U.S. House Committee Probes ESG Cartel: Jordan and Massie Demand Information from 130+ Investment Firms

July 30, 2024 – In a bold move signaling increased scrutiny on Environmental, Social, and Governance (ESG) practices, House Judiciary Committee Chairman Jim Jordan (R-OH) and Subcommittee on the Administrative State, Regulatory Reform, and Antitrust Chairman Thomas Massie (R-KY) have issued demands for information from over 130 U.S.-based companies, retirement systems, and government pension programs involved with Climate Action 100+.

The action follows the Committee's June interim report, titled "Climate Control: Exposing the Decarbonization Collusion in Environmental, Social, and Governance (ESG) Investing," which accuses a coalition of left-leaning activists and major financial institutions of forming a "climate cartel." This cartel, according to the report, conspires to enforce radical ESG goals upon American businesses, potentially undermining their fiduciary responsibilities.

Jordan and Massie are scrutinizing whether current antitrust laws and civil penalties are adequate to curb such practices. The Committee's inquiry targets a diverse group of entities across the country, from large investment firms and pension funds to academic institutions and state treasurers.

Among the companies and organizations receiving letters are prominent names such as Franklin Templeton Investments, Goldman Sachs Asset Management, and New York State Common Retirement Fund, as well as state pension systems from California to Vermont.

In California, the list includes major players like Franklin Templeton and the California State Teachers' Retirement System. New York's list features top investment firms including Neuberger Berman and Rockefeller Asset Management. The inquiry extends to academic institutions such as Harvard and MIT and various state and local pension funds, including the Washington State Investment Board and the Massachusetts Institute of Technology.

The Committee's letters request detailed information regarding these entities' involvement with Climate Action 100+, focusing on how they align their investment practices with ESG goals and whether such alignment might conflict with their fiduciary duties.

Jordan and Massie have expressed concerns that the ESG-driven approach of these organizations could potentially prioritize ideological commitments over financial performance, thereby impacting investors and the broader economy.

As the Committee delves deeper into these allegations, the results of their investigation could have significant implications for the future of ESG investing and regulatory practices in the United States.

Full statement: https://judiciary.house.gov/media/press-releases/jordan-and-massie-demand-information-over-130-companies-surrounding-their