Ann sheehan. Welcome to you all. Thank you. I think the question on everyones mind today is why apple . Of all the companies out there, why apple . Why apple apple is unquestionably a remarkable company, most valuable company in the world, and and a very responsible company, but theres no question that we need to be more responsive to childrens needs and childrens activities, and theres lots of research that has indicated that excessive usage of smartphones is damaging to kids, and so, you know, this should be an easy fix for apple. Apple, in fact, came out with a press release as you saw this morning that i was very encouraged by. They indicated that they acknowledged that theres an issue, that its an important one and that they expect to further improve their interactions, parents interactions with the kids phones. You could perhaps take their statement though as a why us maybe you guess have targeted the wrong company, that were already doing a number of these issues charlie, from my sources apple was blindsided by this, suggest that they are at the forefront of this. Apple, quote, has always looked out for kids we work hard to create powerful products that inspire, entertain and educate chin while also helping parents protect them online we lead the industry by offering intuitive Parental Controls built right into the operating system and think deeply about how products are used and the impact they have on the people and people around them were committed to exceeding and meeting our customers expectations, especially when it comes to protecting kids youre suggesting that they dont. No. Its really a twopart question. Theres, first of all, why apple . You know, first of all, they are a leader in both innovation and kind of setting a standard for the industry, an and, you know, it is not part of their Business Model to encourage overaccuse or kind of improper usage the same way it is arguably for a facebook or a twitter. Its actually part of their Business Model to get people to bite phone, be really happy about and it be excited about the next one that comes out. I think also you have to move away from issues of fault here you know, apple is not responsible for Global Warming either, but they have a great policy on Climate Change in the same way that if you see a kid suffering you dont say thats not my fault and move on if youre in a position to do something about it you do why do you think that the controls that they have right now arent enough . As i acknowledged last night in the statement they will have new ones coming out. One as barry said they are not front and center and integrated into the setup of the phone. Two, they are not really what the research would suggest is effective. They have very binary. Its either on on off. The Research Suggests limited levels of use, actually not only harmful but probably beneficial. Kids use their phone for an hour a day have more positive Mental Health outcome that kids who dont use it at all and even within the most problematic usages like the one you mentioned in terms of social media sites that people are the most worried about, even within those categories theres graduations so, for example, young adults who go to more than three social media sites a day have worse Mental Health outcomes as you get older, the negative impacts that were seeing with social media actually start to phase out and are gone by the time you are 30 so you company kind of phase that out as well so the basic issue is that the controls are good and we applaud them for having them and since 2008 a lot has changed theres more research out there, and we think that the controls, and these would all be optional for parents to choose to use or not to use and can be brought up to date to align with the research and also the developments and technology. Plus, you know, they cite apps that are available, and theres so many apps, and, you know, nobody really knows the Research Upon a lot of these apps are based so parents need help, and, you know, i will tell you based on the response weve gotten with hundreds and hundreds of emails and letters and and phone calls yesterday and the wall street journal told us they have never had a response like this to an article, i just think theres overwhelming agreement in the general public about the need for this. You would admit though, charlie, would you not, that the controls that they do have on the iphone are very easy to enable, for parents to enable and there are a number of controls well show as we have this conversation, a producer demonstrating on an iphone how easy it is to go to the settings and general restrictions and how many settings you can actually enable on the phone. But look what youre actually doing on that. Youre flipping things on and off. Thats, again, not theres actually research out there from a researcher named Alexander Samuel who actually shows that parents who just focus on restricting screen time as opposed to guiding it, their kids actually have worse outcomes in terms of engaging in inappropriate behavior like finding obscene material online and pretending to be other people online than parents who actually guide their usage so the actual kind of onoff binary approach is actually the really wrong approach think of all the other things for youion can do. For example, when you go to sleep at night, a lot of kids are having trouble sleeping because theres a blue light that shoots out of your phone that tricks your brain into thinking its daytime. You can shut that off on your phone. Can you do a lot of things on your phone, but having all these kind of different promises, and as barry alluded, to weve got hundreds, maybe thousands of emails yesterday, 50 from App Developers for other ideas one app that somebody has proposed where you would have to answer a bunch of aimingappropriate questions to kind of buy yourself more screen time theres more you can do than flipping stuff on and off and apple intends to do more which we found very encouraging. The wall street journal said they got letters of support as well as the