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Posts Tagged ‘ESG’

‘ESG,’ the Threat to Liberty You Haven’t Heard Of

Posted by M. C. on June 20, 2022

When Coca-Cola, Gillette, Disney, BP, and other multinational corporations act counter to good business practices to advance a political agenda antithetical to the beliefs of most of their consumer base it is an effort to improve the new value-based credit score known as ESG.

by Tommy Salmons

In March of 2020 COVID-19 spread to the shores of the United States, introducing a medical threat that had all the signs of devastating families from sea to shining sea. But in the shadows, slipping in under the veil of a potentially deadly pandemic, another threat loomed. This threat, known as ESG, was not airborne or viral in the traditional sense. This threat was birthed in the imaginations of banks, corporations, and governments, and much like COVID, this threat is going to alter the life of millions of people worldwide.

ESG is an acronym that stands for Environmental, Social (Justice), and (Corporate) Governance. The goal of ESG, as World Economic Forum founder Klaus Schwab stated in Shaping the Future of the Fourth Industrial Revolution, is to utilize investors to move corporations into a more socially progressive direction; moving technologies and businesses away from the current models of doing business to a new stakeholder method of business.

“Entrepreneurs and Investors are the vanguard when it comes to marrying a values-based approach to technological development…It makes sense that thinking about broader social impact at this stage would have significant cascading effects. Investors, on the other hand, have the carrot with which to direct the development of technologies…The values of entrepreneurs and organizational leaders have a tremendous influence on the workplace and how technologies are developed. Leading from the front can transform company culture and prioritize societal values.”

When Coca-Cola, Gillette, Disney, BP, and other multinational corporations act counter to good business practices to advance a political agenda antithetical to the beliefs of most of their consumer base it is an effort to improve the new value-based credit score known as ESG. As corporations respond to investors and the credit score used to determine societal value, they push agendas intended to move the Overton Window and cultural acceptance towards a more progressive agenda.

Proponents of ESG metrics utilize the famous libertarian mantra of private companies being able to do whatever they feel is best for their company and fiduciary responsibilities, but there’s nothing private about ESG. In March of 2020 the SEC announced they would be forming an ESG Taskforce. The initiative has expanded to requiring publicly traded firms to make detailed disclosures on climate change and greenhouse gas emissions. As with all regulations ESG is being sold as serving the greater good at the cost of business, costing the consumer more money.

Proponents of ESG make a litany of arguments to justify their regulatory dreams:

  1. “ESG is crucial because it offers a focused framework through which governments, businesses, and citizens can work consistently toward solving serious global challenges.”
  2. “ESG, at its core, is a means by which companies can be evaluated with respect to a broad range of socially desirable ends.”
  3. “ESG criteria can help investors avoid investment losses when companies engaged in risky or unethical practices are held accountable.”

But they will never address in any detail how ESG metrics will be utilized to make these changes to society. And if ESG is just a tool to help investors make decisions why is the SEC mandating ESG data disclosures? And who is considered an investor?

Chart published by the Ethics and Compliance Initiative

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Elon Musk versus the Woke Cartel

Posted by M. C. on May 31, 2022

But the best indication that the woke cartel has really gone berserk is its removal of Tesla from the S&P 500’s ESG (Environmental, Social, and Governance) Index. This last rebuff proves that “ESG is a scam.”

I’ve argued that the ESG is a means for dividing the woke wheat from the unwoke chaff to assemble a woke monopolistic cartel, but this exclusion is especially hypocritical and ludicrous. Tesla has produced more electric vehicles than any other manufacturer,

https://mises.org/wire/elon-musk-versus-woke-cartel

Michael Rectenwald

Many criticisms have been leveled against Elon Musk—that he’s part of the elite, that Tesla has been the beneficiary of government handouts and exemptions, that his transhumanist Neuralink is a brain-data-mining operation. Yet his planned purchase of Twitter, his supposed free-speech absolutism, and his subsequent renunciation of the Democratic Party as “the party of hate” have put Musk squarely in the crosshairs of the woke cartel.

