Indiana AG joins multi-state investigation into ESG banking practices

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State Attorney General Todd Rokita says the state of Indiana is now part of a multi-state investigation into whether big banks are ‘colluding’ with the United Nations to destroy American businesses of fossil fuels.

Rokita said 20 states had issued civil investigative requests to six major U.S. banks, which he said served as a subpoena, to access documents related to the companies’ involvement in the Net-Banking Alliance. Zero from the United Nations Environment Programme.

The investigation will focus on alliance members Bank of America Corp., Citigroup Inc., Goldman Sachs, JP Morgan Chase & Co., Morgan Stanley and Wells Fargo & Co.

The alliance was founded in April 2021 and requires members to commit to moving their loan and investment portfolios to net-zero emissions by 2050 or sooner taking into account direct and indirect carbon emissions. greenhouse gases resulting from these loans and investments.

As part of their transition plans, alliance members do not have to divest fossil fuel assets and are encouraged to seek carbon offsets, an action that prevents a certain amount of carbon dioxide from reaching the atmosphere to offset emissions occurring elsewhere. Carbon offsets could, in theory, allow fossil fuels to continue to be used without worsening climate change, although activists and scientists have said offsets are ineffective to combat climate change and are essentially a “licence to pollute”.

The alliance’s guidelines are not strictly enforced and apply on a “comply or explain” basis, and the six companies being investigated by Rokita and other states have so far now refused to stop funding fossil fuels.

Despite this and the alliance’s flexibility on fossil fuels, Rokita and other Republican attorneys general from states dependent on fossil fuels are investigating the companies for alleged “collusion” aimed at destroying US fossil fuel companies.

“These banks appear to be colluding with the UN to destroy American companies that specialize in fossil fuels or otherwise depend on them for energy,” Rokita said in a press release. “They are pushing an investment strategy designed not to maximize financial returns but to impose a leftist social and economic agenda that cannot otherwise be implemented through the ballot box.”

The survey is part of a nationwide effort to secure future funding for fossil fuels.

Encouraged by fossil fuel-funded organizations like the American Legislative Exchange Council, Rokita and other fossil fuel industry-influenced legislators have targeted financial institutions that have developed, or are believed to have developed, strategies for investment based on non-financial considerations, such as climate. the impacts of change or greenhouse gas emissions. These considerations are known collectively as ESG factors, or environmental, social and governance factors.

Lawmakers in Kentucky, Oklahoma, Tennessee and Texas have passed laws to sever ties with financial institutions that “boycott” energy companies using ESG considerations or any other method as part of the effort. Lawmakers in 17 Republican-led states have introduced 44 bills that would do the same elsewhere.

The attempt to pass such legislation in Indiana was defeated when Rep. Ethan Manning withdrew House Bill 1224, a bill nearly identical to the group’s “model legislation,” shortly after introducing it. . The bill could be resurrected in the next legislative session.

Rokita issued an advisory opinion in September that was spurred by a request from ALEC member Sen. Eric Koch that Indiana’s public retirement system board investments made with consideration of ESG considerations would violate state law.

Rokita says ESG considerations and banks’ net zero goals would hurt the state’s economy.

“This new awakening in the financial industry poses a real threat to everyday Hoosiers,” Rokita said. “Indiana’s farmers, truckers, and oil workers are hurt when the radical left attacks swaths of our economy. And it is troubling that these Net-Zero Banking Alliance banks are taking orders from UN globalists too eager to undermine America’s best interests.

A recent study indicates that anti-ESG policies could end up having a significant negative financial impact in Indiana.

Researchers from the Wharton School at the University of Pennsylvania examined what happened when Texas boycotted financial institutions over their ESG policies, finding that the rule reduced competition for borrowing and cost taxpayers millions of dollars in additional interest.

After Texas passed two anti-ESG laws in September 2021 prohibiting local governments from contracting with banks that adopted ESG policies affecting the oil and gas industry and the gun industry, five of the largest Municipal bond underwriters left the government market. . That includes JP Morgan Chase, Goldman Sachs, Citigroup and Bank of America, four of the six companies being investigated by Indiana and other states.

During the first eight months of the laws’ enactment, cities in Texas were forced to negotiate borrowing terms with other financial institutions that had lower rates than incumbent banks. According to the report, these cities will pay between $303 million and $532 million more in interest than they would have if these banks had remained.

The Indiana Environmental Reporter has contacted the companies under investigation, but none have yet commented on the investigation.