Conservatives Use CPAC Platform to Galvanize Attack on ESG

Conservative activists—gathering for an agenda-setting, annual Republican conference—signaled the attack on those who believe environmental, social and governance criteria should be used to guide investing is just getting started.

The anti-ESG fervor running through this week’s Conservative Political Action Conference, or CPAC, was evident from swag like anti-woke stickers and “stress balls” poking fun at climate change, and organizers offering tickets to a documentary warning of the evils of ESG.

The conference is being held at the Gaylord National Resort and Convention Center. It is often a backdrop for coalescing the political troops on the conservative cause at the time, whether that be border security, expanded government health care or, now, ESG. It will end Saturday with a speech from former President Donald Trump.

“ESG is just purely political activism,” said Oklahoma House Speaker Charles McCall (R), speaking on a panel called “The New Axis of Evil: Soros, Schwab, and Fink,” a reference to billionaire George Soros, the World Economic Forum’s Klaus Schwab, and Larry Fink, CEO of asset-management behemoth BlackRock. “It undermines the financial returns and the focus of the fiduciary duty, that all of our pension administrators have to seek out the highest return of beneficiaries.”

Fink is regularly criticized by Republican politicians who say the asset manager uses other people’s money to push social values like fighting climate change. Fink said earlier this year that the ESG narrative has become ugly, and that he has never experienced such personal attacks.

McCall, along with former CKE Restaurants CEO Andrew Puzder, said during a panel Friday that they’re actively designing and implementing policies to prevent ESG investing at the state level.

The comments come on the heels of a push by congressional Republicans to overturn a Department of Labor rule that allows retirement advisers to consider ESG factors when advising clients. While President Joe Biden is expected to veto a bill the Senate approved this week, Puzder noted that conservatives were making a similar push in state legislatures.

Republicans such as Florida Gov. Ron DeSantis have seized on the moment to label ESG policies as “woke” and antithetical to how companies have traditionally operated. DeSantis and other prominent Republicans, including House Speaker Kevin McCarthy, skipped the event. Some of McCarthy’s top lieutenants, however, did make appearance, including House Ways and Means Committee Chairman Jason Smith (R-Mo.).

Puzder, who spent 16 years at the helm of CKE Restaurants, the parent company of Carl’s Jr. and Hardee’s, is now a visiting fellow at the Heritage Foundation, where he works on “the consequences of ESG activism,” according to his Heritage Foundation biography. He said the conservative think tank and lobby organization, as well as the American Legislative Exchange Council, has developed “model legislation” to more narrowly define what a fiduciary is—to explicitly prohibit them from advising clients to invest in ESG funds.

“These bills specifically exclude ESG: environmental, social and governance investing,” Puzder said to applause from the crowd. “The more states that pass that, the better off we’re going to be.”

Oklahoma’s state Legislature, McCall said, is trying to pass a measure that goes further than the congressional bill. His bill would restrict fiduciaries from investing in ESG funds, hire contractors that don’t “subscribe to ESG policies,” and empower the governor to “root out these types of systematic political activism tactics by the left.“

ESG On Display

Speakers including Vivek Ramaswamy, a conservative political activist who built a newly-launched presidential campaign on a fight against companies’ environment, social and governance efforts, spoke out against “woke capitalism.” The conservative calls against ESG set the topic up to be a prominent Republican theme as a new presidential election cycle looms.

“I traveled the country calling out the woke-industrial-complex in America,” Ramaswamy said, recounting his decision to step down as CEO of his healthcare company, Roivant Sciences, and start a financial services firm called Strive Asset Management.

“I started a new company called Strive to take on BlackRock and the ESG movement through the market itself,” he said to cheers from the audience Friday.

Along the main corridor outside the two-thirds empty ballroom, enthusiastic attendees wore “Woke” protest stickers and shirts that said “Florida is where woke goes to die”—a quote from DeSantis. At the exhibit hall, where dozens of conservative organizations and businesses gathered, one group passed out stress balls made to look like the earth that read: “Don’t stress, there is NO climate crisis.”

Late Friday afternoon came the screening of “The Shadow State,” an ESG documentary by The Epoch Times. The film aimed to tie ESG to broader culture wars like alleged social-media company censorship of voices peddling 2020 election falsehoods.

ESG, the film’s producer Kevin Stocklin said, is a social agenda being made without the input of citizens, and is influencing companies to implement progressive causes.

“Not only are we losing our voice as voters, we are losing our voice as consumers,” Stocklin said before the film aired. “A lot of our companies are being forced to do things that we might not necessarily want.”