packed concert schedule, selling tickets to people who may have already binge-watched all of “Below Deck.” The second, however, suggests that people aren’t as eager to get back to huffing and puffing at the gym as they are content to exercise at home. As restrictions lift and people feel safer in crowds, drinking and dancing appear to be higher priorities.

new book, “Noise: A Flaw in Human Judgment,” the Princeton psychology professor and Nobel laureate Daniel Kahneman, along with co-authors Olivier Sibony and Cass Sunstein, argue that these inconsistencies have enormous and avoidable consequences. Kahneman spoke to DealBook about how to hone judgment and reduce noise.

DealBook: What is “noise” in this context?

Kahneman: It’s unwanted and unpredictable variability in judgments about the same situations. Some decisions and solutions are better than others and there are situations where everyone should be aiming at the same target.

Can you give some examples?

A basic example is the criminal justice system, which is essentially a machine for producing sentences for people convicted of crimes. The punishments should not be too different for the same crime yet sentencing turns out to depend on the judge and their mood and characteristics. Similarly, doctors looking at the same X-ray should not be reaching completely different conclusions.

How do individuals or institutions detect this noise?

You detect noise in a set of measurements and can run an experiment. Present underwriters with the same policy to evaluate and see what they say. You don’t want a price so high that you don’t get the business or one so low that it represents a risk. Noise costs institutions. One underwriter’s decision about one policy will not tell you about variability. But many underwriters’ decisions about the same cases will reveal noise.

WSJ)

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    Warren Buffett Opposes Climate and Diversity Proposals for Berkshire

    The other proposal, by the shareholder advocacy group As You Sow on behalf of Handlery Hotels, calls on Berkshire to detail its diversity and inclusion efforts, arguing that more diverse workforces perform better.

    Berkshire does not dispute the importance of either issue. In its proxy statement to shareholders, which recommends voting against the proposals, the company says that it agrees about the importance of both climate change and a diverse and inclusive work force.

    The argument against those proposals is tied to what the company calls its “unusually decentralized” business model. Though its various subsidiaries employ about 360,000 people around the world, Berkshire itself employs only about two dozen at its base in Omaha, Neb., with relatively lean resources to review the efforts of all its portfolio companies. Asking for standardized diversity data for all of its subsidiaries, for instance, would be “unreasonable,” it said.

    “I think for a company this size, it’s an extraordinary ask,” Mr. Cunningham said.

    Moreover, Mr. Buffett has long played up the independence of his subsidiaries’ chief executives, giving them wide berths so long as their companies perform well. “I don’t believe in imposing my political opinions on the activities of our businesses,” he said at Berkshire’s 2018 annual meeting.

    For Berkshire, then, responsibility for action on climate and diversity lies largely with its operating companies. Berkshire Hathaway Energy “determined independently” to back the Paris climate accord and has invested heavily in renewable energy, the proxy statement noted.

    The shareholder proposals’ fates aren’t in doubt. Mr. Buffett controls about a third of Berkshire’s voting power, and holds enormous sway over the company’s army of devoted retail investors. Previous efforts to force changes to Berkshire’s governance do not have a great track record: A 2014 proposal to encourage the company to pay a dividend, which was opposed by management, garnered support from less than 3 percent of shareholders.

    But even if the proposals fail on Saturday, Berkshire may still need to change. The Securities and Exchange Commission is weighing moves to require companies to provide more disclosure on E.S.G. issues, particularly climate, calling them potentially material financial information.

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