For example, does a company rely on water to operate its factories, or to move goods in places like Europe or China where rivers have dried to a trickle this summer? It's probably easiest to think of this as a set of considerations that investors are using to try to understand risks and opportunities that aren't accounted for in traditional financial models.Ĭlimate change is one of the simplest examples: Investors are trying to find out how physical risks from things like rising sea levels and worsening drought could impact a company's operations. This FAQ is for anyone who wants to better understand an investing trend that is becoming core to global financial markets and a new battlefront in American politics - including, possibly, in your own state. Is the idea to bring about social changes that couldn't be achieved at the ballot box? And what does it mean for things like your 401K when investors follow ESG principles? It's hard for most people to get a clear read of what ESG is amid the overheated rhetoric. Many experts disagree, saying Republicans are distorting the goals and strategies of ESG investing. And Republicans have said that if they retake Congress in the midterms, they plan to push federal legislation to curtail investment decisions they attack as "woke."Īnti-ESG Republicans say big financial firms are abusing their power to advance a liberal agenda on issues like diversity, social justice and, especially, climate change. Fifteen other states are considering similar measures. In Texas and West Virginia, GOP leaders say they will block investors from state business who they claim "boycott" the fossil fuel industry. Ron DeSantis recently barred investment fund managers and advisors from considering "social, political, or ideological interests" when making decisions for Florida's retirement system.
In Florida, a state board chaired by Gov. A growing number of Republican politicians are moving to penalize Wall Street investors who consider environmental, social and governance (ESG) issues when they decide where to put clients' money.
0 kommentar(er)