many you got, theres been a lot of critics and youve heard the criticism over the last 24 hours, notably from ourim cramer who calls your letter duplicitous making everyone think apple does nothing. Goings has not done nothing and theres several companies in the s p who need to be more responsible. Its clear he hasnt read our left because our letter does not say that apple does nomping oth. Our letter applauds apples efforts and says he can do more. The point he tries to make is says facebook has its own tremendously large platform along with instagram android is a much larger platform than the ios operating system is and those phones are all over the place google has youtube as well why not a Video Company who is making violent company that kids are getting their hands on for the same wore you wore one tie today and go after another one. We can go after one company today and focus on others in the future as i said at the outset, apple is the smartest place to start they are the leader in the industry what they do would send a powerful message to those other companies, by the way, the other companies that you mentioned are they are not unaware of these issues, and they are starting to address them two, as i said, they are the gateway to a lot of these more problematic apps and sites and its like a hose if you can squeeze the hose you wont focus on every drop of water, youll try to squeeze the hose and a s l in an incredibly powerful position to do that fault doesnt matter if you can focus on the most impactful way to help kids you should do that, and lastly were shareholders and folks at calstrs are shareholders this is Smart Business for a toll do this when you invest in apple, youre not investing like if youre investing in a Tobacco Company if you are investing in a Tobacco Company youre investing in making people sick and if you invest in coke youre investing in potentially giving people diabetes this is different. This is not what apple investors signed up for. What they actually signed up for is people happy about their products and, again, i dont know apple look, if you are smart, customeroriented company the way apple, is your response would not be, well, this isnt our fault and by the way in a related story, thats not what they have said. They said we want to partner with parents on this issue to make them feel happy about our phones and its a Smart Business sense. If you can improve young peoples Mental Health outcomes and make customers including parents better about the phones they buy, it would be a winwin. Longstanding wave that apple has thought about this i mean, ive been in small gatherings with tim cook he strikes me as the kind of ceo who cares deeply not only about his customers and also why and apple as a corporate citizen. Why have most of the original designers of the iphone, including one who came out yesterday. Tony fiddel. And says there needs to be more improvemans youre making a straw man argument weve not said apple is not a simmon company, incredibly responsible on issues like the environment, on supply chain issues and even on this issue, but we think theres an opportunity for them to get out ahead of the curve keep in mind that with everything they have done you still have 94 of parents who say they try to do something every school year to limit their kids phoneusage, but half of them feel like its a constant battle and more than half of them worry about their kids social media and more than half feel like their kids are atampd, their words, to the phone and also half those kids feel like they are addicted to their phones you know what this is easier for apple to do than maybe some of the other companies you mentioned because this is not going after the hardware this is a software fix, so its not going to the essence of their product as it would be with one of the other social media sites. The other criticism, i know youve heard over the last, you know, many hours, is that youre essentially asking tim cook and apple to play the role of parent where at the end of the day this is a parental issue, that apple has given tools and tin tends to give more as it has said in the response to to your letter, but that, you know, at what point does it does it become the parents responsibility and tim cab is not the parent to hundreds if not hundreds of millions of people around the world. We havent heard that from the company. Read apples statement what youre saying contradicts apples own position its completely inaccurate to say what were saying or what apple is say is were imposing a nanny state idea i encourage everybody to read the letter www. Thinkdifferently. Kids. Com. Late night pitch man where you can read the whole letter. We say, first of all, parents bear ultimate responsibility for this, full stop, but when you have kids using their phones on average four and a half hours a day, when they check it 100 times a day, most parents, particularly working parents, cant follow their kids around all day, and when you have that level of usage, a company that makes such a powerful product has a responsibility to partner with kids, and, again, we may be arguing with you or cramer, but were not arguing with a were all on the same page to this to the extent that were having a debate and the quality of controls out there right now and apple said last night in response to our efforts that they are putting out new tools, so were looking forward to a constructive discussion with the company. I dont really think either of us care what cramer thinks most people are supportive of this if you actually read the informed analysis about this, and were looking forward to a constructive discussion with the company about this enveloped by the experts. Do you think youll have a conversation with either tim cook or other members of the board . We hope to. We will. Have you attempted to reach out to him already we have. Mr. Sghook. Weve sent him a left we expect well get a response. Yes. Ann, thank you for your patience how did calstrs get involved here well, weve had a long relationship with jama