The Heartland Institute, a free-market think tank located in the Chicago suburbs, has been reporting on and critiquing woke corporate elites and government regulators for pushing a “Great Reset” and environment, social, and governance (ESG) requirements for more than two years.
Based on actions in state legislatures and Washington, DC, and recent surveys of investors, our efforts are paying dividends. Americans are increasingly rejecting the strident calls by global elites and woke activists to supplant making profits as the primary goal for companies and investors with the pursuit of progressive political causes, like fighting climate change and indoctrinating children with critical race theory.
The Heartland Institute has described the dangers of government agencies mandating that banks, companies, and portfolio funds adopt and report ESG programs and has critiqued efforts by a cabal of large multi-national banks and gigantic portfolio managers, run by billionaire woke corporate elites, to force every business to adopt ESG goals.
In addition, in a joint effort with like-minded research organizations, Heartland has worked with legislators in various states to shape model legislation, blocking forced ESG scoring. These efforts have borne fruit. Some states have enacted legislation challenging woke investing. Also, 16 states’ governors recently sent a letter to President Joe Biden requesting that he reject the U.S. Securities and Exchange Commission’s (SEC) proposal, which would force publicly-traded companies to account for and share so-called climate change risks and greenhouse gas emissions for themselves and the companies in their supply chain. The governors argue the proposal is unjustified, outside of the SEC’s authority, would harm U.S. business’ competitiveness, and would reduce returns to investors, including already woefully underfunded public pension funds.
In addition, Rep. Chip Roy (R-TX) and seven other members of the U.S. House have offered a bill to bar the federal Thrift Savings Plan from investing U.S. taxpayer dollars in ESG funds. The pursuit of profits to maximize fund returns, not progressive political goals, should be the sole focus of federal savings plans, Roy and his colleagues argue.
Our nascent successes have recently captured the attention of progressive political and economic elites and their lapdogs in the corporate media. In recent months, dozens of news outlets have published stories sharing the same misleading narrative: right-wing groups and politicians are undermining the free choices of businesses in the marketplace to fight climate change and racial and sexual inequity; in so doing they are harming American investors, the economy, and the environment.
Not only is this description of our efforts false; in reality, the opposite is true. Data show corporations and stock funds increasingly adopting political causes like fighting climate change, promoting diversity or amorphous equity, or obsessing over advancing racial or sexual politics— taking their eye off the exclusive goal of making a profit—perform poorer than corporations focused on maximizing profits and diversified portfolio funds containing stocks in politically incorrect industries such as firearms manufacturers and fossil fuel production..
The fight that Heartland, other free-market groups, and politicians are engaged in is not to prevent those who wish to make investment decisions based on political reasons from doing so. They can already do so, as the proliferation of socially responsible investment funds attests. Rather, we are fighting to prevent big government, big banks, and big investment houses from using their inordinate political and economic power to force everyone to support their preferred political causes, or to place liberal politics above maximizing stock returns and fiscally sound retirement funds.
American investors increasingly seem to understand the stakes. A recent survey shows most investors agree with The Heartland Institute’s view that companies should be pursuing profits, not political goals.
Despite the near-constant drumbeat of claims made by banking and investment behemoths like Bank of America and BlackRock and the progressive activists in the Biden administration along with their Democratic allies that investors want “socially responsible, green investing,” a recent survey by the Daily Wire/Echelon Insights of more than 1,000 investors found only “29% of respondents agreed it is a ‘good thing’ for companies to leverage their financial power for political or social means supported by executives, 58% — twice as many — said it is a ‘bad thing.’”
“The data are clear: everyday investors want companies to focus on creating shareholder value by delivering excellent products and services to their customers, not on advancing social or political agendas,” Vivek Ramaswamy, entrepreneur, and former pharmaceutical executive, told the Daily Caller.
Ramaswamy is right. Free markets, not market decisions driven by the pursuit of political ends, whether left or right, are critical to continued economic progress and personal economic advancement and security. Freedom is critical for peoples’ lifestyle choices, at the ballot box, and in one’s economic life. The Heartland Institute is fighting for all three.
Sterling Burnett, Ph.D.(hburnett@heartland.org) is the director of the Arthur B. Robinson Center on Climate and Environmental Policy at The Heartland Institute, a nonpartisan, nonprofit research center headquartered in Arlington Heights, Illinois.
