{"id":355747,"date":"2024-12-20T08:37:21","date_gmt":"2024-12-20T07:37:21","guid":{"rendered":"https:\/\/climatescience.press\/?p=355747"},"modified":"2024-12-20T08:37:23","modified_gmt":"2024-12-20T07:37:23","slug":"trump-to-bury-already-dead-esg","status":"publish","type":"post","link":"https:\/\/climatescience.press\/?p=355747","title":{"rendered":"Trump to Bury Already Dead\u00a0ESG"},"content":{"rendered":"\n
\"\"<\/figure>\n\n\n\n

<\/p>\n\n\n\n

From Science Matters<\/a><\/p>\n\n\n\n

By\u00a0Ron Clutz<\/a><\/p>\n\n\n

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John  Authers explains the demise of ESG in his Bloomberg article Trump Will Bury ESG, But It Was Already Dead.<\/strong> <\/a>Excerpts in italics with my bolds and added images.<\/p>\n\n\n\n

The green investing revolution never stood a chance in the US once
ensnared by the culture wars, but that wasn\u2019t the only cause of death.<\/strong><\/em><\/p>\n\n\n\n

Ever So Gone<\/strong><\/em><\/h4>\n\n\n\n

As was obvious even before voters went to the polls, ESG was already a decisive loser in the US.<\/strong> The concept of Environmental, Social and Governance investing became hopelessly entangled with the culture war agenda, failed to deliver on its promises, and went into retreat.<\/strong> Rather than attempt a technocratic, clean, green way of changing capitalism, America has opted for something more nationalist, even mercantilist.<\/strong><\/em><\/p>\n\n\n\n

ESG as a term has been demonized<\/u><\/a> <\/strong>by politicians on the right, to the point that BlackRock\u2019s Larry Fink said<\/strong> that it had been \u201cweaponized\u201d and should no longer be used<\/strong>. Because of Fink\u2019s stand on ESG issues, BlackRock<\/strong> has become a lightning rod for conservative attacks lumped in with identity politics<\/u><\/a>.<\/strong> Startlingly, the company shows up in a list of \u201cdecadent and rootless\u201d institutions that should be burned to the ground <\/strong>in a new book by Kevin Roberts<\/u><\/a>, the head of the Heritage Foundation, a distinction it bizarrely shares with the Boy Scouts of America and the Chinese Communist Party.<\/em><\/p>\n\n\n\n

Supporters of the concept were already disillusioned<\/strong> that ESG had become little more than a marketing wheeze<\/strong>, and several big fund managers, including WisdomTree<\/u><\/a> and Invesco<\/u><\/a>, have faced fines <\/strong>in the US for \u201cgreenwashing\u201d<\/strong> (claiming their products were greener than they really were). In France, BlackRock is under fire over allegations<\/u><\/a> that 18 of its funds sold as sustainable are in fact investing in fossil fuels.<\/em><\/p>\n\n\n\n

Regulator attitudes differ starkly across the Atlantic.<\/strong> In Europe<\/strong>, regulators have raised the ante<\/strong> by telling fund managers that they must reach minimum thresholds for environmental impact before they can use the ESG label \u2014 a move that makes it hard<\/u><\/a> for them to keep investing in the US, where the best returns are, and requires them to become more active<\/strong> than is currently the case for many.<\/em><\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

n the US, the Securities and Exchange Commission (SEC) has watered down<\/u><\/a> its requirements<\/strong> on companies to disclose ESG statistics<\/strong> \u2014 and the whole concept<\/strong> is close to unworkable<\/strong> unless everyone has to disclose standardized statistics. In September, it quietly disbanded<\/u><\/a> its task force on ESG enforcement. Now, the Trump<\/strong> administration is likely to make dismantling such rules one of its first acts<\/strong> in office.<\/em><\/p>\n\n\n\n

That will complete a retreat<\/strong> that has largely already taken place<\/strong>. A look at the total market cap of BlackRock\u2019s flagship ETFs covering the global energy and clean energy sectors shows that after a boom in 2021, the clean energy fund has steadily dwindled<\/strong>, and is now worth slightly less than the main energy fund:<\/em><\/p>\n\n\n\n

Investors Wash Their Hands of Clean Energy<\/strong><\/em>
There has been an exodus from clean energy stocks in the last two years<\/em><\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Much of this is driven by the declining share prices of clean energy stocks<\/strong>. However, if we look at the number of shares in the ETF, it\u2019s clear that there were huge inflows during the pandemic,<\/strong> and much of that money has now been withdrawn<\/strong>.<\/em><\/p>\n\n\n\n

Investors are losing interest in the concept, and claims that ESG would reduce
global warming, or starve fossil fuel groups of capital, look overblown.<\/strong><\/em><\/p>\n\n\n\n

Interest among the public has waned in the US \u2014 although not elsewhere. Google Trends shows that US searches for ESG and its synonyms tanked<\/strong> over the last two years, while continuing at much the same level elsewhere. The rest of the world still seems happy to give it a try, but America is no longer<\/strong> going along for the ride.<\/em><\/p>\n\n\n\n

