This month, Texas’ anti-responsible investing rule fell under fire from all sides of the political spectrum. Texas politicians like Attorney General Ken Paxton and Governor Greg Abbot are throwing the well-being and financial security of their state under the bus by imposing strict, onerous rules on entities trying to do business in the state. By making it more difficult for businesses to work with municipalities in the states, Texas politicians are showing their true loyalties lie with the special interests funding these attacks on responsible investing policies.
‘A concerning trajectory’: Texas got slammed for acting ‘like California’ and micromanaging private business — is the Lone Star State going down a ‘disastrous’ path?. “A public policy expert has slammed Texas lawmakers for taking a leaf ‘right out of the California playbook.’ ‘The fight over environmental and social governance (ESG) policy has gotten so out of control that Texas is seemingly trying to emulate California,’ according to Brandon Arnold, EVP of the National Taxpayers Union, a fiscally conservative taxpayer advocacy organization.‘The Lone Star State — a great economic success story — is now trying to engage in the concerning practice of micromanaging private businesses,’ he wrote in an opinion piece, published by Fox News.” [Moneywise, 1/17/24]
Even BlackRock Funds Buying Oil Stocks Are Banned by Texas ESG Fight. “The findings demonstrate how vague rhetoric used by Republicans attacking what they call ‘woke’ capitalism has found its way into statutes that have proven difficult to interpret and seemingly contradictory to the state’s self-proclaimed reputation as business friendly.” [Bloomberg, 1/10/24]
Editorial: Conservative Texas’ big government social agenda. “A bank that invests heavily in fossil fuel production but that also a) acknowledges the reality of climate change and b) invests in alternative fuel sources isn’t woke; it’s realistic and fulfilling its fiduciary duty by being forward-looking. Or what about a company that has decided that underwriting firearms manufacturers could expose it to unpredictable future liability? It could just be balancing risk vs. reward — good corporate governance. In Texas these days that could get a company in trouble.” [Dallas Morning News, 1/10/24]
Opinion: When Texas starts acting like California. “It would be bad enough if this ESG war was limited to our two largest states, but of course, others have joined the fray with red states lining up behind Texas while blue states team up with California. Stuck in the middle, as usual, are taxpayers who have to foot the bill for this back-and-forth battle. Simply put, all politicians should stop using taxpayers as their pawns as they duke it out in the culture war. And Texas politicians in particular should know better than to mess with their own state.” [Fox News, 1/10/24]
Wall Street thrived, small towns lost as anti-ESG campaign raged in 2023. “In Texas, the municipal bond market is in turmoil after the state’s attorney general, Ken Paxton, issued an advisory in October to state and local government agencies asking them to be on the lookout for bond underwriters that may ‘boycott energy companies, discriminate against firearm entities or associations, or boycott Israel.’ Paxton’s letter included a list of 22 companies he accused of violating Texas laws passed in 2021 to protect such interests. [S&P Global, 1/3/24]
Opinion: Texas’ ‘Fair Access’ law hurts state’s business-friendly reputation, raises borrowing costs. “Nonsensical enforcement of Fair Access laws that target certain financial institutions due to their corporate governance policies could threaten the pro-growth groundwork we have laid by tightening our municipal bond market, costing Texas taxpayers, municipalities and businesses.” [Dallas Business Journal, 1/2/24]
