January 6

U.S. Finance Faces ESG Backlash, More to Come In 2023

By Ross Kerber, Isla Binnie, and Simon Lessop,

A movement by financial firms and activists to challenge companies over their efforts on climate change and social inequality faced organised and growing push-back in 2022, led by Republican U.S. politicians.

Focusing on environmental, social or governance-related issues, ESG in industry parlance, could hit returns to investors, critics said.

A rise in oil prices this year bolstered their case by hurting the performance of many ESG funds that had moved away from energy stocks, responsible for producing a large share of climate-damaging carbon emissions.

Despite that, the list of financial firms signing up to industry coalitions aiming to help companies make the shift to a low-carbon economy lengthened as scientists warned time was running out to limit global warming.

Photo courtesy of Bud Helisson.

Source: Reuters (link opens in a new window)

Energy, Environment, Investing
climate change, ESG, governance