Utah Gov. Spencer Cox signed a joint letter with Florida Gov. Ron DeSantis and 17 other governors this week to push back against President Joe Biden’s use of environmental, social and governance (ESG) investing in federal retirement funds.
“The proliferation of ESG throughout America is a direct threat to the American economy, individual economic freedom, and our way of life putting investment decisions in the hands of the woke mob to bypass the ballot box and inject political ideology into investment decisions, corporate governance, and the everyday economy,” the letter said.
Cox and DeSantis joined the governors of Alabama, Alaska, Arkansas, Georgia, Idaho, Iowa, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Oklahoma, South Dakota, Tennessee, West Virginia and Wyoming in signing the public letter.
Gov. Cox posted the letter to his official government Twitter account Thursday. His office didn’t respond to a request for comment.
We sent a statement to @potus with other governors responding to his environmental, social and corporate governance (ESG) movement.— Utah Gov. Spencer J. Cox (@GovCox) March 16, 2023
The bi-partisan Congressional effort clarifying that retirement plan fiduciaries should NOT be considering ESG-related factors in their investment… https://t.co/MLw8P9dWZz pic.twitter.com/phPQHH2AiO
The letter opens by expressing support for Congress’ bipartisan resolution blocking the Biden administration’s newly finalized rule submitted by the Department of Labor known as “the Prudence and Loyalty rule.” Congressional Republicans argued the rule targeted oil and gas industries unfairly.
Both Democratic Sens. Joe Manchin of West Virginia and Jon Tester of Montana, as well as Democratic Rep. Jarred Golden of Maine joined Republicans in approving the resolution.
Biden is expected to use his veto power for the first time against the resolution.
The Biden administration’s rule would allow federal retirement plan fiduciaries to consider climate change and other environmental, social and governance factors when they select retirement investments and exercise shareholder rights on behalf of employees contributing to federal pensions.
The governors’ letter said if President Biden implements this rule he will be putting “his political agenda above the wellbeing and individual freedoms of hardworking Americans.”
Last Month, the White House argued the rule only “reflects what successful marketplace investors already know — there is an extensive body of evidence that environmental, social, and governance factors can have material impacts on certain markets, industries, and companies.”
DeSantis said in a separate press statement Thursday that Florida proposed the nation’s governors join an “alliance” to use coordinated state-level efforts to “protect individuals from the ESG movement.” He suggested governors ditch “firms that follow the ESG model of ‘politics before fiduciary duty.’” The Sunshine State governor is expected to announce a campaign for president soon.
“We as freedom loving states can work together and leverage our state pension funds to force change in how major asset managers invest the money of hardworking Americans,” the letter stated, “ensuring corporations are focused on maximizing shareholder value, rather than the proliferation of woke ideology.”
The letter lists two action items the governors “agree” to enact in their state.
The governors may remove state pension funds and other state controlled investment funds from firms that follow ESG investment. They will prioritize “maximizing the return on investment, protecting retirees and taxpayers alike.”
And secondly, the governors may ban the financial sector from considering “social credit scores” in banking and lending practices, and stop “discriminating” against those who own firearms, and hold political beliefs like “securing the border, or increasing our energy independence.”