A chemical plant in Port Arthur, Texas. Access to state contracts, pensions focus of anti-ESG bills Model legislation targets ‘boycotts’ of fossil fuels, firearms Republican lawmakers in several statehouses are pushing to limit access to state contracts and pension funds for businesses with ESG investments and policies, forcing many firms to navigate a changing regulatory landscape. Bills proposed in roughly a dozen states this year would penalize companies for considering environmental, social, and governance factors—such as climate change or diversity issues—over financial returns. The activity adds to growing backlash against companies with ESG investment policies from doing business in states such as Texas and Florida, where GOP officials have launched high-profile battles against BlackRock Inc. and other asset managers. There are also anti-ESG proposals by Republicans in the US House. “It’s definitely come to a crescendo lately,” said Lance Dial, a partner at Morgan, Lewis & Bockius LLP, whose clients include asset managers, mutual fund managers, and pension fund managers. The state proposals are part of a larger political debate over ESG that includes disagreement over its overall definition and whether such factors align with a company’s fiduciary duties. Firms have been whipsawed between shareholders who have pressed them […]
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