Kentucky’s state treasurer has dropped the hammer on several “woke” companies by issuing sanctions against those engaged in “ideological” boycotts of the energy sector.
State Treasurer Allison Ball published a list of financial institutions currently boycotting energy companies.
Ball stated that agencies in the commonwealth are now required to divest from the firms.
The move is the latest effort among conservative states to distance themselves from companies involved in the controversial “environmental, social, and corporate governance” movement, also known as ESG.
ESG is a “woke” movement in corporate America that pushes companies to follow far-left ideologies.
States are distancing themselves from ESG-linked firms over concerns that the approach mingles profits with social and political causes.
Ball named 11 asset management companies and investment banks, including Larry Fink’s BlackRock and JPMorgan Chase, as “Restricted Financial Institutions” in a notice sent to state officials.
“When companies boycott fossil fuels, they intentionally choke off the lifeblood of capital to Kentucky’s signature industries,” Ball commented in a press release.
“Traditional energy sources fuel our Kentucky economy, provide much-needed jobs and warm our homes.
“Kentucky must not allow our signature industries to be irreparably damaged based upon the ideological whims of a select few.”
State government entities must notify Ball of any holdings in the companies within 30 days of the notice.
Identified companies must cease boycotting energy producers within 90 days in order to avoid divestment.
The other firms named by Ball include Citigroup, Climate First Bank, Danske Bank, HSBC, Nordea Bank, Schroders, Svenska Handelsbanken, and Swedbank.
The notice from Ball occurs more than two months after she authored a letter alongside Kentucky Attorney General Daniel Cameron asking the commonwealth’s public pension systems to advise their offices about “efforts to ensure that ESG considerations are not being implemented in your systems’ investment decisions.”
Kentucky ranks seventh in the nation for coal production, according to data from the Department of Energy, and low electricity prices have helped attract manufacturing to the commonwealth.
Beverage waste from the state’s distilleries is often used in ethanol production.
Several banks and asset managers have participated in alliances under which executives push portfolio companies to nix carbon emissions.
BlackRock has taken “voting action on climate issues” against dozens of portfolio companies, according to a stewardship report published two years ago.
The report revealed that the company is a member of Climate Action 100+ and similar associations.
State officials recently called on the Federal Energy Regulatory Commission to prohibit Vanguard, another prominent asset management company, from purchasing shares in publicly traded utilities out of a concern that the firm’s climate activism will raise prices and decrease energy reliability.
Vanguard subsequently ceased participation in the Net Zero Asset Managers initiative, under which companies commit to seeking “net zero greenhouse gas emissions by 2050 or sooner” using investment funds.
Republican state officials pulled some $12 billion from BlackRock last year, representing a small fraction of the nearly $8 trillion managed by the company as broader market forces react against the ESG movement.
Officials have expressed concern that the ESG movement presents difficulties to energy companies seeking to obtain capital.
“Treasurer Ball takes another bold step today in defense of her state’s financial future by putting banks on notice that boycotts of American energy won’t be tolerated,” State Financial Officers’ Foundation CEO Derek Kreifels said in a statement about the move.
“She and other state financial officers across the country are leading the movement to ensure that money earned by hardworking American families is used in accordance with their values, not weaponized against them.”