),/2=2),$
BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB
5Rþþ
87,/,7$5,$1,03$57,$/,7<
$1'&217(0325$5<'$5:,1,60
720,6/$9%5$&$129,û=DJUHE&KRUYiWVNR
%5$&$129,û78WLOLWDULDQ,PSDUWLDOLW\DQG&RQWHPSRUDU\'DUZLQLVP
),/2=2),$1RS
2QH LPSRUWDQW FRPSRQHQW RI XWLOLWDULDQ HWKLFDO IUDPHZRUN LV D VSHFLILF YHUVLRQ RI WKH
SULQFLSOH RI LPSDUWLDOLW\ 7KH SULQFLSOH FODLPV WKDW RQH VKRXOG EULQJ DERXW WKH JUHDWHVW
SRVVLEOHRYHUDOOXWLOLW\RUKDSSLQHVVDQGWKDWRXUPRUDODQGPRUDOO\UHOHYDQWDFWLRQVRXJKW
WRUHVXOWIURPREMHFWLYHDQGQHXWUDOGHOLEHUDWLRQVZLWKDOORXUSHUVRQDOLQWHUHVWVOLNHVDQG
GLVOLNHV OHIW RXW 'URZLQJ RQ UHOHYDQW LQVLJKWV IURP VRFLRELRORJ\ DQG HYROXWLRQDU\
SV\FKRORJ\ WKLV SDSHU VHHNV WR VKRZ WKDW XWLOLWDULDQ SULQFLSOH RI LPSDUWLDOLW\ LV VHULRXVO\
HQGDQJHUHG E\ WZR LQWHUFRQQHFWHG 'DUZLQLDQ IDFWV WKH IDFW WKDW KXPDQ ELRORJLFDOO\
VKDSHGSV\FKRORJ\DQGPRWLYDWLRQPHFKDQLVPVGRQRWILWZHOOZLWKWKHSULQFLSOHUHTXLULQJ
WKHLQGLVFULPLQDWHSURPRWLRQRIJHQHUDOKDSSLQHVVDQGWKHIDFWWKDWKXPDQEHLQJVDUH
LQGLYLGXDOV ZLWK QDWXUDOO\ HYROYHG SHUVRQDO GHVLUHV SURMHFWV DQG LGHDOV DQG QRW PHUHO\
VSDUHSDUWVRIVRPHJHQHUDOXWLOLWDULDQFORFNZRUNRIKDSSLQHVV
.H\:RUGV8WLOLWDULDQLVP±,PSDUWLDOLW\±'DUZLQLVP
8WLOLWDULDQLVPDQGWKHSULQFLSOHRILPSDUWLDOLW\2QHLPSRUWDQWDQGSUDFWLFDOO\
LQGLVSHQVDEOHFRPSRQHQWRIDOPRVWHYHU\HWKLFDOWKHRU\LVVRPHYHUVLRQRIWKHSULQFLSOH
RILPSDUWLDOLW\$FFRUGLQJWRWKLVSULQFLSOHRXUPRUDODQGPRUDOO\UHOHYDQWDFWLRQVRXJKW
WRUHVXOWIURPREMHFWLYHDQGQHXWUDOGHOLEHUDWLRQZLWKDOORXUSHUVRQDOLQWHUHVWVOLNHVDQG
GLVOLNHVOHIWRXW7KHLQWLPDWHERQGEHWZHHQWKHÄLPSDUWLDO³DQGWKHªPRUDO©LVQRWMXVWDQ
LGHD ILUPO\ URRWHG LQ RXU HYHU\GD\ PRUDO GLVFRXUVH EXW DOVR D FHQWUDO WHQHW RI PDQ\
HWKLFDO WKHRULHV OLNH WKH YDULRXV ÄLGHDO³ RU ÄLPSDUWLDO³ VSHFWDWRU WKHRULHV DGYRFDWHG E\
PRVW QRWDEO\ 'DYLG +XPH DQG $GDP 6PLWK 7KLV SULQFLSOH ILJXUHV SURPLQHQWO\ LQ WKH
FODVVLF YHUVLRQV RI XWLOLWDULDQ HWKLFV HVSHFLDOO\ WKDW DGYRFDWHG E\ -RKQ 6WXDUW 0LOO>@
ZKLFKZLOOEHFHQWUDOWRWKHSUHVHQWFRQVLGHUDWLRQDVZHOODVLQLWVFRQWHPSRUDU\YHUVLRQV
VXFKDVWKDWDGYDQFHGE\3HWHU6LQJHU>@
7KH EDVLF LGHD RI XWLOLWDULDQ HWKLFV LV WKDW RXU DFWLRQV PXVW LI WKH\ DUH WR FRXQW DV
PRUDOO\ ULJKW EULQJ DERXW WKH JUHDWHVW RYHUDOO XWLOLW\ RU KDSSLQHVV RU WKH EHVW FRQVH
TXHQFHVSRVVLEOH)XUWKHUPRUHZKHQWKHXWLOLWDULDQDJHQWGHOLEHUDWHVDVWRZKLFKDFWLRQ
ZLOO \LHOG WKH JUHDWHVW XWLOLW\ RU KDSSLQHVV RU WKH EHVW FRQVHTXHQFHV WKH LPSDFW RI WKLV
DFWLRQ XSRQ KLV RZQ ZHOIDUH PXVW EH UHJDUGHG DV LUUHOHYDQW RU DW PRVW DV HTXDOO\
LPSRUWDQW DV LWV LPSDFW RQ DOO WKH RWKHU SDUWLHV FRQFHUQHG :KDW LV UHOHYDQW IURP WKH
XWLOLWDULDQ SHUVSHFWLYH LV WKH PD[LPL]DWLRQ RI JRRG FRQVHTXHQFHV RU WKH DPRXQW RI
7KHILUVWGUDIWRIWKLVDUWLFOHZDVSUHVHQWHGLQ'HFHPEHUDWWKH.RQUDG/RUHQ],QVWLWXWHIRU(YROX
WLRQDQG&RJQLWLRQ5HVHDUFK$OWHQEHUJ$XVWULDDVSDUWRIP\UHVHDUFKSURMHFWRQWKHHYROXWLRQDU\SHUVSHF
WLYHRQKXPDQQDWXUHDQGHWKLFV,WVVHFRQGGUDIWZDVSUHVHQWHGDWDFRQIHUHQFHHQWLWOHGÄ)UHHGRPDQG(TXDO
LW\LQ&RQWHPSRUDU\3KLORVRSK\³RUJDQL]HGE\WKH6RFLHW\IRUWKH$GYDQFHPHQWRI3KLORVRSK\LQ6DPRERU
&URDWLDLQ-XQH,WKDQNERWKDXGLHQFHVIRUWKHLUFRQVWUXFWLYHGLVFXVVLRQV
KDSSLQHVVLQJHQHUDORURQEDODQFHQRWWKHPD[LPL]DWLRQRIRQH¶VRZQKDSSLQHVV,QWKH
VHFRQGFKDSWHURIKLV8WLOLWDULDQLVP-RKQ6WXDUW0LOO>@VD\VWKDWÄWKHKDSSLQHVV
ZKLFK IRUPV WKH XWLOLWDULDQ VWDQGDUG RI ZKDW LV ULJKW LQ FRQGXFW LV QRW WKH DJHQW¶V RZQ
KDSSLQHVV EXW WKDW RI DOO FRQFHUQHG $V EHWZHHQ KLV RZQ KDSSLQHVV DQG WKDW RI RWKHUV
XWLOLWDULDQLVP UHTXLUHV KLP WR EH DV VWULFWO\ LPSDUWLDO DV D GLVLQWHUHVWHG DQG EHQHYROHQW
VSHFWDWRU³
$YLYLGLOOXVWUDWLRQRIWKHSRVVLEOHLPSDFWRIWKHXWLOLWDULDQSULQFLSOHRILPSDUWLDOLW\
XSRQ PRUDO SUDFWLFH ZDV RIIHUHG E\ :LOOLDP *RGZLQ WKH IRXQGHU RI SKLORVRSKLFDO
DQDUFKLVPDQGDQHDUO\XWLOLWDULDQ,QKLV(QTXLU\&RQFHUQLQJ3ROLWLFDO-XVWLFH>@*RG
ZLQ DVNV WKDW ZH LPDJLQH D KRXVH RQ ILUH ZLWK $UFKELVKRS )HQHORQ DQG DQ RUGLQDU\
FKDPEHUPDLGLQVLGHLW,IZHZHUHDEOHWRVDYHMXVWRQHSHUVRQ*RGZLQPDLQWDLQVWKDW
SHUVRQPXVWEHWKHDUFKELVKRSDVKLVEHQHILFLDOFRQWULEXWLRQWRVRFLHW\DWODUJHLVPXFK
JUHDWHU WKDQ WKH FKDPEHUPDLG¶V 7KLV GHFLVLRQ LV MXVWLILHG E\ YLUWXH RI LWV JRRG FRQVH
TXHQFHVDQGVKRXOGEHSXUVXHGUHJDUGOHVVRIDQ\SHUVRQDORUSDUWLDOUHODWLRQZHPD\KDYH
WRZDUGV WKH FKDPEHUPDLG ,Q *RGZLQ¶V ZRUGV Ä6XSSRVLQJ WKH FKDPEHUPDLG KDG EHHQ
P\ZLIHP\PRWKHURUP\EHQHIDFWRU7KDWZRXOGQRWDOWHUWKHWUXWKRIWKHSURSRVLWLRQ
7KH OLIH RI )HQHORQ ZRXOG VWLOO EH PRUH YDOXDEOH WKDQ WKDW RI WKH FKDPEHUPDLG DQG
MXVWLFH ± SXUH XQDGXOWHUDWHG MXVWLFH ± ZRXOG VWLOO KDYH SUHIHUUHG WKDW ZKLFK ZDV PRVW
YDOXDEOH-XVWLFHZRXOGKDYHWDXJKWPHWRVDYHWKHOLIHRI)HQHORQDWWKHH[SHQVHRIWKH
RWKHU:KDWPDJLFLVWKHUHLQWKHSURQRXQªP\©WRRYHUWXUQWKHGHFLVLRQVRIHYHUODVWLQJ
WUXWK"0\ZLIHRUP\PRWKHUPD\EHDIRRORUDSURVWLWXWHPDOLFLRXVO\LQJRUGLVKRQHVW
,IWKH\EHZKDWFRQVHTXHQFHLVLWWKDWWKH\DUHPLQH"³>@±
7KH SULQFLSOH RI LPSDUWLDOLW\ DUJXHG IRU E\ 0LOO DQG LOOXVWUDWHG E\ *RGZLQ LV DOVR
UHFRJQL]DEOHLQFRQWHPSRUDU\XWLOLWDULDQDSSURDFKHVWRHWKLFVOLNHWKHRQHDGYRFDWHGE\
3HWHU 6LQJHU $W WKH FHQWHU RI 6LQJHU¶V ÄSUHIHUHQFH XWLOLWDULDQLVP© VWDQGV RQH SDUWLFXODU
YHUVLRQ RI WKH SULQFLSOH RI LPSDUWLDOLW\ FDOOHG ÃWKH SULQFLSOH RI HTXDO FRQVLGHUDWLRQ RI
