Publisher's Note: This post appears here courtesy of the The Daily Wire. The author of this post is Ben Zeisloft.
Republican members of the Senate cautioned attorneys to "preserve relevant documents"
as lawmakers float antitrust investigations regarding the environmental, social, and governance movement, also known as ESG.
A letter, spearheaded by Sen. Tom Cotton (R-AR), told more than four dozen law firms to warn corporate clients about "the risks they incur by participating in climate cartels and other ill-advised ESG schemes,"
referencing the fact that FTC Commissioner Lina Khan recently said during a hearing that there is no "ESG exemption" to antitrust laws.
"The ESG movement attempts to weaponize corporations to reshape society in ways that Americans would never endorse at the ballot box,"
the letter stated. "Of particular concern is the collusive effort to restrict the supply of coal, oil, and gas, which is driving up energy costs across the globe and empowering America's adversaries abroad."
Beyond asset managers encouraging portfolio companies to rapidly pivot toward renewable energy, six major banks recently came under scrutiny from Republican state attorneys general for jointly vowing to discourage fossil fuel use and investment. The financial institutions were served with civil investigative demands requesting details about their involvement with Net-Zero Banking Alliance, a project of the United Nations which seeks to unify bank portfolios toward the goal of eliminating carbon emissions by 2050.
"Over the coming months and years, Congress will increasingly use its oversight powers to scrutinize the institutionalized antitrust violations being committed in the name of ESG, and refer those violations to the FTC and the Department of Justice,"
the letter added. "To the extent that your firm continues to advise clients regarding participation in ESG initiatives, both you and those clients should take care to preserve relevant documents in anticipation of those investigations."
The letter was also endorsed by Sen. Marsha Blackburn (R-TN), Sen. Chuck Grassley (R-IA), Sen. Mike Lee (R-UT), and Sen. Marco Rubio (R-FL).
Republican officials in South Carolina, Louisiana, Missouri, West Virginia, and Utah have divested funds from BlackRock and other asset managers engaged in the ESG movement, under which executives encourage portfolio companies to adopt green energy standards, introduce racial hiring quotas, or otherwise mingle activism with maximizing profits.
Conservatives also argue that the ESG movement threatens the economy of many states by discouraging fossil fuel investment. The government of Texas recently concluded that BlackRock and nine other firms had violated state law by "refusing to deal with"
companies involved in the production and use of fossil fuels "without an ordinary business purpose."
BlackRock responded to the states' criticism and broader market forces by extending voting choice to more institutional investors, allowing public and private clients to vote their own shares in portfolio companies instead of surrendering such rights to asset managers. "It's clear there are investors who don't want to sit on the sidelines; they have a view on corporate governance, and they want a meaningful way to express those views,"
BlackRock CEO Larry Fink wrote in a letter. "While some pension funds have long been actively involved in corporate governance, we're working to make that easier and more efficient for a larger number of investors."