‘Weakened and Reshaped’: The State of Legislative Attacks on ESG

More than 150 bills and resolutions have been proposed. Few are getting anywhere.


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Republican lawmakers continued their legislative efforts to stymie investments in their states that use environmental, social and governance factors to choose companies — with little success.

In 2024, legislators wrote 161 bills and resolutions in 28 states for consideration, a high volume and continuation of a trend in recent years. Out of those proposed, including 58 that carried over from the 2023 legislative session, only six bills passed in 2024 (each in a different state). Five of those six have become law; one is awaiting a governor’s signature.

The success rate is worsening. In 2023, 23 laws were passed and 6 resolutions resolved out of 198 total pieces of legislation.

Lawmakers have introduced hundreds of pieces of legislation across the majority of states to prohibit pension boards, state and municipal governments, and the private sector from considering a broad group of risk factors, according to a report by Pleiades Strategy, a strategic research and advisory firm. Factors include climate-related filters and requirements for how companies treat their workers, among others.

“We saw an extremely broad coalition come together this year to push back against attempts by right-wing politicians to prevent companies from making financially responsible decisions,” Frances Sawyer, founder of Pleiades Strategy, said.

Republican lawmakers would like to see the proposals passed into law. But even if a bill has a relatively low chance of successfully getting enough votes, it can still have a chilling effect and instill fear in companies and organizations, Sawyer said in a statement. And it seems that is happening, at least to some degree.

BlackRock became a lightning rod for ESG critics in recent years but it’s hardly the only asset manager to consider those factors in its investment decisions. Only 32 percent of U.S. institutional investors use ESG considerations in their portfolios; those in Europe, Canada, and Asia, by comparison, are forging ahead.

Pleiades Strategy argues that the impact is a negative one. “Boards understand that climate risk is financial risk. When legislators are hostile toward responsible investment, companies are more cautious in how they address these real risks. And their shareholders and investors pay the price, through lower returns and higher risks,” Sawyer added.

For those reasons, anti-ESG policies “remain deeply unpopular with diverse constituencies who don’t often see eye to eye on public policy, including business groups, financial officers, investors, labor unions, libertarians, taxpayer advocates, racial justice advocates, and environmentalists,” according to the report.

To combat the proposals, those constituencies have highlighted the high costs and impacts of anti-ESG policies to businesses and constituents in formal testimonies, publicly and behind closed doors. But the fight is far from over.

“The mosaic of state anti-ESG legislation and state executive actions are reverberating into anti-ESG efforts on the national stage. This summer, anti-ESG Congressional hearings are expected to return to Washington, D.C.,” the report says in its conclusion.