LQWHUHVWVµ³ 7KLV SULQFLSOH DFFRUGLQJ WR 6LQJHU ÄDFWV OLNH D SDLU RI VFDOHV ZHLJKLQJ
LQWHUHVWV LPSDUWLDOO\ 7UXH VFDOHV IDYRXUWKHVLGHZKHUHWKHLQWHUHVWLVVWURQJHURUZKHUH
VHYHUDOLQWHUHVWVFRPELQHWRRXWZHLJKDVPDOOHUQXPEHURIVLPLODULQWHUHVWVEXWWKH\WDNH
QRDFFRXQWRIZKRVHLQWHUHVWVWKH\DUHZHLJKLQJ³>@+LVZHOONQRZQLOOXVWUDWLRQ
RI WKLV LV WKH REOLJDWLRQ RI GRQDWLQJ PRQH\ WR RYHUVHDV DLG DJHQFLHV )RU H[DPSOH WKH
PRQH\ZHDUHDERXWWRVSHQGRQFDUVIRURXUFKLOGUHQVRWKDWWKH\FDQWUDYHOPRUHHDVLO\
WR FROOHJH FRXOG LI GRQDWHG WR D KXPDQLWDULDQ DJHQF\ SUHYHQW WKH GHDWK E\ KXQJHU RU
LQIHFWLRQRIVHYHUDOFKLOGUHQLQVRPHSRRUFRXQWU\7KHLQWHUHVWVRIRXUFKLOGUHQLQKDYLQJ
QHZ FDUV GHILQLWHO\ ZHLJK OHVV WKDQ WKH LQWHUHVWV RI VWDUYLQJ RU G\LQJ FKLOGUHQ $W WKLV
SRLQW WKH XWLOLWDULDQ VWDQGDUG RI PRUDOLW\ UHLQIRUFHG E\ WKH SULQFLSOH RI LPSDUWLDOLW\
FOHDUO\ LQGLFDWHV ZKDW RXU PRUDO GXWLHV DUH 2Q WKH RWKHU KDQG LI ZH IROORZLQJ RXU
DIIHFWLRQVDQGSDUWLDOLW\JLYHSUHIHUHQFHWRWKHSHUVRQVZHFRQVLGHUQHDUHVWDQGGHDUHVW
DGHWHUPLQHGXWLOLWDULDQFRXOGDFFXVHXVRIVRPHWKLQJTXLWHFORVHWRPXUGHUIRULQWKLV
LQVWDQFH ZH ZHUH DEOH WR VDYH VHYHUDO OLYHV RU DW OHDVW RQH OLIH ZLWKRXW VDFULILFLQJ
DQ\WKLQJRIFRPSDUDEOHPRUDOVLJQLILFDQFH\HWZHKDYHIDLOHGWRGRVR
(YROXWLRQDU\DFFRXQWVRIKXPDQSDUWLDOLW\&RQWUDU\WRXWLOLWDULDQUHTXLUHPHQWV
FRQFHUQLQJ JHQHUDO XWLOLW\ DQG LPSDUWLDOLW\ LW LV D ZHOONQRZQ IDFW WKDW KXPDQ EHLQJV¶
PRUDODQGPRUDOO\UHOHYDQWGHFLVLRQVDUHXVXDOO\KLJKO\SDUWLDOWRZDUGVWKHPVHOYHVWKHLU
)LOR]RILD
FKLOGUHQ DQG IDPLO\ PHPEHUV WKHLU IULHQGV DQG QHLJKERUV RU WKHLU IHOORZFLWL]HQVHYHQ
WRZDUGV PHPEHUV RI WKHLU RZQ UDFH DQG VH[ 6LQJHU ZRXOG DOVR DGG PHPEHUV RI WKHLU
RZQVSHFLHVWRWKLVOLVW,QRWKHUZRUGVSHRSOHDUHQRWRQO\KLJKO\UHOXFWDQWWRSURYLGH
KHOS WR GLVWDQW LQGLYLGXDOV ZKRP WKH\ KDYH QHYHU PHW QRU ZLOO HYHU PHHW EXW DUH DOVR
KLJKO\LQFOLQHGWRVKDUHWKHLUUHVRXUFHVZLWKDFRPSDUDWLYHO\QDUURZFLUFOHRILQGLYLGXDOV
ZLWKZKRPWKH\DUHLQVRPHVSHFLDOLQWLPDWHUHODWLRQ
+XPDQ SDUWLDOLW\ LV QRW MXVW D SHUPDQHQW SUREOHP IRU WKH QRUPDWLYH SURMHFWV RI
DOPRVW HYHU\ HWKLFDO WKHRU\ IRU D ORQJ WLPH LW KDV DOVR SRVHG D SUREOHP IRU WKH
H[SODQDWRU\ SURMHFWV RI FRQWHPSRUDU\ HYROXWLRQRULHQWHG VFLHQFHV UHJDUGLQJ KXPDQ
EHKDYLRU ,Q D QXWVKHOO WKH SUREOHP ZDV WKH IROORZLQJ KRZ LV LW SRVVLEOH IRU QDWXUDO
VHOHFWLRQ DV WKH FHQWUDO PHFKDQLVP RI 'DUZLQLDQ HYROXWLRQ WR LPSODQW LQ KXPDQV DQ\
SDUWLDO RU DOWUXLVWLF EHKDYLRUDO WHQGHQFLHV WRZDUGV DQ\RQH LI VXFK EHKDYLRU LV GLD
PHWULFDOO\ RSSRVHG WR WKH EDVLF 'DUZLQLDQ SULQFLSOH RI WKH VXUYLYDO RI WKH ILWWHVW" 7KLV
ÄSDUDGR[RIDOWUXLVP³LVFDSWXUHGZHOOE\1HYHQ6HVDUGLü>@Ä>2@QRQHKDQGLW
VHHPVWKDWWKHH[LVWHQFHRIKXPDQDOWUXLVPLVDQXQGHQLDEOHSV\FKRORJLFDOIDFWEXWRQWKH
RWKHUKDQGLWVHHPVRQHYROXWLRQDU\JURXQGVWKDWDOWUXLVPFDQQRWH[LVWEHFDXVHVSHFLHV
ZLWKWKLVWUDLWDUHH[SHFWHGWRKDYHJRQHH[WLQFWWKURXJKWKHSURFHVVRIQDWXUDOVHOHFWLRQ
6HOILVKQHVVLQFUHDVHVELRORJLFDOILWQHVVDQGRQO\WKHILWWHVWVXUYLYH³
,QVSLWHRIWKLVSULPDIDFLHFRQIOLFWEHWZHHQDOWUXLVWLFEHKDYLRUDQGWKHFHQWUDOWHQHWV
RI'DUZLQLDQHYROXWLRQGXULQJWKHSDVWWKUHHWRIRXUGHFDGHVHYROXWLRQDU\DSSURDFKHVWR
KXPDQEHKDYLRU±SDUWLFXODUO\VRFLRELRORJ\DQGHYROXWLRQDU\SV\FKRORJ\±KDYHPDQDJHG
WRSURGXFHWKUHHFXUUHQWO\TXLWHLQIOXHQWLDOH[SODQDWLRQVRIKXPDQDOWUXLVP
7KH ILUVW H[SODQDWLRQ LV WKH ÄNLQ VHOHFWLRQ³ RU ÄLQFOXVLYH ILWQHVV³ WKHRU\ RULJLQDOO\
SURSRVHGE\:LOOLDP+DPLOWRQ>@$FFRUGLQJWRWKLVWKHRU\KXPDQDOWUXLVWLFWHQGHQFLHV
KDYHHYROYHGSULPDULO\LQVPDOOJURXSVRIJHQHWLFDOO\UHODWHGLQGLYLGXDOV7KHEDVLVRIWKLV
WKHRU\LVWKHLGHDRIJHQHV±ªVHOILVKJHQHV©WRXVHWKHWHUPFRLQHGE\5LFKDUG'DZNLQV
>@±DVFUXFLDODFWRUVLQWKHHYROXWLRQDU\SURFHVVZKRVHSULPDU\ªREMHFWLYH©LVWRFUHDWH
DV PDQ\ RI WKHLU LGHQWLFDO FRSLHV DV SRVVLEOH LQ VXEVHTXHQW JHQHUDWLRQV )URP WKH
SHUVSHFWLYH RI JHQHV ZKLFK VXSSRVHGO\ LQIOXHQFH LQGLYLGXDO DOWUXLVWLF RU QRQDOWUXLVWLF
EHKDYLRULWSD\VWREHDOWUXLVWLFWRZDUGVRQH¶VUHODWLYHVEHFDXVHWKH\FDUU\DVLJQLILFDQW
SURSRUWLRQRILGHQWLFDOJHQHV%\DOWUXLVWLFDOO\DVVLVWLQJWKHVXUYLYDODQGUHSURGXFWLRQRI
RXU UHODWLYHV ZH LH RXU JHQHV DUH DOVR DVVLVWLQJ WKH VXUYLYDO DQG PXOWLSOLFDWLRQ RI
FRSLHVRIRXUJHQHV,QWKLVZD\DOWUXLVPHYROYHGWREHFRPHRQHRIWKHPRVWXELTXLWRXV
W\SHVRIKXPDQVRFLDOEHKDYLRU
7KH VHFRQG H[SODQDWLRQ LV WKH ÄUHFLSURFDO DOWUXLVP³ WKHRU\ RULJLQDOO\ SURSRVHG E\
5REHUW 7ULYHUV >@ 7ULYHUV¶ PRGHO GRHV QRW QHFHVVDULO\ UHTXLUH JHQHWLF UHODWHGQHVV
EHWZHHQWKHSHUIRUPHUDQGUHFLSLHQWRIDQDOWUXLVWLFDFWEXWUDWKHULVGHVLJQHGÄWRVKRZ
KRZ FHUWDLQ FODVVHV RI EHKDYLRU FRQYHQLHQWO\ GHQRWHG DV ÃDOWUXLVWLFµ RU ÃUHFLSURFDOO\
DOWUXLVWLFµ FDQ EH VHOHFWHG IRU HYHQ ZKHQ WKH UHFLSLHQW LV VR GLVWDQWO\ UHODWHG WR WKH
RUJDQLVP SHUIRUPLQJ WKH DOWUXLVWLF DFW WKDW NLQ VHOHFWLRQ FDQ EH UXOHG RXW³ >@ $FFRUGLQJ WR WKLV WKHRU\ DOWUXLVWLF WHQGHQFLHV HYROYH EHFDXVH LW LV DGYDQWDJHRXV WR EH
DOWUXLVWLF WRZDUGV LQGLYLGXDOV ZKR DUH WKHPVHOYHV DOWUXLVWLF ,Q WKLV ZD\ D FRRSHUDWLYH
QHWZRUN LV FUHDWHG LQ ZKLFK DOWUXLVWLF LQGLYLGXDOV E\ YLUWXH RI WKHLU FRQWLQXRXV PXWXDO
6HVDUGLü >@ DOVR RIIHUV DQ LQIRUPDWLYH DQG LQQRYDWLYH ªVWDWH RI WKH DUW© VXUYH\ RI WKHRUHWLFDO DS
