Republican AGs Warn Financial Institutions Against Inconsistent ESG Voting

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  • A coalition of 23 Republican AGs sent a letter to the chief executives of several financial institutions, including Goldman Sachs, urging them to ensure that their votes on ESG issues as asset managers for other companies were not inconsistent with their own boards’ reasoning in recent votes to reject the implementation of ESG proposals.
  • In the letter, the AGs assert that all of the financial institutions’ shareholders recently considered one or more resolutions related to combatting climate change that were unanimously rejected by their boards. The oppositions were allegedly grounded in concerns (1) that management needs discretion to manage risk on a case-by-case basis, and (2) that the climate goals underlying the proposals were not feasible.
  • The AGs noted that they are cognizant of outside pressures to vote a certain way, but reminded the companies that their fiduciary duties require them to act solely in the financial interest of their clients. Therefore, the AGs assured the companies that they would be closely watching the companies’ votes during the proxy season and warned that any inconsistent votes may trigger investigations by the AGs’ offices.
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