This week in responsible investing, despite big oil-funded, right-wing activist group the American Energy Institute continuing to spread climate change misinformation and self-serving politicians doubling down on anti-ESG attacks, regulators, business executives, and leaders in the financial industry are speaking out to uplift the thriving sustainable investing economy, push back on anti-ESG messaging, and reinforce what studies have shown time and time again: anti-ESG efforts hurt American taxpayers and the economy.
That and more below:
Houston Controller Chris Hollins wrote an op-ed in the Houston Chronicle detailing how anti-ESG efforts harm taxpayers and teachers.
From the op-ed: “It works like this. When cities and towns want to secure funding to update water pipes, maintain roads or repair bridges, we turn to financial institutions to underwrite our bonds. The more institutions there are to compete for our business, the better the deal. But a Texas anti-ESG law prevents us from doing business with financial companies that a handful of politicos — who have little knowledge of what it takes to manage a city’s finances — have deemed hostile to fossil fuels.”
Senator Bill Cassidy introduced a bill which would prevent fiduciaries from considering ESG factors in their investment decisions.
From UAF’s statement: “At a time when Congress should be focused on the important issues keeping hardworking, everyday Americans up at night, Senator Cassidy has decided to waste taxpayer resources and introduce anti-ESG legislation that will not pass and that the majority of Americans across party lines do not support. We have seen in states like Texas and Oklahoma the harmful effects of limiting investors’ freedoms to choose where their money goes, including on the financial security of retirees. Given the overwhelming evidence that shows these bills are harmful, and that Americans are unsupportive, we’re left with the conclusion that Sen. Cassidy is simply appeasing his billionaire donors from the oil and gas industry, who have also funded a shady network of extreme organizations working to dismantle responsible investing.”
A JPMorgan executive said that anti-ESG backlash is overblown and overstated.
From Reuters: “The impact of a political backlash against environmental, social and governance-related (ESG) issues in the United States is overstated and having little bearing on the country’s burgeoning green economy, a JPMorgan executive said on Tuesday.”
The former CEO of Unilever wrote an op-ed in Barron’s claiming the victory laps taken by anti-ESG crusaders are premature.
According to the op-ed, “Far from being dead, responsible investing is not even dented, despite the noise. Morgan Stanley data shows that, in 2023, sustainable funds continued to outperform their peers. The market grew 15% last year, reaching a high of $3.4 trillion. Over 50% of investors plan to boost sustainable investments in 2024, and when asked if they are interested in this as an investment strategy, 77% give a resounding yes.”
The American Energy Institute, a group linked to conservative judicial activist Leonard Leo, is attacking efforts to educate judges on climate change.
From The Guardian: “Formerly known as Texas Natural Gas Foundation, AEI on its face appears to contribute little more than public relations work in defense of the fossil fuels industry. The group publishes blogposts defending carbon emissions and denouncing the push for climate action. It has also produced a handful of longer reports promoting laws that restrict environmental, social and governance (ESG) investing and opposing the widespread adoption of electric vehicles.”
Attorneys general are fighting back against the anti-ESG messaging battle.
From ESG Dive: “Matthew Platkin, New Jersey’s attorney general, said that when it comes to incorporating ESG factors into investment decisions “we’re not talking about charity here.” Studies of anti-ESG laws in Texas, Oklahoma and other localities have found restrictive anti-ESG laws to increase costs for municipalities. Anti-ESG rules in Missouri and Oklahoma have been struck down this summer. Additionally, a lawsuit was filed against the state of Texas for one of its anti-ESG laws in late August.”
A former Microsoft executive called out anti-responsible investing laws in Texas and nationwide.
From the op-ed in Forbes: “Of course, the government plays an indispensable role in regulating companies, so they follow the law, do right by their workers and communities, and don’t conduct business with America’s enemies. But trying to force U.S. companies, by law, to uphold far-right conservative ideology is simply a bridge too far. It is, in a word, unconstitutional. And amidst a global climate crisis that threatens all Americans, especially those most vulnerable in our society, these misguided ideological crusades don’t just jeopardize our future prosperity and global competitiveness—they endanger our communities, economy, and planet.”
Read more:
- Barron’s: The Backlash Didn’t Kill Green Investing. In Fact, It’s Booming.
- Houston Chronicle: Lawmakers score political points with anti-ESG laws. Taxpayers, teachers pick up the tab.
- The Guardian: Leonard Leo-linked group attacking efforts to educate judges on climate
- STATEMENT: Sen. Cassidy Doubles Down on Anti-ESG Legislation, Despite State Sister Bills Showing Harms to Taxpayers, Retirees
- Reuters: Anti-ESG backlash in US is overstated, JPMorgan exec says
- ESG Dive: Dem AGs: ‘We were on the verge of losing this messaging battle’ on ESG
- Forbes: Culture Wars And Unconstitutional Laws: The Threat To America’s Future