SURDFKHVWRKXPDQDOWUXLVPDQGHYROXWLRQGXULQJWKHSDVWWKUHHWRIRXUGHFDGHV
DLGIDUHPXFKEHWWHUWKDQQRQFRRSHUDWLYHLQGLYLGXDOV7ULYHUV¶WKHRU\DSSOLHVSULPDULO\
DOWKRXJK QRW H[FOXVLYHO\ WR LQGLYLGXDOV ZLWK D ORQJHU OLIHVSDQ DQG PRUH GHYHORSHG
LQWHOOLJHQFHDQGPHPRU\$VKXPDQVGHILQLWHO\EHORQJWRWKLVFODVV7ULYHUVPDLQWDLQVWKDW
ÄJLYHQWKHXQLYHUVDODQGQHDUO\GDLO\SUDFWLFHRIUHFLSURFDODOWUXLVPDPRQJKXPDQVWRGD\
LWLVUHDVRQDEOHWRDVVXPHWKDWLWKDVEHHQDQLPSRUWDQWIDFWRULQUHFHQWKXPDQHYROXWLRQ
DQGWKDWWKHXQGHUO\LQJHPRWLRQDOGLVSRVLWLRQVDIIHFWLQJDOWUXLVWLFEHKDYLRUKDYHLPSRUWDQW
JHQHWLFFRPSRQHQWV³>@
7KHWKLUGH[SODQDWLRQLVWKHÄJURXSVHOHFWLRQ³WKHRU\RULJLQDOO\SURSRVHGE\&KDUOHV
'DUZLQ>@$FFRUGLQJWRWKLVWKHRU\KXPDQDOWUXLVWLFWHQGHQFLHVKDYHHYROYHGE\YLUWXH
RI QDWXUDO VHOHFWLRQ DFWLQJ XSRQ KXPDQ JURXSV RU DV 'DUZLQ VD\V ÄWULEHV³ $OWKRXJK
DOWUXLVWLF EHKDYLRU PD\ RFFDVLRQDOO\ EH GLVDGYDQWDJHRXV IRU WKLV RU WKDW SDUWLFXODU
LQGLYLGXDO'DUZLQ¶VSRLQWLVWKDWÄDWULEHLQFOXGLQJPDQ\PHPEHUVZKR>«@ZHUHDOZD\V
UHDG\ WR DLG RQH DQRWKHU DQG WR VDFULILFH WKHPVHOYHV IRU WKH FRPPRQ JRRG ZRXOG EH
YLFWRULRXV RYHU PRVWRWKHUWULEHVDQGWKLVZRXOGEHQDWXUDOVHOHFWLRQ³>@±
'DUZLQ¶VLGHDRIJURXSVHOHFWHGDOWUXLVPZDVQHJOHFWHGLQWKHKXPDQEHKDYLRUDOVFLHQFHV
IRU D ORQJ WLPH EXW ZDV UHFHQWO\ UHYLYHG DQG LPSURYHG ± ERWK FRQFHSWXDOO\ DQG
HPSLULFDOO\±E\(OOLRWW6REHUDQG'DYLG6ORDQ:LOVRQ>@7KH\FRQYLQFLQJO\DUJXHWKDW
JURXS VHOHFWLRQ LV D SODXVLEOH HYROXWLRQDU\ IRUFH DQG WKDW PXFK RI KXPDQ DOWUXLVP ±
SV\FKRORJLFDODOWUXLVPLQSDUWLFXODU±FDQEHDFFRXQWHGIRUE\PHDQVRIDVHOHFWLRQZKLFK
DFWVQRWRQO\RQJHQHVDQGLQGLYLGXDOVEXWDOVRRQJURXSV
7KHWKHRULHVRINLQVHOHFWLRQUHFLSURFDODOWUXLVPDQGJURXSVHOHFWLRQDUHWKUHHPRUH
RU OHVV PXWXDOO\ FRQVLVWHQW DWWHPSWV WR H[SODLQ WKH FRPPRQVHQVH IDFW WKDW KXPDQV DUH
HVSHFLDOO\ DOWUXLVWLF RU SDUWLDO WRZDUGV WKUHH FODVVHV RI LQGLYLGXDOV WKHLU UHODWLYHV
LQGLYLGXDOVIURPZKRPWKH\H[SHFWVRPHNLQGRIUHFLSURFDWLRQDQGPHPEHUVRIWKHLURZQ
JURXS 9LHZHG IURP WKH RSSRVLWH DQJOH WKH VDPH WKHRULHV H[SODLQ ZK\ KXPDQV GR QRW
GLVSOD\DOWUXLVPRUSDUWLDOLW\WRZDUGVLQGLYLGXDOVZKRGRQRWEHORQJWRDQ\RIWKHVHWKUHH
FODVVHV 7KH SRLQW LV WKDW LQ WKH FRXUVH RI HYROXWLRQ LQYHVWLQJ RQH¶V UHVRXUFHV LQ QRQ
UHODWLYHVQRQUHFLSURFDWLQJLQGLYLGXDOVDQGJURXSRXWVLGHUVEURXJKWQRERQXVLQWHUPVRI
LQGLYLGXDO LQFOXVLYH ILWQHVV DQG DV D UHVXOW KXPDQV UHPDLQHG SV\FKRORJLFDOO\ LOO
DGDSWHGLQGLVSRVHGWRDQ\VXFKW\SHRIEHKDYLRU
,I ZH DFFHSW WKHVH WKUHH H[SODQDWLRQV RI KXPDQ DOWUXLVP RU SDUWLDOLW\ DV WUXH RU DW
OHDVW DV SODXVLEOH GRHV WKLV KDYH DQ\ LPSOLFDWLRQV IRU WKH XWLOLWDULDQ SULQFLSOH RI
LPSDUWLDOLW\",QP\YLHZVRPHUDWKHUQHJDWLYHLPSOLFDWLRQVGRLQGHHGH[LVWDQGFDQEH
IRUPXODWHGE\PHDQVRIWKHWZRREMHFWLRQVGLVFXVVHGEHORZ
2EMHFWLRQIURPKXPDQHYROXWLRQDU\GHVLJQ7KHILUVWREMHFWLRQVWDUWVRXWIURP
WKUHH VWDQGDUG SRLQWV LQ 'DUZLQLDQ DFFRXQWV RI KXPDQ QDWXUH KXPDQ SV\FKRORJLFDO
PHFKDQLVPVDUHVKDSHGE\QDWXUDOVHOHFWLRQDQGRWKHUFDXVHVRIHYROXWLRQDU\FKDQJH
WKH\ DUH ÄGHVLJQHG³ DV VROXWLRQV WR VSHFLILF ILWQHVVPD[LPL]LQJ SUREOHPV LPSRVHG RQ
KXPDQV E\ WKHLU SDVW SK\VLFDO DQG VRFLDO HQYLURQPHQW MXVW OLNH DOO RWKHU ELRORJLFDO
&RQWHPSRUDU\HYROXWLRQDU\SV\FKRORJLVWVOLNH/HGD&RVPLGHVDQG-RKQ7RRE\SXVKWKLVLGHDRI7UL
YHUV IXUWKHU DUJXLQJ WKDW WKH KXPDQ PLQG LV DFWXDOO\ D VHULHV RI PXWXDOO\ LVRODWHG PRGXOHV RU Ä'DUZLQLDQ
DOJRULWKPV³HDFKRIWKHPVSHFLDOL]HGWRVROYHDGLIIHUHQWSUREOHPSRVHGWRRXU3OHLVWRFHQHDQFHVWRUVE\WKHLU
ÄHQYLURQPHQWRIHYROXWLRQDU\DGDSWHGQHVV³(($2QWKHEDVLVRIWKHLUH[SHULPHQWVZLWKWKHÄ:DVRQVHOHF
WLRQWDVN³WKH\DUJXHLQSDUWLFXODUWKDWWKHKXPDQPLQGFRQWDLQVDVSHFLDOÄFKHDWHUGHWHFWLRQPRGXOH³FUHDWHG
E\QDWXUDOVHOHFWLRQWRIDFLOLWDWHUHFLSURFDOO\DOWUXLVWLFLQWHUDFWLRQV>@>@
)LOR]RILD
WUDLWVWKH\DUHIXQFWLRQDOO\FRQVWUDLQHGDQGFDQQRWDGHTXDWHO\SHUIRUPWDVNVZKLFKGLIIHU
VLJQLILFDQWO\IURPWKRVHIRUZKLFKWKH\ZHUHÄRULJLQDOO\GHVLJQHG³
7KHILUVWWZRSRLQWVDVZHKDYHVHHQDOORZXVWRSUHGLFWWKDWPRVWKXPDQVZLOOEH
PRWLYDWHGWRVDFULILFHWKHLURZQEHQHILWIRUWKHVDNHHLWKHURIWKHLUFORVHUHODWLYHVRURI
LQGLYLGXDOV ZKRP WKH\ SHUFHLYH DV SRVVLEOH SDUWQHUV LQ D SURVSHFWLYH FRVWEHQHILW
LQWHUDFWLRQRURILQGLYLGXDOVZKRPWKH\UHJDUGDVPHPEHUVRIWKHLURZQJURXS$OWUXLVP
LV WKHUHIRUH D SRVVLELOLW\ LQ ERWK HYROXWLRQDU\ DQG SV\FKRORJLFDO WHUPV >@ 7KH WKLUG
SRLQW KRZHYHU VXJJHVWV WKDW KXPDQ DOWUXLVP ZLOO RFFXU LQ D UHVWULFWHG IRUP DQG LQ
VSHFLILF FLUFXPVWDQFHV RQO\ $V (OOLRWW 6REHU DQG 'DYLG 6ORDQ :LOVRQ HPSKDVL]H LW LV
LPSRUWDQW WR WDNH LQWR DFFRXQW WKH IROORZLQJ ªV\PPHWULF ORJLF RI VHOHFWLRQ DUJXPHQWV©
FRQFHUQLQJDOWUXLVPDQGQRQDOWUXLVPīLIVHOHFWLRQSURPRWHVDQDOWUXLVWLFFRQFHUQIRU
WKH ZHOIDUH RI RQH¶V GHDU DQG QHDU LW DOVR PD\ SURPRWH LQGLIIHUHQFH RU PDOHYROHQFH
WRZDUGRXWVLGHUV:LWKLQJURXSVHOHFWLRQLVDFRPSHWLWLYHSURFHVVEXWVRWRRLVEHWZHHQ
JURXS VHOHFWLRQ LW SURPRWHV ERWK ZLWKLQJURXS QLFHQHVV DQG EHWZHHQJURXS QDVWLQHVV
>«@,IHPSDWK\HOLFLWVDOWUXLVWLFPRWLYHVZLWKUHVSHFWWRWKRVHZKRPZHWDNHWREHVLPLODU
LWV DEVHQFH PHDQV WKDW ZH DUH OHVV LQFOLQHG WR EH DOWUXLVWLFDOO\ PRWLYDWHG WRZDUG WKRVH
ZKRPZHWDNHWREHGLIIHUHQW³>@±
$FFRUGLQJWRWKLVªV\PPHWULFORJLF©WKHFODVVRILQGLYLGXDOVWRZDUGVZKRPKXPDQV
ZLOO QRW EH DOWUXLVWLFDOO\ PRWLYDWHG LV PXFK ODUJHU WKDQ WKH FODVV RI LQGLYLGXDOV WRZDUGV