just like a lot of other activist investors, and as weve shared with them our esg priorities which has been in calstrs dna for over 40 years, these are issues that we care deeply about because they affect shareholder value and could be a risk to our poll, so as we look at these issues and we continued our discussions with jana, this is one that came up in the discussion about apple being our Largest Holding in our portfolio, so it resonated with us we have a long relationship with a. We think they are a responsive company, they are sop. They take their social license to operate very seriously as evidenced by the values that you see on their website and that they espouse as charlie talked about, human capital, supply chain, so this is one that was a natural for us, especially as the teachers fund. We heard from so many teachers yesterday about the positive response on this because teachers in the classroom see the impact that these students are suffering and having as a result of these iphones and other telephones and other devices, so it resonated with calstrs, and it was natural for us to partner up with jana and to communicate with apple on our concerns about this, and most importantly how they are protecting longterm shareholder value. Well be a share holder in apple for a very long time and so we want them to step up and respond, and as you said they are they do have responses for this the statement that they issued yesterday was very positive, but one of the things we want them to do is to share more about what they are doing and to bring in some of the stakeholders and maybe talk to the shareholders about this concern and how they are addressing it. Im just curious. Weve looked through your ownership of other stocks, and you owned facebook, and this is current, and forgive me if its not. Facebook, google, cocacola, pepsi, mcdonalds, activision, blizzard are you concerned about Childhood Obesity and are you concerned about violent video games and concerned about the other Technology Companies and their impact on children we are concerned about all those issues and the impact that it can have not just on the children butalso on the reputation of the company. We have a very active Engagement Program and have communicated with all of those companies on a variety of issues. But you dont have a problem owning those stocks but not taking an active role in contacting those companies we are taking an active role in contacting apple, and well continue the discussion. It was a natural for us to go talk to apple. They are the laenchingt holdirg. Thats a good place to heart dialogue and hear what they are doing on this issue. Charlie, let me tell you. Jim cramer is emailing me saying he did read the letter. He didnt insult you at all, and he raises the issue of when you guys were holders of wall green, why didnt you take a big stand against tobacco . Ill respond to that since i was on the board of walgreens. One, we had a standstill agreement. Two, i was on the board so i had no ability to speak publicly and three i did raise it privately with the company i dont know. I just fine this line of questioning with all due respect kind of ridiculous you can say youre doing this good thing but why arent you doing 100 other good things. These are the kinds of questions that people are asking. Im not on jim cramers show. What questions do you have ive asked you all the questions that are the relevant questions. Relevant to the question you asked anne about her holdings. You know, from hour perspective this is a new fund were starting this is our First Investment youve just erin just listed a number of companies. You can be sure well be looking at all of them. We havent had a social impact fund. Nobody has ever done this before. But you dont think these are relevant questions. Did i say that . Its our first one. We can do others i dont know. But you questioned why im asking the questions. Ive answered the question. Which i am. I feel like weve answered the question. How did sting get involved with you stings been a longtime friend of mine obviously Everybody Knows him as a rock star but he and his wife trudy styler have been longterm sustainability advocates including with their very successful Rain Forest Foundation project and so i expect, you know, sting not being specifically involved in apple and they are interested in the issue and will be on the Advisory Committee and will help us understand a lot of issues with a lot of companies and will certainly bring awareness to this effort. Im curious as to what the what you realistically expect the end game to be you also could have, i suppose, put this on a proxy and and made it a shareholder proposal, but you didnt is that something that you would consider in the future well, possibly, but hopefully we dont have to do that you know weve conducted over 80 activist campaigns in our 18year history. Weve only had to run one proxy fight so weve been able to create change every single time generally without a fighting what will your metric be to determine whether apples done enough in your mind to meet the demands that you suggest they should yeah. You know, thats a good question heres what weve asked for and i think that will lead to kind of the answer. Weve asked them to convene a committee of the experts and weve recommended some people who can play that role and theres obviously a lot of others review the research with those experts and then kind of determine what you know now and what more you can fine out, and in the same way that other Tech Companies have done like, for example, with the family online Family Institute which, you know, facebook and google, and other folks have done and then take something that you need to do Additional Research and help to facilitate that off your other resources, and, again, theres certainly plenty of capacity at apple toll do that, and then kind of go where the research tells you were in the attempting to micromanage the company and calstrs isnt attempting to micromanage the company. We are not software or childhood Software Ex