Bank Failures Highlight Risks of Using ESG in Americans’ Pension Funds

Contact Your Elected Officials
The Epoch Times Header

Asset Managers Dispute Biden’s Claim That ‘Extensive Evidence’ Supports ESG Investing

President Joe Biden used his veto power on Monday to block a bipartisan action from Congress that would have prevented pension fund managers from investing retirees’ money according to environmental and social-justice criteria.

“There is extensive evidence showing that environmental, social, and governance factors can have a material impact on markets, industries, and businesses,” Biden stated.

However, despite attempts by its advocates to brand environmental, social, and governance (ESG) criteria as an effective risk-management tool, recent bank failures such as Silicon Valley Bank (SVB) suggest the opposite.

In defense of ESG, Senate Majority Leader Chuck Schumer (D-N.Y.) wrote in a Wall Street Journal op-ed that “America’s most successful asset managers and financial institutions have used ESG factors to minimize risk and maximize their clients’ returns. In fact, according to McKinsey, more than 90 percent of S&P 500 companies publish ESG reports today.”

This echoed a statement by Bank of America CEO Brian Moynihan in 2020 that “our research shows that companies that do well on ESG end up doing better, or fail less.” Also advocating for ESG, The New York Times was quick to “fact check” critics who claimed that ESG was partly to blame for SVB’s demise.

In an op-ed titled, “No, ‘Wokeness’ Did Not Cause Silicon Valley Bank’s Collapse,” the Times argues that SVB “was not an outlier in its diversity goals or its ESG investments,” which is accurate as far as it goes. But the fact that most other financial institutions are doing the same thing is not reassuring to many who are concerned that ESG will now be used as a risk-management criteria for pensioners’ money.

Hiding Management Failures

“If management is focusing on ESG, then important functions like risk-management can easily fall to the wayside,” Aharon Friedman, a former senior counsel to the House Ways and Means Committee and former senior advisor to the Treasury Department, told The Epoch Times. “ESG metrics are inherently subjective and unquantifiable, so using ESG factors to measure a company’s performance can hide bad management practices.”

By Kevin Stocklin

Read Full Article on TheEpochTimes.com

The Epoch Times
The Epoch Timeshttps://www.theepochtimes.com/
Tired of biased news? The Epoch Times is truthful, factual news that other media outlets don't report. No spin. No agenda. Just honest journalism like it used to be.

How The Big Beautiful Bill Will Keep Louisiana’s Energy Industry Strong

Renewable or not, our federal govt should not be rigging the deck against any energy sources, especially nuclear power that is both clean and consistent.

On Declaring War, Congress De Facto Amended the Constitution

Congress has de facto amended the Constitution by 55 years of refusing to debate matters of war and peace.

AOC – Acting On Cue

It is easy to dislike Alexandria Ocasio-Cortez (AOC), also known as Sandy Cortez, because she is fraudulent and not to smart.

LGBTQ™ Propaganda Roundup: Tampon Tim Walz Fails the Test

LGBTQ™ Propaganda Roundup: Nip/tucking the latest social engineering fisted...

AI is Now an Existential Threat

We now see evidence that artificial intelligence is an existential threat to our future. It is coming to take American jobs!

DOJ Sues LA Over Sanctuary City Policies: 4 Things to Know

DOJ filed a lawsuit against Los Angeles over what it said are “sanctuary city” policies that shield illegal immigrants from deportation efforts.

Rep. Dusty Johnson Will Run for Governor of South Dakota

U.S. Rep. Dustin Michael “Dusty” Johnson has announced that he will run for governor of South Dakota during the general election to that office in 2026.

Moderna to Ask for Clearance for Combination COVID-Influenza Vaccine

Moderna is going to ask regulators to approve its combination vaccine against COVID-19 and influenza, the company said on June 30.

FBI Says It’s Uncovered ‘Largest Health Care Fraud’ in American History

FBI and DOJ said $15 billion in losses was reported in “largest health care fraud” investigation in U.S. history. Officials charged more than 300 people.

Federal Reserve ‘Should Be Ashamed’ for Not Lowering Interest Rates, Trump Says

President Donald Trump said Federal Reserve Chair Jerome Powell and his colleagues “should be ashamed” for not lowering interest rates.

Canada-US Trade Talks Will End Until ‘Certain Taxes’ Are Dropped, Trump Stresses

Trade discussions between Canada and the United States will end “until such time as they drop certain taxes,” U.S. President Trump said in an interview.

Trump Says US to Send Tariff Letters to Trade Partners Before July 9 Deadline

President Donald Trump said Sunday he will soon send letters to trading partners detailing the tariffs to be imposed on their exports to the United States.

Trump Says He Found a Buyer for TikTok

President Trump said he found a buyer for the Chinese-owned short video application TikTok, and that he will reveal the group in roughly two weeks.
spot_img

Related Articles