ZKRPWKH\ZLOO6HOHFWLRQIRUDOWUXLVWLFPRWLYHVWRZDUGVUHODWLYHVSRVVLEO\UHFLSURFDWLQJ
LQGLYLGXDOV DQG RQH¶V JURXS LQVLGHUV HQWDLOV D ORZHU GHJUHH RU HYHQ DEVHQFH RI DQ\
VLPLODUPRWLYHVWRZDUGVQRQUHODWLYHVLQGLYLGXDOVZKRDUHQRWOLNHO\WRUHFLSURFDWHDQG
JURXSRXWVLGHUV8WLOLWDULDQLPSDUWLDOLW\RQWKHRWKHUKDQGUHTXLUHVVRPHWKLQJFRPSOHWHO\
GLIIHUHQW HTXDO EHQHYROHQFH WR LQGLYLGXDOV IURP WKH ODWWHU WKUHH FODVVHV )RUPXODWHG LQ
*RGZLQLDQWHUPVWKHXWLOLWDULDQVWDQGDUGRIULJKWQHVVUHFRJQL]HVQRªPRUDOPDJLF©LQWKH
IDFW WKDW FHUWDLQ LQGLYLGXDOV DUH P\ UHODWLYHV P\ SRWHQWLDO EHQHIDFWRUV RU EHORQJ WR P\
JURXS
,Q SULQFLSOH D 'DUZLQLDQ PLJKW DJUHH ZLWK WKLV ÄQR PRUDO PDJLF³ SURYLVR EXW KH
ZRXOGSUREDEO\WKHQTXHVWLRQWKHUDLVRQG¶rWUHRIDQ\PRUDOVWDQGDUGZKLFKFRQWUDGLFWV
RXUEHVWNQRZOHGJHRIKXPDQQDWXUH,QWKHFDVHRIXWLOLWDULDQLPSDUWLDOLW\WKLVREMHFWLRQ
PLJKW DVVXPH WKH IROORZLQJ IRUP VLQFH KXPDQ SV\FKRORJ\ GXH WR LWV HYROXWLRQDU\
ÄGHVLJQ³LVLOODGDSWHGIRUSURGXFLQJEHKDYLRUWKDWLPSDUWLDOO\PD[LPL]HVKDSSLQHVVLWLV
XVHOHVV WR SURFODLP VXFK EHKDYLRU WR EH PRUDOO\ REOLJDWRU\ ,Q LWV H[WUHPH YHUVLRQ WKLV
REMHFWLRQVWDWHVWKDWLQVLVWLQJRQVXFKEHKDYLRUFRPHVDOOWRRFORVHWRDYLRODWLRQRIWKH
ÄRXJKW LPSOLHV FDQ³ SULQFLSOH ,Q LWV PRGHUDWH YHUVLRQ LW VWDWHV WKDW LPSDUWLDOLW\ FDQ EH
UHTXLUHGLQUHVWULFWHGIRUPRQO\LHRQO\LQWKRVHVRFLDODQGSV\FKRORJLFDOFLUFXPVWDQFHV
WRZKLFKKXPDQVDUHUHODWLYHO\ZHOODGDSWHG
$Q\ XWLOLWDULDQ ZRXOG SUREDEO\ WHQG WR GLVPLVV WKH ILUVW H[WUHPH YHUVLRQ RI WKLV
7KH VDPH SRLQW FDQ EH IRUPXODWHG E\ DQDORJ\ ZLWK KXPDQ SHUFHSWXDO DQG UHDVRQLQJ FDSDFLWLHV $V
*HUKDUG9ROOPHU>@VXJJHVWVÄRXUVHQVHRUJDQVSHUFHSWLRQDOSRZHUVVWUXFWXUHVRIH[SHULHQFHRUGL
QDU\ODQJXDJHDQGHOHPHQWDU\LQIHUHQWLDOKDELWVDUHZHOODGDSWHGWRWKLVPHVRFRVP>ZRUOGRIPHGLXPGLPHQ
VLRQV@DQGDUHDGHTXDWHIRUPHVRFRVPLFQHHGV³+RZHYHUWKHVHVDPHRUJDQVDQGFDSDFLWLHVGRQRWIXQFWLRQDW
WKH OHYHO RI WKH PLFURFRVPRUPDFURFRVPDZRUOGRIYHU\VPDOORUYHU\ODUJHGLPHQVLRQVUHVSHFWLYHO\DV
WKLVLVQRWWKHZRUOGLQZKLFKWKH\RULJLQDWHGLQWKHILUVWSODFH,QWKHVDPHYHLQLWFDQEHDUJXHGWKDWKXPDQ
SV\FKRORJLFDO FDSDFLWLHV DQG PRWLYDWLRQDO PHFKDQLVPV FDQQRW IXQFWLRQ ZHOO LQ VRFLDO FLUFXPVWDQFHV ZKLFK
GLIIHUVLJQLILFDQWO\IURPWKRVHLQZKLFKWKH\ILUVWRULJLQDWHG
REMHFWLRQ DV WRR VSHFXODWLYH RU LQFRQFOXVLYH +RZHYHU D UHDOLVWLF XWLOLWDULDQ ZRXOG SUR
EDEO\FRQFHGHVRPHZHLJKWWRWKHVHFRQGPRGHUDWHYHUVLRQRIWKLVREMHFWLRQDQGDWWHPSW
WR GHYLVH D GHIHQVH VWUDWHJ\ 0LOO IRU H[DPSOH VXJJHVWHG WKDW WKH PD[LPL]DWLRQ RI
JHQHUDOKDSSLQHVVFDQDQGVKRXOGEHVHUYHGILUVWDQGIRUHPRVWE\SURPRWLQJKDSSLQHVVDW
DPRUHORFDOOHYHOÄ7KHPXOWLSOLFDWLRQRIKDSSLQHVVLVDFFRUGLQJWRWKHXWLOLWDULDQHWKLFV
WKHREMHFWRIYLUWXHWKHRFFDVLRQVRQZKLFKDQ\SHUVRQH[FHSWRQHLQDWKRXVDQGKDVLW
LQKLVSRZHUWRGRWKLVRQDQH[WHQGHGVFDOHLQRWKHUZRUGVWREHDSXEOLFEHQHIDFWRUDUH
EXWH[FHSWLRQDODQGRQWKHVHRFFDVLRQVDORQHLVKHFDOOHGRQWRFRQVLGHUSXEOLFXWLOLW\LQ
HYHU\RWKHUFDVHSULYDWHXWLOLW\WKHLQWHUHVWVRUKDSSLQHVVRIVRPHIHZSHUVRQVLVDOOKH
KDVWRDWWHQGWR³>@
+RZHYHULQVSLWHRILWVSULPDIDFLHSODXVLELOLW\WKLVDQVZHUPD\SHUKDSVRQO\VHUYH
DV D MXVWLILFDWLRQ IRU WKH HWKLFDO YLHZV FRQFHUQLQJ LPSDUWLDOLW\ KHOG E\ WKH WK FHQWXU\
SKLORVRSKHU-RKQ6WXDUW0LOOEXWQRWIRUVLPLODUYLHZVKHOGE\KLVPRGHUQVXFFHVVRUV,W
LVPRUHWKDQREYLRXVWKDW0LOO¶VZRUOGGLIIHUVVLJQLILFDQWO\IURPWKHPRGHUQZRUOGZLWK
UHVSHFWWRÄRFFDVLRQVRQZKLFKDQ\SHUVRQKDVLWLQKLVSRZHUWREHDSXEOLFEHQHIDFWRU³
7KHVHRFFDVLRQVDUHQRORQJHUÄH[FHSWLRQDO³DV0LOOWKRXJKWWKH\ZHUHLQKLVGD\UDWKHU
GXHWRSRVVLELOLWLHVRIIHUHGE\PRGHUQWHFKQRORJ\WKH\DUHDOPRVWRPQLSUHVHQWDWOHDVW
IRU UHVLGHQWV RI :HVWHUQ VRFLHWLHV 7KLV FUHDWHV D FRXQWHULQWXLWLYH VLWXDWLRQ ZKLFK 0L
FKDHO5XVH>@GHSLFWVLQWKHIROORZLQJPDQQHUÄ6RORQJDVRQHLVGHDOLQJZLWK
D UHODWLYHO\ WLJKW OLWWOH ZRUOG \RX FDQ DUJXH IRU WUHDWLQJ PRVW SHRSOH PRUH RU OHVV DV
HTXDOO\ GHVHUYLQJ EHLQJV >«@ :LWK D VPDOO LQWLPDWH JURXS DOO ZLOO EHQHILW LQFOXGLQJ
\RXUVHOI %XW LQ WKH PRGHUQ VLWXDWLRQ WR SXW XWLOLWDULDQLVP LQWR DFWLRQ VLPSO\ OHDGV WR
DQHYHUHQGLQJGUDLQRQ\RXURZQUHVRXUFHVDV\RXJLYHHYHU\WKLQJDZD\$QGVRPHKRZ
WKHUHMXVWGRHVQRWVHHPWREHWKHREOLJDWLRQWRGRWKLV³
$VHYROXWLRQDU\SV\FKRORJLVWVOLNH/HGD&RVPLGHVDQG-RKQ7RRE\>@DUJXHWKHUH
LV D VLJQLILFDQW GLVFUHSDQF\ EHWZHHQ KXPDQ FXOWXUDO DQG ELRORJLFDO HYROXWLRQ &XOWXUDO
HYROXWLRQ RQ WKH RQH KDQG KDV GRQH DQ DPD]LQJ MRE PRVW KXPDQV QR ORQJHU OLYH DV
KXQWHUJDWKHUHUV LQ VPDOO NLQEDVHG JURXSV XVLQJ VWRQHDJH WHFKQRORJ\ EXW UDWKHU LQ
ODUJHFLWLHVXVLQJFRPSXWHUVDQGWUDYHOLQJLQIDVWFDUVDQGDLUSODQHV%LRORJLFDOHYROXWLRQ
RQWKHRWKHUKDVEHHQOHVVJHQHURXVWRKXPDQVERWKSK\VLFDOO\DQGSV\FKRORJLFDOO\WKH\
DUHMXVWWKHVDPHDVWKH\ZHUHLQWKHLU3OHLVWRFHQHSDVW6RHYHQLIKXPDQRSSRUWXQLWLHV
IRUSXEOLFEHQHILFHQFHSULPDULO\GXHWRWKHWHFKQRORJLFDOSRVVLELOLWLHVWKH\KDYHDWKDQG
DUHQRORQJHUªH[FHSWLRQDO©KXPDQPRWLYDWLRQIRUWKLVVDPHEHQHILFHQFHSULPDULO\GXH
WR FRQVWUDLQWV RQ WKHLU QDWXUDOO\ VHOHFWHG SV\FKRORJ\ UHPDLQV ÄH[FHSWLRQDO³ WR D ODUJH
H[WHQW
$ XWLOLWDULDQ PLJKW WU\ WR FRXQWHU WKLV REMHFWLRQ E\ FODLPLQJ WKDW PRWLYDWLRQ E\
LPSDUWLDOFRQVLGHUDWLRQVLVQRWQHFHVVDU\IRUDQDFWLRQWRTXDOLI\DVPRUDOLQVWHDGDOOWKDW
