLD GH WHU XUQ JUXSR GH HVWXGR FMXHPHQLQD QV DGLDPRV PRQWDU HVVH JUXSR SRUTXH DL WRGR PXQGR TXHULD LU SDUD R JUXSR GH HVWXGR ZRXOG OLNH WR GR RWKHU WKLQJV DV ZHOO WR EH DEOH WR ZULWH D ELW ZULWH D ERRN DQG GR ZRXOG OLNH WR OHDUQ WKLQJV QRZ ZRXOG OLNH WR EHFRPH PRUH RI D VWXGHQW QR (X JRVWDULD GH PH GHGLFDU D ID]HU RXWUDV FRLVDV WDPEP SRGHU HVFUHYHU XUQ SRXFR SRGHU HVFUHYHU XP OLYUR H ID]HU XPHX JRVWDULD GH DSUHQGHU DOJXPDV FRLVDV QR PRPHQWR JRVWDULD GH YLUDU XP SRXFR DOXQD Q GRQnW GR WKLV DQ\PRUH 7KH ZRPHQ ZDQW WR WDON DERXW NQRZLQJ WKHLU RZQ ERG\ WKHVH WKLQJV WKDW ZH ZHUH GRLQJ \HDUV DJR >@ ,nYH GRQH LW GRQnW GR WKDW DQ\PRUH ZRQnW ZDON XQWLO WKHUH DQ\PRUH >@ OHW RWKHUV GR LW RU WKHQ OHW WKHP ILQG D VROXWLRQ RI WKHLU RZQ 1DR IDJR PDLV LVVR $V PLGKHUHV TXHUHP IDODU GH DXWRFRQKHFLPHQWR GR FRUSR HVVDV FRLVDV TXH QV ID]DPRV DQRV DWU£V >@ MD IL] LVVR QGR IDJR PDLV 1GR YRX PDV D S DW O£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nV VD\ WKH PLFURVFRSLF ZRUN >DQWVn ZRUN@ ZKLFK LV GRQH WKHUH LQ *XDLDQD]HV RU LQ &DPSR /LPSR WKLQN WKDW SDUW RI WKH ZRUN WKDW 6DQGH GRHV LV VXEPHUJHG IURP WKLV SRLQW RI YLHZ RI WKH ZRUOG RI 1*2V DQG RI DJHQFLHV %HFDXVH LW LV ZRUN ZH GR RYHU WKHUH LQ WKH YHU\ HQG RI *XDLDQD]HV LQ WKH YHU\ HQG RI &DPSR /LPSR PHDQ WKLV ZLOO RQO\ EH PRUH YLVLEOH WKH GD\ ZH FUHDWH D YLGHR DERXW LW 7KHQ

PAGE 363

HYHU\ERG\ LV JRLQJ WR VD\ 2K ZKDW D JUHDW MRE \RX DUH GRLQJ EHFDXVH WKHQ WKHUH LV D YLVLEOH SURGXFW D SURGXFW ZKLFK FDQ FLUFXODWH WKURXJKRXW WKH ZRUOG 'R \RX XQGHUVWDQG" 1R FDVR GDV DJHQFLDV HX VLQWR TXH QDR WDQWR SHOD FRLVD SUSULDPHQWH GRV UULLPHURV PDV D FRLVD GR LPSDFWR +£ XUQD H[LJHQFLD K£ XUQD H[SHFWDWLYD DVVLP GH TXDO R LPSDFWR GD VXD DJDR" 3RGH VHU R TXDQWLWDWLYR PDV DFKR TXH PDLV D FRLVD GD YLVLELOLGDGH GR WUDEDOKR 6H YRF ID] XP WUDEDOKR TXH PDLV YLVYHO LVVR LPSUHVVLRQD PXLWR PDLV GR TXH XP WUDEDOKR GLJDPRV XP WUDEDOKR GH IRUPLJXLQKD TXH -HLWR O£ HP *XDLDQD]HV TXH -HLWR O£ QR &DPSR /LPSR (X DFKR TXH XUQD SDUWH GR WUDEDOKR GR 6RQGH XP WUDEDOKR VXEPHUVR GR SRQWR GH YLVWD GR PXQGR GDV 21*V R GDV DJHQFLDV 3RUTXH XP WUDEDOKR -HLWR O£ QR ILPGDR GH *XDLDQD]HV QR ILPGDR GR &DPSR /LPSR 4XHU GL]HU LVVR YDL VH WRPDU YLVYHO R GLD TXH D JHQWH IL]HU XP YLGHR VREUH LVVR $L WRGR PXQGR -DOD n2K 6DQGH HVW£ ID]HQGR XP WUDEDOKR OLQGR H PDUDYLOKRVRn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£R GH PDWHULDO SHOR PHQRV G£ GXDV FRLVDV G£ HVVD LGLD GH TXH VH HOH GLVWULEXLGR HOH DWLQJH GH DOJXPD IRUPD DV SHVVRDV H G£ XUQD LGLD GR TX TXH R JUXSR HVW£ FRQVHJXLQGR VLVWHPDWL]DU RUJDQL]DU G£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£R SDUD R JUXSR Q" 'H LQWHJUDU R UHSDVVH SHOR PHQRV SDUWH GR NLW SDUD RV JUXSRV TXH YRF WUDEDOKD Q" FRPR IRUPDJ£R GH PXOWLSOLFDGRUHV Q" :H DUH \HDUV ROG :KDW LV RXU UROH WRGD\" 637 ZKHQ MRLQHG >LQ @ DOUHDG\ KDG WKLV SUHRFXSDWLRQ ZLWK WKH DUWLFXODWLRQ WKH V\VWHPDWL]DWLRQ DQG WKH SURGXFWLRQ RI HGXFDWLRQDO

PAGE 364

PDWHULDOV %XW 637 KDG QHYHU PDQDJHG WR WXUQ WKLV LQWR VRPHWKLQJ FRQFUHWH > @ 7KH %XOOHWLQ LV RXU ILUVW SRVLWLYH H[SHULHQFH 1V M£ H[LVWLPRV K DQRV 2 TX TXH R QRVVRSDSHO KRMH Q" 2 637TXDQGR HQWUHL M£ WLQKD HVVD SURFXSDJGR FRP D DUWLFXODJGR FRP D VLVWHPDWL]DJGR FRP D SURGXJGR GH PDWHULDOV HGXFDWLYRV 2 TXH R 637 QDR FRQVHJX IRL JHVWDU >-R EROHWLP D QRVVD SULPHLUD H[SHULHQFLD SRVLWLYD 6R WRSLFV ZHUH GLVFXVVHG D ORW ZLWK WKH TXHVWLRQV WKDW FDPH RXW RI WKH UHJLRQ DQG QRW VR PXFK ZLWK WKLV LVVXH RI WKHRUHWLFDO GHHSHQLQJ RI WKLV nOHWnV VHH KRZ ZH FDQ OHDUQ WKHRUHWLFDOO\n (QWDR RV WHPDV HUDP GLVFXWLGRV PXLWR D SDUWLU GHVVH UHWRPR GDV TXHVWRHV GD UHJLGR H PHQRV FRP HVVD FRLVD GH DSURIXQGDPHQWR WHULFR GH nYDPRV YHU FRPR H TXH D JHQWH SRGH DSURIXQGDU WHULFDPHQWH WKLQN WKDW LW ZDV LQ WKDW SK\VLFDOO\ OHIW WKH (DVWHUQ 3HULSKHU\ ZLWK SDLQ LQ P\ KHDUW >@ ZDV VWLOO LQ WKH RUJDQL]DWLRQ >@ UHVSRQGLQJ WR WKH GHPDQGV IRU IHPLQLVW WUDLQLQJ DQG DW WKDW WLPH ZDV DOVR D PHPEHU RI WKH FRRUGLQDWLRQ 6R WKLV ZDV D YHU\ GLIILFXOW FKDQJH IRU PH $W WKH VDPH WLPH ZDQWHG LW NQHZ WKDW LW ZDV LPSRUWDQW ,Q D ZD\ LW HQGV XS EHLQJ D FHUWDLQ OHYHO RI VSHFLDOL]DWLRQ HYHQ LI ZH GRQn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nV LVVXHV HVSHFLDOO\ WR GLVFXVV WKH VRFLDO UROH RI ZRPHQ DQG VWXII 7KHUH LV WKLV WKLQJ DERXW WKH JHQGHU LVVXH DQG HYHU\ZKHUH \RX JR WKH\ WDON DERXW WKLV WKLQN WKDW ZH VWLOO KDYH GLIILFXOWLHV LQ XQGHUVWDQGLQJ H[DFWO\ ZKDW LW LV ,WnV D QHZ ZRUG IRU WKH ZRPHQ RI WKH VRFLDO PRYHPHQWV IURP WKH SHULSKHU\ 6H TXLVHU DYDQJDU SU£ DOP GLVVR QRV YDPRV SUHFLVDU GH DVVHVVRULD SRUTXH DL D JHQWH HVW£ XP SRXFR QR OLPLWH GD DWXDOL]DJDR DFKR TXH QV HVWDPRV ILFFPGR PHLR GHVDWXDOL]DGDV DVVLP FRP DV TXHVWRHV GD PLGKHU GD PXOKHU SULQFLSDOPHQWH SDUD GLVFXWLU R SDSHO VRFLDO GD PXOKHU WDO WHP HVVD FRLVD GD TXHVWDR GH JHQHUR TXH WRGR TXDQWR OXJDU VH IDOD GLVVR HX DFKR TXH D JHQWH DQGD WHP GLILFXOGDGH GH VDFDU GLUHLWR R TXH TXH LVVR XPD SDODYUD QRYD SDUD DV PXOKHU HV GRV PRYLPHQWRV VRFLDLV GD SHULIHULD PDLV

PAGE 365

&KDSWHU 3XWWLQJ RQ WKH 5RRI EHIRUH /DYLQJ WKH )RXQGDWLRQV" )HPLQLVW 1*2V WKH 8QLWHG 1DWLRQV DQG WKH 6WDWH 7KH PHWKRGRORJ\ RI WKH )HPLQLVW (QFRQWURV KDV H[DFWO\ WKLV IXQFWLRQ ZKLFK LV WR EUHDN WR XQGR WKH ULJLG VWUXFWXUH RI RWKHU HYHQWV WR SURYLGH MR\ DQG H[FKDQJHV DW DOO OHYHOV LW LV D OHDUQLQJ H[SHULHQFH IRU DOO RI XV $ PHWRGRORJD GRV (QFRQWURV )HPLQLVWDV WHUQ PHVPR HVVD IXQJ£R GH TXHEUDU URPSHU FRP DV HVWQLWXUDV UJLGDV GH RXWURV HYHQWRV GH SURSRUFLRQDU DOHJUDV WURFDV HP WRGRV RV QYHLV HVVH XP H[HUFFLR GH DSUHQGL]DJHP SDUD WRGDV QV 0HPRULD GR ;, (QFRQWU 1DFLRQDO )HPLQLVWD f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£R VH HQFRQWUDU ID]HP SODQRV MXQWRV W£ HQWHQGHQGR" 7KLV KDV EHHQ SUHWW\ GLIILFXOW WKHUH ZDV QR VSDFH OHIW LQ SHRSOHnV DJHQGDV IRU WKH 5HGH >DW WKH PXQLFLSDO OHYHO @ XQGHUVWDQG WKDW ODVW \HDU DQG WKLV \HDU KDYH EHHQ YHU\ GLIILFXOW WKHUH KDYH EHHQ VHYHUDO LPSRUWDQW HYHQWV DW WKH LQWHUQDWLRQDO OHYHO OLNH WKH &DLUR PHHWLQJ DQG WKLV \HDU ZLWK WKH HYDOXDWLRQ RI WKH GHFDGH LQ %HLMLQJ DQG LW LV QHFHVVDU\ IRU SHRSOH WR JR %XW WKLQN WKDW ZH FDQQRW OHW JR RI ORFDO LVVXHV WR WDNH FDUH RI WKH ELJ HYHQWV >@ $QG QH[W \HDU ZH KDYH WKH >WK@ LQWHUQDWLRQDO FRQIHUHQFH RQ ZRPHQnV KHDOWK >RUJDQL]HG DQG KHOG LQ 6DR 3DXOR @ $QG DP ZRUULHG EHFDXVH WKLQJV DUH JRQQD UXQ WKH VDPH ZD\ ,VVR WHP VLGR DVVLP PXLWR GLIFLO QDR WHP VREUDGR HVSDJR QD DJHQGD GDV SHVVRDV SUD GRU PDLV SULRULGDGH £ 5HGH >DR QLYHO PXQLFLSDO@ (QWHQGR TXH IRL DVVLP R DQR SDVVDGR H HVVH DQR PXLWR GLIFLO DRQGH WHYH DVVLP Y£ULDV FRLVDV LPSRUWDQWHV D QLYHO PXQGLDO FRPR R HQFRQWU GR &DLUR H HVVH DQR DTXL R HQFRQWU GD DYDOLDFJDR GD GFDGD HP 3HTXLP TXH QHFHVVDULR TXH DV SHVVRDV YDR PDV HX DFKR TXH D JHQWH QDR SRGH DEULU PDR GDV QHFHVVLGDGHV ORF£LV SRU FRQWD GDV FRLVDV JUDQGHV TXH HVW£R DFRQWHFHQGR >@ 1R DQR TXH YHP QV WHPRV R >;,,,@ HQFRQWU LQWHUQDFLRQDO GH VFQGH >RUJDQL]DGR HP 6DR 3DXOR@ ( LVVR PH SUHRFXSD SRUTXH DV FRLVDV YDR FRUUHU GD PHVPD IRUPD /RRN GRQnW NQRZ ZK\ WKLV WKLQJ RI WKLV ELOO ZDV SDVVHG LQ VXFK DQ LPSHUFHSWLEOH ZD\ GRQnW NQRZ ZKDW DQG LQFOXGH P\VHOI LQ WKLV VWRU\ EHFDXVH DP UHVSRQVLEOH DP WKH UHSUHVHQWDWLYH RI WKH 5HGH GRQnW NQRZ KRZ ZH OHW WKLV KRZ WKLV HVFDSHG XV OLNH WKLV %HFDXVH ZH GLG QRW VHH WKLV ELOO LQ SURJUHVV >7R WKH RWKHUV@ 6RPHERG\ KDV DQ\ LGHD" 7KH VWHULOL]DWLRQ ELOO" ,W VHHPV WKDW ZH IROORZ XS EHWWHU RQ ZKDW LV KDSSHQLQJ DW WKH &RQJUHVV WKDQ DW WKH PXQLFLSDO OHJLVODWXUH 2OKD HX QDR VHL SRUTXH HVVH QHJRFLR GHVVH SURMHWR SDVVRX GH XPD IRUPD W£RLPSHUFHSWLYHOQDR VHL R TXH D H HVWRX PH LQFOXLQGR QLVVRSRUTXH HX VRX UHVSRQVFWYHO HX VRX UHSUHVHQWDQWH GD 5HGH HX QDR VHL FRPR D JHQWH GHL[RX FRPR LVVR HVFDSRX DVVLP

PAGE 366

3RUTXH D JHQWH QDR YLX HVVH SURMHWR WUDPLWDQGR >3DUD DV RXWUDV@ $OJQP VDEH 2 SURMHWR GH HVWHULOL]DQGR" 3DUHFH TXH D JHQWH DFRPSDQKD PHOKRU R TXH SDVVD QR &RQJUHVVR 1DFLRQDO GR TXH QD &£PDUD 0XQLFLSDO ,Q WKH ILUVW SODFH ZH VD\ WKDW WKHUH LV QRW HQRXJK WLPH DQG LW KDV DOZD\V EHHQ OLNH WKLV ZH KDYH WR JR ZH KDYH WR GR WKLV ZH KDYH WR GLVFXVV WKDW ZH KDYH WR WKLQN DERXW WKLV TXLFNO\ HYHU\WKLQJ PXVW EH TXLFN :KR LV LPSRVLQJ WKLV U\WKP RQ XV" 7KLV GRHV QRW OHDYH XV DQ\ WLPH IRU GUHDPLQJ GDULQJ RU FUHDWLQJ (P SULPHLUR OXJDU GL]HPRV TXH R WHPSR PXLWR FXUWR H WHUQ VLGR VHPSUH DVVLP WHUQ TXH LU WHUQ TXH ID]HU WHUQ TXH GLVFXWLU WHUQ TXH SHQVDU5£SLGR OXGR PXLWR U£SLGR 4XHP LPSRH HVVH ULWPR SDUD QRV" $VVLP QDR G£ WHPSR QHP SU£ VRQKDU RXVDU RX FULDU &,0 f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£R 1DR " ( VH YRF VH OLPLWD D XUQD DWXDJGR D QLYHO ORFDO GR VHX EDLUUR RX GD VXD FLGDGH SRVVYHO VH PDQWHU XP PRGHOR DQWHULRU GH XUQD DVVRFLDJDR TXH H[LVWH VHP UHFXUVRV TXH H[LVWH VHP LQIUDHVWUXWXUD TXH IXQFLRQD QRV ILQ£LV GH VHPDQD FRP R WHPSR OLYUH TXH FDGD GLD PDLV HVFDVVR GDV SHVVRDV 0DV VH YRF FRPHQD D DFKDU TXH HVVH XP QLYHO GH LQWHUIHUHQFLD TXH PXLWR OLPLWDGR H PXLWR SHTXHR SURV SURFHVVRV TXH HVWDR DFRQWHFHQGR D QLYHO PXQGLDO QDR WHP FRPR YRF QDR GHVHQYROYHU XUQD HVWUXWXUD GH WUDEDOKR SURILVVLRQDOL]DGR GH VHJXQGD D VH[WDIHLUD V£EDGR YHP R IHULDGR FDUQDYDO QDWDO H OXGR SRUTXH DVVLP TXH DV 21*V WUDEDOKDP WKLQN WKDW ERWK DUH LPSRUWDQW %HFDXVH \RX FDQQRW SXW RQ WKH URRI EHIRUH OD\LQJ WKH IRXQGDWLRQV 6R LW LV TXLWH EDVLF ILUVW WDNLQJ FDUH RI ZKDW LV KDSSHQLQJ DURXQG XV DQG WKHQ DIWHU WKDW RU DW WKH VDPH WLPH VWDUW SDUWLFLSDWLQJ LQ RWKHU ODUJHU WKLQJV >@ (X DFKR TXH DV GXRV VDR SULRULW£ULDV 3RUTXH D JHQWH QDR SRGH ERWDU R WHOKDGR QD FDVD DQWHV GH ID]HU R DOLFHU FH (QW£R LVVR E£VLFR SULPHLUR FXLGDU GDV FRLVDV TXH HVWDR DR QRVVR UHGRU SUD GHSRLV HVWDU RX DR PHVPR WHPSR HVWDU ID]HQGR WDPEP D SDUWLFLSDQGR GD JHQWH HP RXWUDV FRLVDV PDLRUHV >@ ,WnV QR JRRG LQVLVWLQJ RQ ZRUNLQJ XS WKHUH DQG RQ WKH RI 0D\ WR RUJDQL]H D GHPRQVWUDWLRQ RQ WKH 3DXOLVWD >PRVW LPSRUWDQW DYHQXH LQ 6DR 3DXOR@ ZLWK ZRPHQ PHDQ ZKHUH LV WKH ZRUN RI WKH ZKROH \HDU WR EULQJ D EXQFK RI ZRPHQ WR WKH GHPRQVWUDWLRQ IRU WKH OHJDOL]DWLRQ RI DERUWLRQ RU DJDLQVW PDWHUQDO GHDWKV LQ %UD]LO" >@ 7KH &DPSDLJQ WKDW WKH 5HGH GHFLGHG XSRQ

