Utah Leaders Object to 'Dubious' S&P Woke Climate ESG Activism
Utah’s congressional delegation and state leaders “categorically object” to S&P Global Ratings’s woke climate activism in a letter to the Wall Street credit rating group on Thursday.
Utah leaders wrote a letter to S&P Global Ratings President and CEO Douglas Peterson and President Martina Cheung over their decision, including environmental, social, and governance (ESG) investing credit indicators as part of its credit ratings for states and state subdivisions. “To call them “credit indicators” attempts to legitimize a dubious and unproven exercise in developing a political rating system that is based on indeterminate factors. Traditional public finance entity credit ratings already incorporate financially material factors, including ESG factors,” the Utah leaders wrote in their letter. Including ESG indicators in its creditworthiness for states and state subdivisions could expose Utah to undue punishment for failing to live up to the left’s latest demands on alleged climate change.
The leaders wrote: Considering recent global events, the current economic situation in the U.S., and the unreliability and inherently political nature of ESG factors in investment decisions, we view this newfound focus on ESG as politicizing the ratings process. It is deeply counterproductive, misleading, potentially damaging to the entities being rated, and possibly illegal. Utah is very protective and proud of its credit rating.
The leaders include Gov. Spencer Cox (R), Lt. Gov. Deidre Henderson (R), Attorney General Sean Reyes (R), State Treasurer Marlo Oaks (R), State Auditor John Dougall, Sen. Mike Lee (R), Sen. Mitt Romney (R), Rep. Blake Moore (R), Chris Stewart (R), John Curtis (R), Burgess Owens (R), Utah State Senate President J. Stuart Adams, and Utah Speaker of the House Brad Wilson.
The Utah leaders also slammed credit rating agencies, including S&P Global Ratings over the deleterious effects of credit ratings, citing the 2008 financial crisis: S&P should have already learned the costly lesson that undue influence over its credit ratings can lead to disaster—both for the company and the nation.
The failure of credit rating agencies, including S&P, to accurately assess mortgage-backed securities and related credit default swaps in the lead up to the financial crisis of 2007-2008 contributed to the proliferation of these products and the resulting catastrophic collapse of the financial system and the global economy along with it. Indeed, S&P admitted in its $1.375 billion state Attorney General andDepartment of Justice settlement that it succumbed to conflicts of interest in rating these products by prioritizing business relationships with issuers over accuracy in its models and ratings. Many Americans suffered because of S&P’s failures.
These failures should have resulted in S&P’s greater commitment to sound financial practices rather than extraneous political impulsions. ESG campaigns have also moved to starve fossil fuel companies of capital, including Oregon.
These campaigns also make it harder to produce energy, which drives up prices, and starves fossil fuel companies of capital at a time when energy and overall prices continue to skyrocket. “This time, S&P appears to choose politicization over accuracy in its ratings,” the Utah leaders added. Sean Moran is a congressional reporter for Breitbart News. Follow him on Twitter @SeanMoran3.
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