The case for fighting E.S.G. gets messy
“Many Republicans have made railing against the environmental, social and corporate governance investing movement a cornerstone of their political success.”
The case for fighting E.S.G. gets messy
By Andrew Ross Sorkin, Ravi Mattu, Bernhard Warner, Sarah Kessler, Michael J. de la Merced, Lauren Hirsch and Ephrat Livni
Feb. 22, 2023, New York Times
Many Republicans have made railing against the environmental, social and corporate governance investing movement a cornerstone of their political success. (Indeed, Vivek Ramaswamy, the financier who rose to fame battling against “woke capitalism,” announced a long-shot bid for the 2024 G.O.P. presidential nomination yesterday.)
But that stance is growing increasingly complicated — especially given new revelations that lawmakers who have publicly berated companies for pursuing E.S.G. strategies have also taken big donations from those same businesses.
Bashing E.S.G. and left-leaning companies has been highly fruitful for Republicans. Gov. Ron DeSantis of Florida, widely considered a front-runner for the Republican presidential nomination, has scored political points for picking a fight with Disney over its opposition to his state’s so-called “Don’t Say Gay” law.
And he and other G.O.P. state officials have taken on investment giants like BlackRock, one of the biggest proponents of E.S.G. policies, and Vanguard, threatening to pull billions in state money from those firms over their support of environmental and social considerations in investing. Mike Pence, who may also run for president, last year accused “a few Wall Street financiers” of pushing a left-wing agenda that Democrats hadn’t been able to get approved at the ballot box.
(Mr. Ramaswamy, who wrote “Woke Inc.” and whose Strive Asset Management has targetedApple, BlackRock and Disney, has sought to capitalize on that stance in the business world.)
But the money trail complicates things. CNBC reports that 10 of the 29 Republicans on the House Financial Services Committee (including its chairman, Representative Patrick McHenry of North Carolina) took in a combined $140,000 in campaign donations from BlackRock, State Street and Vanguard during the 2022 election cycle, according to Federal Election Commission filings. All three of those companies are regularly criticized by conservative lawmakers.
That’s on top of recent pushback in states like Kentucky against G.O.P. efforts to remove public pension funds’ money from firms like BlackRock.
Some Republicans are moving away from strident opposition to E.S.G. Among them is Mr. Ramaswamy himself, who wrote in a Wall Street Journal opinion piece last month that it’s actually acceptable for investors to support environmental goals, so long as they’re transparent about their efforts.