PAGE 367

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£ HQFLPD H YRF ID]HU QR GLD GH 0DLR XUQD PDQLIHVWDQGR QD 3DXOLVWD FRP PXOKHUHV 4XHU GL]HU FDGH R WUDEDOKR GH GXUDQWH XP DQR WRGR SDUD OHYDU EDVWDQWH PXOKHU SDUD ID]HU PDQLIHVWDQGR SHOD OHJDOL]DQGR GR DERUWR R FRQWUD DV PRUWHV PDWHPRV QR %UDVLO" >@ $ &DPSDQKD TXH D 5HGH WLURX QR OWLPR HQFRQWU GR DQRSDVVDGR >SDUD D OHJDOL]DQGR GR DERUWR@ R TXH IRL IHLWR IRL DSHQDV XP FDUWD] 1DR IRL IHLWD D FDPSDQKD 2 DWR TXH IXL V HX TXH SXGH LU GD &DVD IRL XP DWR HFXPQLFR RUJDQL]DGR SHODV &£WROLFDV SHOR 'LUHLWR D 'HFLGLU WLQKDQGR WLQKD PXOKHUHV WLQKD XQV 9RF QDR ID] DOJXPD FRLVD TXH YRF SDUDVVH DV SHVVRDV TXH HVWDYDP SDVVDQGR DL SDUD YHU ,VVR VLJQLILFD TXH HVWD IDOWDQGR HVVH WUDEDOKR 3RUTXH TXDQGR YRF HVW£ O£ FRP EDVWDQWH JHQWH FODUR TXH DV SHVVRDV YGR SDUDU SDUD YHU R TXH $ LPSUHQVD YHP FXEULU ,W LV WKLV WKLQJ DERXW WKH SDUWQHUV DP JRLQJ WR FKRRVH WR RUJDQL]H P\ VWUDWHJLHV 6R RUJDQL]H D VPDOO VHPLQDU RU D FRQIHUHQFH WR ZKLFK LQYLWH VRDQGVR ZKRfV LPSRUWDQW KHUH DQG VRDQGVR ZKR LV LPSRUWDQW WKHUH OLNH IRU WKDW VHPLQDU RQ HGXFDWLRQDO SUDFWLFHV QR" :KR LV LQYLWHG IRU WKH VHPLQDU" ZRPHQ ZKR ZRUN LQ WKH 6WDWH +HDOWK V\VWHP DQG ZKR KDYH D IHPLQLVW SHUVSHFWLYH ZRPHQ ZKR ZRUN LQ WKH +HDOWK 'HSDUWPHQW ZRPHQ IURP ILQDQFLQJ DJHQFLHV ZKR IXQG KHDOWK LVVXHV DQG ZRPHQ IURP IHPLQLVW 1*2V ZKR ZRUN ZLWK WUDLQLQJ 0H LI ZDV WR RUJDQL]H D VHPLQDU KHUH ZH ZRXOG LQYLWH WKH SHRSOH IURP WKH WUDGHXQLRQV WKH SHRSOH IURP WKH )HGHUDWLRQ RI 3RSXODU 0RYHPHQWV ZHn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£ULR RX RUJDQL]R XP HQFRQWU QDR VHL R TXH TXH HX FKDPR IXODQD TXH LPSRUWDQWH DTX IXODQD TXH LPSRUWDQWH DOL TXH QHP HVVH VHPLQ£ULR GH SU£WLFDV HGXFDWLYDV Q" 4XHP FRQYLGDGD SUR VHPLQ£ULR"PXOKHUHV TXH WUDEDOKDP WD 6HFUHWDULD GH 6DGH H TXHUQ WHP XUQD YLVGR IHPLQLVWD PXOKHUHV TXH WUDEDOKDP QR 0LQLVWULR GD 6DGH PXOKHUHV GH DJQFLDV ILQDQFLDGRUDV TXH ILQDQFLDP D VDGH H PXOKHUHV GH 21*V IHPLQLVWDV TXH WUDEDOKDP FRP WUH LQDPHQ WR (X VH IRVVH RUJDQL]DU XP VHPLQ£ULR >$TX@ D JHQWH LD FKDPDU R SRYR GR PRYLPHQWR VLQGLFDO R SRYR GD &HQWUDO >GRV 0RYLPHQWRV 3RSXODUHV@ LD FKDPDU WDPEP HVVDV PXOKHUHV >GDV 6HFUHWDULDV GR 0LQLVWHULR@ PDLV LD SRU TX" SRUTXH D

PAGE 368

FRQFHSWR GH HVWUDWJLD GH PXLWD SROWLFD QDR V HVVH HVSDGR >LQVWLWXFLRQDO@ R HVSDGR IXQGDPHQWDO GH YRF FULDU PRELOL]DJDR GH YRF FULDU XUQD DUWLFXODQGR H[SUHVVLYD PDVVLYD FRP -RUJD SUD HVVH PRYLPHQWR SURYRFDU XUQD GHPDQGD SRU SDUWH GR (VWDGR TXH HOH DWHULGD DV SROWLFDV SLEOLFDV $JRUD D RXWUD YLV£R QDR HVVD TXH D SROWLFD SEOLFD YDL YLU YLD QRVVD LQVHUJDR DV 6HFUHWDULDV QR 0LQLVWULR XP OREEL]LQKR FRP DTXHOH 'HSXWDGR FRP DTXHOH 6HQDGRU ‹ DTXHOH VHPLQ£ULR TXH HX YRX O£ QD 1LFDU£JXD TXH YDL WHU JHQWH GR %DQFR 0XQGLDO GHVVH GDTXHOH TXH YDL GDU GLQKHLUR SUR 0LQLVWULR 4XHU GL]HU XP RXWUR WLSR GH DUWLFXODJ£R SROWLFD TXH HQYROYH RXWURV DWRUHV RXWUDV LQVW£QFLDV Q" 4XH SULYLOHJLD RXWUDV HVWUDWJLDV (VVD E£VLFDPHQWH D GLIHUHQJD GH FRQFHSJGR f 'LG 86$,' ZDQW WR LPSRVH DQ RUJDQL]DWLRQDO VWUXFWXUH RQ XV" f :K\ LV 86$,' QRW XVLQJ DQG FKDQQHOLQJ UHVRXUFHV YLD WKH VWUXFWXUHV DOUHDG\ EXLOW E\ ZRPHQ WKURXJKRXW WKHVH WZR GHFDGHV RI WKH H[LVWHQFH RI RXU PRYHPHQW" f 'RQnW /DWLQ $PHULFDQ IHPLQLVWV KDYH WKH ULJKW WR HVWDEOLVK WKHLU RZQ SURFHVV DQG WR GHFLGH LI WKH\ DUH JRLQJ WR KRZ WKH\ DUH JRLQJ WR DQG ZLWK ZKRP WKH\ DUH JRLQJ WR HYDOXDWH WKH GHFDGH DQG EXLOG WKHLU RZQ VWUXFWXUHV LI QHFHVVDU\f RU VWUHQJWKHQ WKRVH DOUHDG\ H[LVWLQJ ff $ 86$,' TXHULD LPSRU XUQD HVWUXWXUD RUJDQL]DWLYD SDUD QV" f 3RU TX D 86$,' QGR XWLOL]DYD H UHSDVVDYD RV UHFXUVRV DV HVWUXWXUDV M£ FRQVWUXLGDV SHODV PXOKHUHV QHVVDV GXRV GFDGDV GH H[LVWHQFLD GR QRVVR PRYLPHQWR" f $V PXOKHUHV ODWLQRDPHULFDQDV QDR WP R GLUHLWR GH HVWDEHOHFHU VHX SURSLR SURFHVVR H GHFLGLU VH YGR FRPR YDR H FRP TXHUQ YGR DYDKDU D GFDGD H FRQVWUXLU VXDV SURSLDV HVWUXWXUDV VH DVVLP IRVVH QHFHVV£ULRf RX IRUWDOHFHU DV H[LVWHQWHV" 4$0 f 7KH WUXWK LV WKDW ZH ZHUH VXUSULVHG DQG KLW E\ D PHHWLQJ ZKLFK LQ RXU YLHZ VKRXOG KDYH EHHQ RUJDQL]HG ODWHU DIWHU ZH KDG EURXJKW WR WKH SURFHVV D JUHDWHU QXPEHU RI RUJDQL]DWLRQV LQ WKH FRXQWU\ 1D UHDOLGDGH IRPRV VXUSUHHQGLGDV H DWURSHODGDV SRU XP HQFRQWU TXH VHJXQGR QRVVDV SHUVSHFWLYDV GHYHULD VH UHDOL]DU PDLV WDUGH TXDQGR WLYVVHPRV DUWLFXODGR XP QPHUR PDLRU GH HQWLGDGHV GR SDV &,0 f 7KH JURXSV LQYROYHG LQ WKH &DLUR SUHSDUDWLRQ KHUH ZHUH OLPLWHG WR 1*2V $K ZH MXPSHG RQ LW :H PDGH D IXVV %HLMLQJ LV GLIHUHQW )RU %HLMLQJ LW LV WKH PRYHPHQW WKDW GHFLGHV DQG ZH VWRSSHG WKLV QRQVHQVH &DLUR ZDV D JXHWWR EXW QRW %HLMLQJ $QG ZH PDGH VXUH LW GLG QRW KDSSHQ DJDLQ 6XGGHQO\ ZH KDG 1*2V RUJDQL]LQJ WKH GLVFXVVLRQ DURXQG &DLUR>@ ZLWKRXW DQ\ FRDOLWLRQ VWUXFWXUH
PAGE 369

HVFRQGHU DP LQIRUPDQGR IL]HUDP WXGR &RPHJDUDP D RUJDQL]DU &DLUR H 3HTXLP QD (FR ( D JHQWH VDEH TXH WHP XUQD SRUUDGD GH JHQWH TXH IHFKQ FRPSURPLVRV SUD 3HTXLP QD (FR ( DJRUD W£ IHUUDGDSRUTXH R 0RYLPHQWR )HPLQLVWD VH GHX FRQWD GLVVR H GHVPRQWRX &RPHJDQGR DTXL HP 6DR 3DXORL 4XHU GL]HU YRJV FDEHP QR QRVVR FRUDJ£R YRFHV VDR OHJWLPDPHQWH GHVVH 0RYLPHQWR GLWR )HPLQLVWD GLWR GD6DR 6DR OHJLWLPDV 0DV QDR VDR GRQDV 1DR VDR GRQDV ( V Y£R IDODU HP QRPH GHOH VH D JHQWH GHOHJDU SRGHUHV SUD LVVR 7KH ZRPHQnV PRYHPHQW DXWRQRP\ LWV RUJDQL]DWLRQ WKH UK\WKP LPSRVHG E\ RXU LQVWLWXWLRQDOL]HG DJHQGDV WKH EXUHDXFUDWL]DWLRQ RI IHPLQLVP WKH H[FHVV RI SRZHU RI K\SHUILQDQFHG 1*2V ZKR KDYH WKH LQIRUPDWLRQ LQ RWKHU ZRUGV WKH QHHG WR GHPRFUDWL]H RXU PRYHPHQW $ DXWRQRPD GR PRYLPHQWR GH PXOKHUHV VXD RUJDQL]DJ£R FRP R ULWPR LPSRVWR SHODV QRVVDV DJHQGDV LQVWLWXFLRQDOL]DGDV FRP D EXURFUDWL]DJDR GR IHPLQLVPR FRP R H[FHVVR GH SRGHU GDV 21*V VXSHUIWQDQFLDGDV TXH GHWP DV LQIRUPDJRHV HQILP FRP D QHFHVVLGDGH GH GHPRFUDWL]DU R QRVVR PRYLPHQWR &(0 f RQ FHQVXVHV DQG RWKHU KHDOWK LQIRUPDWLRQJDWKHULQJ LQVWUXPHQW@ 7KRVH ZKR GHDO ZLWK VH[XDOLW\ :H DOVR QHHG@ WR EH WUDLQLQJ QHZ SHRSOH DOORZLQJ SHRSOH LQ WKH UHJLRQ IURP OHVV IDPRXV RUJDQL]DWLRQV ZKR DUH PRUH ZKR KDYH PRUH GLIILFXOWLHV LQ WDNLQJ WKH IURQW OLQH LQ WKH 5HGH DW WKH QDWLRQDO DQG LQWHUQDWLRQDO OHYHO IRU H[DPSOH >:H KDYH WR@ WUDLQ DOORZ WKHVH SHUVRQV WR DVVXPH QHZ UROHV DV ZHOO %XW HYHQ WKLV KDV EHHQ YHU\ GLIILFXOW WKHUH KDV QRW EHHQ DQ\ VSDFH OHIW LQ SHRSOHnV VFKHGXOH 3UD HVWDU WDPEP IRUPDQGR DV SHVVRDV QRYDV GDQGR FRQGL JRHV D QLYHO UHJLRQDO GDV SHVVRDV GDV HQWLGDGHV PHQRV IDPRVDV TXH HVW£R PDLV TXH WP PDLV GLILFLGGDGHV GH HVWDU QD IUHQWH GDV TXHVWRHV GD 5HGH SRU H[HPSOR D QLYHO QDFLRQDO H LQWHUQDFLRQDO GH HVWDU GDQGR