Vitriolic Twitter storms, a New York TimesFinancial Times biographical exposé, a slew of hit pieces and scaremongering segments in the legacy media, and allegations of sexual harassment have dogged the automobile magnate ever since his Twitter bid. In response, Musk announced on Twitter that he’s assembling a legal crew to sue defamers and defend Tesla (and likely himself) against lawsuits.

But the best indication that the woke cartel has really gone berserk is its removal of Tesla from the S&P 500’s ESG (Environmental, Social, and Governance) Index. This last rebuff proves that “ESG is a scam.”

I’ve argued that the ESG is a means for dividing the woke wheat from the unwoke chaff to assemble a woke monopolistic cartel, but this exclusion is especially hypocritical and ludicrous. Tesla has produced more electric vehicles than any other manufacturer, yet Exxon Mobil and JP Morgan Chase rank among the S&P 500’s top ESG performers after a recent rebalancing. JP Morgan is the world’s largest investor in oil producers and ExxonMobil ranks first among them.

The reasons given for axing Tesla from the index also prove that ESG indexing is political to the core. Writes Margaret Dorn of Indexology Blog:

A few of the factors contributing to its 2021 S&P DJI ESG Score were a decline in criteria level scores related to Tesla’s (lack of) low carbon strategy and codes of business conduct. In addition, a Media and Stakeholder Analysis, a process that seeks to identify a company’s current and potential future exposure to risks stemming from its involvement in a controversial incident, identified two separate events centered around claims of racial discrimination and poor working conditions at Tesla’s Fremont factory, as well as its handling of the NHTSA investigation after multiple deaths and injuries were linked to its autopilot vehicles. Both of these events had a negative impact on the company’s S&P DJI ESG Score at the criteria level, and subsequently its overall score. While Tesla may be playing its part in taking fuel-powered cars off the road, it has fallen behind its peers when examined through a wider ESG lens.

What we see through this “wider ESG lens” is a political spectacle. ESG grading, notes Bloomberg, is a measure of public relations imagery, not environmental performance. Tesla has been besmirched with bad press regarding supposed racial discrimination, and Musk’s South African provenance is used to support such allegations. In 2018, Business Insider claimed that Musk was a beneficiary of an apartheid emerald mine owned by his father, Errol, and worked by black South Africans. Twitter mobs and other media outlets have continued to repeat the allegation, despite Musk’s convincing refutation.

Tesla and Musk have thus been subjected to the S in ESG—the “social” or “social justice” quotient. “Diversity, equity, and inclusion” means exclusion of the politically incorrect. This applies to corporations as much as it does to individuals. Musk has been deemed a deplorable, and thus his company does not pass “social justice” muster.

As such, Musk has exposed the contradictions within the woke cartel’s measurement apparatus. Anything that can be used against a company, or its owners, will be used—

when the target runs afoul of the woke arbiters, that is. That’s because the ESG is an impressionistic, qualitative metric that subjects companies to the whims of a woke dictatorship.

I’m not suggesting that Musk is a free-market hero or a lowercase libertarian, but there is little doubt that he’s become corporate enemy number one for the state-backed woke cartel. The battle shaping up between Musk and the regime will prove to be an important one, if only because it pits the power of the latter against a high-visibility manufacturer and the reputed “richest man in the world.” What we will learn is how powerful the woke cartel is and just how far it will go to infringe property rights and eradicate any remaining legitimate (consumer-based) market criteria—no matter how much its moves reek of hypocrisy or how obvious its vendetta.

In today’s political economy, satisfying shareholders and customers has become less important than ingratiation with the woke cartel and the government that supports it. Corporations’ fealty to wokeness, state dictates, and state narratives can be explained in terms of a fully politicized economy. Corporations seek to curry favor with the clique in power, and thus they have become organs of the Democratic Party and the federal government it now runs unilaterally.