LV UHTXLUHG LV WKH FRQIRUPLW\ RI WKLV DFWLRQ ZLWK WKH VWDQGDUGV RI PRUDOLW\ 7KLV W\SH RI
GHIHQVH ZDV RIIHUHG E\ 0LOO ZKR DUJXHG WKDW ÄWKH PRWLYH KDV QRWKLQJ WR GR ZLWK WKH
PRUDOLW\ RI WKH DFWLRQ³ VR WKDW IRU H[DPSOH ÄKH ZKR VDYHV D IHOORZ FUHDWXUH IURP
GURZQLQJ GRHV ZKDW LV PRUDOO\ ULJKW ZKHWKHU KLV PRWLYH EH GXW\ RU WKH KRSH RI EHLQJ
SDLGIRUKLVWURXEOH³>@0LOO¶VDQVZHUUHVHPEOHVWKHZHOONQRZQªRFFDVLRQDOLVW©
VROXWLRQ WR WKH PLQGERG\ SUREOHP DFFRUGLQJ WR ZKLFK PLQG DQG ERG\ GR QRW FDXVDOO\
LQWHUDFWEXWRQO\DSSHDUWREHFDXVDOO\FRQQHFWHGEHFDXVH*RGFRQVWDQWO\NHHSVWKHPLQ
PXWXDOKDUPRQ\,QDVLPLODUYHLQWKHUHLVIRU0LOOQRQHFHVVDU\FRQQHFWLRQEHWZHHQWKH
)LOR]RILD
PRUDO ZRUWK RI DQ DFWLRQ DQG WKH KXPDQ PRWLYHV ZKLFK EULQJ LW DERXW VR ORQJ DV LWV
FRQVHTXHQFHVDUHLQOLQHZLWKXWLOLWDULDQVWDQGDUGV
+RZHYHU WKLV ªRFFDVLRQDOLVW© VROXWLRQ HQFRXQWHUV VRPH GLIILFXOWLHV )RU RQH WKLQJ
ZH XVXDOO\ H[SHFW PRUDO DFWLRQV WR EH PRWLYDWHG E\ JHQXLQH PRUDO UHDVRQV 2WKHUZLVH
DFWLRQV PRWLYDWHG E\ OHVV WKDQ PRUDO UHDVRQV DQG DFWLRQV PRWLYDWHG E\ PRUDO UHDVRQV
SURSHUZRXOGLIWKH\DFFLGHQWDOO\OHGWRWKHVDPHILQDOUHVXOWVKDYHWKHVDPHZRUWK)RU
LQVWDQFH,PD\JLYHP\HQWLUHSURSHUW\WRDFKDULW\IXQGPRWLYDWHGVROHO\E\P\GHVLUHWR
OHDYHDJRRGLPSUHVVLRQRQDMXU\ZKLFKLVDERXWWRFRQYLFWPHIRUVWRFNPDUNHWIUDXG
0LOO¶V ÄRFFDVLRQDOLVW³ VROXWLRQ WKXVUXQVFRXQWHUWRRXUFRPPRQVHQVHPRUDOLQWXLWLRQV
0RUHRYHU XQOLNH WKH RFFDVLRQDOLVW VROXWLRQ WR WKH PLQGERG\ SUREOHP LQ ZKLFK *RG
V\QFKURQL]HV WKH LQGHSHQGHQW VSKHUHV RI WKH PHQWDO DQG WKH SK\VLFDO WKH XWLOLWDULDQ
HWKLFDO IUDPHZRUN UHFRJQL]HV QR VLPLODU LQVWDQFH WKDW ZRXOG ZDUUDQW D SUHVXSSRVHG
XOWLPDWH V\QFKURQLFLW\EHWZHHQWKHÄPRWLYHRIWKHDFWLRQ©DQGªPRUDOLW\RIWKHDFWLRQ³
)LQDOO\0LOOKLPVHOISRLQWVRXWWKDWÄQRV\VWHPRIHWKLFVUHTXLUHVWKDWWKHVROHPRWLYHRI
DOO ZH GRVKDOOEHDIHHOLQJRIGXW\³DGGLQJWKDWÄQLQHW\QLQHKXQGUHGWKVRIDOORXUDF
WLRQV DUH GRQH IURP RWKHU PRWLYHV³ >@ 7KLV KRZHYHU LQ FRQMXQFWLRQ ZLWK WKH
SUHYLRXVFRQVLGHUDWLRQVVXJJHVWVWKDWWKHSULQFLSOHRILPSDUWLDOLW\GRHVQRWDFWXDOO\KDYH
DQ\ VLJQLILFDQW PRWLYDWLQJ SRZHU RI LWV RZQ DQG PD\ WKXV EH FRQVLGHUHG LUUHOHYDQW RU
UHGXQGDQW
7KH ÄREMHFWLRQ IURPKXPDQHYROXWLRQDU\GHVLJQ³DPRXQWVWRFODLPLQJWKDWKXPDQV
JHQHUDOO\ODFNWKHQHFHVVDU\PRWLYHWRH[WHQGWKHERXQGDULHVRIWKHLUQDWXUDOEHQHYROHQFH
8QVHOILVKPRWLYHVDYDLODEOHWRKXPDQVZLOOXVXDOO\UHPDLQFRQILQHGWRSDUWLFXODUFODVVHV
RILQGLYLGXDOVZKLFKDUHKRZHYHUWRRQDUURZIURPWKHSHUVSHFWLYHRIXWLOLWDULDQHWKLFDO
VWDQGDUGV 7R EH VXUH WKLV REMHFWLRQ SUHVXSSRVHV D +XPHDQ LQWHUSUHWDWLRQ RI PRUDO
PRWLYDWLRQ ZKHUHE\ ÄUHDVRQ LV DQG RXJKW RQO\ WR EH WKH VODYH RI WKH SDVVLRQV³ ZKLOH
ÄRXUVHQVHRIGXW\DOZD\VIROORZVWKHFRPPRQDQGQDWXUDOFRXUVHRIRXUSDVVLRQV³>@
$ XWLOLWDULDQ PD\ GLVDJUHH ZLWK WKLV HPRWLYLVW FRQFHSWLRQ EXW WKHQ KH LV OHIW ZLWK
WZRLQGHSHQGHQWEXUGHQVRISURRIWRSURYHERWKWKDWD+XPHDQYLHZRIPRUDOPRWLYDWLRQ
LV ZLGH RI WKH PDUN DQG WKDW WKH SULQFLSOH RI LPSDUWLDOLW\ FDQ SOD\ D VLJQLILFDQW UROH LQ
DFWXDOPRUDOSUDFWLFH
2EMHFWLRQIURPQDWXUDOKXPDQGHVLUHV7KHVHFRQGREMHFWLRQUHOLHVRQDFRP
PRQ FULWLFLVP RI XWLOLWDULDQLVP RQH ZKLFK VXJJHVWV WKDW WKH FRQVLVWHQW PD[LPL]DWLRQ RI
JHQHUDO KDSSLQHVV ZRXOG KDYH VXFK D GHWULPHQWDO HIIHFW RQ VR PDQ\ LQGLYLGXDO KXPDQ
TXDOLWLHV ERWK PRUDO DQG QRQPRUDO WKDW LWV REVHUYDQFH FDQQRW EH FRQVLGHUHG DQ
RYHUULGLQJPRUDOREOLJDWLRQ$IWHUDVKRUWLOOXVWUDWLRQRIWZRZHOONQRZQIRUPXODWLRQVRI
WKLV FULWLFLVP E\ %HUQDUG :LOOLDPV DQG 6XVDQ :ROI WKHLU SRVVLEOH OLQN ZLWK 'DUZLQLDQ
LGHDVZLOOEHDGGUHVVHG
$FFRUGLQJ WR %HUQDUG :LOOLDPV >@ WKH XWLOLWDULDQ PRUDO DJHQW LV QR PRUH
WKDQ ªWKH DJHQW RI WKH VDWLVIDFWLRQ V\VWHP ZKR KDSSHQV WR EH DW D SDUWLFXODU SRLQW DW
DSDUWLFXODUWLPH©+LVH[FOXVLYHUROHLVWRVHUYHDVÄDFKDQQHOEHWZHHQWKHLQSXWRIHYH
U\RQH¶VSURMHFWVLQFOXGLQJKLVRZQDQGDQRXWSXWRIRSWLPLILFGHFLVLRQ³LHDGHFLVLRQ
WKDW\LHOGVWKHEHVWFRQVHTXHQFHVLQWKHJLYHQFLUFXPVWDQFHV:LOOLDPV>@±
PDLQWDLQVKRZHYHUWKDWLWLVDEVXUGWRFRQFHLYHKXPDQDJHQWVVROHO\DVPHPEHUVRIRQH
H[WHQVLYH V\VWHP RI WKH GLVWULEXWLRQ DQG UHGLVWULEXWLRQ RI JHQHUDO KDSSLQHVV IRU LQ WKLV
ZD\RQHQHJOHFWVWKHLPSRUWDQWIDFWWKDWKXPDQVDUHVHSDUDWHLQGLYLGXDOVZLWKWKHLURZQ
SHUVRQDOLQWHJULW\DVZHOODVWKHIDFWWKDWSHUVRQDOFRPPLWPHQWVSURMHFWVDQGJRDOVSOD\
DQLQGLVSHQVDEOHUROHLQWKHLUOLYHV6LQFHXWLOLWDULDQLVPWKXVWKUHDWHQVWRDOLHQDWHWKHYHU\
KXPDQLW\DQGLQWHJULW\RIWKHPRUDODJHQWLWVSULQFLSOHRIWKHLPSDUWLDOPD[LPL]DWLRQRI
JHQHUDOKDSSLQHVVFDQQRWEHDPRUDOSULQFLSOHRUUHDVRQRYHUULGLQJDOORWKHUPRUDORUHYHQ
H[WUDPRUDOUHDVRQV
$QREMHFWLRQVLPLODUWRWKDWRI:LOOLDPVLVRIIHUHGE\6XVDQ:ROI>@:ROIDUJXHV
WKDW WKH LPSDUWLDO PD[LPL]DWLRQ RI JHQHUDO KDSSLQHVV DV GHPDQGHG E\ XWLOLWDULDQ HWKLFDO
VWDQGDUGVZRXOGDPRXQWWRWKHVRUWRIEHKDYLRUFKDUDFWHULVWLFRIÄPRUDOVDLQWV³7KHWHUP
ªPRUDO VDLQW© EHDUV QR WKHRORJLFDO FRQQRWDWLRQV KHUH UDWKHU LW GHVFULEHV D SHUVRQ IRU
ZKRPPRUDOLGHDOVYDOXHVDQGSHUIHFWLRQDOZD\VWDNHSUHFHGHQFHRYHUDQ\RWKHUKXPDQ
LGHDOVYDOXHVDQGSHUIHFWLRQ+RZHYHUDV:ROIFODLPV>@ÄPRUDOSHUIHFWLRQLQ
WKHVHQVHRIPRUDOVDLQWOLQHVVGRHVQRWFRQVWLWXWHDPRGHORISHUVRQDOZHOOEHLQJWRZDUG
ZKLFKLWZRXOGEHSDUWLFXODUO\UDWLRQDORUJRRGRUGHVLUDEOHIRUDKXPDQEHLQJWRVWULYH³
7KHSUREOHPZLWKWKHFXOWLYDWLRQRIPRUDOSHUIHFWLRQLVWKDWLWHQWDLOVQHJOHFWLQJRUWRWDOO\