PAGE 370

IRUPDJ£R FRQGLTGHV SDUD TXH HVVDV SHVVRDV WDPEP YHQKDP D HVWDU DVVXPLQGR QRYRV SDSLV ( DW LVVR WHP VLGR DVVLP PXLWR GLIFLO PR WHP VREUDGR HVSDJR QD DJHQGD GDV SHVVRDV :H DUH JRLQJ WR WUDLQ SHRSOH LQ WKH KLVWRU\ RI IHPLQLVP DQG ZLWK SXEOLF VSHDNLQJ ZRUNVKRSV DQG RQ WKH >VRFLRSROLWLFDO FRQMXQFWXUH GR \RX XQGHUVWDQG" 7UDLQLQJ IRU SXEOLF SDUWLFLSDWLRQ GR \RX XQGHUVWDQG" $ JHQWH YDL FDSDFLWDU QD KLVWRULD GR IHPLQLVPR RILFLQDV GH IDOD SLEOLFD FRQMXQWXUDW£ HQWHQGHQGR" &DSDFLWDU PHVPR SUD DWXDT£R SEOLFD W£ HQWHQGHQGR7 6KH >WKH SURIHVVLRQDOL]HG IHPLQLVW@ KDV DFFHVV WR LQIRUPDWLRQ IURP WKH ZKROH ZRUOG DQG PRQH\ WKHUH DUH SHRSOH SD\LQJ IRU WKLV SHUVRQ WR JR DOO RYHU WKH ZRUOG DQG WKH\ JR > @ %XW ZKDW FDQQRW KDSSHQ LV WKH SUREOHP WKDW ZH DUH QRZ KDYLQJ LQ %UD]LO HVSHFLDOO\ LQ WKH IHPLQLVW PRYHPHQW >ZKLFK LV WKDW@ WKLV VWRU\ RI JHWWLQJ PRQH\ JHQHUDWHV SRZHU :H ZHQW WKURXJK D SHULRG HVSHFLDOO\ KHUH LQ 6DR 3DXOR ZKHQ IHPLQLVW 1*2V WKRXJKW WKH\ ZHUH WKH 0RYHPHQW $QG ZH GR QRW WKLQN WKDW WKH\ DUH WKH PRYHPHQW (OD >WKH SURIHVVLRQDOL]HGIHPLQLVW@ WHP DFHVVR D WRGD LQIRUPDJDR GR PXQGR LQWHLUR H WHP GLQKHLUR WHP TXHUQ EDQTXH SDUD HVVDSHVVRD HVWDU QR PXQGR LQWHLUR H HODV YDR R TXH QDR SRGH DFRQWHFHU R SUREOHPD TXH DJHQWH YHP WHQGR QR %UDVLO SDUWLFLGDUPHQWH QR 0RYLPHQWR )HPLQLVWD HVVD KLVWRULD GH WHU GLQKHLUR JHUD SRGHU 1V YLYHPRV XP SHURGR SDUWLFXODUPHQWH DTXL HP 6DR 3DUGR HP TXH DV 2QJV )HPLQLVWDV DFKDYDP TXH HODV HUDP R 0RYLPHQWR ( D JHQWH DFKD TXH HODV QDR VDR R 0RYLPHQWR 5HFHQWO\ WKH FRQTXHVW E\ RUJDQL]HG SRSXODU VHFWRUV RI QHZ LQVWLWXWLRQDO VSDFHV SDUWLFLSDWLRQ LQ FRQJUHVV DQG LQ PXQLFLSDO DGPLQLVWUDWLRQVf KDV EURDGHQHG WKH UHVSRQVLELOLW\ RI 1*2V )URP D FULWLFDO DQDOLV\V RI VRFLHW\ DQG WKH 6WDWH WKH\ ZHUH FDOOHG WR SDUWLFLSDWH LQ WKH HODERUDWLRQ RI FRQFUHWH SURSRVDOV RI SXEOLF SROLFLHV 0DLV UHFHQWHPHQWH D FRQTXLVWD SHORV VHWRUHV SRSLGDUHV RUJDQL]DGRV GH QRYRV HVSDJRV LQVWLWXFLRQDLV SDUWLFLSDTDR QR SDUODPHQWR H HP DGPLQLVWUDJRHV PXQLFLSDLVf DPSOLRX D UHVSRQVDELOLGDGH GDV 21*V 'D DQ£OLVH FUWLFD GD VRFLHGDGH H GR (VWDGR HODV IRUDP FKDPDGDV D SDUWLFLSDU GD HODERUDJDR GH SURSRVWDV FRQFUHWDV GH SROWLFDV SEOLFDV &DFFLD %DYD D f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£R GH SRUTXH R IHPLQLVPR SDUD DOP GH XP PRYLPHQWR SROWLFR XP PRYLPHQWR FXOWXUDO FRPSURPHWLGR FRP DV QHFHVVLGDGHV PDWHULDLV H HVSLULWXDLV GRV VHUHV KXPDQRV $UWLFXODJDR GH 0XOKHUHV %UDVLOHLUDV f

PAGE 371

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£PLFD TXH LQYROYH PDLV DV PXOKHUHVYRF SRGHULD WHU DW JUXSRV WDPEP PDV FRP XUQD GLQ£PLFD TXH ID] FRP TXH DV SHVVRDV VH FRORTXHP WDPEP H IDOHP (X DFKR ERP HVVD FRLVD GR JUXSR ( ERP PDV QHP WRGR PXQGR IDOD H HQW£R VDR SHVVRDV DFKR TXH GHYHULD XVDU DOJXPDV FRLVDV TXH VH XVRX DQWHULRUPHQWH TXH VH XVH DV WFQLFDV GH RILFLQD (VVDV FRLVDV IXQFLRQDP QHP TXH IRU SRU WHPDULR FDGD XUQD VH HVFUHYH QXP WHPD TXH DILQV SDUD WHU XUQD SDUWLFLSDQGR PDLRU GDV PXOKHUHV SULQFLSDOPHQWH QRVVDV PXOKHUHV GH EDVH PHVPR TXH QDR VDR KDELWLWDGDV D IDODU PDV PDLV D ID]HU HQWHQGHX" $L YRF G£ HVVD RSRUWXQLGDGH SDUD HVVDV PXOKHUHV ( GD IRUPDQHVVD GLQ£PLFD TXH D JHQWH HVWRYD XWLOL]DQGR KRMH TXHP HVW£ IDODQGR PDLV VRPRV QV TXH M£ DWXDPRVID] DOJXP WHPSR &KDSWHU 8S WKH 3XUVHnV 6WULQJV 1*2 UHODWLRQV ZLWK 'RQRU $JHQFLHV 2QH QRWHV LQ SDUWLFXODU WKDW 1RUWK$PHULFDQ FRRSHUDWLRQ KDV LQFUHDVHG FRQVLGHUDEO\ IRU /DWLQ $PHULFDQ 1*2V DV (XURSHDQ DJHQFLHV VWDUWHG SULRULWL]LQJ (DVWHUQ (XURSHDQ FRXQWULHV GXH WR WKHLU SROLWLFDO RSHQLQJ &RQVWD LQFOXVLYH TXH WHUQ DXPHQWDGR YHUWLJLQRVDPHQWH D FRRSHUDJ£R GH DJHQFLDV QRUWHn DPHULFDQDV SDUD 21*V ODWLQRDPHULFDQDV QD PHGLGD HP TXH DV DJHQFLDV HXURSLDV SDVVDUDP D SULRU L]DU RV SDVHV GD (XURSD 2ULHQWDO HP UD]£R GD DEHUWXUD GR /HVWH 'RLPR f 7KHQ TXHVWLRQV VWDUWHG EHLQJ UDLVHG E\ JRYHUQPHQWDO DJHQFLHV WKH PHGLD SXEOLF RSLQLRQ ZKDW \RX DUH GRLQJ WKHVH FKDULW\ SURMHFWV" $UH WKH\ SROLWLFDO LQWHUYHQWLRQV LQ D IRUHLJQ FRXQWU\" &DQ ZH WUXVW WKH ZD\ \RX DUH DOORFDWLQJ WKH IXQGV" ZKDW DUH WKH UHVXOWV LQ FRQFUHWH WHUPV" $UH WKH UHVXOWV EHWWHU WKDQ WKRVH RI JRYHUQPHQWDO FRRSHUDWLRQ" 0HGLDV 21*V f /RJR FRPHFDUDP DV SHUJXQWDV IHLWDV SHODV DJHQFLDV JRYHPDPHQWDLV SHOD PLGLD SHOR SXEOLFR 2 TXH YRFHV HVWDR ID]HQGR" 6DR SURMHWRV GH FDULGDGH ( XUQD LQWHUYHQJ£R SROWLFD QRV DVVXQWRV GH XP RXWUR SDV" 3RGHPRV FRQILDU HP YRFHV QD IRUPD GD DORFDU RV IXQGRV" 2 TXH UHVXOWD FRQFUHWDPHQWH" 2V UHVXOWDGRV VDR PHOKRUHV GR TXH RV GD FRRSHUDQGR GRV (VWDGRV" 0HGLDV 21*V f :KDW WKH\ DUH VD\LQJ LV WKH IROORZLQJ WKDW WKH DJHQFLHV KDYH EHHQ LQYHVWLQJ LQ /DWLQ $PHULFD IRU \HDUV DQG WKDW SRYHUW\ KDV QRW FKDQJHG RQH ELW 7KLV KDYH KHDUG D QXPEHU RI WLPHV > @ 1RZ LQ WKHVH PRUH UHFHQW FKDQJHV ZKDW WKH (XURSHDQ DJHQFLHV DQG WKH :RUOG &RQJUHVV RI &KXUFKHV DUH GRLQJ WKH\ DUH UHGLUHFWLQJ WKH PRQH\ WR $IULFD WR (DVWHUQ (XURSH DQG VR RQ

PAGE 372

2 TXH HOHV GL]HP R VHJXLQWH TXH DV DJHQFLDV HODV LQYHVWLUDP DQRV QD $PULFD /DWLQD DV 2QJV H TXH D VLWXDQGR GH SREUH]D GD $PULFD ODWLQD QDR PXGRX QDGD ,VVR HX RXYL M£ YDULDV YH]HV >@ $JRUD QHVVDV QRYDV PXGDQFDV TXH DV DJHQFLDV HXURSHLDV H R &RQVHOKR 0XQGLDO GDV ,JUHMDV HVW£R ID]HQGR HQWDR HVW£R GHVYLDQGR R GLQKHLUR SDUD D $IULFD SURV SDVHV GR /HVWH(XURSHX H WDO (XURSHDQ DQG &DQDGLDQ DJHQFLHV ZKLFK DUH RI LQWHUHVW WR XV KHUH ZHUH ERP UDWKHU LQGHSHQGHQWO\ IURP WKHLU JRYHUQPHQWV DQG HVSHFLDOO\ VWDUWLQJ LQ WKH V ZLWK D VWURQJ LQIOXHQFH RI )$2nV FDPSDLJQ DJDLQVW +XQJHU FRPPLWWHHVf LQWHQVLILHG WKHLU UHODWLRQV ZLWK WUDGHXQLRQV DQG SROLWLFDO DFWLYLVW JURXSV LQ WKHLU RZQ FRXQWULHV +HQFH WKH\ GHYHORSHG LGHDV DQG DFWLRQV FULWLFL]LQJ WKH LQWHUQDWLRQDO SROLFLHV RI WKHLU JRYHUQPHQWV /DQGLP f $V DJHQFLDV HXURSLDV H FDQDGHQVHV TXH QRV LQWHUHVVDP DTX QDVFHP GH IRUPD UD]RDYHOPHQWH LQGHSHQGHQWH GH VHXV JRYHPRV H VREUHWXGR D SDUWLU GD GFDGD GH FRP IRUWH LQIOXHQFLD GRV FRPLWV GD &DPSDQKD 0XQGLDO FRQWUD D )RPH GD )$2f LQWHQVLILFDP UHODJRHV FRP JUXSRV GH DWLYLVPR VLQGLFDO RX SROWLFR GHQWUR GH VHXV SUSULRV SDVHV GHVHQYROYHQGR LGHDULRV H DJHV FUWLFDV FRP UHODJ£R DV SROWLFDV LQWHPDWLRQDLV GH VHXV JRYHPRV ,[PGLP f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
PAGE 373

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nV D VXUSULVH 0DULHNH :DJHV DW 1RYLE DUH QRW KLJK VR WKRVH ZKR ZDQW WR HDUQ D ORW RI PRQH\ LW LV EHWWHU IRU WKHP WR ORRN IRU D ILUP 1 2I FRXUVH 6R LW LV D VLPLODU G\QDPLF DV DPRQJ ZRPHQnV 1*2V 0DULHNH
PAGE 374

SROWLFDV HQWUH DVSDV ,VWR IXQGDPHQWDO HVWDV RSJHV HVW£R GHQWUR GR HVTXHPD GH SULRULGDGHV GDV PGLDV 21*V 0HGLDV 21*V f >,W LV QRW RQO\ EHFDXVH RI VROLGDULW\ WKDW ZH DUH ZRUNLQJ ZH DOVR KDYH D FHUWDLQ OHYHO RI SURIHVVLRQDOLW\ @ 6R ZH DUH QRZ SD\LQJ PRUH DWWHQWLRQ WR ZKDW LV KDSSHQLQJ ,W LV QRW OLNH EHIRUH ZKHQ ZH VDLG :HOO JUHDW :H JLYH \RX WKH PRQH\ DQG \RX VWDUW ZRUNLQJ DQG RQH GD\ ZH ZLOO PHHW VR \RX FDQ WHOO XV ZKDW KDV EHHQ GRQH ZLWK WKH PRQH\ DQG WKDWnV ILQH 7KDWnV ILQHn DP H[DJJHUDWLQJ D ELW EXW EXW LQ VRPH FDVHV IRU PRUH WKDQ \HDUV \HDUV LW ZDV OLNH WKLV :H YLVLWHG D FRXQWU\ ORRNLQJ IRU RUJDQL]DWLRQV ZH FRXOG KHOS DQG WKH\ WROG XV ZKDW WKH\ ZDQWHG WR GR DQG WKH GLUHFWRU ZDONHG DURXQG ZLWK WKH FKHFNERRN LQ KLV SRFNHW DQG ZRXOG JLYH WKHP WKH FKHFN VD\LQJ nVHQG XV VRPH LQIRUPDWLRQ VRPHGD\ ,W ZDV OLNH WKLV LQ VRPH FDVHV WKDW ZH VSHQW RXU PRQH\ 7RGD\ LWnV QR ORQJHU OLNH WKLV >1DR V SRU VROLGDULHGDG TXH HVWDPRV WUDEDOKDQGR WHPRV WDPEP XUQD SURILVLRQDOLGDGH@ (QWDR FRP ROKRV PDLV FUWLFRV HP WXGR R TXH HVW£SDVVDQGR ( PHQRV FRPR DQWHV TXH n$K WXGR EHP -£ GDPRV RV IXQGRV H YRF YDL WUDEDOKDU H DOJXP GLD YDPRV QRV HQFRQWUDU SDUD YHU R TXH IRL IHLWR FRP R GLQKHLUR H HVW£ EHP (VW£ EHPn ( XPSRXFR H[DJHUDGR PDV PDV HQ DOJXQV FDVRV KDFH PDLV GH DQRV GH DQRV D FRLVD HVWRYD DVVLP (D]DPRV YLVLWDV D XP SDV SURFXUDQGR RUJDQL]DUHV TXH SXGHVVHPRV DMXGDU H HOHV GL]LDP R TXH TXHULDP ID]HU H R GLUHWRU DQGDYD FRP R FKHTXH HQ VX EROVD H HQWUHJR R FKHTXH H GL]LD nDOJXP GLD YRF PDQGD DOJXPD LQIRUPDJ£R n$VVLP IRL HP DOJXQV FDVRV TXH QRV JDVWDPRV RV IXQGRV ( DJRUD M£ QDR )DFHG ZLWK DOO WKLV TXHVWLRQLQJ DJHQFLHV KDYH RIWHQ KDG GLIL%FXOWLHV LQ H[SODLQLQJ WKH LPSDFW RI WKHLU RZQ ZRUN RI WKH SULRULWLHV ZKLFK DUH PRUH UHODWHG WR TXDOLWDWLYH VRFLDO FKDQJHV WKDQ WR TXDQWLWDWLYH >@ 7KLV LV ZKHUH WKH TXHVWLRQV WKH $JHQFLHV DUH DVNLQJ WR WKHLU SDUWQHUV DUH FRPLQJ IURP ZKDW FDQ \RX WHOO XV DERXW \RXU ZRUN DERXW LWV LPSDFW DERXW WKH UHVXOWV RI \RXU DFWLYLWLHV" 0HGLDV 21*V f 'LDQWH GHVWDV SHUJXQWDV DV DJHQGDV IUHTLLHQWHPHQWH WP WLGR GLILFXOGDGHV GH H[SOLFDU R LPSDFWR GR SURSLR WUDEDOKR GDV SULRULGDGHV PDLV UHODFLRQDGDV FRP PXGDQJDV TXDOLWDWLYDV VRFLDLV GR TXH TXDQWLWDWLYHLV >@ 'DL VXU JHP DV SHUJXQWDV TXH DV $JHQGDV ID]HP DRV VHXV SDUFHLURV 2 TXH YRFHV SF[LHP QRV GL]HU VREUH R WUDEDOKR R LPSDFWR R UHVXOWDGR GH VXDV DWLYLGDGHV" 0HGLDV 21*V f :H DUH LQ D QHZ HUD RI FKDQJH 7KH V ZDV WKH GHFDGH RI GHYHORSPHQW DQG RI WKH n*UHHQ 5HYROXWLRQn WKH V WKDW RI VROLGDULW\ 7KH V ZDV WKDW RI SDUWQHUVKLS DQG QRZ LQ WKH V ZKDW LV PRVW VDOLHQW LV SURIHVVLRQDOLVP LPSDFW DQG UHVXOWV 5HLFK f (VWDPRV HP QRYD SRFD GH PXGDQJDV $ GFDGD GH IRL D GR GHVHQYROYLPHQWR H GD UHYROXJ£R YHUGH D GH IRL D GD VROLGDULHGDGH $ GFDGD GH IRL D GDSDUFHULD H DJRUD QRV R MXHSUHGRPLQD RSURILVVLRQDOLVPR R LPSDFWR RV UHVXOWDGRV 5HLFK f ,Q JHQHUDO WKH SUREOHP VHH >ZLWK DJHQFLHV@ LV WKDW WR OLYH RII ILQDQFLQJ LV H[WUHPHO\ XQVWDEOH H[WUHPHO\ GUDLQLQJ ,W LV DQ HQRUPRXV ZDVWH RI WLPH DQG HQHUJ\ \RX DUH FRQVWDQWO\ ZULWLQJ SURMHFWV DOZD\V DVNLQJ IRU PRQH\ DOZD\V QHJRFLDWLQJ (PRWLRQDOO\ LW LV GUDLQLQJ NQRZ EHFDXVH KHUH DP WKH RQH ZKR GRHV LW PRVW RI WKH WLPH HPRWLRQDOO\ LW LV H[WUHPHO\ GUDLQLQJ DQG LW LV D ZDVWH RI WLPH >@ 7KH IDFW WKDW \RX KDYH WR FRQWLQXRXVO\ EH ORRNLQJ IRU IXQGLQJ EH

