Nineteen Republican governors led by Ron DeSantis teamed up to reject Joe Biden's woke agenda based on ESG criteria. In a statement, the leaders described the President's proposal as a "direct threat" to retirees' finances.
"Yet again, President Biden put his political agenda above the wellbeing and individual freedoms of hardworking Americans. We as freedom loving states can work together and leverage our state pension funds to force change in how major asset managers invest the money of hardworking Americans, ensuring corporations are focused on maximizing shareholder value, rather than the proliferation of woke ideology," the governors said.
ESG is the acronym for Environment, Society and Governance, and refers to the criteria investors use to determine the type of investment they will make. The United Nations (UN) used them to develop the 17 Sustainable Development Goals (SDGs).
The alliance is made up of the governors of Alabama, Alaska, Arkansas, Florida, Georgia, Idaho, Iowa, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Oklahoma, South Dakota, Tennessee, Utah, West Virginia and Wyoming. Its objective is to ensure that economic freedom is respected and that investments do not fall "into the hands of the woke mob":
The proliferation of ESG throughout America is a direct threat to the American economy, individual economic freedom, and our way of life, putting investment decisions in the hands of the woke mob to bypass the ballot box and inject political ideology into investment decisions, corporate governance, and the everyday economy.
Biden sued for imposing ESG criteria on retirement plans
In January, 25 attorneys general filed a federal lawsuit against the Biden Administration on the grounds that allowing retirement fund managers to take ESG criteria into account in their investment decisions violates the law.
The 19 Republican governors listed above argue that the Department of Labor (DOL) is in violation of the Employee Retirement Income Security Act (ERISA), which safeguards the retirement of more than 150 million Americans.