Kentucky Gov. Andy Beshear is the latest prominent Democrat to turn against his own party and the environmental, social, and corporate governance movement, also known as ESG, amid a run for reelection in a heavily Republican state.
Critics of the ESG movement largely align with conservatives and assert that the philosophy intermixes political and social causes in a manner that compromises or distracts from profitability. Beshear signed a bill last week to require fiduciaries of the state’s retirement funds to only consider factors which have a “direct and material connection to the financial risk or financial return of an investment” rather than any “environmental, social, political, or ideological interest” without a connection to the financial realities of an asset.
Beshear, who won an upset victory four years ago in the predominantly Republican state, is presently campaigning for a second term; the general election will occur at the end of the year.
Sen. Joe Manchin (D-WV) and Sen. Jon Tester (D-MT), both of whom will be on their respective ballots in primarily Republican states next year, recently voted against fellow Democrats to pass a resolution scrapping a White House rule that allows retirement fiduciaries to invest in accordance with the ESG movement. President Joe Biden vetoed the resolution last week.
American investors are broadly skeptical of the ESG movement and desire that their funds are allocated in a politically neutral manner. An exclusive poll from The Daily Wire showed last year that 64% of respondents believe “individual investors whose savings are being invested” should decide whether funds are appropriated according to ESG standards, while a mere 20% believe that “Wall Street asset managers” should make such decisions.
Republican West Virginia Gov. Jim Justice signed legislation this week similar to the law enacted in Kentucky. Justice, a former Democrat who became a Republican six years ago, has been pushed as a possible contender for the Senate seat currently held by Manchin.
Republican officials in both Kentucky and West Virginia lauded the endorsement of the bills.
“Kentucky now has the strongest anti-ESG legislation in the nation,” Kentucky State Treasurer Allison Ball said in a statement provided to The Daily Wire. “For many years, pension investments were about maximizing returns. Recently, however, there has been a destructive shift in investment methodology to use the savings of Americans as financial muscle to push ideological causes through the ESG movement. Kentucky has said no to this shift.”
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“West Virginia is once again leading the way to protect pensioner and taxpayer dollars from woke Wall Street activists who prioritize their own political and social agendas over the best financial interests of our people,” West Virginia State Treasurer Riley Moore said in another statement provided to The Daily Wire. “Each year, public employees in West Virginia retire from their jobs after decades of service to our state and rely on their hard-earned state pensions to support them and their families through retirement.”
The ESG movement could emerge as a core issue in the 2024 election cycle, particularly among declared and potential Republican primary candidates. Former President Donald Trump and Florida Governor Ron DeSantis, who currently lead early polls as Republican voters’ preferred nominees, have each spoken against the totalizing investment approach, while former Strive Asset Management Executive Chairman Vivek Ramaswamy entered the contest and placed the issue at the center of his platform.