PAGE 375

QHJRFLDWLQJ EH VKRZLQJ WKHP WKH DJHQFLHV WKDW UHDOO\ \RX DUH ZRUWK WKHLU PRQH\ ,W LV H[WUHPHO\ XQSOHDVDQW DQG GUDLQLQJ 1R JHP R SUREOHPD TXH HX YHMR >FRP DV DJHQFLDV@ TXH YRF YLYHU GH ILQDQFLDPHQWR XUQD FRLVD H[WUHPDPHQWH LQVW£YHO H[WUHPDPHQWH GHVJDVWDQWH H XP GHVSHUGLFLR GH WHPSR H HQHUJD HQRUPHV YRF HVW£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£R &DUORV &KDJDV ( DL D QRWLFLD TXH FRUUD HUD TXH R SURMHWR QDR WLQKD GLQKHULR HQWDR QDR WLQKD QHP TXHP FRRUGHQDVVH PDLV R SURMH WR?f 2[IDP EHOLHYHV WKDW XQOHVV LQHTXDOLWLHV EHWZHHQ PHQ DQG ZRPHQ EH FRQVLGHUHG WKHUH ZLOO EH QR FRQVROLGDWLRQ RI VXVWDLQDEOH GHYHORSPHQW DQG RI SRYHUW\ DOOHYLDWLRQ $ 2[IDP DFUHGLWD TXH D PHQRV TXH DV GHVLJXDOGDGHV HQWUH KRPHQV H PXOKHUHV VHMDP HQIRFDGDV QDR VHU£ SRVVYHO FRQVROLGDU XP GHVHQYROYLPHQWR VXVWHQW£YHO H UHGX]LU D SREUH]D 2[IDP f 7KH DFNQRZOHGJHPHQW RI ZRPHQnV ULJKW WR VHOIGHWHUPLQDWLRQ LV WKHUHIRUH PRUH WKDQ DQ\WKLQJ HOVH D ORJLFDO FKDUDFWHULVWLF RI 1RYLEnV JHQHUDO SROLF\ 2I FRXUVH 1RYLE DOVR DFNQRZOHGJHV WKH VXEVWHQWLDO FRQWULEXWLRQ WKDW ZRPHQ PDNH WR SURFHVVHV RI GHYHORSPHQW DQG WKH ULJKW WR HTXDO RSSRUWXQLWLHV IRU DOO (O UHFRQRFLPLHQWR GHO GHUHFKR GH ODV PXMHUHV D OD DXWRGHWHUPLQDFLQ HV HQWRQFHV DQWHV TXH QDGD XQD HVSHFLILFDFLQ OJLFD GH OD SROWLFD JHQHUDO GH 1RYLE (YLGHQWHPHQWH 1RYLE UHFRQRFH WDPELQ OD FRQWULEXFLQ VXVWDQFLDO TXH ODV PXMHUHV KDFHQ D ORV SURFHVRV GH GHVDUUROOR \ HO GHUHFKR D RSRUWXQLGDGHV LJXDOHV SDUD WRGRV 1RYLE f 6XSSRUW WKH GHYHORSPHQW RI VHOIFRQILGHQFH E\ VWUHQJWKHQLQJ ZRPHQnV JURXSVRUJDQL]DWLRQV E\ SURPRWLQJ GLDORJXHV DQG VXSSRUW QHWZRUNV 3RLQW UHDGV &RQWLQXH WR KHOS DQG VWUHQJWKHQ UHODWLRQV EHWZHHQ ZRPHQnV JURXSV DQG RUJDQL]DWLRQV QDWLRQDOO\ DQG LQWHPDWLRQQDOO\ LQ RUGHU WR LQWHQVLI\ PXWXDO XQGHUVWDQGLQJ DQG VROLGDULW\ LQ FROOHFWLYH DFWLRQV

PAGE 376

$SRLDIU@ R GHVHQYROYLPHQWR GD DXWRFRQILDQ]D IRUWDOHFHQGR DV RUJDQL]DJRHVJUXSRV GH PXOKHUHV SURPRYDQGR GL£ORJRV H UHGHVGH DSRLR 3RLQW UHDGV fFRQWLQXD>U@ D DMXGDU H D IRUWDOHFHU OLJDJGHV HQWUH JUXSRV GH WUDEDOKR H RUJDQL]DJRHV GH PXOKHUHV QDFLRQDO H LQWHPDFL$QDOPHQWH SDUD LQWHQVLILFDU HQWHQGLPHQWR H VROLGDULHGDGH PXWXRV QRV DJRHV 2[IDP f 6HYHUDO LPSRUWDQW SURJUDPV RI $IULFDUH GLUHFWO\ VXSSRUW SURFHVVHV RI GHPRFUDWL]DWLRQ DQG GHYHORSPHQW RI WKH SULYDWH VHFWRU DV ZHOO DV LQ JHQHUDO WUDLQ JRYHUQPHQWV WR LPSURYH KXPDQ TXDOLW\ RI OLIH 9DULRV LPSRUWDQWH SURJUDPDV GD $IULFDUH DSRLDP GLUHFWDPHQWH RV SURFHVVRV GH GHPRFUDWL]DJ£R H GHVHQYROYLPHQWR GR VHFWRU SULYDGR EHP FRPR GH PRGH JHUDO FDSDFLWDP RV JRYHPRV D PHOKRUDU D TXDOLGDGH GD YLGD KXPDQD $IULFDUH f >UHODWRULR DQXDO GH @ ,Q D JUHDW QXPEHU RI FRXQWULHV RI WKH 6RXWK SRYHUW\ DQG GHPRJUDSKLF LQFUHDVH LQIOXHQFH HDFK RWKHU QHJDWLYHO\ ,FFR IDYRUV DQ DFWLYH GHPRJUDSKLF SROLF\ +RZHYHU WKLV SROLF\ PXVW EH SDUW RI D ODUJHU YLVLRQ RI WKH SRYHUW\ LVVXH DQG PXVW EH RULHQWHG WRZDUGV JUHDWHU GLJQLW\ IRU PHQ DQG ZRPHQ ,&&2 f (Q JUDQ SDUWH GH ORV SDVHV GHO 6XU SREUH]D \ FUHFLPLHQWR GHPRJU£ILFR VH LQIOX\HQ QHJDWLYDPHQWH ,FFR HVW£ D IDYRU GH XQD SROWLFD GHPRJU£ILFD DFWLYD 6LQ HPEDUJR HVWD SROWLFD GHEH IRUPDU SDUWH GH XQ HQIRTXH P£V DPSOLR GH OD SUREOHP£WLFD GH OD SREUH]D \ GHEH HVWDU GLULJLGD DOIRPHQWR GH OD GLJQLGDG GH KRPEUHV \ PXMHUHV ,&&2 f D SUHVV£R GD FRRSHUDJ£R LQWHUQDFLRQDO QR VHQWLGR GH GLVVXDGLU D SRVWXUD fGR FRQWUD f YLVLYHO WKH SUHVVXUH RQ WKH SDUW RI WKH LQWHUQDWLRQDO FRRSHUDWLRQ WR SUHYHQW DQ\ RSSRVLWLRQDO SRVLWLRQ LV SDOSDEOH 'RLPR f (YHU\WLPH LQ %UD]LO WKHUH LV PRUH HPSKDVLV SXW RQ SROLWLFDO SUHVVXUH DW WKH QDWLRQDO OHYHODGYRFDF\ 6R ZH WKRXJKW WKDW LQ WKH DUHD RI JHQGHU DOVR LW ZRXOG EH LPSRUWDQW IRU XV WR KDYH D FRXQWHUSDUW ZRUNLQJ IURP D JHQGHU SHUVSHFWLYH &DGD YH] QR %UDVLO K£ PDLV DWHQJDR SDUD D SUHVV£R SROWLFD DVVLP DR QLYHO QDFLRQDO DGYRFDF\ (QW£R DFK£YDPRV TXH WDPEP SDUD R HQIRTXH GH JQHUR LPSRUWDQWH TXH WHPRV XUQD FRQWUDSDUWH TXH HVW£ WUDEDOKDQGR GHVGH HVVD SHUVSHFWLYD GH JQHUR 7KLV LV KRZ WKLQN 7R GR D JRRG OREE\LQJ MRE DW WKH QDWLRQDO OHYHO \RX GRQn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£R WUDEDOKDU R QLYHO GR EDLUUR H R QLYHO GD SUHIHLWXUD ORFDO H DR QLYHO QDFLRQDO H LQWHUQDFLRQDO 3DUD PLOLWDV RUJDQL]DJRHV GHPDVLDGR >@

PAGE 377

:H QHYHU KDG DQ\ GHPDQGV RQ WKH SDUW RI DJHQFLHV WR GR WKLQJV WKDW ZH GLG QRW ZDQW WR GR ,W QHYHU KDSSHQHG DQG DOVR GR QRW DFFHSW SURSRVDOV WKDW UHTXHVW WKDW ZH IRU H[DPSOH GR WKLQJV OLNH XVLQJ D ,8' RQ DOO ZRPHQ RU W\LQJ WKH WXEHV RI ZRPHQ RU UHFRPPHQGLQJ ZRPHQ WR KDYH KHU WXEHV WLHG RU QRW FRXQVHOLQJ ZRPHQ UHJDUGLQJ DERUWLRQ 7KLV QHYHU KDSSHQHG 2QFH RQO\ WKHUH ZDV DQ DJHQF\ ZKLFK IRUELG )t6 WR ZRUN ZLWK DERUWLRQ QRW RQO\ QRW SHUIRUPLQJ DERUWLRQV EXW DOVR QRW FRXQVHOLQJ WKHQ ZH GLG QRW DFFHSW WKH ILQDQFLQJ 2. 1V PLQHD WLYHPRV H[LJHQFLDV GH DJHQFLDV SDUD ID]HU FRLVDV TXH QRV QDR TXHUDPRV ID]HU QXQFD WLYHPRV H WDPSRFR DFHLWDPRV SURSRVWDV TXH QRV H[LJLVVHP SRU H[HPSOR ID]HU FRLVD FRORFDU ',8HP WRGDV DV PXOKHUHV RX ODTXHDU PLGKHUHV RX HQFDPLQKDUSUD ODTXHDGXUD RX QDR RULHQWDU PXOKHU VREUH DERUWR 1XQFD WLYHPRV 1V V WLYHPRV XUQD YH] TXH XUQD DJHQFLD SURLELD R )t6 WUDEDOKDU FRP DERUWR QDR V ID]HU DERUWR PDV RULHQWDU H DL QV QDR QDR SHJDPRV R ILQDQFLDPHQWR FHUWR WKH\ QHYHU LQWHUIHUH LQ RXU EURDG ZRUNLQJ GLUHFWLYHV :H GR ZKDW ZH ZDQW 5DFKHO )t6f 7KHUH DUH QR SUREOHPV :KHQ WKHUH LV D SUREOHP ZH FXW WKH UHODWLRQ IRU H[DPSOH LI WKH\ LPSRVH WKHLU YLHZ 6LQFH KDYH EHHQ KHUH LW KDSSHQHG ZLWK 3DWKILQGHU 7KH\ ZDQWHG WR IXQG XV EXW LW ZDV YHU\ VSHFLILF ZLWK D SUREOHPDWLF SURSRVDO DQG ZH GHFLGHG QRW WR GR ZKDW WKH\ ZDQWHG XV WR GR $QG LW ZDV D WLPH ZKHQ ZH QHHGHG PRQH\ &ODXGLD 637f 6LPLODUO\ DPRQJ YROXQWHHU RUJDQL]DWLRQV ZDV WROG 7KH\ GRQnW LQIOXHQFH XV LQ DQ\ ZD\ 08f GRQnW HYHQ VHH WKHP $OHVVDQGUD 08f 6R IDU ZH KDYH ZRUNHG ZLWKRXW SUREOHPV 0RHPD 7KH &DVDf 1XQFD LQWHUIHUHP QRV OLQKDV GH WUDEDOKR )D]HPRV R TXH TXHUHPRV 5DFKHO )t6f 1DR WHUQ SUREOHPD TXDQGR WHUQ SUREOHPD D JHQWH FRUWD DV UHODTRHV DVVLP GR WLSR GH TXLVHU LPSRU GHPDQGD 'HVGH R WHPSR TXH HVWRX DTXL DFRQWHFHX FRP D 3DWKILQGHU (OD TXHUD ILQDQFLDU D JHQWH PDV HUD PXL WR GLUHLWLQKR GHQWUR GH XUQD SURSRVWD PXL WR FRPSOLFDGD H DJHQWH UHVROYHX QDR ID]HU R TXH HOHV TXHULDP H HUD XUQD SRFD TXH SUHFLVDYD GLQKHLUR9n &ODXGLD 637f “DV RUJDQL]DUHV YROXQWDULDV IDODUDP DVVLP ,QIOXHQ]D GH MHLWR QHQKXP 08f QHP YHMR HOHV $OHVVDQGUD 08f $W DTXL WUDEDOKDPRV VHP LPSRVLTGR 0RHPD &DVDf ,W VWDUWV ZLWK ZKDW WKH\ JLYH SULRULW\ WR VR HLWKHU \RX ILW LQ WKHLU SULRULWLHV RU WKH\ WHOO \RX QR 1RZ RQFH WKH\ KDYH DFFHSWHG WR ILQDQFH WKHQ WKH UHODWLRQ LV UDWKHU RSHQ D SDUWLU GR TXH HODV SULRUL]DP HQWDR RX YRF VH HQFDL[D QRV SULRULGDGHV RX HQW£R HODV YDR WH UHVSRQGHU QDR $JRUD TXDQGR HODV DFHLWDP ILQDQFLDU DL QDR JHUDOPHQWH D UHODTDR EDVWDQWH DEHUWD Q9 QR WKDWnV ZK\ ZH KDYH VR OLWWOH PRQH\ 1DR SRU LVVR TXH QV HVWDPRV FRPSRXFR GLQKHLUR9n ; VXSSRUW JLYHQ WRSLFV RU WKH\ GLG QRW ILQDQFH WKH SDUW RI WKLV ZRUN WKDW GHDOV ZLWK ZRPHQ RQO\ WKH ZRUN ZLWK WHHQDJHUV ; DSRLD FHUWDV WHP£WLFDV RU HOHV QDR ILQDQFLDUDP D SDUWH GR WUDEDOKR FRP PXOKHUHV V FRP DV DGROHVFHQWHV 2Q RQH VLGH RXU QHHGV WKH TXDVL LPSRVVLELOLW\ WR ZRUN ZLWKRXW UHVRXUFHV IURP RXWVLGH 2Q WKH RWKHU WKH VHDUFK IRU RXU DXWRQRP\ RXU UHVSHFW RXU SULGHRXU GLJQLW\ GH XP ODGR QRVVDV QHFHVVLGDGHV D TXDVH LPSRVVLELOLGDGH GH WUDEDOKDU VHP HVVHV UHFXUVRV GH IRUD 'R RXWUR D EXVFD GD QRVVD DXWRQRPD GR QRVVR UHVSHLWR GD QRVVD DOWLYH] GD QRVVD GLJQLGDGH

PAGE 378

6KH SROLWHO\ EXW VTXDUHO\ GHFODUHG +RZ ZRQGHUIXO LI ZH FRXOG ZRUN ZLWKRXW LQWHUQDWLRQDO FRRSHUDWLRQ 4XH ERP VH D JHQWH SXGHVVH WUDEDOKDU VHP FRRSHUDQGR LQWHUQDFLRQDO 7KH\ PHQ DQG ZRPHQ KDYH WKH FRUUHFW SHUVSHFWLYH RQ RXU SUREOHPV DQG ZH DUH WKH SRRU VRXOV ZKR GRQnW NQRZ DQ\WKLQJ 7KLV FRPHV RXW YHU\ VWURQJO\ DQG LW LV D FRORQL]HUnV PHQWDOLW\ GHV H HODV TXH WHUQ D YLVGR FRUUHWD GRV QRVVRV SUREOHPDV TXH QRV VRPRV RV FRL WRGRV TXH QDR VDEHPRV TXDVH QDGD ,VVR PXL WR IRUWH H SHQVDPQHWR GH FRORQL]DGRU9n 7KLV LV QR ORQJHU RXU REMHFWLYH 1RZ LW LV WKDW )RU H[DPSOH 1RZ LWn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nGRFWRUVn 2V PRYLPHQWRV SRSXODUHV QDR HODERUDP WDR KHP TXDQWR XPD 21* FKHLD GH nGRXWRUHV 1*2 PHPEHU $FFRUGLQJ WR P\ SHUVRQDO H[SHULHQFH QR ZH GR QRW GR WKLV 1 VXUSULVHGf \RX GRQnW GR WKLV" 1*2 PHPEHU $W WKH PD[LPXP ZH PRGHUDWH RXU ODQJXDJH D ELW ZKHQ LW LV D &KULVWLDQ DJHQF\ GR \RX XQGHUVWDQG" RUWKLQJV OLNH WKDW 0HPEUR GH 21* 1D PLQKD H[SHULHQFLD SHVVRDO D JHQWH QDR D JHQWH QDR ID] LVVR 1DWKDOLH VXUSULVHGf YRFHV PR WHUQ TXH ID]HU LVVR 0HPEUR GH 21* 1R P£[LPR PDQHUD XUQ SRXFR D OLQJXDJHP TXDQGR FULVWD W£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£FLD H UDFLRQDOLGDGH EDVHDGRV QR F£OFXOR GR FXVWREHQHILFLR 'RLPR f

