• The attacks on ESG and responsible investing started from a well-coordinated and well-funded group of right-wing organizations that have clear corporate and political interests in avoiding any changes to their business models. 
  • The State Financial Officers Foundation (SFOF), a cadre of right-wing organizations backed by groups like the American Legislative Exchange Council, the Heritage Foundation, the Heartland Institute, and Consumers’ Research, is working alongside some state treasurers and comptrollers to push and pass anti-ESG bills.
  • These entities have close ties with the fossil fuel industry, which wants to limit ESG considerations, as such investment considerations may hamper their profits unless they update their business models.
  • While this movement has managed to get some legislation through at state level to ban responsible business practices, it is not winning public support for this agenda, and a growing number of local business groups, local chambers of commerce and banking associations are fighting to stop these bills from harming the economy.

Why would companies be against responsible investing?

Some companies that have a vested interest in stopping responsible business practices, like those in the fossil fuel industry, are working with right-wing lawmakers to advocate against the use of environmental, social, and governance factors. The legislative efforts to ban ESG would essentially ban pension funds and states from making their own responsible investment decisions. Investigations have shown that the State Financial Officers Foundation and a group of organizations funded by Leonard Leo and his web of allies are behind the coordinated attacks on responsible investing.

While these groups have managed to get some legislation approved at the state level, they are not winning public support for this agenda. There is a growing, public movement to push back against these attacks on ESG because consumer and investor support for responsible businesses is growing and many companies and investors have or are already in the process of developing new strategies to operate responsibly and account for workers and the environment.

Who is against ESG?

The State Financial Officers Foundation (SFOF) is one organization behind the anti-ESG attacks. SFOF is supported by right-wing organizations such as the American Legislative Exchange Council (ALEC), the Heritage Foundation, the Heartland Institute, Consumers’ Research, and major corporations. Many of these organizations have received contributions from fossil fuel companies, which have openly advocated for these anti-ESG bills to prevent companies and investors from addressing the environmental and social concerns that affect their bottom line.

Investigative journalist outlet Documented found that SFOF has been working with a set of state treasurers and comptrollers to advance anti-ESG legislation, restrict access to data about financial risk factors, and limit responsible investments.

Why are my investments being called woke?

There is no such thing as woke investing. Woke means being aware of racial and social injustices. Some right-wing pundits and politicians are using the phrase “woke investing” to attack any person or issue that relates to caring for the environment, workers, or racial justice and in turn any decision made by companies and investors that accounts for any form of risk related to environmental, social, or governance issues.

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