Environmental, Social and Governance: How Activists Are Using ESG Policies as a Hammer to Promote a Socialist Political Agenda

Craig HueyCurrent Events, Environment, Government, Congress, and Politics Leave a Comment

Corporate research and development (R&D) and large business expansion projects are usually funded by large investment companies with billions of dollars of cash to invest in or loan to big businesses.

But when investment companies establish ESG practices as the criteria for corporations to receive their funding, corporate CEOs and Boards of Directors are in a rock and hard place. They often cave into the political demands of ESG – to the detriment of their employees and their customers.

Let me explain…

Nearly 20 years ago, UN Secretary-General Kofi Annan got together with over 50 CEOs of large financial institutions, encouraging them to partner with the international Finance Corporation (IFC) and the Swiss government for the purpose of bringing politics into the business marketplace.

They produced a report titled “Who Cares Wins,” which proposed that integrating environmental, social, and governance policies into business practices would improve business sustainability and thus produce a brighter future for the world.

In 2006, this report was published in a UN report called Principles for Responsible Investment (PRI).

The result of this was that large investment companies began to distribute their investment funds and loans based on an ESG “scorecard” that they assigned to corporations seeking funding.

What are the ESG policies that affect a corporation’s score?

To increase the Environmental score, a corporation must reduce its carbon footprint by reducing emissions or eliminating them completely by switching to green energy.

Examples of Social policies that investment companies are looking for in corporations they invest in are things such as:

  • Educating employees on critical race theory
  • Supporting Radical Transgender Marxist Ideology
  • Adopting pro-abortion policies
  • Providing travel coverage for employees to access abortion services out of state
  • Emphasis on diversity, equity, and inclusion (DEI) in the workplace

The Governance score of a corporation is a measure of its emphasis on diversity, equity, and inclusion among the corporate leadership. Fairness of shareholder rights and the compensation of CEOs and top executives also factor into the Governance score.

You may be asking what the harm is to you and me of companies adopting policies of diversity, equity, and inclusion. Aren’t these policies transparent to the consumer and to society in general?

Not at all. The impacts are far-ranging.

According to Alliance Defending Freedom, “When companies embrace ESG, they are encouraged to prioritize DEI quotas and ideological initiatives over providing quality products and services to customers.”

In addition to lower standards of product quality and customer service, there are other damaging effects of ESG:

  • Employees who disagree with their company’s ESG policies are usually coerced into silence if they want to keep their jobs
  • Anyone who speaks out or who expresses disagreement on social media will be shunned for promotion
  • Customer needs are ignored for the sake of pursuing higher ESG rankings
  • Woke political agendas like abortion, critical race theory and transgender ideology are smuggled into employee orientation and training programs – as well as into educational institutions

ESG circumvents the free-market process by politicizing every aspect of a company’s business. “It is socialism is sheep’s clothing,” says Andy Puzder of the Heritage Foundation.

In an interview with Newsweek, Vivek Ramaswamy, author of Woke, Inc.: Inside Corporate America’s Social Justice Scam, said this:

“BlackRock, State Street, and Vanguard are using the capital of their clients – everyday Americans – to advocate for policies most of them probably don’t agree with. The role of a depoliticized private sector is to bring us together, whether we are Black or white, red or blue. A divided body politic is dangerous, and the problem is partly caused by asset managers who demand that CEOs engage in a political agenda.”

The news is not all bad, however.

Opposition to ESG is growing. Companies that are waking up to the dangers of ESG policies and are refusing to cave into far-left ideology are proposing alternative, better ways to conduct business.

Groups such as Strive Asset Management, Free Enterprise Project, and 2nd Vote have been formed to end far-left political activism in corporations.

In a 2021 research study, Vanessa Burbano of Columbia University looked at the costs versus the benefits of corporate political activism and found that ESG isn’t beneficial for a company in the long term.

Among the study’s conclusions: “Employees who disagree with a political stance taken by their companies are demotivated – they do less extra work and lower quality work. Those who agree with a political stance their companies take are not motivated – they behave not statistically differently than a control group.

The study also found that customers are likely to boycott a company over a political position they strongly disagree with. Still, they are not prone to buy more from a company whose politics they agree with.

True diversity in the marketplace requires companies to protect the freedom of expression for employees, customers, shareholders, and other stakeholders.

Two noteworthy financial institutions – Inspire Investing and Vident Financial – are among the growing list of investment institutions that have exited the ESG scene and are working to reverse the effects of ESG and the cancel culture.

What do you think? Email me at craig@craighuey.com.

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