PAGE 379

$33(1',; % '(6&5,37,21 2) 0(0%(56f $&7,9,7,(6 637 '(6&5,37,21 2) 0(0%(56f $&7,9,7,(6 3ROLWLFDO QHWZRUNLQJ UHODWLRQV ZLWK %RDUG RI GLUHFWRUV UHODWLRQV ZLWK LQWnO RUJDQL]DWLRQV RUJDQL]DWLRQ RI GLVFXVVLRQV RI LQWHUQDO SROLWLFV D IHZ FRXUVHV SDUWLFLSDWHV LQ ZULWHXS RI HGXFDWLRQDO PDWHULDOQHZVOHWWHU nDVVHVVRULDn UHODWLRQV ZLWK $%21* 0HPEHU RI WKH ZRPHQnV KHDOWK SJUP ,QYROYHG LQ WDVNV WKDW UHTXLUH SDUWQHUVKLSV ZLWK RWKHU JURXSV LH ,555$* IHPLQLVW KHDOWK QHWZRUN 3DUWLFLSDWHV LQ WKH SURGXFWLRQ RI HGXFDWLRQDO PDWHULDO &RQGXFWV GHEDWHV FRXUVHV WUDLQLQJ ZRUNVKRSV $VVHVVRULDn WR &87 WUDGHXQLRQf EULQJV nGHPDQGDVn IURP WUDGHXQLRQV nDVVHVVRULDn WR &HQWUDO GRV 0RYLPHQWRV 3RSXODUHV SDUWLFLSDWHV LQ &DPSDLJQ IRU &LWL]HQVKLS GHEDWHV HVSHFLDOO\ RQ ZRPHQ DQG ZRUN LVVXHVf +HOSV ZLWK ILQDQFHV DQG LQWHUQHW DFFRXQW $VVHVVRULD WR KHDOWK PRYHPHQW t WR KRXVLQJ 1*2 SDUWLFLSDWHV LQ QHZVOHWWHU PHPEHU RI ORFDO KHDOWK FRXQFLO PHPEHU RI WHFKQLFDO FRPLVVLRQ RI SXEOLF KHDOWK V\VWHP XVHUV LQ %UDVLOLD /LQNV JHQHUDO KHDOWK LVVXHV DQG ZRPHQnV KHDOWK LVVXHV /RQJWHUP DVVHVVRULD ZLWK 06=/ RQ ZRPHQnV KHDOWK LVVXHV VRPH WUDLQLQJ VRPH SDUWLFLSDWLRQ LQ HGXFDWLRQDO PDWHULDO UHVSRQGV WR SRQFWXDWHG GHPDQGV IRU VXSSRUW $VVHVVRULD WR *UXSR GH PXOKHUHV GD =RQD /HVWH 'HEDWHV DQG OHFWXUHV RQ JHQGHU UHODWLRQV LQ VFKRROV \RXWK FHQWHUV +HOS RWKHU PRYHPHQWV LQFRUSRUDWH JHQGHU PHPEHU RI ORFDO PDWHUQDO PRUWDOLW\ FRPPLWWHHKHOS ZLWK ZRUNVKRSV WR 06=/ &XUUHQWO\ FRRUGLQDWRU RI WKH SURJUDPV )DFLOLWDWLQJ DUWLFXODWLRQ RI YDULRXV SURMHFWVnGHPDQGVn 5HVSRQG WR nGHPDQGn IRU WUDLQLQJ RQ IHPLQLVP RUJDQL]DWLRQ VH[XDOLW\ UHSURGXFWLYH ULJKWV LQFRUSRUDWLQJ UDFH LVVXHV (GLW WH[WV LQ SDUWLFXODU WKH QHZVOHWWHU ZLWK HIIRUW WR V\VWHPDWL]H 637nV YLVLRQ DQG PHWKRGRORJ\ QHZVSDSHU FOLSSLQJ SDUWLFLSDWHV LQ HODERUDWLRQ RI HGXFDWLRQDO PDWHULDO (ODERUDWLRQ RI HGXFDWLRQDO PDWHULDO WUDLQLQJ GHEDWHV FRXUVHV RWKHU GHPDQGV IRU VXSSRUW

PAGE 380

)t6 '(6&5,37,21 2) 0(0%(56f $&7,9,7,(6 5HVSRQVLEOH IRU LQVWLWXWLRQDO SURMHFWV UHSRUWVf 5HODWLRQV ZLWK ILQDQFLQJ DJHQFLHV 3ROLWLFDO UHODWLRQV ZLWK )HPLQLVW +HDOWK 1HWZRUN UHODWLRQV ZLWK IRUHLJQ RUJDQL]DWLRQV PDQDJHPHQW FRRUGLQDWRU RI RQH SURMHFW &RRUGLQDWHV LQWnO UHVHDUFK SURMHFW RQ ZRPHQnV UHSURG KHDOWK LQ %U ZRUNV RQ SURMHFWV YLROHQFH $,'6f UHSUHVHQWV )t6 DW UHJLRQDO IRUXP RI WKH 5HGH ZRUNV RQ SUHS RI LQWnO ZRPHQnV KHDOWK FRQIHUHQFH KHOSV ZLWK SE FDVHV LQ FOLQLF PHPEHU RI &(&) 7ZR UHVHDUFK SURMHFWV RQH RQ ZRPHQ DQG $,'6 DQG RQH RQ PDWHUQLW\ DQG ZRUN $OVR LQ FKDUJH RI WKH ILQDQFLDO FRRUGLQDWLRQ RI WKH RUJDQL]DWLRQ (GXFDWLRQ DQG WUDLQLQJ (GLWLRQ RI IHPLQLVW QHZVOHWWHU ZRUNV RQ RQH SURMHFW RQ ZRPHQ DQG $,'6 )ROORZV XS RQ ZKDW QHHGV WR EH GRQH RQ HYHU\GD\ EDVLV 5HVWUXFWXULQJ WKH FOLQLFnV GDWD EDVH DQG FRQVXOWDWLRQ SURFHGXUHV :RUNV RQ WZR SURMHFWV RQH LV D /DWLQ $PHULFDQ H[FKDQJH SJU IRU IHPLQLVW KHDOWK VSHFLDOLVWV WKH RWKHU DERXW KHDOWK DQG YLROHQFH 2QH RI WKH PHPEHUV RI )t6 &RQGXFWV J\QHFRORJLFDO FDUH FRQVXOWDWLRQV D SUHJQDQF\ JURXS IRU QDWXUDO ELUWK D VWXG\ RQ GLDSKUDJP GRHV WUDQVODWLRQV *\QHFRORJLFDO FDUH VWXG\ RQ DERUWLRQ WKH ELUWK FRQWURO SLOO DQG WKH GLDSKUDJP WUDLQLQJ RI KHDOWK SURIHVVLRQDOV 2UJDQL]DWLRQ RI PRQWKO\ VHPLQDU &0 '(6&5,37,21 2) 0(0%(56f $&7,9,7,(6 3UHVLGHQW DFFRUGLQJ WR VWDWXWHV EXW HTXDO UHODWLRQV DQG FROOHFWLYH ZRUN n, KDYH WKLV UROH RI VHHLQJ WKLQJV FRPLQJn 7UHDVXUHU EHFDXVH WKH SHUVRQ ZKR GLG WKLV QR ORQJHU SDUWLFLSDWHV 0DLQWDLQV WKH OLQN ZLWK KHDOWK LVVXHV 2UJDQL]HV VHPLQDUV RQ KHDOWK DP VHFUHWDU\ DFFRUGLQJ WR WKH VWDWXWHV > @ EXW ZH IXQFWLRQ PRUH FROOHFWLYHO\ >@ VR DP DQ DFWLYH HOHPHQW RI WKLV FROOHFWLYH >@ ZKR RQ DQ HYHU\GD\ EDVLV FRQWULEXWHV WR WKH ZRUN RI WKH &DVD 0HPEHUn RI WKH &DVD 6KH DQG DQRWKHU PHPEHU UHSUHVHQW &DVD DW 0DWHUQDO 0RUWDOLW\ FRPPLWWHH &RQGXFWV ZRUNVKRSV 'LVFXVVHV SURMHFWVn HODERUDWLRQ 4XHVWLRQV WKH RWKHUV RQ VLWXDWLRQ RI WKH &DVD WRGD\ :RUNV RQ RQH SURMHFW

PAGE 381

08 '(6&5,37,21 2) 0(0%(56n $&7,9,7,(6 DOUHDG\ GLG D ELW RI HYHU\WKLQJ GRQnW HYHQ NQRZ KRZ WR DQVZHU ,nYH EHHQ FOHDQLQJ ODG\ ZRUNHG RQ WKH 1HZVOHWWHU DP D PHPEHU RI WKH nGLUHWRULDn 8VHG WR ZRUN D ORW ZLWK WKH nQFOHRVn 1R VSHFLILF UROH LW GHSHQGV RQ WKH SROLWLFDO FRQMXQFWXUH GR DQ\WKLQJ WKDW FRPHV XS ZDQW WKLQJV UROOLQJ 6RPH DFFXVHG KHU RI EHLQJ nWKH ERVVn 6KH LV QRZ *HQHUDO 7UHDVXUHU EHFDXVH VKH ZDV DVNHG WR 6HHV KHU SRWHQWLDO RUJDQL]H GHEDWHV ZRUN LQ WKH SHULIHULD ZULWH IRU WKH QHZVOHWWHU /DVW \HDU ZH KDG D ELJ ILJKWnnQRZ DP SURIRUPD 3UHVLGHQWnn:KHQ ILUVW SDUWLFLSWHG VWD\HG RQH \HDU OLVWHQLQJn n, QHYHU KDG WKH SURILOH WR EH LQ DQ RUJDQL]DWLRQn n:LWK WLPH VWDUWHG IHHOLQJ SDUW RI WKH JURXS VWDUWHG SUHVHQWLQJ P\ SURMHFWV )RUPDOO\ KDV KDG YDULRXV SRVLWLRQV LQ WKH %RDUG RI 'LUHFWRUV ,Q SUDFWLFH GHDOV ZLWK SDSHUZRUN )HZ PHPEHUV DUH nFRPSURPHWLGDVn 6LQFH DP UDWKHU RUJDQL]HG KDYH EHHQ VWXFN ZLWK WKH SDSHUZRUN ,WnV TXLWH ERULQJ &KDLU RI +HDOWK 'HSW 3DUW RI KHDOWK HYHQWV VHPLQDUV FRQIHUHQFHV DQG WUDQVPLW LQIR WR WKH JURXS &RQGXFWV $,'6 ZRUNVKRSV &RQGXFWV OHLVXUH DFWLYLWLHV IRU 08 ZKHQ WKLQJV DUH WHQVH +HOS SUHSDUH 0HHWLQJV +HOSV RWKHU GHSWV nZH GR D OLWWOH RI HYHU\ WKLQJ 6D\V VKH GRHVQnW KDYH DQ\ UROH EHFDXVH VKH LV QRW D PHPEHU RI WKH %RDUG RI 'LUHFWRUV 3DUWLFLSDWHV LQ WKH PHHWLQJV DV nRXYLQWHn 'RHV D IHZ WKLQJV OLNH VHUYH WHD DW VHPLQDU 3DUWLFLSDWHG LQ )HPLQLVW 0HHWLQJ LQ &DOGDV 1RYDV 6D\V VKH GRHVQnW KDYH D YHU\ ZHOO GHILQHG UROH DQG FDQQRW DIIRUG WR PLVV WR ZRUN LI VRPHWKLQJ FRPHV XS 3V\FKRORJLFDO IROORZXS IRU FDVHV RI YLROHQFH DJDLQVW ZRPHQ 08 IROORZV FDVHV QRZ 3DUWLFLSDWHG LQ FODVVHV IRU nSURPRWRUDV OHJ£LV SRSXODUHVn DQG LQ D FODVV IRU ZRPHQ LQ VLWXDWLRQ RI YLROHQFH 08 KDV D PRUH GHPRFUDWLF SHUIXPH WKDQ LW UHDOO\ LV SDUWLFLSDWHG PRUH DW WLPHV OHVV DW RWKHUV GR QRW NQRZ ZKDW LV P\ H[DFW UROH LW ZDV LPSRUWDQW QRW WR KDYH UHPXQHUDWHG ZRUN EXW ZH HQG XS QRW EHLQJ DEOH WR SDUW RI DOO WKDW ZH ZRXOG OLNH ,Q FKDUJH RI FXOWXUDO GHSW :H WKRXJKW RI FXOWXUDO HYHQWV DV D PHDQV RI FRPPXQLFDWLRQ WKURXJK DUW OHFWXUHV GDQFH FKRLU SDUWLHV %XW LW GLG QRW ZRUN :RUNV RQ WKH QHZVOHWWHU DV ZHOO

PAGE 382

/,67 2) 5()(5(1&(6 $JUDZDO $UXQ 3RVWVWUXFWXUDOLVW DSSURDFKHV WR GHYHORSPHQW 6RPH FULWLFDO UHIOHFWLRQV 3HDFH DQG &KDQJH f $OYDUH] 6RQLD ( (QJHQGHULQJ GHPRFUDF\ LQ %UD]LO :RPHQnV PRYHPHQWV LQ WUDQVLWLRQ SROLWLFV 3ULQFHWRQ 13ULQFHWRQ 8QLYHUVLW\ 3UHVV 'HHSHQLQJ GHPRFUDF\ 3RSXODU PRYHPHQW QHWZRUNV FRQVWLWXWLRQDO UHIRUP DQG UDGLFDO XUEDQ UHJLPHV LQ FRQWHPSRUDU\ %UD]LO ,Q 0RELOL]LQJ WKH FRPPXQLW\ /RFDO SROLWLFV LQ WKH HUD RI WKH JOREDO FLW\ HGLWHG E\ 5REHUW )LVKHU DQG -RVHSK .OLQJ 1HZEXU\ 3DUN &$ 6DJH 7KH WUDQVfIRUPDWLRQ RI IHPLQLVPVf DQG JHQGHU SROLWLFV LQ GHPRFUDWL]LQJ %UD]LO ,Q 7KH ZRPHQnV PRYHPHQW LQ /DWLQ $PHULFD 3DUWLFLSDWLRQ DQG GHPRFUDF\ HGLWHG E\ -DQH -DTXHWWH %RXOGHU :HVWYLHZ 3UHVV /DWLQ $PHULFDQ IHPLQLVPV n*R *OREDOn 7UHQGV DQG FKDOOHQJHV RI WKH V :RUNLQJ GUDIW $QG HYHQ )LGHO FDQnW FKDQJH WKDW 7UDQVQDWLRQDO IHPLQLVW DGYRFDF\ VWUDWHJLHV DQG FXOWXUDO SROLWLFV LQ /DWLQ $PHULFD 3DSHU SUHVHQWHG DW WKH 0HOORQ /HFWXUH 6HULHV RQ 3XEOLF FXOWXUH DQG WUDQVQDWLRQDOLVP 'HSDUWPHQW RI FXOWXUDO DQWKURSRORJ\ 'XNH 8QLYHUVLW\ 'XUKDP 1& 2FWREHU D /DWLQ $PHULFDQ IHPLQLVPV JR JOREDO 7UHQGV RI WKH V DQG FKDOOHQJHV IRU WKH QHZ PLOOHQQLXP ,Q &XOWXUHV RISROLWLFV3ROLWLFV RI FXOWXUHV 5Hn YLVLRQLQJ /DWLQ $PHULFDQ VRFLDO PRYHPHQWV HGLWHG E\ 6RQLD ( $OYDUH] (YHOLQD 'DJQLQR DQG $UWXUR (VFREDU %RXOGHU &2 :HVWYLHZ 3UHVV E $GYRFDWLQJ IHPLQLVP 7KH /DWLQ $PHULFDQ IHPLQLVW 1*2 ERRP 3DSHU SUHVHQWHG DW WKH )RXUWK $QQXDO 6FKRPEXUJ0RUHQR /HFWXUH /DWLQ $PHULFDQ 6WXGLHV 3URJUDP 0RXQW +RO\RNH &ROOHJH 6RXWK +DGOH\ 0$ 0DUFK $OYDUH] 6RQLD ( (YHOLQD 'DJQLQR DQG $UWXUR (VFREDU HGV &XOWXUHV RI SROLWLFV SROLWLFV RI FXOWXUHV 5HYLVLRQLQJ /DWLQ $PHULFDQ VRFLDO PRYHPHQWV %RXOGHU &2 :HVWYLHZ 3UHVV $QGUHZV *HRUJH 5HLG %ODFNV DQG ZKLWHV LQ 6DR 3DXOR %UD]LO 0DGLVRQ :, 8QLYHUVLW\ RI :LVFRQVLQ 3UHVV

PAGE 383

$UL]SH /RXUGHV )RUHZRUG 'HPRFUDF\ IRU D VPDOO WZRJHQGHUHG SODQHW ,Q :RPHQ DQG VRFLDO FKDQJH LQ /DWLQ $PHULFD HGLWHG E\ (OL]DEHWK -HOLQ $WODQWLF +LJKODQGV 1=HG %RRNV $UWLFXODI£R GH 0XOKHUHV %UDVLOHLUDV 6\QWKHVLV RI %UD]LOLDQ ZRPHQfV GRFXPHQW 5LR GH -DQHLUR $UWLFXODIDR GDV 0XOKHUHV %UDVLOHLUDV%HLMLQJ %DLHUOH 6HUJLR 8P QRYR SULQFLSLR WLFRSROWLFR 3U£WLFD VRFLDO H VXMHLWR QRV PRYLPHQWRVSRSXODUHV XUEDQRV HP 3RUWR $OHJUH QRV DQRV 0DVWHUnV WKHVLV 8QLYHUVLGDGH (VWDGXDO GH &DPSLQDV &DPSLQDV 6DR 3DXOR %DUURVR &DUPHQ DQG 7LQD $PDGR 7KH LPSDFW RI WKH FULVLV XSRQ SRRU ZRPHQnV KHDOWK 7KH FDVH RI %UD]LO ,Q 7KH LQYLVLEOH DGMXVWPHQW 3RRU ZRPHQ DQG WKH HFRQRPLF FULVLV HGLWHG E\ 81,&() 5HJLRQDO 3URJUDP :RPHQ LQ 'HYHORSPHQW 6DQWLDJR &KLOH 81,&() %DVX $PULWD HG 7KH FKDOOHQJH RI ORFDO IHPLQLVPV :RPHQnV PRYHPHQWV LQ JOREDO SHUVSHFWLYH %RXOGHU &2 ZHVWYLHZ 3UHVV %HEELQJWRQ $QWKRQ\ DQG *UDKDP 7KLHOH ZLWK 3HQHORSH 'DYLHV 0DUWLQ 3UDJHU DQG +HUQDQGR 5LYHURV 1RQ*RYHUQPHQWDO RUJDQL]DWLRQV DQG WKH VWDWH LQ /DWLQ $PHULFD 5HWKLQNLQJ UROHV LQ VXVWDLQDEOH DJULFXOWXUDO GHYHORSPHQW /RQGRQ 5RXWOHGJH %HUQ 'DUU\O %HOLHIV DWWLWXGHV DQG KXPDQ DIIDLUV %HOPRQW &$ %URRNV&ROH %HQHULD /RXUGHV DQG 6KHOOH\ )HOGPDQ HG 8QHTXDO EXUGHQ (FRQRPLF FULVHV SHUVLVWHQW SRYHUW\ DQG ZRPHQnV ZRUN %RXOGHU &2 :HVWYLHZ 3UHVV %HUTX (O]D $ VDGH GDV PXOKHUHV QD GFDGD SHUGLGD 3DSHU SUHVHQWHG DW WKH WKLUG 1DWLRQDO 0HHWLQJ RI WKH 1DWLRQDO )HPLQLVW 1HWZRUN IRU +HDOWK DQG 5HSURGXFWLYH 5LJKWV 0DUFK 5LR GH -DQHLUR %OXPHU +HUEHUW 6RFLDO PRYHPHQWV ,Q 7KH VRFLRORJ\ RI GLVVVHQW HGLWHG E\ 5 6HUJH 'HQLVRI7 1HZ
PAGE 384

