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Press Release: ESG Is a Threat to Individual Liberty, Free Markets, and the U.S. Economy

Posted on Thursday, May 4, 2023
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ARLINGTON HEIGHTS, IL (April 28, 2023) — A new report by The Heartland Institute offers a thorough examination of the growing threat that ESG standards of “stakeholder capitalism” pose to the U.S. economy, the free market, and individual liberty.

Authored by Heartland Institute Research Fellow Jack McPherrin, the report explains how ESG (environment, social, and governance) has “become one of the gravest threats facing the free societies of the world today.” This paper has been developed to provide a comprehensive overview of ESG, and to give elected officials and policy makers specific solutions to oppose this movement that is driven by a destructive ideology.

At its core, ESG is a social credit scoring system that ideologically aligned elites and subservient bureaucratic authorities have developed to “reset” the global financial system to their advantage, fundamentally transforming society in the process. This is accomplished by altering traditional frameworks of evaluating businesses and assessing investment risk.

Rather than determining the creditworthiness and value of a business or industry based upon objective measures such as profit, return on investment, consumer demand, and other material performance measures, ESG’s architects seek to judge entities based upon subjective and difficult to quantify social and environmental goals. These objectives typically have little or nothing to do with business success in the marketplace based on consumer demand expressed through their purchases.

After comprehensively analyzing all of ESG’s nefarious impacts, this report ultimately offers ways that states can fight ESG (page 41), how Congress can take action (page 42), and how ESG can be opposed using the leverage of U.S. foreign policy (page 42).

The following statements about the Heartland Institute report may be used for attribution. To speak to any Heartland Institute expert, please contact Director of Communications Jim Lakely at [email protected] and 312/377-4000 or (cell) 312/731-9364.


“The coercive imposition of environmental, social, and governance (ESG) systems across the global macroeconomy is one of the gravest threats to freedom and economic prosperity facing us today. Any entity—whether that be a large corporation, small company, sovereign country, or individual—that does not comply with ESG’s subjective and political mandates faces serious consequences. The elite oligarchs and institutions behind ESG designed it to be an infinitely malleable system of societal control, in which they inorganically alter the free marketplace by artificially modifying supply and demand.

“Entities that do not comply risk losing basic access to financial services, such as investment infusion, lending, insurance underwriting, and other benefits that should be accessible to any member of society objectively considered to be worthy of credit. Moreover, many Americans are at risk of seeing their hard-earned money invested in retirement accounts and other investment vehicles drastically diminish, as fund fiduciaries are now being induced to use those funds on behalf of non-material goals.

“This paper provides a sweeping overview of ESG, including its history, specific metrics, the actors responsible for ESG, the problems associated with ESG, and an analysis of how ESG will only become more powerful in the coming years if it is not stopped. To that end, this paper also provides specific policy recommendations that will halt ESG in its tracks, if state and federal policymakers have the will to protect their constituents and the country.”

Jack McPherrin
Research Editor
Research Fellow, Socialism Research Center
The Heartland Institute
[email protected]


“ESG is an insidious threat to individual freedom and economic progress, as this important paper explains. ESG efforts threaten everyone’s retirement, their ability to obtain and maintain credit, and even to have bank accounts and do business with banks. A cabal of political and financial elites are using social credit scoring in the form of ESG to enforce docile acceptance of the progressive social and economic goals they favor.

“Because knowledge is power, this paper is an antidote to the ESG push, providing a comprehensive analysis of ESG, including: what it means; who developed it; why some are advocating for it; the dangers it poses to individuals, individual companies, entire industries, and the economy as a whole; and how to fight it at the state, federal, and international level.”

H. Sterling Burnett, Ph.D.
Director, Arthur B. Robinson Center on Climate and Environmental Policy
Managing Editor, Environment & Climate News
The Heartland Institute
[email protected]


“Environmental, social, and governance (ESG) scores are a direct threat to the free market and individual liberty. Instead of allowing supply and demand to dictate the products and services companies offer to their customers, the proponents of ESG seek to use arbitrary metrics, which they can modify at any time, to control these businesses by limiting their access to capital and other financial vehicles if they do not play ball.

