Florida Gov. Ron DeSantis and Republican state lawmakers recently took a major step toward fighting back against woke corporations parroting Biden’s leftist agenda.
According to a press release by DeSantis’ office, his proposed legislation, will target environmental, social, and governance (ESG) standards. It’s a move that will, if successful, go a long way toward protecting individual liberty and promoting free-market economics. His bill, which will be introduced formally during the 2023 legislative session, would "Prohibit big banks, credit card companies and money transmitters from discriminating against customers for their religious, political, or social beliefs."
It would also "Prohibit State Board of Administration (SBA) fund managers from considering ESG factors when investing the state’s money" and mandate that SBA fund managers "only consider maximizing the return on investment on behalf of Florida’s retirees."
In Florida, the SBA is responsible for managing and investing the assets of the state’s retirement system and other funds.
ESG scores are a kind of social credit scoring system that is now widely being used by woke corporations and Wall Street investors to promote the Biden administration’s far-left agenda, all without having to pass a law through Congress or a state legislature.
ESG scores turn market economics on its head, by rewarding companies based on non-financial, non-business metrics that have absolutely nothing to do with supply and demand. For example, one highly influential ESG system promoted by the World Economic Forum rates companies based on their "Percentage of employees per employee category, by age group, gender and other indicators of diversity (e.g. ethnicity)."
In other words, under many ESG models, a company with the "wrong" ratio of Asian to Hispanic workers would receive a lower ESG social credit score than a business that might sell goods and services that are of a lower quality, but that has a ratio of certain racial groups that’s deemed desirable by corporate elites.
Similarly, ESG metrics punish companies that use too much water or land, aren’t committed to adopting various parts of the Biden administration’s climate change agenda, and don’t engage in community activism.
Many of America’s largest banks, including companies like Bank of America, investment managers like BlackRock, and big-tech companies such as Microsoft have pledged to use ESG scores to help transform society so that it's in line with numerous left-wing goals, especially those related to climate change.
In fact, every one of America’s six largest banks — Bank of America, Goldman Sachs, Citi, Morgan Stanley, JPMorgan Chase, and Wells Fargo — have committed to using ESG and their financial might to force the U.S. economy to produce net-zero carbon dioxide emissions, a decision that is having an absolutely disastrous effect on investment in fossil-fuel development at a time when gas prices are near their all-time highs.
ESG scores have also been used to deny access to capital or payment services for gun manufacturers and other legal businesses hated by left-wing elites.
ESG has been used to discriminate against those who hold social and political views corporate leaders don’t like. For example, the conservative group Moms for Liberty claims payment processor PayPal froze its assets because of the organization’s ideological views.
DeSantis’s proposed legislation, which was rolled out in partnership with Florida’s incoming speaker of the House, Rep. Paul Renner, would put pressure on investment management firms to avoid ESG by preventing many of Florida’s public investments from being used to promote ESG. It would also prohibit banks from using ESG metrics to discriminate against customers on the basis of their religious, political or social beliefs.
The detailed legislative language included in DeSantis’s proposal has yet to be released publicly, and, unfortunately, it appears DeSantis’s legislation would not stop the use of all forms of ESG discrimination. For example, it appears under his proposal, banks could deny access to banking services to customers who refuse to buy electric cars or choose not to put solar panels on the roofs of their home or business.
Despite these flaws, however, the proposal offered by DeSantis and Republicans in Florida’s state legislature are a huge step in the right direction.
Banks, financial institutions, and investment managers should not be allowed to use their economic power to make an end run around the Constitution and democratic institutions by discriminating against businesses and individuals based on non-financial considerations.
Hopefully, lawmakers in other states will soon take notice of the tremendous progress being made to stop these practices in Florida and make similar, perhaps even stronger efforts to stop the rise of ESG.