%RXOGLQJ (OLVH )HPDOH DOWHUQDWLYHV WR KLHUDUFKLFDO V\VWHPV SDVW DQG SUHVHQW $ FULWLTXH RI ZRPHQnV 1*2V LQ WKH OLJKW RI KLVWRU\ LQ :RPHQ LQ WKH WZHQWLHWK FHQWXU\ ZRUOG E\ (OLVH %RXOGLQJ 1HZ
PAGE 385

&DFFLD %DYD 6LOYLR 8UEDQ SROLFLHV IRU VRFLDO WUDQVIRUPDWLRQ 7KH FDVH RI 6DR 3DXOR &LWLHV Of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nV ERG\ 8QGHUVWDQGLQJ GLIIHUHQFH $PHULFDQ $QWKURSRORJLVW f &,0 &HQWUR ,QIRUPDGR 0XOKHU %UHYH KLVWULFR VREUH R SURFHVVR GH DYDOLDI£R GD GFDGD SDUD R )UXP 3DUDOHOR 3HTXLPf &,0%ROHWLP &LWHOL 0DULD 7HUHVD 0XOKHUHV HP PRYLPHQWRV GH VDGH 'HVDIRV QD OXWD SRU FLGDGDQLD UHSURGXWLYD 3DSHU SUHVHQWHG DW WKH WK $QQXDO 0HHWLQJ RI $132&6 &D[DPE %UD]LO &ODUN -RKQ 'HPRFUDWL]LQJ GHYHORSPHQW 7KH UROH RI YROXQWDU\ RUJDQL]DWLRQV /RQGRQ (DUWKVFDQ &1'0 1DWLRQDO &RXQFLO IRU :RPHQnV 5LJKWVf $ &DPSDQKD SDUD R GLUHLWR D VDGH %UDVLOLD &1'0 &RKHQ -HDQ 6WUDWHJ\ RU LGHQWLW\ 1HZ WKHRUHWLFDO SDUDGLJPV DQG FRQWHPSRUDU\ VRFLDO PRYHPHQWV 6RFLDO 5HVHDUFK f

PAGE 386

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t &R &RUUHD 6QLD 0DULVD 0DWDPDOD 1DQF\ 3DORPLQR DQG 6LOYLQD 5DPRV $V DYHQWXUDV GR PRYLPHQWR IHPLQLVWD QR FDPLQKR SDUD R &DLUR (VWXGRV )HPLQLVWDV &RVWD $OEHUWLQD GH 2OLYHLUD ( YL£YHO R IHPLQLVPR QRV WUSLFRV" 5HVLGXRV GH LQVDWLVIDJ£R ,Q 0XOKHUHV GD 'RPHVWLFLGDGH £ &LGDGDQLD (VWXGRV VREUH 0RYLPHQWRV 6RFLDLV H 'HPRFUDWL]DJDR HGLWHG E\ (0 2OLYHLUD %UDVLOLD $132&6&1'0 &RXVLQV /LQZRRG 3OD\LQJ EHWZHHQ FODVVHV 3DSHU SUHVHQWHG DW WKH WK $QQXDO 0HHWLQJ RI WKH $PHULFDQ $QWKURSRORJLFDO $VVRFLDWLRQ 6DQ )UDQFLVFR 1RYHPEHU 'DJQLQR (YHOLQD D 2Q EHFRPLQJ D FLWL]HQ 7KH VWRU\ RI 'RQD 0DUOHQHf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

PAGE 387

7KH TXHVW IRU FLWL]HQVKLS LQ D UHODWLRQDO XQLYHUVH ,Q 6WDWH DQG VRFLHW\ LQ %UD]LO &RQWLQXLW\ DQG FKDQJH HGLWHG E\ -RKQ :LUWK ( GH 2OLYHLUD 1XQHV DQG 7 ( %RJHQVFKLOG %RXOGHU &2 :HVWYLHZ 3UHVV 'D 6RX]D +HUEHUW $ YH] GDV 2QJV &RQKHAD H DSLH -RUQDO GD$%21* 'H 2OLYHLUD )UDQFLVFR 2 JRYHUQR )+& H DV SROWLFDV VRFLDLV -RUQDO GD $%21* 'LDQL 0DULR 7KH FRQFHSW RI VRFLDO PRYHPHQW 6RFLRORJLFDO 5HYLHZ f 'RLPR $QD 0DULD 2QJV QR %UDVLO SV 'D HGXFDGR SRSXODU £ OXWD SHOD FLGDGDQLD 3DSHU SUHVHQWHG DW WKH DQQXDO PHHWLQJ RI WKH %UD]LOLDQ 6RFLHW\ RI 6RFLRORJ\ -XO\ 9LWRULD %UD]LO $ 9H] H D YR] GR SRSXODU 0RYLPHQWRV VRFLDLV H SDUWLFLSDQGR SROWLFD QR %UDVLO SV 5LR GH -DQHLUR 5HOXPH'XPDU£ 'URJXV &DURO $QQ 3RSXODU PRYHPHQWV DQG WKH OLPLWV RI SROLWLFDO PRELOL]DWLRQ RI WKH JUDVVURRWV LQ %UD]LO ,Q &RQIOLFW DQG FRPSHWLWLRQ 7KH /DWLQ $PHULFDQ FKXUFK LQ D FKDQJLQJ HQYLURQPHQW HGLWHG E\ (GZDUG / &OHDU\ DQG + 6WHZDUW*DPELQR %RXOGHU &2 /\QQH 5LHQQHU 'U\]HN -RKQ 6 3ROLWLFDO LQFOXVLRQ DQG WKH G\QDPLFV RI GHPRFUDWL]DWLRQ $PHULFDQ 3ROLWLFDO 6FLHQFH 5HYLHZ f 'XUNKHLP (PLOH >@ 7KH GHWHUPLQDWLRQ RI PRUDO IDFWV ,Q 6RFLRORJ\ DQG SKLORVRSK\ 1HZ
PAGE 388

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f'HYHORSPHQWf GHSROLWLFL]DWLRQ DQG EXUHDXFUDWLF SRZHU LQ /HVRWKR 0LQQHDSROLV 01 8QLYHUVLW\ RI 0LQQHVRWD 3UHVV )HUQDQGHV 5XEHP &HVDU 3ULYDGR SRUP SEOLFR 2 WHUFHLUR VHWRU QD $PULFD /DWLQD 5LR GH -DQHLUR 5HOXPH'XPDU£ )HUQDQGHV 5XEHP &HVDU DQG /HDQGUR 3LTXHW &DUQHLUR 21*V DQRV $ RSLQLDR GRV GLULJHQWHV EUDVLOHLURV 5LR GH -DQHLUR 1FOHR GH 3HVTXLVDV GR ,VHU )HUUHH 0\UD 0DU[ 3ROLWLFDO FRQWH[W RI UDWLRQDOLW\ ,Q )URQWLHUV LQ VRFLDO PRYHPHQW WKHRU\ HGLWHG E\ $OGRQ 0RUULV DQG &DURO 0F&OXUJ 0XHOOHU 1HZ +DYHQ &7
PAGE 389

)UDVHU 1DQF\ 8QUXO\ SUDFWLFHV 3RZHU GLVFRXUVH DQG JHQGHU LQ FRQWHPSRUDU\ VRFLDO WKHRU\ 0LQQHDSROLV 01 8QLYHUVLW\ RI 0LQQHVRWD 3UHVV )UHHPDQ -R 7KH W\UDQQ\ RI VWUXFWXUHOHVVQHVV 0V t )ULHGPDQ (OL]DEHWK :KDW 1DLUREL EURXJKW WRJHWKHU %HLMLQJ WRUH DVXQGHU 7KH HIIHFWV RI WUDQVQDWLRQDOLVP UHYHUVHG 3DSHU SUHVHQWHG DW WKH ;; PHHWLQJ RI WKH /DWLQ $PHULFDQ 6WXGLHV $VVRFLDWLRQ *XDGDODMDUD 0H[LFR $SULO )ULHGPDQ -RKQ 5HEHFFD $EHUV DQG /LOLDQ $XWOHU (PHUJHQFHV :RPHQnV VWUXJJOHV IRU OLYHOLKRRG LQ /DWLQ $PHULFD /RV $QJHOHV 8&/$ /DWLQ $PHULFDQ &HQWHU 3XEOLFDWLRQV *DPVRQ :LOOLDPV 7KH VRFLDO SV\FKRORJ\ RI FROOHFWLYH DFWLRQ ,Q )URQWLHUV LQ VRFLDO PRYHPHQW WKHRU\ HGLWHG E\ $OGRQ 0RUULV DQG &DURO 0F&OXUJ 0XHOOHU 1HZ +DYHQ &7
PAGE 390

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
PAGE 391

-DTXHWWH -DQH HG 7KH ZRPHQnV PRYHPHQW LQ /DWLQ $PHULFD 3DUWLFLSDWLRQ DQG GHPRFUDF\ %RXOGHU &2 :HVWYLHZ 3UHVV -HOLQ (OL]DEHWK HG :RPHQ DQG VRFLDO FKDQJH LQ /DWLQ $PHULFD $WODQWLF +LJKODQGV 1=HG %RRNV -HQNLQV &UDLJ :KDW LV WR EH GRQH 0RYHPHQW RU RUJDQL]DWLRQ" &RQWHPSRUDU\ 6RFLRORJ\ 5HVRXUFH PRELOL]DWLRQ WKHRU\ DQG WKH VWXG\ RI VRFLDO PRYHPHQWV $QQXDO 5HYLHZ RI 6RFLRORJ\ 1RQSURILW RUJDQL]DWLRQV DQG SROLF\ DGYRFDF\ ,Q 7KH QRQSURILW VHFWRU $ UHVHDUFK KDQGERRN HGLWHG E\ 3RZHOO :DOWHU 1HZ +DYHQ &7
PAGE 392

/DQGLP /HLODK D $ LQYHQJDR GDV 2QJV 'R VHUYLGR LQYLVYHO £ SURILVVGR VHP QRPH 5LR GH -DQHLUR 8QLYHUVLGDGH )HGHUDO GR 5LR GH -DQHLUR E 3DUD DOP GR PHUFDGR H GR (VWDGR" )+DQWURSLD H FLGDGDQLD QR %UDVLO 5LR GH -DQHLUR 1FOHR GH 3HVTXLVD GR ,VHU D ,QWURGXI£R 1RWDV SDUD XP SHUILO GDV 21*V ,Q 21*V 8PSHUILO FDGDVWUR GDV ILDGDV £ DVVRFLJ£R EUDVLOHLUD GH 21*V $%21*f HGLWHG E\ /HLODK /DQGLP DQG /HWLFLD /LJQHXO &RWULP 6DR 3DXOR $%21*,6(5 E %UD]LO ,Q 'HILQLQJ WKH QRQSURILW VHFWRU $ FURVVQDWLRQDO DQDO\VLV HGLWHG E\ /HVWHU 0 6DODPRQ DQG +HOPXW $QKHLHU 0DQFKHVWHU 0DQFKHVWHU 8QLYHUVLW\ 3UHVV /DQGLP /HLODK DQG /HWLFLD /LJQHXO &RWULP 21*V 8P SHUIFDGDVWUR GDV ILOLDGDV £ DVVRFLJ£R EUDVLOHLUD GH 21*V $%21*f 6DR 3DXOR $%21*,6(5 /DWLQ $PHULFDQ 0DUNHW 3ODQQLQJ 5HSRUW 0LDPL )/ 6WUDWHJ\ 5HVHDUFK &RUSRUDWLRQ /LQG $P\ 3RZHU JHQGHU DQG GHYHORSPHQW 3RSXODU ZRPHQnV RUJDQL]DWLRQV DQG WKH SROLWLFV RI QHHGV LQ (FXDGRU ,Q 7KH PDNLQJ RI VRFLDO PRYHPHQWV LQ /DWLQ $PHULFD ,GHQWLW\ VWUDWHJ\ GHPRFUDF\ HGLWHG E\ $UWXUR (VFREDU DQG 6RQLD $OYDUH] %RXOGHU &2 :HVWYLHZ 1HJRWLDWLQJ ERXQGDULHV :RPHQnV RUJDQL]DWLRQV DQG WKH SROLWLFV RI UHVWUXFWXULQJ LQ (FXDGRU ,Q *HQGHU DQG JOREDO UHVWUXFWXULQJ 6LWHV DQG VLJKWLQJV HGLWHG E\ $QQH 5XQ\DQ DQG 0DULDQQH 0DUFKDQG 1HZ
PAGE 393

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
PAGE 394

0HPRULD GR ;, (QFRQWU 1DFLRQDO )HPLQLVWD &DOGDV 1RYDV *RL£V 6HSWHPEHU 0LFKHOV 5REHUW >@ 3ROLWLFDO SDUWLHV $ VRFLRORJLFDO VWXG\ RI WKH ROLJDUFKLFDO WHQGHQFLHV RI PRGHUQ GHPRFUDF\ 1HZ
PAGE 395

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£R 'HYDJDU FRP DQ DQGRU TXH R VDQWR GH EDUUR -RUQDO GD $%21* 3HUURZ &KDUOHV (FRQRPLF WKHRULHV RI RUJDQL]DWLRQV 7KHRU\ DQG 6RFLHW\ 3HWUDV -DPHV ,PSHULDOLVP DQG 1*2V LQ /DWLQ $PHULFD 0RQWKO\ 5HYLHZ f 3LQWR &HOLD 5JLQD -DUGLP 0XOKHU H SROWLFD QR %UDVLO 2V LPSDVVHV GR IHPLQLVPR HQTXDQWR PRYLPHQWR VRFLDO IDFH £V UHJUDV GR MRJR GD GHPRFUDFLD UHSUHVHQWDWLYD (VWXGRV )HPLQLVWDV f 3LYHQ )UDQFHV )R[ DQG 5LFKDUG $ &ORZDUG 3RRU SHRSOHnV PRYHPHQWV :K\ WKH\ VXFFHHG KRZ WKH\ IDLO 1HZ
PAGE 396

5LEHLUR 0DWLOGH 0XOKHUHV QHJUDV EUDVLOHLUDV 'H %HUWLRJD D %HLMLQJ (VWXGRV )HPLQLVWDV f 5REEHQ $QWRQLXV & *0 6RQV RI WKH VHD JRGGHVV (FRQRPLF SUDFWLFH DQG GLVFXUVLYH FRQIOLFW LQ %UD]LO 1HZ
PAGE 397

6DQWRV 0LOWRQ 3RU XUQD HFRQRPD SROWLFD GD FLGDGH 2 FDVR GH 6DR 3DXOR 6DR 3DXOR +XFLWHF 6FKHOHU 0D[ 5HVVHQWLPHQW *OHQFRH ,/ )UHH 3UHVV 6FKHSHU+XJKHV 1DQF\ 'HDWK ZLWKRXW ZHHSLQJ 7KH YLROHQFH RI HYHU\GD\ OLIH LQ %UD]LO %HUNHOH\ &$ 8QLYHUVLW\ RI &DOLIRUQLD 3UHVV 6FKPLQN 0DULDQQH :RPHQ LQ %UD]LOLDQ $EHUWXUD SROLWLFV 6LJQV f 6FKXPDKHU 0DULD $SDUHFLGD DQG (OLVDEHWK 9DUJDV /XJDU QR JRYHUQR $OLEL RX FRQTXLVWD" (VWXGRV )HPLQLVWDV 6FKZDUW] 0LFKDHO DQG 6KXYD 3DXO 5HVRXUFH PRELOL]DWLRQ YHUVXV WKH PRELOL]DWLRQ RI SHRSOH :K\ FRQVHQVXV PRYHPHQWV FDQQRW EH LQVWUXPHQWV RI VRFLDO FKDQJH ,Q 1HZ IURQWLHUV LQ VRFLDO PRYHPHQW WKHRU\ HGLWHG E\ $OGRQ 0RUULV DQG &DURO 0F&OXUJ 0XHOOHU 1HZ +DYHQ &7
PAGE 398