VDFULILFLQJ PDQ\ RWKHU QRQPRUDO FKDUDFWHULVWLFV RU DFWLYLWLHV ZKLFK DUH XVXDOO\ FRQVL
GHUHG WR EH LUUHSODFHDEOH SDUWV RI D ZHOOURXQGHG DQG IXOILOOHG KXPDQ OLIH :KDW FRPHV
LQWRSOD\KHUHDJDLQDUHTXLWHSHUVRQDOSURMHFWVDQGJRDOVVXFKDVDGYDQFLQJRQH¶VRZQ
WDOHQWV DQG VNLOOV LQWHOOHFWXDO FXOWXUDO DUWLVWLF DWKOHWLF VRFLDO DQG VR RQ ,I ZHGHYRWH
RXU OLYHV WR WKH XWLOLWDULDQ IXUWKHULQJ RI JHQHUDO KDSSLQHVV EHOLHYHV :ROI ZH ZLOO
QHFHVVDULO\ KDYH WR VDFULILFH DOO WKHVH SHUVRQDO FRQVLGHUDWLRQV ZKLFK FRQVWLWXWH WKH
H[FHOOHQFH RI D SHUVRQ¶V OLIH ,I D PRUDO WKHRU\ XOWLPDWHO\ HQWDLOV VDFULILFLQJ SHUVRQDO
GHYHORSPHQW SHUVRQDO UHODWLRQV DQGDJHQHUDOO\IXOILOOHGOLIHWKHQLWPD\UHDVRQDEO\EH
RSLQHGWKDWWKHUHLVVRPHWKLQJZURQJZLWKVXFKDWKHRU\
,Q FRQQHFWLRQ ZLWK 'DUZLQLDQ DFFRXQWV RI KXPDQ QDWXUH WKHVH REMHFWLRQV E\
:LOOLDPV DQG :ROI VHHP SDUWLFXODUO\ WKUHDWHQLQJ WR WKH YLDELOLW\ RI WKH XWLOLWDULDQ
SULQFLSOHRILPSDUWLDOLW\1DPHO\ZKDW:LOOLDPVXQGHUVWDQGVDVÄSHUVRQDOSURMHFWV³DQG
:ROIDVWKHLGHDORIWKHÄIXOILOOHGOLIH³FRUUHVSRQGVVLJQLILFDQWO\WRDFRPSDUDWLYHO\ZLGH
VHW RI XQLYHUVDO KXPDQ LQFOLQDWLRQV WKDW KDYH EHHQ VKDSHG RYHU WKH FRXUVHRIELRORJLFDO
HYROXWLRQ 7KH HWKLFDO EHDULQJ RI WKRVH LQFOLQDWLRQV LV SDUWLFXODUO\ HPSKDVL]HG E\ /DUU\
$UQKDUW$UQKDUWPDLQWDLQVWKDWWKHUHDUHDWOHDVWWZHQW\QDWXUDOGHVLUHVSUHVHQWLQ
DOO KXPDQ VRFLHWLHV WKURXJKRXWKLVWRU\ZKLFKFRQVWLWXWHDQLQVHSDUDEOHSDUWRIDQHWKL
FDOO\FRQFHLYHGJRRGOLIHDFRPSOHWHOLIHSDUHQWDOFDUHVH[XDOLGHQWLW\VH[XDOPDWLQJ
IDPLOLDO ERQGLQJ IULHQGVKLS VRFLDO UDQNLQJ MXVWLFH DV UHFLSURFLW\ SROLWLFDO UXOH ZDU
KHDOWK EHDXW\ ZHDOWK VSHHFK SUDFWLFDO KDELWXDWLRQ SUDFWLFDO UHDVRQLQJ SUDFWLFDO DUWV
DHVWKHWLFSOHDVXUHUHOLJLRXVXQGHUVWDQGLQJDQGLQWHOOHFWXDOXQGHUVWDQGLQJ>@
0RUHRYHUDV:ROI>±UHPDUNVÄ$ZRUOGLQZKLFKHYHU\RQHRUHYHQDODUJHQXPEHURI
SHRSOHDFKLHYHGPRUDOVDLQWKRRG±HYHQDZRUOGLQZKLFKWKH\VWURYHWRDFKLHYHLW±ZRXOGSUREDEO\FRQWDLQ
OHVVKDSSLQHVVWKDQDZRUOGLQZKLFKSHRSOHUHDOL]HGDGLYHUVLW\RILGHDOVLQYROYLQJDYDULHW\RISHUVRQDODQG
SHUIHFWLRQLVWYDOXHV³
$GHWDLOHGH[SRVLWLRQRI$UQKDUW¶V>@HWKLFDOYLHZVZRXOGEHUHTXLUHWRRPXFKVSDFHKHUH,WVKRXOGEH
PHQWLRQHGKRZHYHUWKDWKHDWWHPSWVWRFRPELQHWKHLQVLJKWVRIFRQWHPSRUDU\'DUZLQLVPZLWKFHUWDLQFODVVL
FDOYLHZVRIKXPDQQDWXUHDQGKXPDQPRUDOLW\+HSDUWLFXODUO\GHIHQGVWKH$ULVWRWHOLDQDQGWRVRPHH[WHQW
+XPHDQLGHDWKDWKXPDQSROLWLFVDQGPRUDOLW\DUHURRWHGLQKXPDQELRORJ\DVZHOODVWKHLGHDWKDWWKHUHLVQR
DEVROXWHGLYLVLRQEHWZHHQQDWXUDOIDFWVDQGPRUDOYDOXHV$OWKRXJKKHGRHVQRWPHQWLRQ:LOOLDPV¶DQG:ROI¶V
SRLQWVPDQ\VLPLODULWLHVGRH[LVWHVSHFLDOO\FRQFHUQLQJWKHLUFRQFHSWLRQVRIZKDWFRQVWLWXWHVDZHOOURXQGHG
DQGIXOILOOLQJKXPDQOLIH
)LOR]RILD
,W LV QRW GLIILFXOW WR FRPSUHKHQG ZK\ PDQ\ RI WKHVH GHVLUHV FRQVWLWXWH LQVHSDUDEOH
SDUWVRIDGLVWLQFWLYHO\KXPDQOLIH3DUHQWDOFDUHDQGVH[XDOPDWLQJDUHSHUGHILQLWLRQHP
IDFWRUV WKDW PD[LPL]H RQH¶V ELRORJLFDO ILWQHVV IDPLOLDO ERQGLQJ IULHQGVKLS DQG D SUH
IHUHQFHIRUMXVWLFHDVUHFLSURFLW\DUHVRFLDOO\LPSRUWDQWEHKDYLRUDOVWUDWHJLHVZKLFKKDYH
SOD\HG D FUXFLDO UROH LQ KXPDQ HYROXWLRQDU\ KLVWRU\ DQG D SUHIHUHQFH IRU KHDOWK DQG
ZHOIDUH LV D SUDFWLFDOO\ HVVHQWLDO FRQGLWLRQ IRU LQGLYLGXDO VXUYLYDO LQ WKH 'DUZLQLDQ
ªVWUXJJOHIRUOLIH©,WLVLPSRUWDQWWREHDULQPLQGWKDWQRWZLWKVWDQGLQJWKHIDFWRIFXOWXUDO
HYROXWLRQ WKHVH QDWXUDOO\ HYROYHG GHVLUHV DQG SUHIHUHQFHV VWLOO UHSUHVHQW FHQWUDO PRWL
YDWLRQDOPHFKDQLVPVZLWKLQWKHKXPDQEHKDYLRUDODQGSV\FKRORJLFDOUHSHUWRLUH,QRWKHU
ZRUGV KXPDQV ZKR OLYHG DV KXQWHUJDWKHUHUV GXULQJ WKH 3OHLVWRFHQH HUD DQG KXPDQV
OLYLQJWRGD\VWLOOKDYHWKHVDPHVHWRIQDWXUDOGHVLUHVDQGWKHLQFHQWLYHVWRVDWLVI\WKHP
7KHNH\ZRUGVKHUHDUHªQDWXUDOO\©DQGÄSHUVRQDO³DQGWKH\LQGLFDWHZKDWVHHPVWR
EH DW RGGV ZLWK WKH XWLOLWDULDQ LGHDO RI LPSDUWLDOLW\ )RU LW VHHPV WKDW WKH XWLOLWDULDQ
SULQFLSOH RI LPSDUWLDOLW\ UHTXLUHV WKDW DQ DJHQW QRW RQO\ JUDQW KLV RZQ SHUVRQDO SURMHFWV
WKHVDPHZHLJKWDVWKRVHRIDQ\RWKHUDJHQWEXWDOVRVDFULILFHPDQ\RIKLVPRVWSHUVRQDO
OLIHORQJSURMHFWV0LOOLWVKRXOGEHUHFDOOHGH[SOLFLWO\VWDWHVDVIROORZVÄ$VEHWZHHQKLV
RZQKDSSLQHVVDQGWKDWRIRWKHUVXWLOLWDULDQLVPUHTXLUHVKLPWREHDVVWULFWO\LPSDUWLDODV
D GLVLQWHUHVWHG DQG EHQHYROHQW VSHFWDWRU³ >@ (YHQ VHWWLQJ DVLGH DOO 'DUZLQLDQ
FRQVLGHUDWLRQVVXFKDGHPDQGVHHPVXQMXVWLILHGDVLWWHQGVWREULQJDERXWFRQVHTXHQFHV
ZKLFK DUH HWKLFDOO\ DEVXUG DQG SV\FKRORJLFDOO\ XQIDYRUDEOH WR WKH DJHQW LQ TXHVWLRQ
+RZHYHU WKLV VDPH REMHFWLRQ GHULYHV DGGLWLRQDO IRUFH IURP D 'DUZLQLDQ WKHRUHWLFDO
IUDPHZRUN ZKLFK GHPRQVWUDWHV WKDW KXPDQ ªSHUVRQDO SURMHFWV© DQG YLVLRQV RI ÄD JRRG
OLIH³ZKLFKDUHXVXDOO\VXSSRVHGWREHFHQWUDOWRDQ\HWKLFDOHQWHUSULVHDFWXDOO\FRQVLVW
RI D VHULHV RI QDWXUDO ELRORJLFDOO\ URRWHG GHVLUHV ,W VHHPV WKHUHIRUH WKDW D VHULRXV
DWWHPSW DW OHDGLQJ D XWLOLWDULDQ PRUDO OLIH ZRXOG QRW RQO\ UHTXLUH VDFULILFLQJ VRPH YHU\
LPSRUWDQWSHUVRQDOSURMHFWVDQGLGHDOVEXWZRXOGDOVRKDYHDKLJKO\GHWULPHQWDOHIIHFWRQ
WKHSHUVRQDOLGHQWLW\DQGFKDUDFWHURIWKHDJHQWLQTXHVWLRQ
$QDSWLOOXVWUDWLRQRIWKLVODVWSRLQWFDQSHUKDSVEHIRXQGLQWKHOLIHRI-RKQ6WXDUW
0LOO KLPVHOI ,Q KLV $XWRELRJUDSK\ >@ 0LOO GHVFULEHV KLV LQWHOOHFWXDO GHYHORSPHQW
ZKLFK ZDV KLJKO\ VKDSHG XQGHU WKH LQIOXHQFH RI KLV IDWKHU -DPHV 0LOO DQG -HUHP\
