President Joe Biden used his first veto to reject a Republican-led bill designed to ax an administration rule allowing retirement plan managers to base investment decisions on Environmental, Social, and Governance (ESG) goals, instead of considering the maximum financial benefit of their clients.
On Twitter on Monday, Florida Republican Gov. Ron DeSantis slammed Biden, saying the veto was why he “formed an alliance of freedom-loving states to combat the threat posed by ESG.”
“Now with Virginia, our 20-state coalition will protect our citizens against powerful economic actors using their financial might to impose an ideological agenda.”
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On Tuesday, Republican presidential candidate Vivek Ramaswamy sought to pull back the curtain on ESG so voters could get a better glimpse of what DeSantis and those other governors are fighting against.
In a Twitter video, Ramaswamy, a biotech industry engineer, said ESG is “designed to sound boring for a reason.”
The reason: So liberals can leverage capital markets “to accomplish through the back door what government could not get done through the front door using the Constitution.”
“My general rule of thumb is if it’s a three-letter acronym that bores you, that’s a good sign you should be paying more attention,” he said.
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ESG, Ramaswamy continued, “uses the money of everyday citizens to invest in companies, and to vote their shares, in ways that advance one-sided progressive agendas — environmental and social agendas — that most of those people do not agree with, that most of those people did not know were actually being advanced with their own money — and which don’t advance the financial best interests of most people whose money is actually used.”
“You think that the person who’s managing that money is exclusively looking after your best financial interests,” he added.
“It turns out they’re not. They’re also interested in looking after advancing these other environmental and social goals.”
Ramaswamy identified the top asset management firms that push ESg the hardest: BlackRock, State Street, Vanguard, and Invesco. Combined, they manage about $20 trillion.
And, he noted, they “have signed a pledge that they’re going to align all of their underlying companies with the goals of the Paris Climate Accords, with net-zero (carbon) standards by 2050, with modern diversity, equity and inclusion standards.”
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“But, they’re not using their money to do it,” said Ramaswamy.
Instead, they use the assets of everyday investors and Americans with retirement plans dependent on those firms for their future economic security to force companies like, for example, Apple to adopt policies to conduct “racial equity audits,” or Chevron to adopt environmental emission caps — policies that the boards of those companies did not want.
“That’s what this ESG movement is all about,” he noted.
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