Andy Puzder After working as CEO of CKE, which operates Carls Jr., he is a senior fellow at Pepperdine University and a visiting researcher at the Heritage Foundation.
ESG investing is a departure from the fiduciary duty of maximizing shareholder returns. Many U.S. investors seek to secure funds for retirement or to supplement their living expenses through investments in pension funds, defined contribution pensions (401k), and index funds (stock investment trusts linked to a specific stock index). are doing We do not entrust funds to financial institutions because we hope to tackle climate change measures and social issues.
The direction that ESG pushes is not something that all shareholders agree with, nor does it necessarily boost stock prices. The “E” factor has encouraged companies to decarbonise, but the energy crisis following Russia’s invasion of Ukraine has made it clear that such policies will weigh on economic growth.
"S (Society)" called for attention to racism, and instead deepened the rift within the company. "G (corporate governance)" requires prioritizing gender and race over experience and ability when selecting directors.
Most people who invest in pension funds and index funds are unaware that their voting rights are being used to implement these radical left policies. I think that the current situation in which the trend of ESG influences the direction of corporate management without sufficient explanation is a problem.
I do not intend to deny industrial activities that are useful in combating climate change, such as manufacturing solar panels and storage batteries for electric vehicles (EVs). For these companies, promoting decarbonization directly leads to an increase in corporate value.
However, it is doubtful that a company like Exxon Mobil, whose main business is oil, would have an "environmental" member on the board, reflecting the wishes of some investors. This is because decarbonization does not lead to improvements in profits and stock prices.
What is more problematic is the behavior of asset management companies such as BlackRock in the United States. It puts pressure on companies to implement ESG policies with someone else's money instead of their own. If the company's CEO, Larry Fink, is going to self-fund and pursue decarbonization, I don't think it matters if he personally opposes that direction.
