What is the scariest three-letter combination in the English language?
I would vote for “GOP.” But maybe it’s “CIA.” Or perhaps you would say “MSG” or “NFL,” or for some emotionally complicated reason, “TLC.”
But if you are an easily triggered Republican, the diabolical combo is “ESG.”
That phrase stands for environmental, social, and governance, and it refers to a set of standards for a corporation’s behavior. Socially conscious investors look at an organization’s ESG initiatives — things like carbon footprint, diversity programs, ethics guidelines, and so on — to gauge if it is a business that they want to work with.
This seems pretty straightforward, and it makes sense that, for example, an environmentalist might not want to invest his money with a corporation that’s destroying the planet.
But where you see a principled stand, conservatives see the hideous creep of wokeness.
ESG has become “a lightning rod for the GOP, as the party turns the investing form into an emblem of left-wing politics.”
Republicans believe that anything that promotes racial diversity or combats climate change must be an insidious communist plot to round up all the white Christians and execute them. So they spew “hysterical rhetoric about ‘wokeness’ in response to everything from school shootings to police violence to the Pentagon budget, all while the party struggles to even define what they think the word means.”
Yes, the people who live for culture wars now believe that their old ally — big business — is a fifth column of social justice warriors who are selling out American values and making it impossible for straight guys to buy their products.
As a result, red states are “passing laws blacklisting state investment funds from doing business” with those companies that they claim are pushing “liberal agendas.”
Conservatives are trying to use “their own market influence to try to steer the larger project of American culture-building back in their direction.”
But it’s not going so well.
You see, despite “the increasing pushback against ESG by Republican politicians, including some potential presidential aspirants, and their fossil-fuel industry donors,” many companies view the “the ESG backlash [to] be a bump in the road” that won’t have a real impact.
Hell, even some CEOs say the ESG “trend is just going to continue growing.”
There’s a good reason for this, and it’s not because Wall Street suits are secret progressives clamoring for Scandinavian-inspired utopias.
No, it’s because ESG is good business.
This approach to investing “examines a company’s social or environmental impact precisely because it considers non-financial information useful for determining whether the company would deliver strong investor returns.”
Corporate ESG initiatives are designed to help companies operate more sustainably and to create long-term value for stakeholders. And studies have shown that younger consumers take a company’s ESG policies into account before buying their goods or products.
So in yet another display of spectacular hypocrisy and backwards thinking, it turns out that conservatives are the ones jeopardizing companies’ returns by demanding everyone adhere to their agenda.
Consider that “muzzling ESG activity is causing financial losses – again, which should be contrary to conservative financial principles.” For example, Texas “banned cities from having their funds managed by companies whose policies restricted investment in fossil fuels and weapons.” Because so many banks left the market, and Texas officials “had fewer choices of investment management,” the law wound up costing the state “between $303 million and $532 million extra in interest.”
Wow — owning the libs is not cheap.
Or consider that many experts believe “failing to consider ESG risks and opportunities would more
likely result in a breach of fiduciary duty,” meaning that company leaders are actually being negligent and sabotaging their organizations if they are anti-ESG.
Finally, keep in mind that companies “that get ‘woke’ aren’t going broke — they’re more profitable than ever.”
Even though conservatives will continue to rant against ESG, and blame business failures on leaders who “may have been distracted by diversity demands,” there is no real evidence for the harmful effects of this approach.
Again, the exact opposite is true.
And that’s why the letters “GOP” are far more terrifying than “ESG” will ever be.