6QRZ 'DYLG DQG 5REHUW %HQIRUG 0DVWHU IUDPHV DQG F\FOHV RI SURWHVW ,Q 1HZ IURQWLHUV LQ VRFLDO PRYHPHQW WKHRU\ HGLWHG E\ $OGRQ 0RUULV DQG &DURO 0F&OXUJ 0XHOOHU 1HZ +DYHQ &7
PAGE 399

5HWXUQ RI WKH DFWRU 6RFLDO WKHRU\ LQ SRVWLQGQVWULDO VRFLHW\ 0LQQHDSROLV 01 8QLYHUVLW\ RI 0LQQHVRWD 3UHVV 7XUUD &OHXVD DQG *XVWDYR 9HQWXUL HGVf 5DFLVPR FRUGLDO $ PDLV FRPSOHWD DQ£OLVH VREUH RSUHFRQFHLWR GH FRU QR %UDVLO 6DR 3DXOR )ROKD GH 6DR 3DXOR$WLFD 8SKRI) 1RUPDQ /RFDO LQVWLWXWLRQDO GHYHORSPHQW $Q DQDO\WLFDO VRXUFHERRN ZLWK FDVHV :HVW +DUWIRUG &7 .XPDULDQ 8YLQ 3HWHU DQG 'DYLG 0LOOHU 3DWKV WR VFDOLQJXS $OWHUQDWLYH VWUDWHJLHV IRU ORFDO QRQJRYHUQPHQWDO RUJDQL]DWLRQV +XPDQ 2UJDQL]DWLRQ f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f :LHQHU $QWMH ,GHQWLW\SRZHUSROLWLFV RU VRFLDO PRYHPHQWV LQVLGH RXW $ FULWLFDO IHPLQLVW SHUVSHFWLYH RQ VRFLDO PRYHPHQWV 3DSHU SUHVHQWHG DW WKH ;9,,, LQWHUQDWLRQDO &RQJUHVV RI WKH /DWLQ $PHULFDQ 6WXGLHV $VVRFLDWLRQ $WODQWD *HRUJLD 0DUFK :LOVRQ -DPHV 4 3ROLWLFDO RUJDQL]DWLRQV 1HZ
PAGE 400

=DOG 0D\HU /RRNLQJ EDFNZDUG WR ORRN IRUZDUG 5HIOHFWLRQV RQ WKH SDVW DQG IXWXUH RI WKH 5HVRXUFH 0RELOL]DWLRQ 5HVHDUFK 3URJUDP LQ )URQWLHUV LQ VRFLDO PRYHPHQW WKHRU\ HGLWHG E\ $OGRQ 0RUULV DQG &DURO 0F&OXUJ 0XHOOHU 1HZ +DYHQ &7 @ 6RFLDO PRYHPHQW RUJDQL]DWLRQV *URZWK GHFD\ DQG FKDQJH LQ 6RFLDO PRYHPHQWV LQ DQ RUJDQL]DWLRQDO VRFLHW\ &ROOHFWHG HVVD\V HGLWHG E\ 0D\HU 1 =DOG DQG -RKQ 0F&DUWK\ 1HZ %UXQVZLFN 17UDQVDFWLRQ %RRNV

PAGE 401

%,2*5$3+,&$/ 6.(7&+ 1DWKDOLH /HERQ LV D QDWLYH RI UXUDO QRUWKHDVWHUQ )UDQFH ,Q VKH ZDV DZDUGHG DQ KRQRUV VFKRODUVKLS E\ WKH *HUPDQ 1DWLRQDO ([FKDQJH 6HUYLFHV '$$'f WR VWXG\ IRU RQH VHPHVWHU DW WKH 8QLYHUVLW\ RI &RORJQH *HUPDQ\ ,Q VKH HDUQHG D PDVWHUnV GHJUHH LQ DSSOLHG IRUHLJQ ODQJXDJHV IURP WKH 8QLYHUVLW\ RI 1DQF\ ,, )UDQFH $IWHU D RQH \HDU H[FKDQJH SURJUDP LQ WKH 8QLWHG 6WDWHV VKH JUDGXDWHG ZLWK D PDVWHUnV GHJUHH LQ SROLWLFDO VFLHQFH LQWHUQDWLRQDO DIIDLUV FRQFHQWUDWLRQ IURP ,QGLDQD 8QLYHUVLW\ RI 3HQQV\OYDQLD LQ $V SDUW RI KHU GHJUHH UHTXLUHPHQWV VKH SDUWLFLSDWHG LQ WKH WK 8QLWHG 1DWLRQV *UDGXDWH 6WXG\ 3URJUDP LQ *HQHYD LQ -XO\ 6KH UHWXUQHG WR DFDGHPLD LQ WR HQUROO LQ WKH 3K SURJUDP LQ DQWKURSRORJ\ DW WKH 8QLYHUVLW\ RI )ORULGD +HU ILHOGZRUN LQ %UD]LO ZDV ILQDQFHG E\ 7KH 1RUWK6RXWK &HQWHU DW WKH 8QLYHUVLW\ RI 0LDPL WKH -RKQ DQG &DWKHULQH 7 0DF$UWKXU )RXQGDWLRQ 7KH 1DWLRQDO 6FLHQFH )RXQGDWLRQ DQG WKH &ROOHJH RI /LEHUDO $UWV DQG 6FLHQFHV DW WKH 8QLYHUVLW\ RI )ORULGD 6KH LV WKH DXWKRU RI WZR DUWLFOHV 7KH 3URIHVVLRQDOL]DWLRQ RI :RPHQnV +HDOWK *URXSV LQ 6DR 3DXOR 7KH 7URXEOHVRPH 5RDG WRZDUGV 2UJDQL]DWLRQDO 'LYHUVLW\ LQ 2UJDQL]DWLRQ f IRU ZKLFK VKH ZDV DZDUGHG WKH ,UHQH 7KRPSVRQ IHOORZVKLS E\ WKH &HQWHU IRU :RPHQnV 6WXGLHV DQG *HQGHU 5HVHDUFK DW WKH 8QLYHUVLW\ RI )ORULGD LQ 6HSWHPEHU DQG 7KH %UD]LOLDQ )HPLQLVW 0RYHPHQW LQ WKH 3RVW&RQVWLWXWLRQDO (UD $VVHVVLQJ WKH ,PSDFW RI WKH 5LVH RI )HPLQLVW 1RQ*RYHUQPHQWDO 2UJDQL]DWLRQV LQ 7KH )ORULGD -RXUQDO RI $ QWKURSRORJ\ f

PAGE 402

, FHUWLI\ WKDW KDYH UHDG WKLV VWXG\ DQG WKDW LQ P\ RSLQLRQ LW FRQIRUPV WR DFFHSWDEOH VWDQGDUGV RI VFKRODUO\ SUHVHQWDWLRQ DQG LV IXOO\ DGHTXDWH LQ VFRSH DQG TXDOLW\ DV D GLVVHUWDWLRQ IRU WKH GHJUHH RI 'RFWRU RI 3KLORVRSK\ +HOHQ 6DID &KDLU 3URIHVVRU (PULWD RI $QWKURSRORJ\ FHUWLI\ WKDW KDYH UHDG WKLV VWXG\ DQG WKDW LQ P\ RSLQLRQ LW FRQIRUPV WR DFFHSWDEOH VWDQGDUGV RI VFKRODUO\ SUHVHQWDWLRQ DQG LV IXOO\ DGHTXDWH LQ VFRSH DQG TXDOLW\ DV D GLVVHUWDWLRQ IRU WKH GHJUHH RI 'RFWRU RI 3KLORVRSK\ A A 6RQLD ( $OYDUH] $VVRFLDWH 3URIHVVRU RI 3ROLWLFV 8QLYHUVLW\ RI &DOLIRUQLD DW 6DQWD &UX] FHUWLI\ WKDW KDYH UHDG WKLV VWXG\ DQG WKDW LQ P\ RSLQLRQ LW FRQIRUPV WR DFFHSWDEOH VWDQGDUGV RI VFKRODUO\ SUHVHQWDWLRQ DQG LV IXOO\ DGHTXDWH LQ VFRSH DQG TXDOLW\ DV D GLVVHUWDWLRQ IRU WKH GHJUHH RI 'RFWRU RI 3KLORVRSK\ eY 0D[LQH / 0DUJROLV 3URIHVVRU RI $QWKURSRORJ\ FHUWLI\ WKDW KDYH UHDG WKLV VWXG\ DQG WKDW LQ P\ RSLQLRQ LW FRQIRUPV WR DFFHSWDEOH VWDQGDUGV RI VFKRODUO\ SUHVHQWDWLRQ DQG LV IXOO\ DGHTXDWH LQ VFRSH DQG TXDOLW\ DV D GLVVHUWDWLRQ IRU WKH GHJUHH RI 'RFWRU RI 3KLORVRSK\ $QWKRQA5 2OLYHU6PLWK 3URIHVVRU RI $QWKURSRORJ\

PAGE 403

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


THE LABOR OF LOVE AND BREAD PROFESSIONALIZED AND
VOLUNTEER ACTIVISM IN THE SÁO PAULO WOMEN’S HEALTH MOVEMENT
By
NATHALIE LEBON
A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL
OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT
OF THE REQUIREMENTS FOR THE DEGREE OF
DOCTOR OF PHILOSOPHY
UNIVERSITY OF FLORIDA
1998

Copyright 1998
by
Nathalie Lebon

Dedicated to the vibrant Sao Paulo women activists without whom this work would not
have seen the light of day.

ACKNOWLEDGMENTS
My first expressions of gratitude go to my mother and my father for always having
believed in me and supporting my plans without a wink and for having instilled in me their
genuine concern for social justice and equity. My deepest gratitude goes to the women
who so generously dedicated their time so that I could conduct this research and without
whom this study would not have seen the light of day It is their tenacious commitment to
bettering women's lives which has given birth to the Sao Paulo women's health movement
and hence to this study. They taught me about the reality of social movements and
organizations, about commitment and activism, about feminism in all its forms, and about
myself. It would be impossible for me to list here the names of all the women I interviewed
and interacted with. In particular, I would like to thank the groups who opened their doors
to my inquisitive eyes. In these pages, they have been renamed Feministas & Saúde,
Saúde Para Todas, The Casa da Midher, Mulheres Unidas, Moví mentó Mulher e Saúde,
Grupo de Mulheres da Zona Leste, and Sande. Thank you as well to the Fórum de
Mulheres de Sao Paulo para Avaliagao da Década and to the Rede Nacional Feminista
de Saúde e Direitos Reprodutivos for allowing me to participate in their activities. A
number of women offered me their friendship and spent time with me outside the
"research setting:" Mudas saudades to Amelinha, Bel, Cássia, Cleide, Estella, Firmina,
Fátima, Jacira, Liége, Maria, Melodie, Nalu, Regina and Teresinha, and especially to
Flávia, Matilde, Lurdinha, Denise, Gláucia and Teresa. Thank you as well to the
IV

Association of Brazilian NGOs (ABONG) and in particular to Rosangela Dias O. da Paz,
for patiently answering all of my questions and sending me material even after 1 was back
in the US.
In Sao Paulo, the Carlos Chagas Foundation was particularly generous with
institutional and logistical support, notably a vital email link, and a very friendly staff.
However, I also want to extend my warmest thanks to the researchers of their gender
research group: Danielle Ardaillon, Cristina Bruschini, Teresa Citeli and Albertina de
Oliveira Costa for innumerable supportive chats and stimulating conversations about
feminism, the women's movement, and Brazilian life and politics.
I am deeply indebted to my committee for the support I have received throughout
this endeavor. Helen Safa, as chair of my committee, was always present and supportive,
providing essential guidance and inspiration, prodding me to give my very best, and
concerned with my well-being as a human being. Marianne Schmink deserves my highest
gratitude for crucial pep-talks and strategic advice, for her insights on institutional
development issues, and for countless hours spent at straightening and fine-tuning my
thoughts and sentences. I feel very fortunate to have met Sonia Alvarez, whose long-term
insider knowledge and understanding of the issues at hand and of the Brazilian women's
movement have been a blessing. During my stay in the field and throughout write-up she
opened the way for a close collaboration which was essential in strengthening my
arguments and boosting my confidence. Philip Williams' comments and knowledge of
social movement theory and democratization issues were most welcome. So were his
friendly support, encouragements and insightful suggestions during write-up. Throughout
my years at Florida, Maxine Margolis offered me her unconditional support, which made
v

my first trip to Brazil a reality. I thank her for her astute comments on my work, and for
partaking with me in her remarkable knowledge of and love for all things Brazilian. Tony
Oliver-Smith was essential in helping me find my marks within the moving terrain of social
and anthropological theory. His enlightening reading suggestions and stimulating
conversations were critical in refining my view of the role of culture which led to my
understanding of the relationship between culture, politics and democratization.
I was fortunate to meet, along my trips to foreign lands, great people to help
quench my thirst for home: the Matera-Castro family in Rio de Janeiro and the Romitelli
family in Sao Paulo both hosted and pampered me as their own. My dear friends Claudia
Castro and Silvia Romitelli provided the link.
My "expatriate" friends in the field Bertha French, Ann Mische, and most
especially Sara Nelson, were an inestimable source of research discussion, fieldwork
survival tips and vital play time. My closest friends in Gainesville Karla Slocum, Karen
Hjerpe, Cristina Espinosa, Vicki Michener, Laura Kozuch, Bryan Byrne and Peter
Cronkleton shared research and writing experiences, and provided countless advice and
encouragements, as well as opportunities for having a good time over the years. Finally, I
want to thank my companion, Scott Hill, for his encouragements, for lively and stimulating
"anthropological" conversations and comments on my work, for having stuck through
thick and thin during this sometimes painful delivery, as well as for constantly reminding
me that there is life beyond academia... and for delicious dinners.
vi

TABLE OF CONTENTS
page
ACKNOWLEDGEMENTS iv
LIST OF TABLES xi
ABSTRACT xii
CHAPTERS
1 INTRODUCTION 1
Social Movements and the Deepening of Democracy 1
Methods and Fieldwork Experience 5
The Politics of Representation and the Ethnography of Activism 9
Setting the Stage 11
Sao Paulo in Facts 11
Health Situation in Brazil 15
The Brazilian Public Health Care System 16
Outline of Chapters 17
2 SOCIAL MOVEMENT RESEARCH AND ANTHROPOLOGY 20
Introduction 20
Resource Mobilization Theory and New Social Movement Theory 21
Bridging the Gap In Social Movement Research 25
Disruption versus Integration in the Political System 28
Social Movement Fields 29
Organizations and the Formalization, Institutionalization and
Professionalization of Social Movements 30
Formalization and Institutionalization 30
Professionalization 34
Consequences of Professionalization 37
The Role of Funding 40
Anthropology and Social Movement Research 43
Culture, Agency and Social Movements 43
Social Movement Heterogeneity 49
Importance of Practice in Collective Action 51
How Organizational Forms Influence Collective Identity and Solidarity 53
Conclusion 57
vii

3 NONGOVERNMENTAL ORGANIZATIONS AND THE WOMEN'S
MOVEMENT 59
Introduction 59
The Social Construction of a New Political Actor: Nongovernmental
Organizations 61
The Origins: Popular Education Centers and the Dictatorship 61
NGOs in the Time of Democratization: Building Civil Society 64
"NGOs? What Kind of Beast is This?" NGOs Born Out of a Social Movement 67
The Story of the Brazilian Women's Movement 69
The "Takeover" by Issue-Specific Groups and Networks 78
Feminist NGOs: A Contested Definition 88
Funding as a Defining Criterion? Are Aid Agencies Straight-Jacketing
NGOs? 88
Relationship to the Movement 90
An Hybrid Identity 92
Relation to the State and the Development Apparatus: "From Subversion
to Subvention?" 96
The Women's Movement as a Social Movement Field 102
4 FACING THE DREAM OF "SISTERHOOD"AND THE PRAGMATICS OF
GETTING THINGS DONE 105
Introduction 105
Snapshots of Encounters 107
Democratization and NGOs' Internal Dynamics 111
Social Control: General Assemblies and Boards of Directors 113
Internal Dynamics: The Challenges of Participatory Democracy 115
Professionalization and the Homogeneization of Members 120
Division of Labor: Technical Team and Administrative Team 124
Introducing Elements of Instrumentality 129
Role Specialization among NGOs' Technical Staff 129
Feminist Identity and Administrative Staff 134
Collective Versus Individual Incentives and Rewards and the Logic of
Identity 136
Why A More Formalized, Segmented Organizational Structure? 138
Volunteer Groups' Administrative Challenges 138
The "Logic of Projects" and Management of Grant Money 143
Conclusion 146
5 THE LABOR OF LOVE AND BREAD: ORGANIZATIONAL PRACTICES,
INDIVIDUAL AND COLLECTIVE IDENTITIES 148
Introduction 148
From "Militancia" to "Work" and Back: The Meaning of Working in a
Feminist NGO ] 50
Individual Activist History and Moment of Entry in NGO 153
viii