Woke corporatism is what happens when social democracy or democratic socialism grows to such proportions as to make profiting nearly impossible without political approval. Unfortunately, Elon Musk will learn much more about woke political capitalism in the not-so-distant future.

Author:

Contact Michael Rectenwald

Michael Rectenwald is the author of eleven books, including Thought CriminalBeyond WokeGoogle Archipelago, and Springtime for Snowflakes.

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“ESG” = Extreme Shortages Guaranteed! – CFACT

Posted by M. C. on January 18, 2022

The IEA report points out that the demand growth for plastics and fertilizer are outpacing the demand growth for steel, aluminum, and cement. Petrochemical product demand has nearly doubled since 2000 and the U.S. and Europe use twenty times as much plastic and ten times as much fertilizer as India, Indonesia, and other developing countries on a per-capita basis. A decarbonized world without the three fossil fuels of coal, natural gas, and crude oil CANNOT manufacture any of those petrochemicals from a wind turbine or solar panel.

https://www.cfact.org/2022/01/17/esg-extreme-shortages-guaranteed/

By Ronald Stein

The Environmental, Social and Governance (ESG) factors climbing up the agenda in the banking industry would have banks divest in fossil fuels.  This would lead toward a world like that in the 1800’s, the last time the world was “decarbonized”.

Back in the 1800’s, we had no coal or natural gas power plants, and we had not discovered crude oil as something that could be manufactured into usable products. Life was hard and dirty, and most people never traveled 100-200 miles from where they were born, and life expectancy was short.

Today, there is a lost reality that the primary usage of crude oil is NOT for the generation of electricity, but to manufacture derivatives and fuels which are the ingredients of everything needed by economies and lifestyles to exist and prosper. Energy realism requires that the legislators, policymakers, and media that demonstrate pervasive ignorance about crude oil usage understand the staggering scale of the decarbonization movement.

The efforts to cease the use of crude oil could be the greatest threat to civilization, not climate change, resulting in billions of fatalities from diseases, malnutrition, and weather-related deaths.

In the worldwide frenzy to achieve the goal for “net zero” emissions, over the last 5-10 years, “ESG”–standing for Environmental Social Governance–has gone from an acronym that virtually no one knew or cared about, to a cultishly embraced top priority of financial regulators, markets, and institutions around the world. Today, the ESG divesting efforts are applying to all 3 fossil fuels of coal, natural gas, and crude oil.

The Net-Aero Banking Alliance developed with the support from the United Nations, now includes seven of the largest and most influential banks in the United States, including BOA, Citi, J.P. Morgan Chase, Morgan Stanley, Goldman Sachs, Wells Fargo, and Amalgamated Bank.

Allowing banks to collude to reshape economies so that they are in line with the preferences of banks and other financial institution is a very dangerous precedent. The American people never voted to give banks this sort of control over our country.

The domino effects from tinkering with the supply chain of crude oil, is supply shortages and soaring prices for thousands of products that support the economies of the world. Products based on oil are the basis of the entire medical industry, all branches of the military, airports, electronics, communications, merchant ships, container ships, and cruise liners, as well as asphalt for roads, and fertilizers to help feed the world. Fossil fuel shortages encourage inflation as it imposes serious damage on the energy and raw materials infrastructures.

Climate alarmism seems to be inexhaustible and if history is any guide, ESGers admitting their mistakes and rushing to undo the damage is not at the top of the list of likely responses. Thus, by divesting in crude oil infrastructure we can look forward to supply shortages of thousands of products manufactured from oil and crippling power prices and unreliable supplies to meet the demands of society.

The oil products that reduced infant mortality, extended longevity to more than 80+ and allowed the world to populate from 1 to 8 billion in less than two centuries, is now required to provide the food, medical, and communications to maintain and grow that population. How can world leaders consciously support the demise of crude oil that would take us back to the 1800’s when life was hard, dirty, and short?

