House GOP submit bill to prohibit federal requirements for so-called 'ESG investing' guidelines

 December 15, 2022

The latest trend among left-leaning bureaucracies and corporations is a focus on so-called ESG (Environmental, Social, and Governance) investing, but some House Republicans aim to disrupt that, the Daily Caller reported.

Rep. Byron Donalds (R-FL) even introduced legislation that would prohibit federal agencies from requiring certain ESG benchmarks as requirements for eligibility for federal contracts.

ESG guidelines are new big thing

A number of major corporations and financial firms have adopted ESG investing guidelines as a way to encourage or force companies to shift from "fossil fuels" to "green" energy reliance and a reduction of carbon and other greenhouse gas emissions, as well as to focus more sharply on things like racial diversity and social justice instead of a company's bottom line on profits or returns for investors.

The federal government under President Joe Biden's administration has gotten in on the act now, too, as the head of the Securities and Exchange Commission has increasingly pushed ESG investing guidelines and passed a rule that requires all publicly traded companies to publicly release their climate emissions data.

Likewise, a new rule was recently jointly proposed by the Defense Department, General Services Administration, and NASA that would require "certain Federal contractors disclose their greenhouse gas emissions and climate-related financial risk and set science-based targets to reduce their greenhouse gas emissions" in order to remain eligible for federal contracts.

Legislation to prohibit federal ESG requirements

House Republicans, however, who are set to take majority control in January, intend to counter and reverse that trend on ESG investing, and Rep. Donalds is at the forefront of that effort, according to the Daily Caller.

On Wednesday, Donalds introduced legislation as H.R.9543 which has been dubbed by him as the "ESG Rule Prevention Act."

What that legislation would do, if passed, is amend Title 41 of the U.S. Code to "prohibit the head of agencies from requiring the disclosure of greenhouse gas emissions and the implementation of greenhouse gas emission reduction targets by Federal contractors, and for other purposes."

In a statement to the Daily Caller, Donalds said, "The joint rule proposed by the Defense Department, NASA, and the General Service Administration is the latest effort by the Biden administration to push its leftist ESG agenda at the expense of the American people."

The ESG Rule Prevention Act will restore the Constitution’s separation of powers, promote competition, and ensure that material factors like product quality and efficiency are prioritized ahead of left-wing social causes in the federal procurement marketplace," he added.

ESG policies should be "abandoned" and ignored

Opposition to the left's embrace of ESG-related policies is nothing new for Rep. Donalds, as he made clear in an op-ed published by The Hill in March, in which he called for such policies to be "abandoned" both here at home and around the world.

"ESG scores are based on a host of woke factors such as a company’s carbon emissions, energy consumption, and board diversity, among others. The more woke the company is, the higher the ESG score. The higher the ESG score, the more 'investable' the company is said to be," he explained. "While this Chinese Communist Party-style social credit score was once limited to a few virtue-signaling companies, there is growing effort from the Biden administration to make ESG a mandatory part of doing business in America."

Donalds pointed as evidence to proposed rules from the Labor Department and SEC, suggestions from Federal Reserve members and numbers, and actions already taken by corporations and financial firms that all encouraged and promoted ESG investing requirements for private companies and federal contractors.

"Rather than scoring the diversity of a company’s board of directors and scrutinizing the amount of carbon a business emits, the Biden administration should be laser-focused on addressing the mounting number of challenges facing the American people," the congressman concluded. "Leftist policies helped create the mess we find ourselves in, more leftist policies are not the solution."

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