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West Virginia State Treasurer Moore joins other financial officers opposing ESG

State Treasurer Riley Moore joined other state financial officers Wednesday in opposing the trend of environmental, social, and governance (ESG) investing. (Photo courtesy of WV Legislative Photography)

CHARLESTON — State Treasurer Riley Moore and financial officers from other states warn that the trend by financial institutions to base investments on non-financial factors, such as environmental and social issues, are a “progressive trojan horse” to get around the normal political process.

Moore was part of a virtual panel Wednesday morning put on by the State Financial Officers Foundation, a non-profit organization consisting of 27 Republican state treasurers and state auditors in 23 states.

The topic of discussion was ESG, short for environmental, social and governance. ESG is a form of investing in companies by financial institutions based on factors that go beyond financial issues. Financial institutions and investors use ESG to determine investment strategies based on a company’s commitment to environment or climate change, social justice, and how a company treats its workforce in areas of equity.

“It started off as this idea of trying to invest in a socially responsible manner,” Moore said. “Now, they are trying to impress their values and their view of the world down onto all of us without a single vote being taken by anybody in the country.”

Moore talked about West Virginia’s efforts to fight back against ESG investing when it comes to financial institutions the state does business with using their power to punish coal and natural gas companies.

“We’re an energy state. We produce coal, gas, and oil,” Moore said. “This ESG movement, in its current form, is really an existential threat to our jobs, our economy, and our tax revenue. We generate hundreds of millions of dollars in tax revenue from coal and gas specifically.”

The State Treasurer’s Office helped draft Senate Bill 262, passed during the 2022 legislative session and signed into law by Gov. Jim Justice. SB 262 authorizes the State Treasurer’s Office to restrict banking contracts with any bank or investment group that refused to deal with coal or natural gas companies or terminates contracts with existing fossil fuel companies as a way to punish companies who don’t fall in line with ESG standards.

The new law requires the State Treasurer’s Office to maintain a public list of restricted financial institutions. Any bank on the restricted list would be unable to enter into new financial contracts with the state or remain in current contracts until they are able to show they no longer engage in boycotts of energy companies.

“I had to do something to start to push against this,” Moore said. “We felt like we had a clear conflict of interest for financial institutions to handle our dollars that at the same time are trying to diminish our dollars and destroy our industries. That’s why we passed a bill here recently that’s going to allow me to put financial institutions on a denied list where they won’t be able to contract with the state anymore for financial services, banking contracts, and things of that nature.”

SB 262 applies to banks, banking associations, investment houses, savings and loan companies, credit unions, savings banks, or any institution that the state could potentially deposit taxpayer funds with. The State Treasurer’s Office has more than $7 billion in management between nearly 30 depositors. Moore said the public list of companies on the prohibited list should be out soon.

Before the passage of SB 262, the State Treasurer’s Office already had the authority to back out of banking contracts with a 30-day notice. Earlier this year, the Treasurer’s Office informed BlackRock Inc., an investment management company, the state would no longer do business with the company, citing reports that BlackRock was urging companies it invested in to commit to “net zero” energy policies, reducing their greenhouse gas footprint and relying more on green sources of energy.

Last year, Moore was one of several financial officers in 15 states that penned an open letter to the U.S. banking industry warning them against pulling investments from fossil fuel industries or making decisions about investments based on political considerations.

“We’ve got to continue to push against this, and that’s why we’re going to start taking assets away from people that are managing our dollars,” Moore said. “It doesn’t just hurt West Virginia; it’s going to hurt everybody in the country…everybody who’s a utility rate payer in the country is going to pay the price as we’ve seen in Europe. So, we’re all in alignment here that we’ve got to keep fighting against this.”

Steven Allen Adams can be reached at sadams@newsandsentinel.com.

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