Today, with all the products manufactured from oil, according to the United Nations the global population of centenarians 100 years old or older is projected to grow from more than 500,000 in 2021, to exceed 2 billion in 2050.

We already know that the poorer developing countries, currently without the usage of the 20th century products manufactured from crude oil, are experiencing about 11,000,000 child deaths every year due to the unavailability of the fossil fuel products used in wealthy countries.

More than 70 per cent of those child fatalities in developing countries are attributable to six causes: diarrhea, malaria, neonatal infection, pneumonia, preterm delivery, or lack of oxygen at birth. About 29,000 children under the age of five – 21 each minute – die every day, mainly from preventable causes.

Without replacements for those derivatives manufactured from crude oil, there will be gigantic reductions in living standards of the population in the current healthy and wealthy countries as the world migrates back to the pre-1900 era, and any attempt to develop the colonial countries would come to a dead stop.

“Net zero” will be taking us back to a time before 1900 when the world had not yet discovered the benefits to society from the 3 fossil fuels. Net-zero policies are demonstrably precipitating ever more serious, unsustainable socio-economic and environmental damage, with several advanced economies routinely experiencing blackouts, and steeply escalating electricity prices that are leading to class-based electricity poverty, excess winter deaths, organized social and political pushback and ever more violent confrontations.

Before the 1900’s we had NONE of the products used in the medical industry nor any of the 6,000 products from oil and petroleum products. By ceasing oil production and fracking, the supply chain to refineries will be severed and there will no need for refineries as they will have no crude oil supply to manufacture derivatives and into transportation fuels demanded by the world’s heavy-weight and long-range infrastructures of aviation, merchant ships, cruise ships, and militaries.

Divesting is already impacting supply shortages of jet fuel as reported by Energy Information Administration (EIA), as less production and more demand have reduced U.S. jet fuel inventories since 2014 for the 23,000 commercial airplanes and 20,000 Private jets.

The IEA report points out that the demand growth for plastics and fertilizer are outpacing the demand growth for steel, aluminum, and cement. Petrochemical product demand has nearly doubled since 2000 and the U.S. and Europe use twenty times as much plastic and ten times as much fertilizer as India, Indonesia, and other developing countries on a per-capita basis. A decarbonized world without the three fossil fuels of coal, natural gas, and crude oil CANNOT manufacture any of those petrochemicals from a wind turbine or solar panel.

As Environmental, Social and Governance (ESG) divesting in fossil fuels progresses, the short memories of petrochemicals’ golden goose contributions to societies are leading the world to an era of Extreme Shortages Guaranteed (ESG) like we had in the decarbonized world in the 1800’s!

Author

  • Ronald Stein Ron Stein is an engineer who, drawing upon 25 years of project management and business development experience, launched PTS Advance in 1995. He is an author, engineer, and energy expert who writes frequently on issues of energy and economics.

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Doug Casey on the Rise of Woke Companies and ESG Investing

Posted by M. C. on April 8, 2021

In reality, stakeholders are just hangers-on, employees, or people who are looking to get in on a shakedown. But everybody slavishly acknowledges them and parrots the meme: “Yes, we’ve got to look out for the stakeholders.”

Where did that concept come from? The same place as ESG and EDI. It’s a recent creation, but Boobus americanus seems to think it was carved in stone at the country’s founding.

We’re told to protect them as if they were a valuable and endangered species. I say, “A pox upon stakeholders.” If they want a vote in what a company does, then they ought to become shareholders. Stakeholders have been created out of nothing by cultural Marxists for the purpose of shaking down shareholders.

https://internationalman.com/articles/doug-casey-on-the-rise-of-woke-companies-and-esg-investing/

by Doug Casey

International Man: The trend of investing in so-called environmental, social, and governance (ESG) companies is growing. Companies are rated based on their carbon emissions, diversity on their board, among other factors. Many companies seem to be bending over backwards to show their ESG credentials.

