Sustainability in Action: Expanding Oaktree’s Business Principles

In 1995, Oaktree’s co-founders gathered in a living room in Los Angeles to create a new type of investment firm: one that would seek to achieve superior performance while taking the high road and thinking differently from the herd.  Our co-founders have always believed that excellence isn’t just about investment returns, but also about how they’re achieved.  Oaktree’s mission hasn’t changed in the last three decades, partly because the firm has been guided by a set of unifying business principles.  These short, straightforward statements outline Oaktree’s responsibilities to its clients, employees and other stakeholders.  Now, for only the second time in Oaktree’s history, we’re adding a new business principle: Responsibility. 

This new principle states:

We are committed to acting responsibly with our stakeholders and society at large.  Oaktree (a) incorporates Environmental, Social and Governance considerations in its investment and business decision-making; (b) fosters an inclusive work environment that embraces diversity; and (c) supports the communities in which we live and operate.

Responsibility has been at the core of Oaktree’s business since our founding.  As our original principles articulate, we put our clients’ interests before our own, pay strict attention to potential conflicts of interest, and are dedicated to creating an equitable workplace that discourages unhealthy competition.  We’ve long promoted a culture that celebrates transparency and fairness, and we’ll continue to do so.  

In recent years, our focus on “doing the right thing” has become increasingly formalized.  In 2021, we appointed Priya Prasad Bowe and Jerilyn Castillo McAniff as our first heads of ESG and Diversity & Inclusion, respectively.  We’re now explicit about how we integrate ESG considerations into our decision-making across the firm and are aligned with some of the leading ESG frameworks.  

Additionally, in 2017, we established a four-pillar strategy to structure Oaktree’s longstanding efforts to increase diversity and inclusion in our workforce: (1) recruitment, (2) retention & development, (3) awareness & education and (4) accountability.  We’re honored that we recently earned the top score of 100 on the Human Rights Campaign Foundation’s 2022 Corporate Equality Index, which measures policies and practices related to LGBTQ+ workplace equality.¹

We’ve also expanded our efforts to promote diversity and inclusion across the financial industry.  We’re proud to be a founding member of AltFinance, a $90 million initiative directed at students attending Historically Black Colleges and Universities that we launched in 2021 in concert with two other alternative investment firms.  

Moreover, philanthropy is an integral part of Oaktree’s culture.  Our Communities Matter (OCM) is an employee-centric program that empowers Oaktree workers to give back to their communities and support the causes that matter to them.  OCM organizes volunteer events throughout the year alongside employee-run groups, including Oaktree Pride, the Women’s Leadership Council, United Groups Connect, ACORN and Oaktree Abilities.  In 2021, there were 34 such events across seven global offices.

Oaktree is aware of the impact that we and the financial industry as a whole have on the lives and livelihoods of people around the globe.  At its best, our industry enables institutions and individuals to meet their financial goals, helps companies access capital, and promotes economic growth and innovation.  We believe our industry’s influence comes with significant responsibilities.  This is one of the reasons why we’ve always stressed the importance of abiding by the highest ethical standards in every aspect of our business.

Over the last few decades, Oaktree’s reach has extended far beyond that living room in Southern California.  We now have more than 1,000 employees operating in offices across multiple continents, and we manage $166 billion in assets.  As we’ve grown, so has the significance of what we say publicly.  That’s why we believe it’s necessary to add Responsibility to our business principles: we want to make sure we’re clear where Oaktree stands on questions of corporate social responsibility.  We acknowledge that our efforts are evolving and that we, like all companies, have more work to do.  But our commitment to this work is rooted in our core principles, and when we put something in writing, we mean it.  At Oaktree, integrity isn’t just part of our mission.  As our Co-Chairman Howard Marks would say, it’s “the most important thing.”

EndNotes

¹ The Human Rights Campaign Foundation’s Corporate Equality Index rates companies on criteria under four central pillars: non-discrimination policies across business entities; equitable benefits for LGBTQ+ workers and their families; supporting an inclusive culture; and corporate social responsibility. Oaktree satisfied all of the CEI’s criteria, earning a top score of 100 and the designation as one of the “Best Places to Work for LGBTQ+ Equality.” Of the 1,271 companies that participated in the 2022 survey, 842 received a score of 100.

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