The pattern recurs in the news media<\/strong>. Counting stories published<\/strong> on the Bloomberg terminal from all sources shows interest peaking in 2016, when Donald Trump was first elected, and long before the flow of money went into reverse. By the time that Fink said ESG had been \u201cweaponized,\u201d interest was barely a third its 2016 level and has continued to dwindle.<\/strong><\/em><\/p>\n\n\n

\n
\"\"<\/figure>\n<\/div>\n\n\n

Critically from the point of view of how capitalism is operating, the same pattern shows up in earnings call transcripts<\/strong>. Bloomberg\u2019s Document Search function shows that executives<\/strong> \u2014 not just Larry Fink \u2014 no longer want to talk about it.<\/strong> This is our quarter-by-quarter measure of mentions of ESG and its various synonyms since 2010. Mentions exploded after the pandemic, and have tumbled since 2022. With this earning season roughly 90% over, interest from executives in ESG looks to be right back to pre-pandemic levels\u2019.<\/em><\/p>\n\n\n\n

This is at least in part\u00a0because fund managers are no longer forcing the issue.<\/strong>\u00a0BlackRock is admirably transparent about the way it votes its shares and produces regular reports;\u00a0here is the latest<\/u><\/a>. As this chart from the report (which is worth a read) demonstrates, the amount of\u00a0support from shareholders for environmental and social proposals has declined markedly<\/strong>\u00a0over the last three years:<\/em><\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

BlackRock itself<\/strong> upped its support for corporate governance proposals, but only backed<\/u><\/a> 4% of social and environmental proposals (<\/strong>down from 20% two years earlier). It also declined to support any of the various anti-ESG proposals that were put forward, and complained that many of them were duplicative or poorly drafted. But the notion that ESG was going to change the way companies operate<\/strong> seems to be in retreat.<\/strong><\/em><\/p>\n\n\n\n

Once Trump is back in the White House in January, we\u2019ll learn much more about how his economic nationalism will work. Fine-tuning capitalism to make it more long-termist<\/strong> and take into account more than the narrowly defined interests of shareholders \u2014 the big ESG idea<\/strong> \u2014 has been comprehensively defeated<\/strong>. Now we wait to see what version of mercantilism comes in its stead.<\/em><\/p>\n\n\n

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\"\"<\/figure>\n<\/div>\n\n\n

Footnote: Fundamental Reasons People Reject ESG Were Not Addressed by Author<\/strong><\/p>\n\n\n

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\"\"<\/figure>\n<\/div>","protected":false},"excerpt":{"rendered":"

Investors are losing interest in the concept, and claims that ESG would reduce
\nglobal warming, or starve fossil fuel groups of capital, look overblown.<\/p>\n","protected":false},"author":121246920,"featured_media":355768,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[1],"tags":[691832172,691832171,691818229,691818087,691819451,691826390],"class_list":["post-355747","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized","tag-blackrocks-larry-fink","tag-bloomberg-article","tag-esg","tag-global-warming","tag-greenwashing","tag-securities-and-exchange-commission-sec","fallback-thumbnail"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/12\/0-RIP-SSG.jpg?fit=1280%2C720&ssl=1","jetpack_likes_enabled":true,"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/paxLW1-1uxR","jetpack-related-posts":[{"id":315845,"url":"https:\/\/climatescience.press\/?p=315845","url_meta":{"origin":355747,"position":0},"title":"States are standing up to BlackRock and ESG","author":"uwe.roland.gross","date":"04\/02\/2024","format":false,"excerpt":"Fox News\u2019 Thomas Catenacci\u2019s article, \u201cMississippi hits BlackRock with cease and desist, threatens massive fine over ESG policies,\u201d shows us a Secretary of State who is following the Constitution and protecting his constituents from one of the Woke and disastrous schemes \u2013 the imposition of Environmental, Social, and Governance (ESG)\u2026","rel":"","context":"In \"16 Republican attorneys general\"","block_context":{"text":"16 Republican attorneys general","link":"https:\/\/climatescience.press\/?tag=16-republican-attorneys-general"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/04\/0blackrock_logo_closeup_1550-main_i.jpg?fit=1200%2C675&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/04\/0blackrock_logo_closeup_1550-main_i.jpg?fit=1200%2C675&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/04\/0blackrock_logo_closeup_1550-main_i.jpg?fit=1200%2C675&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/04\/0blackrock_logo_closeup_1550-main_i.jpg?fit=1200%2C675&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/04\/0blackrock_logo_closeup_1550-main_i.jpg?fit=1200%2C675&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":343327,"url":"https:\/\/climatescience.press\/?p=343327","url_meta":{"origin":355747,"position":1},"title":"Good News: SEC\u2019s ESG Plans Thwarted with Biden Term\u00a0Ending","author":"uwe.roland.gross","date":"09\/16\/2024","format":false,"excerpt":"SEC Chair Gary Gensler started out with big plans on ESG. 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