What do you make of all this? Where did this all come from?

Doug Casey: A tsunami of political correctness is washing over the entire world. It’s not just the US. But it didn’t just arise spontaneously in a vacuum.

The first time that I ever heard the term “politically correct” was in a Saturday Night Live skit in the early ’80s. At the time, I just thought it was a funny catchphrase. It sounded like a takeoff on the Soviet term “politically unreliable,” which was used to describe those who weren’t dogmatic communist ideologues. However, it turned out to be an indicator of a much broader trend, one that got underway in the ’60s. It started in the universities.

Three generations of people have gone to college since the ’60s. In those days, attending college was relatively rare, only around 10% of the youth. It was less than 5% in the previous era. Now it’s quite common, with over a third of Americans getting degrees.

In those days, college was actually supposed to be about learning something tangible. Either subjects about the natural world—science, medicine, engineering, and the like—or humanities—literature, history, philosophy, and the like. There was always a divide between the two categories, of course. Sciences were hard and required diligent work with verifiable data, whereas the humanities were soft, largely the province of opinion and interpretation. Both disciplines have degraded, however. Even math is now considered too “white,” while the humanities have morphed into indoctrination.

College professors—and I speak as somebody who was a trustee of the tenth oldest college in the country for five years— are now almost all “woke,” full of social justice warriors (SJW) and declared Marxists. It appears about 93% of faculty members vote Democrat—not that voting Republican necessarily means you support principles that have much to do with either free minds or free markets.

I’m afraid that the battle for the hearts and minds of Americans is basically over. The progressives, socialists, Marxists, and their fellow travelers have won the intellectual and moral battle. The loss is now being reinforced by the media with their biased reporting, the corporations with their woke ads, and entertainers with their highly politicized skits and shows.

Going back to the analogy of a battle, the Left initially fought a guerrilla war. In recent years they’ve grown strong enough to win set-piece battles. Now they have nearly complete control of the State apparatus. They won’t let go of it. Their next step is just to mop up the resistance.

How does this relate to the Environmental, Social, and Governance (ESG) mandates that are being enforced everywhere? Very directly.

One problem with ESG is that it sounds so positive. Who doesn’t want a clean environment? Who’s opposed to social harmony instead of a race war? Isn’t it better to have some “governance” as opposed to the straw man of Road Warrior-style chaos?

The reality is that ESG mandates managements to redirect corporate resources from creating new wealth and satisfying consumer demands to implementing the semi-religious charities of a new Green religion. And to keep them on the path to righteousness, corporate boards now have to include women, People of Color (a newly minted aggrieved group), and those with psychological and sexual aberrations. Which—the way these things are dictated—amounts to actively transgressing against men, whites, and normals. It’s a new form of class warfare.

The fact that companies are bending over backward to show how ESG conscious they are, how woke they are, and how respectful of SJW values they are, says that they aren’t concentrating on taking care of business and making profits. Putting virtue-signaling first is a very bad sign for productivity and business.

Now that ESG has gotten a seat at the table, it’s opened the door to the next stage of this trend—Equity, Diversity, and Inclusion (EDI). Like ESG, it sounds friendly and welcoming; it’s not.

There is no equality, except before the law and in the grave; trying to make people equal is stupid and counterproductive. But Equity is worse than enforced equality. It means giving certain groups privileges and assets by virtue of ethnicity, gender, disability, or accident of birth. It’s a formula for hatred and resentment.

Diversity boils down to race and gender. It certainly doesn’t include a diversity of viewpoints.

Inclusion has a place in polite society. But it has to be earned, like any other privilege. In fact, there’s more to be said for exclusivity than inclusivity. Exclusivity is about maintaining standards, as are, for instance, private clubs. Perhaps that’s why we see so few private clubs these days; if a club doesn’t include practically everyone and anyone, it’s asking for a lawsuit in today’s world.