%HQWKDPE\XWLOLWDULDQPRUDOLGHDOVDQGWKHGHVLUHWRLPSURYHRQH¶VRZQDQDO\WLFKDELWV
+RZHYHUDV0LOOSRLQWVRXWVXFKDQLQWHOOHFWXDODQGHPRWLRQDOGHYHORSPHQWUHVXOWHGLQ
D VHULRXV FULVLV LQ KLV PHQWDO KLVWRU\ $V 0LOO ODWHU UHDOL]HG DQDO\WLF KDELWV DUH ÄD SHU
SHWXDOZRUPDWWKHURRWERWKRIWKHSDVVLRQVDQGRIWKHYLUWXHVDQGDERYHDOOIHDUIXOO\
XQGHUPLQH DOO GHVLUHV DQG DOO SOHDVXUHV«³ >@ +H DOVR QRWHV WKDW KH ZDV OHIW
ÄZLWKRXWDQ\UHDOGHVLUH©IRUWKHHQGVZKLFKKHKDGEHHQªVRFDUHIXOO\ILWWHGRXWWRZRUN
IRUQRGHOLJKWLQYLUWXHRUWKHJHQHUDOJRRGEXWDOVRMXVWDVOLWWOHLQDQ\WKLQJHOVH³7KH
ÄIRXQWDLQV RI YDQLW\ DQG DPELWLRQ© KDG GULHG XS LQ KLP MXVW DV KDG ªWKRVH RI
EHQHYROHQFH³ >@ )RUWXQDWHO\ IRU 0LOO DQG IRU WKH VXEVHTXHQW GHYHORSPHQW RI
XWLOLWDULDQLVP KLV FRQGLWLRQ LPSURYHG WKDQNV WR KLV SXUVXLW RI VRPH UDWKHU SHUVRQDO
SURMHFWV DQG LGHDOV VXFK DV UHDGLQJ SRHWU\ $OWKRXJK WKLV VWRU\ FDQQRW EH UHJDUGHG DV
D NQRFNGRZQ DUJXPHQW DJDLQVW XWLOLWDULDQ FODLPV LWDWOHDVWVXJJHVWVWKDWWKHXWLOLWDULDQ
SULQFLSOHRILPSDUWLDOLW\VKRXOGQRWEHWDNHQDWIDFHYDOXHHVSHFLDOO\ZKHQFRQVLGHUHGLQ
FRQMXQFWLRQZLWKRXUEHVWWKHRULHVDERXWKXPDQQDWXUH
&RQFOXGLQJUHPDUNV:K\VKRXOGXWLOLWDULDQLVPEHSDUWLFXODUO\YXOQHUDEOHWRDQ\
RI WKH IRUHJRLQJ 'DUZLQLDQ REMHFWLRQV" $UH PDQ\ RWKHU HWKLFDO WKHRULHV QRW HTXDOO\ RU
HYHQ PRUH VXVFHSWLEOH WR VLPLODU FULWLFLVP" 7KHLVWLF RU .DQWLDQ HWKLFV PD\ OLNHZLVH EH
FRQVLGHUHGLUUHFRQFLODEOHZLWKDQHYROXWLRQDU\RXWORRNWKHIRUPHUGXHWRLWVDVVXPSWLRQ
WKDW WKH PRUDO GRPDLQ LV VRPHKRZ FRQWLQJHQW XSRQ *RG¶V ZLOO WKH ODWWHU GXH WR LWV
DVVXPSWLRQ WKDW WKH PRUDO GRPDLQ LV QRW FKDUDFWHUL]HG E\ WKH FDXVDOLW\ RI QDWXUH EXW
UDWKHU E\ D VHSDUDWH FDXVDOLW\ RI IUHHGRP 7R EH VXUH WKHVH HWKLFDO WKHRULHV DUH DOVR DW
RGGVZLWKFRQWHPSRUDU\'DUZLQLVPZKLFKDOORZVIRURQO\RQHQDWXUDOW\SHRIFDXVDWLRQ
ZKLOHWKHLGHDRIDQ\VXSHUQDWXUDOVRXUFHRIWKHKXPDQFRQGLWLRQLVSUDFWLFDOO\GLVPLVVHG
IURPLWVWKHRUHWLFDOKRUL]RQE\GHIDXOW
7KHUHODWLRQEHWZHHQ'DUZLQLVPDQGXWLOLWDULDQLVPKRZHYHULVVRPHZKDWGLIIHUHQW
DV WKH\ DUH ERWK ± XQOLNH WKHLVP DQG .DQWLDQLVP ± FRPPLWWHG WR HPSLULFLVP DQG
QDWXUDOLVP$V%HUQDUG:LOOLDPV>@±DSSURSULDWHO\UHPDUNVXWLOLWDULDQLVP
LV ÄQRQWUDQVFHQGHQWDO DQG PDNHV QR DSSHDO RXWVLGH KXPDQ OLIH LQ SDUWLFXODU QRW WR
UHOLJLRXV FRQVLGHUDWLRQV³ WKH EDVLF JRRG RI XWLOLWDULDQLVP KDSSLQHVV ÄVHHPV
PLQLPDOO\SUREOHPDWLFDOKRZHYHUPXFKSHRSOHGLIIHUVXUHO\WKH\DWOHDVWDOOZDQWWREH
KDSS\³ IRU XWLOLWDULDQV ÄPRUDO LVVXHV FDQ LQ SULQFLSOH EH GHWHUPLQHG E\ HPSLULFDO
FDOFXODWLRQ RI FRQVHTXHQFHV³ DQG ÄXWLOLWDULDQLVP SURYLGHV D FRPPRQ FXUUHQF\ RI
PRUDOWKRXJKWWKHGLIIHUHQWFRQFHUQVRIGLIIHUHQWSDUWLHVDQGWKHGLIIHUHQWVRUWVRIFODLPV
DFWLQJRQRQHSDUW\FDQDOOEHFDVKHGLQSULQFLSOHLQWHUPVRIKDSSLQHVV³
8QOLNH VRPH RWKHU LQIOXHQWLDO HWKLFDO WKHRULHV LW VHHPV WKDW XWLOLWDULDQLVP LQ LWV
GHVFULSWLYH DVSHFWV KDV DOPRVW ERUURZHG LWV EXLOGLQJ EORFNV IURP WKH 'DUZLQLDQ WKHR
UHWLFDOLQYHQWRU\LQSDUWLFXODULWVQRQWUDQVFHQGHQWDOLVPHPSLULFLVPDQGUHFRJQLWLRQRI
WKHKXPDQGHVLUHIRUKDSSLQHVVHVSHFLDOO\LIFRQFHLYHGLQ%HQWKDPLWHWHUPVRIÄVHHNLQJ
SOHDVXUH³ DQG ÄDYRLGLQJ SDLQ³ ,Q LWV QRUPDWLYH DVSHFWV KRZHYHU XWLOLWDULDQLVP WDNHV
VRPH DGGLWLRQDO VWHSV WKDW DUH QRW VR HDVLO\ DFFRPPRGDWHG LQWR D JHQHUDO 'DUZLQLDQ
IUDPHZRUN:K\LVWKLV"
7KHNH\WRWKLVTXHVWLRQSUREDEO\OLHVLQWKHXWLOLWDULDQXQGHUVWDQGLQJRIWKHLGHDRI
ÄKXPDQ QDWXUH³ 0LOO LQ OLQH ZLWK KLV ÄDVVRFLDWLRQLVP³ LQ SV\FKRORJ\ DQG WKH ÄPRUDO
VFLHQFHV³ DOUHDG\ SURSRVHG LQ KLV 6\VWHP RI /RJLF >@EHOLHYHVWKDWKXPDQQDWXUHDQG
WKHKXPDQÄPRUDOIDFXOW\³DUHDÄQDWXUDORXWJURZWK³IURPEXWQRWDSDUWRIRXUQDWXUH
ZKLFKLVPDOOHDEOHDQGSHUIHFWLEOHWRDODUJHH[WHQWRULQKLVZRUGVÄVXVFHSWLEOHRIEHLQJ
EURXJKW E\ FXOWLYDWLRQ WR D KLJK GHJUHH RI GHYHORSPHQW³ >@ $FFRUGLQJ WR 0LOO
KXPDQQDWXUHLVÄVXVFHSWLEOHE\DVXIILFLHQWXVHRIWKHH[WHUQDOVDQFWLRQVDQGRIWKHIRUFH
RI HDUO\ LPSUHVVLRQV RI EHLQJ FXOWLYDWHG LQ DOPRVWDQ\GLUHFWLRQVRWKDWWKHUHLVKDUGO\
DQ\WKLQJ VR DEVXUG RU VR PLVFKLHYRXV WKDW LW PD\ QRW E\ PHDQV RI WKHVH LQIOXHQFHVEH
PDGH WR DFW RQ WKH KXPDQ PLQG ZLWK DOO WKH DXWKRULW\ RI FRQVFLHQFH 7R GRXEW WKDW WKH
VDPHSRWHQF\PLJKWEHJLYHQE\WKHVDPHPHDQVWRWKHSULQFLSOHRIXWLOLW\HYHQLILWKDG
QRIRXQGDWLRQLQKXPDQQDWXUHZRXOGEHIO\LQJLQWKHIDFHRIDOOH[SHULHQFH>@
:ULWLQJ LQ 2Q /LEHUW\ 0LOO PDLQWDLQV >@ WKDW KXPDQ QDWXUH ÄLV QRW D PD
FKLQHEXLOWDIWHUDPRGHODQGVHWWRGRH[DFWO\WKHZRUNSUHVFULEHGWRLWEXWDWUHHZKLFK
UHTXLUHVWRJURZDQGGHYHORSLWVHOIRQDOOVLGHVDFFRUGLQJWRWKHWHQGHQF\RIWKHLQZDUG
IRUFHVZKLFKPDNHLWDOLYLQJWKLQJ³0LOO¶VRSWLPLVWLFDQGSURJUHVVLYHSLFWXUHRIKXPDQ
QDWXUH ZDV SUREDEO\ FRQFHLYHG DV VRPHVRUWRIQHFHVVDU\SV\FKRORJLFDOSUHUHTXLVLWHIRU
KLV VWURQJ XWLOLWDULDQ HPSKDVLV RQ WKH SULQFLSOH RI LPSDUWLDOLW\ ,Q WKLV ZD\ DOO WKDW
)LOR]RILD
UHPDLQHGWREHGRQHZDVWRSURYLGHLWVHWKLFDOMXVWLILFDWLRQZLWKLQWKHJHQHUDOXWLOLWDULDQ
V\VWHP
+RZHYHU'DUZLQLDQDSSURDFKHVVXFKDVVRFLRELRORJ\DQGHYROXWLRQDU\SV\FKRORJ\
VXJJHVWWKDWVXFKDSV\FKRORJLFDOSUHUHTXLVLWHIRULPSDUWLDOLW\VKRXOGQRWEHDFFHSWHGDW
IDFHYDOXH7KHRULHVOLNHUHFLSURFDODOWUXLVPNLQVHOHFWLRQDQGJURXSVHOHFWLRQSUHGLFWWKDW
JHQXLQHLPSDUWLDOLW\VKRXOGQRWEHH[SHFWHGZLWKLQWKHERXQGDULHVRIKXPDQOLIHVLQFHWKH