“Unlike shareholder capitalism, which is built upon the foundation that businesses should maximize profits by offering the highest quality goods and services at the most affordable price, ESG is predicated on stakeholder capitalism, wherein businesses’ primary objective is to serve the esoteric interests of multiple parties. While this may sound good on its face, it is potentially quite dangerous because it places politics and other subjective criteria over the company’s bottom line.

“Because ESG remains a relatively new concept, many people are unaware of the whole story behind the ESG movement. This new Heartland Institute report uncovers the history of ESG, explores how it is being implemented, explains why it must be stopped, and most importantly, offers simple steps that lawmakers can take at the state and federal level to prevent the spread of this economic and social poison.”

Christopher Talgo
Editorial Director
Research Fellow, Socialism Research Center
The Heartland Institute
[email protected]

Read the Report

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David Millikan
David Millikan
1 year ago

Excellent article.
ESG is pure Communism and Un-American.
Those that use ESG must leave the United States and move to their country of Communist China since they are Not Americans.
The United States uses MERIT.
NOT COMMUNIST ESG.
Go ESG, Go BROKE just like WOKE.

PaulE
PaulE
1 year ago

This is the most important part of the article above “At its core, ESG is a social credit scoring system that ideologically aligned elites and subservient bureaucratic authorities have developed to “reset” the global financial system to their advantage, fundamentally transforming society in the process.” It tells you all you really need to know. ESG is NOT about getting better financial returns. ESG is NOT about better more efficient management of companies to produce more at a high profit margin. It is about social engineering to empower empty-suit bureaucrats, with little to no skills to manage or producer anything of value, to have a say in how companies are run and investments are made to meet their personal social criteria.

All ESG investments underperform non-ESG investments by 1 to 3 percent. So the rate of return you achieve will be substantially less over time. Corporate management of companies driven by the ESG model have their attention diverted from important day-to-day operational management issues crucial to keeping their companies in leading positions to instead focus on useless paperwork and procedures that do nothing to maintain the business in the marketplace. Never invest in any ESG driven investment or company.

Theron Kuhn
Theron Kuhn
1 year ago

ESG=COMMUNISM !

Veteran
Veteran
1 year ago

Companies engaging in ESG should be taxed at 95% without being able to claim any exemptions, or losses; it’s the only way we’ll be able to rid ourselves of this malicious evil agenda.

Eliabbeth
Eliabbeth
1 year ago

ESG banks are using the money we deposit for social programs and I am disappointed and discouraged. As soon as I do my diligent research I am closing my accounts and moving my finances to conservative banks that work for my family’s interest.

HocasPocas
HocasPocas
1 year ago

For those of you who haven’t taken the time to read the attached report, I suggest you do so. What I got out of it is the EU along with some major US company oligarchs and elected and unelected officials in this country from state to federal are getting ready to take over all forms of business and if you happen to own a business that doesn’t follow their rules, which can change anytime the overseers see fit, you will be sanctioned financially and quite possibly legally. It looks to me like this is happening already to most conservative Americans who are fighting for the rights of the people of this country. From Trump on down to poor 67 year old Tina Peters who just wanted to serve the people who voted her in.

Terri Matson
Terri Matson
1 year ago

This crap makes me glad I am old and have a relatively short life expectancy due to physical issues that can’t be fixed. I am so sick of woke BS and the LGBTQXYZ agenda being forced on us. I am OK with the can’t be fixed part. I had a great life and was a woman of adventure who spoke her mind, sometimes a bit too honestly. A strange new world is being imposed on us, like it or not. I would not do well in a social credit system. I am not a shut up and go along person. In a social credit system, I would be locked in my house and starved to death.

bill
bill
1 year ago

Orwellian. Straight out of 1984.

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