Just as State Sen. Dan Roberts' (R-Mountain Brook) anti-ESG (environmental, social and governance) bill was gaining momentum in the Alabama Legislature, its hearing before the Senate Fiscal Responsibility and Economic Development Committee, chaired by State Sen. Garlan Gudger (R-Cullman), was delayed until at least next week.
Sources familiar with the issue told 1819 News on Wednesday that Birmingham-based Regions Financial and the company's lobbyist, senior vice president and head of state government affairs and economic development Jason Isbell, were behind the pushback against the bill that would prohibit government entities from contracting with companies that use ESG criteria to discriminate in business practices and leverage economic power for political and ideological objectives.
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).
Organizations, such as MSCI, award ESG scores to corporations supposedly based on their adherence to ESG values. Large asset management groups, like BlackRock, Vanguard and State Street, and banks, such as JPMorgan and Bank of America, use ESG ratings to choose where to direct capital.
Over the past few years, Regions has defended the ESG agenda used by large asset management companies like BlackRock Inc. and other banks to push social and ideological agendas.
According to its website, Regions believes ESG contributes to its success. It reads:
"Regions is committed to our mission to make life better and create shared value. Regions recognizes that the long-term financial performance of our company and our ability to deliver shareholder value are directly tied to the success of our associates, our customers and the communities we serve. We believe that this success stems, in large part, from our continuous improvement efforts related to ESG. For this reason, we believe more than ever that we must consider how ESG matters affect our company and be transparent about our ESG practices and performance. In our ESG reporting, we illustrate how Regions is working to advance our ESG efforts to make life better for our customers, associates and communities, while creating long-term value for our shareholders."
In Regions' 2022 Proxy Statement and Notice, Chair of the bank's Board of Directors Charles D. McCrary touted its ESG report and adherence to standards set by the controversial World Economic Forum.
"The Company enhanced transparency around ESG issues by publishing an expanded ESG Report structured around the World Economic Forum's Stakeholder Capitalism pillars, as well as a Workforce Demographics Report that we will build on for future human capital and Diversity, Equity, and Inclusion (DEI) reporting," McCrary wrote. "Regions led the way among peers with our first standalone Task Force on Climate-related Financial Disclosures (TCFD) Report, covering new ground on climate-related risk and opportunity management and presenting externally assured operational emissions data. The Company achieved previously announced goals around emissions reduction and racial equity commitments and announced new goals related to emissions and sustainable finance, two areas of strategic focus on which Board members are regularly updated."
A spokesman for Regions defended the bank's ESG report to 1819 News in August. When we asked why Regions has an ESG report, who it is designed to appeal to and to respond to the criticism of ESG investing, he declined to comment.
According to the Claremont Institute, Regions has promised $14,600,000 to BLM and related causes. The Claremont Institute's BLM Funding Database records which major corporations have donated money to BLM parent organizations, the BLM Foundation and independent BLM chapters and partners. It also records funding for related initiatives "that advance one or more aspects of BLM's agenda."
BLM is a string of connected organizations with the stated purpose of fighting racism against black people. BLM gained international attention after the death of George Floyd at the hands of a Minneapolis police officer in 2020.
Since then, BLM organizations have received both public and financial support from America's corporate world. Claremont estimated the BLM movement had received nearly $100 billion in donations from various organizations.
Conservatives have criticized BLM leaders such as Alicia Garza, Patrisse Cullors and Opal Tometiln, who described themselves as "trained Marxists."
According to BlackLivesMatter.com, BLM demands that lawmakers convict former President Donald Trump and ban him from running for political office. They also call for banning Trump from all social media platforms and defunding the police.
Claremont was not aware of whether Regions had followed through with its pledge.
Regions is not the only entity within Alabama's business elite pushing back against the anti-ESG legislation. According to an email from the Business Council of Alabama's manager of Governmental Affairs William Newman to the council's Tax and Fiscal Policy Committee, the BCA also opposed the Senate bill.
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