Last year’s attacks on ESG seemed to be a final nail in GOP’s “pro-business” coffin. 

The backlash to consideration of environmental, social and governance factors in investment decision-making came despite broad public support for sustainability, transparency, and risk reduction from companies, executives, employees, investors, customers, researchers, and even conservative voters. 

Now, at a safe distance from the midterm elections, a chorus of traditionally-conservative governors, some with eyes on the White House, are striking a notably more centrist chord.

“Is having world-class transparency and governance a good thing?” asked Virginia Gov. Glenn Youngkin, a Republican. “Yes, it’s a really good thing. But the definition of what’s good for the environment, social goals and governance isn’t one-size-fits-all.” 

Fair enough. And Youngkin, former co-head of Carlyle Group, was likely responding to calls from Virginia-based companies like Hannon Armstrong, Mars, Nestlé, Unilever, and Workday, among others. The companies, in a letter coordinated by the investor advocacy group Ceres, urged state lawmakers to build upon the “considerable progress” made in recent years to grow a robust clean-energy economy.

Or Youngkin, along with Georgia Gov. Brian Kemp and New Hampshire Gov. Chris Sununu may have read a scathing opinion from Julius Klein, “Why the Right Can’t Beat ESG.” They may have thought better of what Popular Information’s Judd Legum calls the GOP’s bogus war on business.

“The campaign against ESG reflects the shortcomings of conservatism,” Klein argues, adding that the anti-ESG crusade is yet another failure of the GOP to address emerging challenges before they become established trends. He also calls out the considerable grifting off of the movement’s most loyal constituents. Ahem, Vivek Ramaswamy and his Strive Funds.

Or they may have read a new study backed by shareholder activists that hung a $708 million price tag on red state laws limiting competition from large financial firms that publicly supported ESG. 

“Legislators will face the backlash of their constituents for flushing hundreds of millions of dollars down the toilet for their own political games,” said Andrew Behar, CEO at As You Sow, one of the study’s authors. 

The study, mimicking Wharton’s research on Texas’ anti-ESG law, should have raised eyebrows in the traditionally frugal GOP. 

“I’m a free market guy,” confessed Sununu, the New Hampshire Republican. “If a business wants to be woke, I don’t agree with it… But it’s not up to the government to come in and punish a business or penalize a business [for being woke].” 

He added that anti-ESG laws set a dangerous precedent for when Democrats are back in the majority and decide to penalize businesses for being too conservative. He added, “That’s crossing a very, very slippery slope.”

Three governors simultaneously take a centrist position on ESG? Is their tack a sign of progress, self-interest, or just a ploy to further muddy the waters? 

Squarely under the “self-interest” category, Georgia Gov. Kemp promised, “By the end of my second term as your governor, I intend for Georgia to be recognized as the electric mobility capital of America.” 

Gov. Kemp saw the green light, aiming to position his newly-purple state to benefit from the low-carbon transition. He doesn’t see EVs as climate action, rather “It’s just letting the market work.” After declaring his ambitious clean energy aspirations, the self-described “redneck” governor flew to Davos.

Speaking of muddy waters, in a long-awaited, and highly-quotable rebuke of the GOP’s anti-ESG crusades, Democratic  Sens. Sheldon Whitehouse (RI), Brian Schatz (HI), and Martin Heinrich (NM) argued that Republican efforts to limit ESG investing are anti-capitalist. 

The “attempted crackdown on ESG is purely ideological in nature and a gross government overreach into U.S. capital markets,” they wrote. 

Wait, a bunch of liberals wrote that?

Ryon Harms is CEO of Manifest Social and a consultant to As You Sow.