KXPDQFDSDFLW\IRUEHQHYROHQFHRQDVRFLDOO\H[WHQGHGVFDOHLVVLJQLILFDQWO\FRQVWUDLQHG
E\ KXPDQ HYROXWLRQDU\ GHVLJQ $V D KLVWRULFDO SRLQW PRUHRYHULWLVLQWHUHVWLQJWRQRWH
WKDW HYHQ 'DUZLQ ZKR ZDV 0LOO¶V FRQWHPSRUDU\ WKRXJKW WKDW WKH LGHD RI WKH HVVHQWLDO
PDOOHDELOLW\RIKXPDQPRUDOEHKDYLRUZDVQRWHDVLO\UHFRQFLODEOHZLWKKLVRZQWKHRU\RI
KXPDQ RULJLQV Ä0U - 6 0LOO VSHDNV >«@ RI WKH VRFLDO IHHOLQJV DV DÃSRZHUIXOQDWXUDO
VHQWLPHQWµDQGDVªWKHQDWXUDOEDVLVRIVHQWLPHQWIRUXWLOLWDULDQPRUDOLW\³$JDLQKHVD\V
Ä/LNH WKH RWKHU DFTXLUHG FDSDFLWLHV DERYH UHIHUUHGWRWKHPRUDOIDFXOW\LIQRWDSDUWRI
RXUQDWXUHLVDQDWXUDORXWJURZWKIURPLWFDSDEOHOLNHWKHPLQDFHUWDLQVPDOOGHJUHHRI
VSULQJLQJXSVSRQWDQHRXVO\³%XWLQRSSRVLWLRQWRDOOWKLVKHDOVRUHPDUNVªLIDVLQP\
RZQ EHOLHI WKH PRUDO IHHOLQJV DUH QRW LQQDWH EXW DFTXLUHG WKH\ DUH QRW IRU WKDW UHDVRQ
OHVVQDWXUDO©,WLVZLWKKHVLWDWLRQWKDW,YHQWXUHWRGLIIHUDWDOOIURPVRSURIRXQGDWKLQNHU
EXWLWFDQKDUGO\EHGLVSXWHGWKDWWKHVRFLDOIHHOLQJVDUHLQVWLQFWLYHRULQQDWHLQWKHORZHU
DQLPDOV DQG ZK\ VKRXOG WKH\ QRW EH VR LQ PDQ" >«@ 7KH LJQRULQJ RI DOO WUDQVPLWWHG
PHQWDOTXDOLWLHVZLOODVLWVHHPVWRPHEHKHUHDIWHUMXGJHGDVDPRVWVHULRXVEOHPLVKLQ
WKHZRUNVRI0U0LOO>@
&RQWHPSRUDU\'DUZLQLDQSHUVSHFWLYHVWURQJO\VXJJHVWVWKDWXWLOLWDULDQLPSDUWLDOLW\LV
HTXDOO\ DQG SHUKDSV HYHQ PRUH JUHDWO\ HQGDQJHUHG E\ WZR LQWHUFRQQHFWHG IDFWV ZKLFK
KDYH EHHQ FRQVLGHUHG LQ WKLV DUWLFOH WKH IDFW WKDW KXPDQ ELRORJLFDOO\ IRUPHG SV\
FKRORJ\ DQG PRWLYDWLRQDO PHFKDQLVPV GR QRW ILW ZHOO ZLWK WKH SULQFLSOH UHTXLULQJ WKH
LQGLVFULPLQDWH SURPRWLRQ RI JHQHUDO KDSSLQHVV DQG WKH IDFW WKDW KXPDQ EHLQJV DUH
LQGLYLGXDOVZLWKQDWXUDOO\HYROYHGSHUVRQDOSURMHFWVDQGLGHDOVDQGQRWPHUHO\WKHVSDUH
SDUWVRIVRPHJHQHUDOXWLOLWDULDQFORFNZRUNRIKDSSLQHVV
5()(5(1&(6
>@ $51+$57/'DUZLQLDQ1DWXUDO5LJKW7KH%LRORJLFDO(WKLFVRI+XPDQ1DWXUH1HZ<RUN
6WDWH8QLYHUVLW\RI1HZ<RUN3UHVV
>@ &260,'(6/7KH/RJLFRI6RFLDO([FKDQJH+DV1DWXUDO6HOHFWLRQ6KDSHG+RZ+XPDQV
5HDVRQ"6WXGLHVZLWKWKH:DVRQ6HOHFWLRQ7DVN,Q&RJQLWLRQS±
>@ &260,'(6/DQG722%<-&RJQLWLYH$GDSWDWLRQVIRU6RFLDO([FKDQJH,Q-+%DUNRZ
HWDOHGV7KH$GDSWHG0LQG(YROXWLRQDU\3V\FKRORJ\DQGWKH*HQHUDWLRQRI&XOWXUH
,WVKRXOGEHPHQWLRQHGWKDWVRPHFRQWHPSRUDU\XWLOLWDULDQVDUHIDUPRUHRSHQWR'DUZLQLDQFRQVLGHUD
WLRQV WKDQ 0LOO ZDV 3HWHU 6LQJHU IRU H[DPSOH KDV ZULWWHQ WZR UHODWLYHO\ XQELDVHG ERRNV DERXW WKH HWKLFDO
LPSOLFDWLRQV RI FRQWHPSRUDU\ 'DUZLQLVP :LWKRXW GRZQSOD\LQJ DQ\ RI WKH 'DUZLQLDQ FRQVLGHUDWLRQV KH
DUJXHV WKDW WKHFLUFOHRIKXPDQEHQHYROHQFHFDQQHYHUWKHOHVVEHH[SDQGHGEH\RQGELRORJLFDOO\HVWDEOLVKHG
KXPDQERXQGDULHV>@+HDOVRFRQWHQGVWKDWWKHLQVLJKWVRIHYROXWLRQDU\SV\FKRORJ\FRQFHUQLQJWKHKXPDQ
UHDGLQHVVIRUFRRSHUDWLRQÄVKRXOGEHVHL]HGXSRQDVDVWDUWLQJSRLQWIRUWKHGHYHORSPHQWRIDILHOGRIVRFLDO
UHVHDUFKWKDWVKRZVWKHZD\WRZDUGVDPRUHFRRSHUDWLYHVRFLHW\³>@6LQJHU¶VYLHZVDUHIDUWRRFRP
SOH[WREHGLVFXVVHGLQWKLVOLPLWHGVSDFH1HYHUWKHOHVVLWFRXOGSHUKDSVEHDUJXHGWKDWKLVLQWHUSUHWDWLRQRI
FRQWHPSRUDU\'DUZLQLVPUHPDLQVWRRVHOHFWLYHDQGLQSDUWLFXODUWKDWKHKDVORVWVLJKWRIWKHªV\PPHWULFORJLF
RIVHOHFWLRQDUJXPHQWV©PHQWLRQHGLQVHFWLRQRIWKLVDUWLFOH
2[IRUG2[IRUG8QLYHUVLW\3UHVV
>@ '$5:,1&2QWKH2ULJLQRI6SHFLHV1HZ<RUN*UDPHUF\%RRNV>@
>@ '$5:,1&7KH'HVFHQWRI0DQ/RQGRQ1HZ<RUN3HQJXLQ>@
>@ '$:.,1657KH6HOILVK*HQH2[IRUG1HZ<RUN2[IRUG8QLYHUVLW\3UHVV>@
>@ *2':,1:(QTXLU\&RQFHUQLQJ3ROLWLFDO-XVWLFHDQGLWV,QIOXHQFHRQ*HQHUDO9LUWXHDQG
+DSSLQHVV1HZ<RUN.QRSI>@
>@ +$0,/721:'7KH(YROXWLRQRI$OWUXLVWLF%HKDYLRU,Q7+&OXWWRQ%URFNDQG3+
+DUYH\HGV5HDGLQJVLQ6RFLRELRORJ\5HDGLQJDQG6DQ)UDQFLVFR:+)UHHPDQDQG
&RPSDQ\>@
>@ +80('$7UHDWLVHRI+XPDQ1DWXUH/RQGRQ1HZ<RUN3HQJXLQ>±@
>@ 0,//-6$6\VWHPRI/RJLF+RQROXOX8QLYHUVLW\3UHVVRIWKH3DFLILF>@
>@ 0,//-62Q/LEHUW\/RQGRQ1HZ<RUN3HQJXLQ>@
>@ 0,//-68WLOLWDULDQLVP2[IRUG2[IRUG8QLYHUVLW\3UHVV>@
>@ 0,//-6$XWRELRJUDSK\1HZ<RUN&ROXPELD8QLYHUVLW\3UHVV>@
>@ 586(07DNLQJ'DUZLQ6HULRXVO\1HZ<RUN3URPHWKHXV%RRNV>@
>@ 6(6$5',û15HFHQW:RUNRQ+XPDQ$OWUXLVPDQG(YROXWLRQ,Q(WKLFV
S±
>@ 6,1*(537KH([SDQGLQJ&LUFOH(WKLFVDQG6RFLRELRORJ\2[IRUG0HOERXUQH2[IRUG
8QLYHUVLW\3UHVV
>@ 6,1*(533UDFWLFDO(WKLFV&DPEULGJH&DPEULGJH8QLYHUVLW\3UHVV
>@ 6,1*(53$'DUZLQLDQ/HIW3ROLWLFV(YROXWLRQDQG&RRSHUDWLRQ1HZ+DYHQDQG/RQGRQ
<DOH8QLYHUVLW\3UHVV
>@ 62%(5(DQG:,/621'68QWR2WKHUV7KH(YROXWLRQDQG3V\FKRORJ\RI8QVHOILVK
%HKDYLRU/RQGRQ+DUYDUG8QLYHUVLW\3UHVV
>@ 75,9(565/7KH(YROXWLRQRI5HFLSURFDO$OWUXLVP,Q7+&OXWWRQ%URFNDQG3+
+DUYH\HGV5HDGLQJVLQ6RFLRELRORJ\5HDGLQJDQG6DQ)UDQFLVFR:+)UHHPDQDQG
&RPSDQ\>@
>@ 92//0(5*0HVRFRVPDQG2EMHFWLYH.QRZOHGJH±2Q3UREOHPV6ROYHGE\(YROXWLRQDU\
(SLVWHPRORJ\,Q):XNHWLWVHG&RQFHSWVDQG$SSURDFKHVLQ(YROXWLRQDU\(SLVWHPRORJ\
'RUGUHFKW%RVWRQ/DQFDVWHU'5HLGHO
>@ :,//,$06%0RUDOLW\$Q,QWURGXFWLRQWR(WKLFV&DPEULGJH&DPEULGJH8QLYHUVLW\
3UHVV>@
>@ :,//,$06%$&ULWLTXHRI8WLOLWDULDQLVP,Q--&6PDUWDQG%:LOOLDPV8WLOLWDULDQLVP
)RU$JDLQVW&DPEULGJH&DPEULGJH8QLYHUVLW\3UHVV
>@ :2/)60RUDO6DLQWV,Q/3RMPDQHG(WKLFDO7KHRU\&ODVVLFDODQG&RQWHPSRUDU\
5HDGLQJV:DGVZRUWK7KRPVRQ/HDUQLQJ>@
BBBBBBBBBBBBBBBBBBBBBBBB
7RPLVODY%UDFDQRYLü
'HSDUWHPHQWRI3KLORVRSK\
8QLYHUVLW\RI=DJUHE±&URDWLDQ6WXGLHV
8OLFDJUDGD9XNRYDUD
+5=DJUHE
&KRUYiWVNR&URDWLD
HPDLOWRPLVODYEUDFDQRYLF#KUVWXGKU
7HO
)LOR]RILD
© Copyright 2026 Paperzz