Wall Street Has A New Plan To “Punish” Conservative America
(RightWing.org) – The Environmental, Social, and Governance (ESG) rating system used by S&P Global Ratings and others, assesses companies and analyzes how they compare to their peers. A recent op-ed in The Wall Street Journal (WSJ) suggests that the data depicting states’ finances are skewed depending on the political backing in each region. More specifically, the rules may be targeting Conservatives.
Utah Treasurer Marlo Oaks Speaks Out
Utah State Treasurer Marlo Oaks, author of the WSJ op-ed discussing ESG, mentions that investment fund and credit rating statistics appear to be discriminating against conservative states. He stresses that the rating system presents itself as completely objective, but often seems to blur the lines between “subjective judgments and objective financial assessments.” Oaks also wrote a letter to the president and CEO of S&P Global Ratings to voice his concerns.
Subjective or Objective?
The criteria for the ESG ratings incorporate various allocations of money and financial data and factors like how carbon is managed throughout the state. Factors that are subjective opinions on environmental issues can easily skew statistics depending on the political stance of each state. Is it possible that ESG is pushing large companies towards a progressive agenda?
In 2019, West Virginia placed top six in the US for energy production. Its State Treasurer Riley Moore says ESG factors are trying to push his state into the Left’s agenda by punishing the state for its mass-energy production. He stressed the importance of energy supplying states in an interview with the Daily Wire saying, “If we are going to be an energy-independent country, you need states like West Virginia.”
Missouri State Treasurer Scott Fitzpatrick is concerned about ESG’s evident distaste for pro-life states. Institutional Shareholder Services is a global investment governance company whose clients are “focused on ESG and governance risk mitigation as a shareholder value enhancing measure.” It approached shareholders of leading companies like Walmart, Lowe’s, and TJX Cos., emploring them to force companies to take a stand — and report on that stand — regarding abortion-related proposals. It appears ESG ratings are attributes for assessments and not cut-and-dry facts.
What Do Investors Want
An Echelon poll asked 1,000 influential investors their opinion on how companies interact in agendas. An overwhelming majority of US respondents said they would rather the companies they invest in focus on making profits and refrain from “promoting political agendas.” Results show that shareholder value increases when an establishment effectively produces and sells goods and services, not when it spends time sharing its leaders’ views.
America’s most influential business leaders and investors are increasingly wary of the ESG rating system due to subjective quantifications altering the data. That increases the risk of creating unclear statistics and evidence. Do you believe the ESG ranking process is objective?
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