McRae: Building a Team Against ESGs
By Treasurer David McRae
Mississippi knows a thing or two about winning teams. It’s rarely a single player who can lead us to a national championship. Sure, there might be a standout quarterback some years. But without a solid offensive line and a defense that can limit the opposition’s scoring, you aren’t going to win the title.
That’s true in government and politics too.
This month, I sat down with State Treasurers across the country to discuss building a team of our own. In recent years, Environmental, Social, and Governance (ESG) investment strategies have caught the attention of liberal states and New York City bankers. Rather than ranking a company on their financial strength, ESG ratings indicate how woke an organization’s business practices are.
Now, there are a lot of hypocrisies in who gets a good ESG rating (for example, Nike with its human rights abuses gets a great rating, while Elon Musk’s Tesla, which has revolutionized electric vehicles, gets a poor rating). But I want to push that to the side for the time being and just talk dollars-and-cents: ESG funds make less money than traditional investment strategies. As someone who helps keep the state government’s books in balance, that’s a problem.
The state often relies on strong investment returns to lift the tax burden on our citizens and ensure Mississippi’s pension system and college savings fund remain afloat. Nonetheless, many in the Biden administration and Wall Street want to force us into less profitable ESG funds that make liberal elites feel better about their contributions to social causes. But if you ask me, I think it’s wrong to launch a personal political agenda off the backs of retirees, parents and taxpayers.
To push back on the ESG movement, I’m working to build a coalition of likeminded states who can team up to take on larger, liberal-leaning entities.
As a single state, Mississippi simply doesn’t have the buying power needed to be a counterweight to the desires of California elites. But if Mississippi, Louisiana, West Virginia, and others can build a coalition, we can force the Big Banks to listen, thereby protecting each of our taxpayers. That’s what this month’s meeting was all about.
I was grateful for the opportunity to lead the discussion, and I found it incredibly helpful to hear the best ideas from around the country. As a team, I’m confident we will mount a serious defense against ESG and the woke left.