West Virginia has so far been the tip of the spear in fighting back against woke, ESG investing, though now it’s finding a growing crowd of partners as other red states wake up to the dangers posed to their interests by left-leaning businesses not only controlling immense amounts of capital but also using it to demand that others do as they say and only invest or support certain projects that the left likes. Joining that collection of states this week was Florida, which followed in the footsteps of states like West Virginia and Texas and pulled state funds from Blackrock.
West Virginia AG Morrisey began the fight and pushed back on the idea of ESG investing in a letter to the SEC in which he asserted that, CompNews reports:
- the satisfaction of demand among investors for ESG disclosure does not qualify as a “compelling government interest”;
- the requirement of ESG disclosure would not “directly and substantially serve that end”; and
- the SEC would be “hard-pressed” to prove that ESG disclosure constitutes the least restrictive means by which investors can obtain ESG information, considering that private competition already yields “a vast amount of voluntary statements on a host of [ESG] issues.”
West Virginia then kicked that fight into high gear by banning five woke Wall Street firms from doing business with the state, with West Virginia Treasurer Riley Moore saying:
“While the ‘Environmental, Social and Governance’ or ‘ESG’ movement might be politically popular in California or in New York, financial institutions need to understand their practices are hurting people across West Virginia.
“I simply cannot stand by and allow financial institutions working against West Virginia’s critical industries to profit off the very funds their policies attempt to diminish.”
The five firms hit by the decision were BlackRock Inc., Goldman Sachs Group Inc., JPMorgan Chase & Co., Morgan Stanley, and Wells Fargo & Co.
Other red states such as Texas then followed suit, also pulling government funds from Blackrock and other woke fund managers and investment companies to resist the tide of ESG investing and its pro-DEI, anti-fossil fuels focus.
Now joining them is Ron DeSantis’ Florida, which just announced that it would be freezing about $1.43 billion in long-term securities and $600 million in short-term investments currently managed for the state by Blackrock over Blackrock’s ESG standards.
State Chief Financial Officer Jimmy Patronis announced that on Thursday, saying “Whether stakeholder capitalism, or ESG standards, are being pushed by BlackRock for ideological reasons, or to develop social credit ratings, the effect is to avoid dealing with the messiness of democracy.”
Patronis added that “I think it’s undemocratic of major asset managers to use their power to influence societal outcomes. If Larry (Fink), or his friends on Wall Street, want to change the world — run for office. Start a non-profit. Donate to the causes you care about. Using our cash, however, to fund BlackRock’s social-engineering project isn’t something Florida ever signed up for.”
Blackrock CEO Larry Fink has, in the past, defended his firm’s ESG investing stance by saying it’s “just capitalism.” In his words: “Stakeholder capitalism is not about politics,” Fink wrote. “It is not a social or ideological agenda. It is not ‘woke.’ It is capitalism, driven by mutually beneficial relationships between you and the employees, customers, suppliers, and communities your company relies on to prosper.”
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