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Policy Tip Sheet

ESG in Banking – States Legal Authority

May 6, 2024   |  
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ESG in Banking – States Legal Authority

States nationwide have passed legislation to combat the dangerous environmental, social, and governance (ESG) practices used by asset managers, financial institutions, public universities, and government entities. These policies have included prohibiting the use of ESG in state pension funds and stipulating that state contracts cannot be awarded to companies that use ESG metrics to discriminate against crucial state industries such as oil, gas, coal, lumber, etc.

The most serious threat ESG poses is to individual freedom. And while states have taken action to protect state funds and the use of state resources, very few have passed bills to protect citizens’ essential economic freedom. A couple of the states that have taken decisive action are Florida (2023) and Tennessee (2024). Both have passed bills to ensure banks cannot discriminate against citizens (de-bank them) because of their religious or political beliefs. It is crucial that consumer protection legislation, similar to what Florida and Tennessee have implemented, is enacted in every state in the nation without delay.

The informative paper below, written by Justin Haskins, Director of the Socialism Research Center at the Heartland Institute, outlines states’ legal authority to regulate the use of ESG in banking.

Please get in touch with us if you would like assistance with legislation to combat ESG in your state.

The time for courageous leadership is now.

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