The fraying relationship between big business and GOP politicians is about to get more strained.
Republicans who lead the House Financial Services Committee plan to spend the next few weeks holding hearings and voting on bills designed to send a clear signal: Corporations, in particular big investment managers, should think twice about integrating climate and social goals into their business plans. Committee conservatives will target the process in which advocates pressure public companies to adopt environmental, social and governance (ESG) goals using the shareholder voting process.
“I’ve had a personal conversation with Larry Fink at BlackRock about this. I’ve had a conversation with the CEO of Vanguard about this,” Rep. Andy Barr (R-Ky.), a leader in the committee’s upcoming “ESG month,” said of the two giant money managers. “Our objective is not to fight for the CEOs of these companies. Our objective is to defend retail investors in America.”
It’s a delicate dance for both sides. While the committee’s bills have no chance of becoming law under President Joe Biden, the messaging — and industry’s response to it — will feed into a broader political conflict that could set the table for the next time Republicans control Washington.
House GOP leaders are under pressure to score points in the right’s escalating war on what many Republicans call “woke” capitalism — even though a number of senior GOP lawmakers would rather tell government regulators, instead of executives, what to do. While framed around holding Wall Street to account, Financial Services Committee Republicans appear to be picking spots where they’ll minimize friction with the industry’s biggest players.
Lobbyists for their part want to avoid further inflaming tensions. Their companies are poised to be huge targets for Florida Gov. Ron DeSantis and other Republican White House contenders who argue that corporations are exercising ideological agendas. Big money managers and banks already face a barrage of legislative attacks from state Republican officials over their policies on energy and guns. BlackRock’s Fink, the financial industry’s most prominent leader in the sustainable investing trend, said last month he will no longer use the term ESG because “it’s been misused by the far left and the far right.”
House Democrats, in a twist, are rallying behind the ability of Wall Street and investors to choose how they want to tackle societal issues such as climate change.
“We’ll continue to be the voice that’s defending the fact that the market should have choice,” Rep. Sean Casten (D-Ill.) said in an interview…
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Orange of Specious
Article URL : https://www.politico.com/news/2023/07/10/house-gop-treads-lightly-in-culture-war-on-wall-street-00104991