Arizona Treasurer Prohibits ESG ‘Social Credit’ Scorings For Investments

September 3, 2022

By Corinne Murdock |

On Tuesday, the Arizona Treasurer prohibited the use of Environmental, Social, and Governance (ESG) scoring when determining investments. ESG scoring is comparable to a social justice scoring, sometimes dubbed a “social credit score.”

Revisions to the Arizona Treasurer’s Investment Policy Statement (IPS) declared that ESG factors were non-pecuniary and therefore had no material effect on the financial risk or return of an investment. 

The IPS further clarified that board shares couldn’t be voted to further “environmental, social, political, ideological, or other benefits or goals.”


Treasurer Kimberly Yee declared that ESG scoring enables malicious government manipulation of the private sector.

“Biden’s Administration uses big government overreach to manipulate the private sector in picking winners and losers based on radical ESG policies,” wrote Yee. “We must protect American free market principles and not allow environmental or social goals to dictate how taxpayer monies are managed.”

This wasn’t the first time this month that Yee took action to counter the effects of ESG scoring. Last week, the treasurer gave a major global financial firm, Morningstar, 30 days to prove that they weren’t complicit in its subsidiary company’s alleged boycott of Israel due to ESG policies. Without sufficient proof, Yee will place Morningstar on the state’s list of prohibited investments.

Yee’s opponent in the upcoming November election, Arizona State Senate Minority Whip Martín Quezada (D-Glendale), responded that he supports ESG scoring. 

The Arizona state legislature attempted to outlaw ESG scoring discrimination through HB2656 during this past legislative session. However, State Representatives Joel John (R-Buckeye) and Michelle Udall killed the bill. John declared that he voted against the bill in accordance with his belief that such discriminations don’t exist. 

However, firearms industry business owners testified earlier in the legislative session about the need for another bill, HB2473, because banks refused to do business with them because they deal with firearms. One testimony came from Ruger Firearms VPO Tim Powney, who shared that Bank of America cut short their decades-long relationship due to his being in the firearms industry. That decision was likely based on ESG criteria. 

The concept of ESG dates back to 2004 when former United Nations (UN) Secretary General Kofi Annan gathered just over 50 of the world’s top financial institution CEOs to discuss influencing markets via ideological criteria. Early prototypes of ESG scoring occurred through the New York Stock Exchange’s Principles for Responsible Investment (PRI) in 2006, then the Sustainable Stock Exchange Initiative (SSEI) in 2007. 

Almost all major companies rely on ESG criteria. Many model their ESG scoring systems after the Stakeholder Capitalism Metrics developed by the World Economic Forum (WEF), a globalist lobbying organization. “Stakeholder capitalism” is the attempt to modify corporations’ behaviors to benefit stakeholders instead of shareholders, necessitating corporate cooperation with government: something Yee claimed allows government overreach and free market subversion. 

The WEF claims that ESG criteria are financially material. They argue that poor ESG scoring played a role in 15 out of 17 S&P 500 bankruptcies that occurred between 2005 and 2015. 

Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to

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