Legislation by State Sen. Dan Roberts (R-Mountain Brook) prohibiting state contracts with businesses that boycott specific sectors of the economy based on environmental, social and governance (ESG) policies is on the docket for a House vote on Wednesday.
The 2023 legislative session is running on fumes with only three legislative days remaining. Due to limited time, leadership in the House and Senate must prioritize bills for them to pass in time.
The anti-ESG bill has caused uproar in the business community and with Democratic lawmakers. Proponents say the bill would protect Alabama from "woke" corporations exerting influence in the state, while opponents say it will negatively affect the economy by chasing away large industries from operating in the state.
The legislation passed the Senate last week with a vote of 27-8. All of the votes against the bill were by Democrats.
Senate Bill 281 (SB261) is on the House's special order calendar but is subject to change. The legislation will assuredly cause lengthy filibustering from the House Democrats.
SB261 would:
Prohibit a governmental entity from entering into a public contract for goods or services with certain companies or businesses that engage in the economic boycott of businesses in certain sectors and industries; that fail to meet or commit to meet certain environmental standards; that fail to meet or commit to meet certain corporate governance criteria; or that fail to facilitate certain activities.
Prohibit any company in the state from being required by a governmental entity to engage in economic boycotts or other actions that further social, political, or ideological interests, including economic boycott criteria.
Prohibit any company in the state from being penalized by a governmental entity for declining to engage in economic boycotts or other actions that further social, political, or ideological interests, including economic boycott criteria.
Require the Attorney General to seek to prohibit the adoption of federal laws or actions that may penalize, inflict harm on, limit commercial relations with, or change or limit the activities of companies or residents of the state based on the furtherance of economic boycott criteria.
Authorize the Attorney General to investigate violations of and enforce this act.
The prohibition on economic boycotts by companies doing business with the state of Alabama does not apply to a "contract related to the issuance, incurrence, or management of debt obligations, to the deposit, custody, management, borrowing, or investment of funds, or to the procurement of insurance or other financial products, or a contract that would prevent the governmental entity from obtaining the supplies or services to be provided in an economically practicable manner," according to the legislation.
ESG scoring evaluates how a corporation aligns itself with social goals beyond earning a profit for its shareholders. These goals often pertain to environmental sustainability and advocacy for specific social movements, and commitment to "diversity, equity and inclusion" (DEI).
To connect with the author of this story or to comment, email craig.monger@1819news.com.
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