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A New Front in the Fight to Stop the Spread of Woke ESG Standards Has Been Opened

M. Spencer Green

There's a new front being opened in the fight to keep harmful ESG standards from being forced on American companies by powerful holding entities such as BlackRock, Vanguard, and State Street which use Americans' hard-earned dollars to force the implementation of woke policies.


On Tuesday, Consumers' Research and 13 state attorneys general filed motions with the Federal Energy Regulatory Commission seeking to stop ESG-pushing Vanguard from being allowed to gobble up shares of publicly traded utility companies. If Vanguard were to acquire shares in those companies, they could then begin forcing ESG standards that include "net-zero" emissions goals to "decarbonize" the economy by force — something Vanguard has been caught doing before.

AGs from Alabama, Arkansas, Indiana, Kentucky, Louisiana, Mississippi, Montana, Nebraska, Ohio, South Carolina, South Dakota, Texas, and Utah signed the motion to "intervene and protest the application filed by The Vanguard Group, Inc. and its affiliated entities and subsidiaries (collectively, Vanguard), which requests a blanket authorization under Section 203 of the Federal Power Act (“FPA”) for acquisitions of voting securities of publicly traded utilities."

The attorneys general further argued in their motion that granting Vanguard's application is "contrary to the public interest" and cited the asset manager's "own public commitments and other statements that have at the very least created the appearance that Vanguard has breached its promises to the Commission by engaging in environmental activism and using its financial influence to manipulate the activities of the utility companies in its portfolio."

"Consumers across our country are already feeling the sting of skyrocketing electricity bills, and Vanguard’s request to extend its authorization, coupled with its commitment to imposing net-zero requirements on publicly traded utilities, would only increase these costs," remarked Kentucky AG Daniel Cameron. "Kentuckians and Americans deserve access to affordable and reliable utilities, and we will oppose any effort that will undermine Kentucky’s economy, destroy good paying jobs, and make it harder for Kentuckians to heat their homes and feed their families," he added. 


Under the previous 2019 authorization from FERC, Vanguard gave "assurances" that it "would refrain from investing 'for the purpose of managing' utility companies" and "guaranteed that it would not seek to 'exercise any control over the day-to-day management' of utility companies nor take any action 'affecting the prices at which power is transmitted or sold.'"

The motion filed by Consumers' Research made similar points about the concerning way in which Vanguard wields influence over the companies in which it invests. "In its own words, Vanguard takes a 'results-oriented' approach to engaging its portfolio companies," the motion noted. "That includes pushing for leadership changes, voting on shareholder proposals, and demanding compliance with Vanguard's 'expectations' on political projects 'such as climate change or diversity.' Consumers' Research is particularly concerned that Vanguard's actions, along with those of other global investment managers such as BlackRock Inc. and State Street Corporation, actively harm U.S. consumers by driving up energy prices."

Will Hild, the executive director of Consumers' Research, explained that his group "took this action on behalf of American energy consumers because time and time again we see massive Wall Street firms pretending to 'passively' manage their shares, but instead they use those assets to bully utility companies into adopting radical left-wing policies that drive up electric bills and risk the stability of our power grid," reminded Hild. "Affordable, reliable energy production is the foundation of America's economy and the quality of life we enjoy. FERC's job is to defend utilities from exactly this type of reckless interference," he noted. "They should act to protect these utilities and American consumers from fat cat wall street wreckers who blithely endanger our electricity supply."


The motions come after some FERC commissioners sought answers from Vanguard earlier this year about how it wields power over companies in which its invested. In August, two commissioners requested information from Vanguard over concerns that the asset manager had attempted to use its power to "influence utility generation mixes through its stock ownership."

Both motions are embedded below:

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