These notions will backfire on their promoters and enforcers. Many people of color are diversity hires now. As a result, many in the public—including people of color—will go out of their way to avoid black doctors, lawyers, and engineers because they are wondering whether or not they’re truly qualified. “Affirmative action” devastates the very people it’s supposed to help as it degrades them and breeds resentment. This is all real poison.

It identifies people not as individuals but as members of a group.

International Man: The ESG trend seems to be part of a larger cultural shift.

What is your take? How will this cultural shift affect the competitiveness of US companies?

Doug Casey: Virtue signaling and wokeness are affecting every aspect of life.

One reason that companies in the old Soviet Union were so unproductive, and turned out crappy products, was that they were much more interested in being “politically reliable” than profitable. Being politically correct today encourages people to sign up for things like gender studies, sociology, and political science today, rather than science, technology, and math courses.

It’s a real cultural shift working to destroy the competitiveness of US companies. And it’s supercharged by the fact actual Bolsheviks now control the government. It’s Mussolini’s dream, where the government and corporations are walking hand-in-hand in a so-called public-private partnership; classical fascism.

International Man: With the rise of ESG investing, shareholders have become less important than stakeholders.

What is going on here? Where did that concept come from?

Doug Casey: A shareholder actually owns part of a company and has paid for that privilege. But over the last generation, shareholders have become less important. In fact, they’re treated as a nuisance by professional managers. “Stakeholders,” who bring absolutely nothing to the party, have become a protected species.

In reality, stakeholders are just hangers-on, employees, or people who are looking to get in on a shakedown. But everybody slavishly acknowledges them and parrots the meme: “Yes, we’ve got to look out for the stakeholders.”

Where did that concept come from? The same place as ESG and EDI. It’s a recent creation, but Boobus americanus seems to think it was carved in stone at the country’s founding.

We’re told to protect them as if they were a valuable and endangered species. I say, “A pox upon stakeholders.” If they want a vote in what a company does, then they ought to become shareholders. Stakeholders have been created out of nothing by cultural Marxists for the purpose of shaking down shareholders.

International Man: Given everything we’ve discussed, what are the investment implications? What can the average person do?

Doug Casey: Historically, an average price-to-earnings (PE) ratio for stocks was in the 12–18x range. Now it’s been moved up to 24–25x. A lot of companies neither have earnings nor are expected to for the foreseeable future.

Market norms are much higher—mainly due to money printing—but they should actually be much lower. Why? Because corporations have changed their emphases from creating value and making money to enforcing political and social notions. Quite frankly, that makes them worth less.

When the next bear market bottoms, maybe it won’t be at a PE of 8 or 9 to 1, as in the past. Maybe it’ll be something like 4 or 5. Wokeness, diversity hiring, PC, and the rest of it are working to destroy capital. The destruction won’t be immediate, of course. But Americans who think it’s a good idea now will regret it soon enough and for the rest of their lives.

Unfortunately, there’s not much you can do about it except try to insulate yourself from its worst aspects and raise hell when you hear people talking nonsense—which won’t make you any friends in the days of Cancel Culture.

It’s important to speak out about these things actively as opposed to just grumbling and allowing the bad guys the moral high ground. You’ve got to challenge these things wherever possible.

Right now, you can still challenge these things, but it’s increasingly risky. People are now getting fired from their jobs if they hold non-PC views—and it’s likely to get much worse for the foreseeable future.

We’re actually moving—devolving—into the same kind of world that existed in the Soviet Union.

I think it’s too late to try and change the trend. In a way, resistance is futile. But that doesn’t mean that you shouldn’t resist, simply because you have to live with yourself.

Editor’s Note: Socialist ideas are becoming increasingly popular in the US. At the same time the US government is printing money hand over fist. All while the US empire continues to overstretch itself across the world.

It’s all shaping up to be a world-class disaster… one unlike anything we’ve seen before. That’s exactly why New York Times bestselling author Doug Casey and his team just released an urgent video showing how it all could go down. Click here to watch it now.

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