Texas passed two laws in 2021 restricting government contracts with companies that state officials view as punitive stances against the fossil fuel and firearms industries. These are among many new laws being pushed in states across the country to oppose ESG investing and lending, which Republicans have targeted in their culture wars. Under one of the laws, Texas requires some state entities, including pension funds, to “boycott” fossil fuels run by asset management companies such as BlackRock, which the Texas Comptroller alleges Investment in approximately 350 funds is prohibited. The bill also urged state officials to ban Citigroup and Barclays from helping state and local governments finance infrastructure projects through bond transactions.
ESG, an abbreviation for “Environment, Social, Governance,” is a term used by some asset managers and bankers to evaluate the environmental practices and social impact of potential investments and loans. refers to a set of criteria used to judge According to Deloitte's primer on ESG, companies are under pressure from consumers, activists, investors and regulators to manage not just their financial capital, but also their natural and social capital. Examples of criteria that may fall under the environmental pillar of ESG include projects such as reducing greenhouse gas emissions, reducing water pollution, and using recycled materials. Socially conscious investors might consider how a company manages workforce diversity or its risk policy regarding firearms.