Money versus Belonging 155
Solidarity and Self-Interest 157
The Labor of Love and Bread 162
Collective Identity: From Direct Action Movement to Advocacy Group 163
Mulheres Unidas: It's Like a Train. . .at the Rhythm of the Movement 164
Feministas e Saúde: A Respected Health Policy-Centered NGO 166
Planning versus "Colar a Realidade" (Stick to Conjuncture) 169
Conflicting Time Schedules 173
"Feminism of the Other" 174
Conclusion 176
6 ENCOUNTERS AND MISENCOUNTERS: "CITY" AND
"NEIGHBORHOOD" FEMINISTS 180
How Different are Neighborhood Women? 182
Cultural Differences 185
Differences in Interests and Needs 188
When Diversity Means Trouble 191
Get to the Point: Time Constraints Hinder Participation 194
"Big Groups" and "Small Groups" 194
The Rule of Homogamy 195
Where Did All the "City" Feminists Go? 198
A Feeling of Abandonment 199
The View from the Other Side 201
Looking for Explanations 205
A New Political Environment 205
Specificity of the Movement in Sao Paulo 206
The Desk and the Street 210
Professionalization Accelerates these Processes 211
"The Feminists Are Still the Others" 216
Unraveling a Paradox 219
Group-Capacity Building 220
The Characteristics of Projects 221
Conclusion 226
7 PUTTING ON THE ROOF BEFORE LAYING THE FOUNDATIONS?
FEMINIST NGOs, THE UNITED NATIONS AND THE STATE 228
Introduction 228
A Move Away from Local and Street Activities 231
Different Dynamics in Mass Events 232
Relations of Local, National and Supranational Agendas 236
Representation at the National and International Levels 241
Institutions Push for Hierarchization 242
The Movement Resists 243
Power Differentials 246
Relations with the State 253
IX

Conclusion: Bridging the Local/International and the Political/Cultural 261
8 UP THE PURSE'S STRINGS: NGO RELATIONS WITH DONOR
AGENCIES 265
Donor Agencies: A Diverse Community 266
Latin American NGOs in Crisis 269
Shift in Funding Policies of European Nongovernmental Donors 270
The Shock of the "Plano Real" 271
Change in Organizational Culture in European Agencies 272
Bitter Consequences for NGOs 276
More Market-Like Dynamics 278
Objectives of International Agencies 282
From Efficiency to Empowerment 283
Liberal Goals 287
The Population Control Issue 288
Fostering Already Established Organizations with an Advocacy Focus 290
Contributing to Formalization and Hierarchization 291
Contributing to Institutionalization and Hierarchization 293
"Let's Stand-up and Denounce" is Out: Influencing Policy-Makers Is In 295
How Women View and Resist International Agencies 302
NGOs' Resistance 306
Noticeable Problems 308
Conclusion 311
9 CONCLUSION 315
Relationship NGOs/Social Movement 315
Impact of Practices on Collective Identity 317
Keeping the Balance between Policy Formulation and Mobilizing/Cultural
Change 318
Getting the Best of Both Worlds 321
APPENDICES
A ORIGINAL OF QUOTES IN PORTUGUESE 328
B DESCRIPTION OF MEMBERS' ACTIVITIES 366
REFERENCES 369
BIOGRAPHICAL SKETCH 388
x

LIST OF TABLES
Table page
3-1 Characteristics of Feminist NGOs Members of ABONG 86
4-1 Socioeconomic Profile: Summary by Organization 125
4-2 Socioeconomic Profile and Political Participation of Members (Support Groups) 126
4-3 Organizational Characteristics of Volunteer and Professionalized Groups 139
6-1 Socioeconomic Profile and Political Participation of Neighborhood Activists 184
6-2 Change in ABONG Members' Spatial Scales of Action 199
7-1 1994 Budget of Sao Paulo Feminist Support Groups 249
8-1 Types of Financing for some Brazilian Women's NGOs 267
8-2 Groups' Sources of Financing in 1995 269
8-3 Ford Foundation. Grants Awarded to Brazilian Organizations under their
Reproductive Health and Population Program, 1994 296
8-4 MacArthur Foundation. Grants Awarded to Brazilian Organizations under
their Population Program, 1994 296
8-5 MacArthur Foundation. Grants Awarded to Brazilian Organizations under
their Population Program, 1996 297
8-6 SPT Projection of Budget for 1993-1996 297
xi

Abstract of Dissertation Presented to the Graduate School
of the University of Florida in Partial Fulfillment of the
Requirements for the Degree of Doctor of Philosophy
THE LABOR OF LOVE AND BREAD: PROFESSIONALIZED AND
VOLUNTEER ACTIVISM IN THE SÁO PAULO WOMEN’S HEALTH MOVEMENT
By
Nathalie Lebon
August 1998
Chairman: Dr. Helen I. Safa
Major Department. Department of Anthropology
In the past 10 years, many professionalized organizations, also referred to as
nongovernmental organizations (NGOs), have been formed in the Brazilian women's
movement. This study examines the origins of this trend, linked to the boom of NGOs
worldwide, to the return of formal democracy in Brazil in 1985, and to the still limited
absorption by the international development establishment of part of the women's
movement agenda, as well as to changes internal to the movement. Based on ethnographic
research, this study compares the collective identity, practices and internal dynamics of
two professionalized and two volunteer groups dealing with women's health in Sao Paulo.
This study demonstrates that the women's movement is best understood as a social
movement field with heterogeneous participants. Feminist NGOs are one of them. Yet,
their organizational characteristics distinguish NGOs from classic social movement
organizations. In search of the efficiency and management capability required by the logic

of projects financed by donor agencies, NGOs have a more formalized and differentiated
internal structure, less permeable for neighborhood women. The presence of extrinsic
rewards alters the meaning of members' participation in feminist NGOs which becomes
simultaneously a commitment for gendered social change and a means for earning a living.
NGOs have an hybrid identity. Their emphasis on planning, linked to accountability to
donors for funded projects, tends to steer NGOs away from, and to limit their potential
for, consciousness-raising and mobilization. Yet, it stimulates publications, research
activities and advocacy in policy-making arenas, a shift already promoted by the transition
towards formal democracy. As a result, professionalized feminists have tended to reduce
their involvement with Sao Paulo neighborhood women's groups. With
professionalization, the movement also faces new challenges in terms of increased power
differentials.
Professionalized activist organizations and their associated institutional strategies
do contribute to social change. Yet, a two-pronged strategy with a vibrant movement
involved in cultural/micro-level change is essential for true democratization and gendered
equity. Strategies increasing NGOs downward accountability to their constituency would
greatly enhance the balancing act between their advocacy and their micro-level culture
change projects.
xiii

CHAPTER 1
INTRODUCTION
Social Movements and the Deepening of Democracy
The other day I was asking somebody who belongs to a women's group:
Your organization, is it an NGO or is it the movement? She replied: It is the
movement! I said: But what do you mean? you' re structured like an NGO. She
said: No, for us it is the same thing, there is no difference. We are an
organization at the service of the movement.
This can't be! An NGO is an NGO! A social movement is a social movement!
NGOs, in principle, are only accountable to financing agencies. The movement
is accountable to those it represents! What kind of simility is there here? I think
that if we do not make this point very clear, we will not contribute to
redemocratization. It is fundamentally linked to a truly democratic order in this
country! [Volunteer feminist activist from Rio de Janeiro]1
This is how it all started. This Brazilian feminist activist, back in the summer of 1992,
had planted the seed that would become this dissertation. Her questioning was about the nature
of social movements and of NGOs, about the relationship between the two and about their
contribution to the democratization of Brazilian society and politics, as well as about the role
played by financing agencies in this story. I decided to find out more about these issues.
In 1985, a formal democratic system was reinstituted in Brazil after two decades of
military rule. As in other Latin American countries, the women's movement along with other
social movements and grassroots organizations have all been significant participants in this
redemocratization process. However, Brazilian society has been and still remains characterized
1 All quotes translated from Portuguese by author.
i

2
by social authoritarianism: hierarchy and inequality pervade the cultural practices through
which people relate to each other in everyday life (Weinstein 1994; Da Matta 1987). This
pattern is reflected in severe economic, racial and gender inequalities (Dagnino 1994a, Lovell
1993) True forms of cultural, economic and social democratization remain to be achieved for a
"deepening of democracy" (Alvarez 1993). Beyond battling social authoritarianism, a
deepening of democracy would entail creating "channels and strategies that increase nonelite
access to policymaking and implementation" (Alvarez 1993: 212).
This study focuses on the role the Brazilian women's movement can play in these
processes, using the Sao Paulo women's health movement as a case study. In the past 10-15
years, the women's movement has undergone partial professionalization —strictly speaking, the
process by which activists come to be remunerated for their movement activities— through the
creation of nongovernmental organizations (NGOs). Generally, NGOs are defined as legally
sanctioned civil organizations providing services and support to local grassroots groups in
disadvantaged communities and/or engaging in research and advocacy activities, a concept
derived from Carroll's Grassroots Support Organizations (1992:11). Maintaining the balance
between these two poles of activity (advocacy and support) has been a challenge for many
NGOs, including for women's NGOs, due to the political opening in Brazil, as well as to their
own history and nature as members of an identity-based movement. NGOs have a permanent,
paid staff and are accountable to some degree to their donors, most often international agencies
or private foundations, for the research, consulting, service-providing projects or support to
local women's groups for which they are granted funding. Their structure is fairly formalized,
usually with a coordination heading the organization, and a division of labor, especially
between administrative tasks and the "technical" work done by specialized staff. However,

NGOs differ according to organizational histories and the political and personal characteristics
of their members.
3
Some volunteer feminist groups perform similar activities as do NGOs, although in a
more spontaneous manner, responding to demands as they arise rather than following projects.
They have a voluntary, fluctuating membership of activists. They are more likely to be
accountable to their constituency, or to grassroots groups since they do not depend on donor
money for their organizational survival and have smaller budgets. They also dedicate some
activities to the needs of the members of the group itself.
Both feminist NGOs and volunteer feminist groups engage in coalition work of the
women's movement and in advocacy for greater gender equity. They consider themselves
feminist. In that sense feminist NGOs differ from other NGOs which also work with women
but do not generally participate in the women's movement and do not identify themselves as
feminist. I will use the terms NGO, professionalized organization and professionalized group
interchangeably in this dissertation. I sometimes refer to professionalized feminist groups and
volunteer feminist groups collectively as support groups, for want of a better label, when I wish
to distinguish them from the neighborhood women's groups with which they interact. As I have
just mentioned, this term is not very satisfactory since many of these groups have reduced the
support they were offering to neighborhood women's groups. I also sometimes refer to
volunteer groups as volunteer support groups, again to distinguish them from neighborhood
women's groups, all of which are also volunteer. To complicate matters father some of these
neighborhood women's groups consider themselves feminist, a phenomenon known as popular
feminism, which I will discuss in chapter 6.

4
The purpose of this dissertation is to understand the origins of the trend towards
professionalization of the women's movement, via the creation of NGOs, considering the
internal and external factors that have contributed to this process. It is also to examine the
impact of professsionalization on the internal dynamics of the groups, as well as on their
collective identity and strategies, on their relationship to the neighborhood women's
organizations they offer support to and sometimes get to represent. I will also consider the
groups' position vis-á-vis the national and international power structure and their relations to
international donor agencies. One of my concerns, throughout this work, has been to highlight
the trade-offs of professionalization with regard to the potential of the movement to bring
about a deepening of democracy within the women's movement and in the larger society.
I hoped, when I started this work that it could be of use to movement activists. John
Burdick made a cogent argument for the role ethnography can play in illuminating diversity
within a movement and hence in helping the movement identify its challenges and potential for
growth He aptly sees applied anthropology as a strong base from which to launch this kind of
work, provided we shift the focus of much of the subdiscipline from "agency or state-initiated
projects of social change" (1995. 363) to these grassroots efforts. Yet, this type of ethnography
is not without challenges: throughout the research and write-up process I have wondered what
gave me the right —not only as an outsider but a neophyte who has not even participated in any
of their struggles— to question some of their practices when these women have dedicated their
lives to matters of feminism. Leilah Landim, who worked for an NGO and wrote her
dissertation based on this experience, puts it in these terms: "to write a sociology of agents
who consider themselves as "at the service of others" is still an issue fraught with ambiguity and

5
questioning"('/ carregada de ambiguidades e questionamentod) (1993a: 19).
Beyond this immediate, applied dimension of my work, it is important for
anthropologists, who have until recently neglected the study of social movements, to take a
closer look at these nonkin forms of social organization. Burdick reminds us that "a generation
ago, Richard Clemmer [...] declared that a sustained commitment by anthropologists to the
study of organized popular attempts to bring about social change would "provide anthropology
with a much more balanced and useful body of theory" (1995:361).
Finally, although nongovernmental organizations (NGOs) have become ubiquitous in
the literature, especially on development and transnational activism, and have prompted many
declarations of faith, few first-hand ethnographic studies are available of their power dynamics
and relationships to the grassroots and to the State (Fisher 1997). Such studies could also
illuminate "changes in the nature of local and global forms of collective action" (Fisher
1997:441). The strength of the international women's movement, of which Brazilian feminists
are noted participants, is undeniable. Yet, we need to assess how it affects local organizing and
processes of democratization.
Methods and Fieldwork Experience
I decided to focus on the issue of NGOization (a Ongizagáo) of the feminist movement
as a result of a preliminary research trip in July and August of 1992, when I conducted semi-
structured interviews with 21 women activists, primarily in Rio de Janeiro. Questions relative
to the professionalization of the movement examined in this dissertation were starting to raise
eyebrows among activists, as the quote at the beginning of this introduction denotes. A review

6
of the literature at the time revealed practically no discussion of these issues. My dissertation
topic was decided
I went back to Brazil from September 1994 until November 1995, this time mainly to
Sao Paulo. I did travel to Rio de Janeiro for national events such as the national conference in
preparation for the IV UN conference on Women. This fieldwork consisted of two phases2.
During the first phase, which lasted from September to December 1994,1 surveyed the existing
women's health groups in Sao Paulo in order to select a sample for the larger project. My
original research design called for identifying two volunteer groups and two professionalized
groups that otherwise would be as similar as possible in terms of size, members' socioeconomic
profile and racial/ethnic identity, and activities conducted. Once on the ground, however, I
realized that, although there was some overlap, the structure, members' composition, collective
identity and the activities engaged in by the two types of groups were in fact quite different and
that this was an important issue to look into. I therefore chose 4 groups which represented
different trajectories, although they all consider themselves as feminist and work on health
issues.
The second phase lasted from January to November 1995. During this stage of the
research I learned more about the different types of groups through participant observation and
semi-structured interviews. More specifically, I conducted interviews with each of the members
2 The first phase was financed by the North-South Center through their Short-term Field
Research Grant Program on Poverty and Urban Violence. The second and longest phase was
financed by The John D. and Catherine T. MacArthur Foundation through their Program on
Peace and International Cooperation, by the College of Liberal Arts and Sciences at the
University of Florida through their Dissertation Fellowship, and by the National Science
Foundation through their Dissertation Improvement Program for Anthropology. The Carlos
Chagas Foundation kindly granted me institutional and logistical support during my stay in Sao
Paulo.

7
of the four support organizations to leam about the socio-economic profile of the members,
how they had changed in participating in this organization, what they understood as the goals
of the organization, and what they thought about the professionalization of the women's
movement. I participated in workshops and other activities organized by the support groups
and spent one week in the headquarters of each organization doing participant observation of
their daily activities and interactions.
Starting at the end of November 19941 followed the process of preparation and
mobilization for the UN international conference on women to be held in Beijing in September
1995.1 conducted participant observation in the bi-weekly preparation meetings, in the three
seminars organized in Sao Paulo, and in the state and the national conferences held in June
1995. I conducted participant observation on the process of organization for the street
demonstration on the 8th March (International Women's Day) and participated in various other
events celebrating this event.
The objective in participating in these movement-wide activities was to observe points
of consensus and conflict between professionalized and volunteer members. With the same
objective I also participated, in May, in the annual meeting of the Rede Nacional Feminista de
Scrúde e Direitos Reprodutivos (National Feminist Network for Health and Reproductive
Rights), in Rio de Janeiro. The Network brings together 70 organizations from all over Brazil
who work with women's health. The four support groups I have been working with are
members of this network. After this meeting I also participated in the monthly meeting of the
Sao Paulo section of the Network. Again, I wanted to understand better what part was played
by different actors and the interaction between them.

8
From August to October 1995,1 interviewed the members of three grassroots groups
who receive support from the four groups I had been working with in order to understand
better their relationship to support groups, to assess their level of gender, race and class
consciousness, as well as their level of dependency on the support group. I conducted
participant observation in the activities that these groups organized, including workshops,
meetings, and a street campaign for gynecological cancer prevention.
Before leaving, I scheduled meetings with each of the support and grassroots groups I
worked with in order to discuss with them my preliminary findings. This feedback proved very
informative and useful. During this last month I also interviewed representatives from six
financing agencies who finance women's groups. I participated in a seminar held in Recife, in
the Northeast of Brazil, about international cooperation and gender policies, which brought
together representatives of women's groups and financing agencies.
Looking back, I found that four groups were too many with which to conduct as
thorough a participant observation as I would have liked. This was compounded by the fact
that I had to spend several hours a day on the public transportation system: Sao Paulo is the
largest city in the world in terms of surface area (1700 km2) (Medina 1991:13) and its public
transportation system relies mainly on buses, not on subways, which greatly lengthens time of
travel (Santos 1994:13). However, managing good relations with all groups simultaneously,
while remaining true to myself and being comfortable expressing my reservations on some
issues proved to be, by far, the most challenging part of my experience with Sao Paulo
women’s groups.

9
The Politics of Representation and the Ethnography of Activism
Issues related to authority in ethnographic work and to the politics of representation
have been debated for more than a decade in anthropology, since Marcus and Fisher’s seminal
work (1986). My work proved particularly challenging in this regard as I was working with
highly politicized informants, aware of the power issues present between me, as researcher, and
them. I was repeatedly warned that I should not be one more researcher who would come, do
my thing and then leave without ever again giving sign of life. One group allowed me to
conduct participant observation only on the condition that they see my work before it is
published. These are logical and natural requests. Yet, in practical terms, it was not an easy
task since I have been writing my dissertation in the United States and