AG Kobach joins coalition against two companies ESG practices
TOPEKA, Kan. (WIBW) - The State of Kansas has officially joined a 21-state coalition to challenge the environmental, social, and governance (ESG) practices of two voting proxy advisory companies.
The Kansas Attorney General Kris Kobach has decided to join other state attorneys general in a challenge against the proxy advisory companies, International Shareholder Services, Inc. (I.S.S.) and Glass, Lewis & Co.
I.S.S. and Glass Lewis have been accused by the 21 states of letting ESG considerations affect ISS and Glass Lewis’s proxy voting recommendations, which conflict with their client’s financial interests.
The Attorney General’s office further explains that ISS and Glass Lewis have so far supported the priorities created by an international group of financial institutions that have aligned their lending and investment portfolios with net zero emissions by 2050. Kobach claims that if the companies let net-zero emissions inform their proxy advice, both ISS and Glass Lewis will in turn abandon the fiduciary duties they have to clients, including Kansas.
“These proxy advisory companies and their ESG-driven agenda threaten the hard-earned pensions of generations of Kansas workers,” Kobach said. “Those pension funds must be invested to maximize their return, not to advance any particular political agenda.”
An additional issue that Kobach has noted is that, according to him, both companies have pledged to recommend votes against certain directors that have been viewed as having insufficient racial, ethnic, or sex-based diversity under established arbitrary quotas.
A portion of the letter states, “your actions may threaten the economic value of our States’ and citizens’ investments and pensions—interests that may not be subordinated to your social and environmental beliefs, or those of your other clients.”
To view the full letter, click HERE.
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