((Automated translation by Reuters, please see disclaimer https://bit.ly/rtrsauto))
(Adds Democratic response to paragraphs 6-7, 11) by Isla Binnie
The Republican majority of a US Congressional committee released a report on Tuesday accusing Wall Street firms of colluding with lobby groups to force companies to reduce their greenhouse gas emissions.
The commission’s report, reported by Reuters, is the first since it launched an investigation in 2022 to determine whether companies’ efforts to combat climate change contravened competition law. .
Several Republican-controlled states have targeted Wall Street firms for participating in climate coalitions and marketing investment products focused on the environment, society and corporate governance (ESG), fearing that These initiatives do not harm jobs in the fossil fuel industry.
And this, while the world has failed to respect the intergovernmental agreement reached in Paris in 2015 to limit global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit) in order to avoid the most catastrophic effects of climate change.
In the report, Republican lawmakers accuse President Joe Biden’s administration of failing to “meaningfully investigate climate cartel collusion, much less take enforcement action against its apparent violations of the American competition law in force for a long time”
A White House spokesperson did not immediately respond to a request for comment. Rep. Jerrold Nadler, a Democrat who sits on the House Judiciary Committee that produced the report, rejected its findings in a document seen by Reuters.
“There is no theory of competition law that prevents private investors from working together to capture the risks associated with climate change,” Mr. Nadler wrote in the preface to a document prepared by Democrats in response to the report. .
While anti-ESG legislation is unlikely to pass as long as Democrats control the White House and Senate, any recommendations made by the commission could shed light on what a new administration led by Republican Donald Trump could attempt to implement it if he prevails in the US election in November.
“The goal of any investigation is to inform legislative reforms,” said a spokesperson for Judiciary Committee Chairman Jim Jordan.
No competition lawsuit has been brought against any coalition of companies in the climate sector. Mr. Jordan’s spokesman declined to comment on possible interactions with U.S. competition authorities over the report. The Justice Department and the Federal Trade Commission, which oversee competition reviews, did not immediately respond to requests for comment.
The commission’s report says it provides provisional findings and that the investigation continues. Democrats argued in their response that coordinating climate efforts promotes competition by creating a common emissions disclosure framework that allows asset managers to operate with fewer compliance costs and their clients to better compare their performances.
The commission has issued subpoenas for documents and questioned former regulators. The Republicans devoted a large part of the commission’s report to Climate Action 100+, a group of more than 700 investors whose objective is to encourage companies to reduce their emissions. They credited their investigation with causing several asset managers to end their membership this year over fears of a competition crackdown.
The commission’s report says Climate Action 100+ “incentivizes asset managers to join” and pressures them to use their shareholder votes in favor of climate proposals, seeking to reduce extraction of fossil fuels and increase energy prices for American consumers.
A spokesperson for Climate Action 100+ said the association’s goals of investor management of climate change were poorly understood in political discourse, and that its investors were “independent fiduciaries, responsible for their individual investment and voting decisions”
“As the world’s largest investor engagement initiative, Climate Action 100+ will be subject to intense scrutiny… But any review must be fair, accurate and fact-based,” said the spokesperson.
CALPERS, CERES
Climate Action 100+ co-founders the California Public Employees Retirement System (CalPERS) and climate-focused investor group Ceres are also in Republican crosshairs for their major support of Climate Action 100+. She claims that activist investor Arjuna Capital, which is a member, “seeks to destroy fossil fuel companies”
The commission called witnesses, including Ceres President Mindy Lubber, for a public hearing on June 12.
Ceres said in a statement that the hearing was part of a broader political campaign to bar investors from taking into account climate-related financial risks.
A CalPERS spokesperson said the company is proud to participate in initiatives such as Climate Action 100+. “This is not about collusion, but about collaboration,” the spokesperson said.
Arjuna did not immediately respond to a request for comment.
The commission’s report cites work plans, meeting minutes and other documents the commission obtained, including an internal email referencing a 100+ Climate Action plan to replace members of the board of directors of oil and gas company Exxon Mobil XOM.N, which said the effort would “show that (Climate Action 100+) has teeth”
Republicans profiled the world’s three largest asset managers, BlackRock BLK.N, Vanguard and State Street
STT.N, like members of a climate cartel.
Representatives for BlackRock and State Street had no immediate comment. A Vanguard spokesperson said the company’s mission is to help individual investors achieve their financial goals and is committed to cooperating with the commission.
