Northern Arizona University (NAU) launched a climate change program geared toward a career focused on corporations’ Environmental, Social, Governance (ESG) scoring. The program spans four courses, each costing $500 — $2,000 total.
NAU announced the online, non-credit certificate program last week. The courses will prepare students for greenhouse gas (GHG) accounting. GHG is a key part of ESG.
“[This will] help working professionals gain the skills needed to address climate change at the corporate or organizational level,” stated the press release.
In the program, students will quantify the greenhouse gas emissions from individual products or commodities, business or corporation operations, and local communities. Then, the students will propose and defend emission management, reduction, and mitigation strategies.
NAU explained in its course description of the program that most large corporations were expanding GHG accounting hires at a rapidly multiplying pace.
“Companies see aggressive emission reduction goals as good for business and a way to market themselves as climate-friendly. However, companies cannot manage what they don’t measure. Therefore, the need for skilled GHG accountants is growing exponentially,” stated NAU.
The university also pointed out that the Securities and Exchange Commission (SEC) proposed a rule change in March requiring all publicly traded companies to report their climate-related finance risk.
The SEC rule would require companies to include these ESG findings in their registration statements and periodic reports. This would include governance and risk management processes of climate-related risks; the potential or current material impact of climate-related risks; the potential or current strategy, business model, and outlook impact of climate-related risks; and the impact of climate-related events on financials. It would also require disclosures of a GHG emissions target or goal, and GHG emissions from purchased electricity (or other energy forms) as well as upstream and downstream activities in its value chain.
SEC Chair Gary Gensler declared that mandatory ESG disclosure would better serve investors’ decision-making and hold corporations accountable.
“I believe the SEC has a role to play when there’s this level of demand for consistent and comparable information that may affect financial performance,” said Gensler.
The timing of this course is significant, given that state leaders such as Treasurer Kimberly Yee oppose ESG. In September, Yee modified the state’s investment rules to prevent ESG ratings from investment considerations.
NAU sustainability professor Deborah Huntzinger stated that environmental policymaking required quantifiable data that ESG approaches like GHG accounting offer. Huntzinger and NAU Online director of continuing education Brenda Sipe created the new GHG accounting program.
“To design effective policies, whether at the corporate or national level, to mitigate rising emissions and human-driven climate change, we need to accurately track emissions,” stated Huntzinger. “Robust training in the best practices in GHG accounting will lead to a more educated workforce that can better inform corporate, organizational, community and national discussions about effective climate change mitigation strategies.”
Along with Huntzinger, carbon analyst Heather Aaron will teach the courses.
The World Economic Forum (WEF), the globalist lobbying organization that serves as a pioneer for ESG scoring systems, identifies GHG accounting as a critical component of ESG. In a July publication, the WEF issued guidelines advising that GHG was key to quantifying the “carbon value” of corporations.
The WEF, along with numerous powerful corporations and advocates of progressive reforms like ESG such as George Soros, BlackRock, Vanguard, JP Morgan Chase, Amazon, General Motors, the Sierra Club, issued comments or engaged in meetings with the SEC in support of the ESG mandate (though many offered suggestions for improvement).
NAU will also offer its GHG program at the graduate level, requiring students to complete a minimum of 12 credit hours. The regular course commences on Jan. 30 and remains open for six months of access.
The world of finance is turning bullish on ESG, an investment strategy directing funds to corporations with woke environmental, social, and governance policies. Trillions of dollars have already flowed into ESG funds, projected to hit $50 trillion in two years.
ESG boosters claim the funds enable investors to do well by doing good. You can make good money while simultaneously bettering the world.
Wish it were so. In fact, ESG funds do neither.
Investing goals that compete with shareholder profitability have predictable results. A recent NYU study compared investment results created by firms with high versus low ESG scores, which are generated by professional ratings agencies. Over the past five years, high ESG funds have returned 6.3% compared with 8.9% for others. Over time, that’s a chunk of change.
Thus, Kentucky AG Daniel Cameron warned his state’s pension fund managers to avoid funds that “put ancillary interests before investment returns,” which would “violate statutory and contractual fiduciary duties” to the pensioners depending on them. Seniors deserve better than to have their retirements hijacked by an ideology they might not share.
The basic tenants of ESG are radical environmental policy (primarily the elimination of fossil fuels), woke social policies promoted by the company, and corporate governance that replaces merit with preferences based on race or gender.
The driving forces behind the growth of ESG are three very powerful financial firms. BlackRock, Vanguard, and State Street are, between them, the largest shareholders in 80% of the companies in the S&P 500. Their financial heft gives them the ability to force companies to implement ESG, making them, in effect, upstream controllers of these companies.
ESG is based on the foundational principle of progressivism—the notion that the most beneficial governance comes from giving experts, the best and the brightest, control over our lives. Personal freedoms and democratic processes must yield to a governing elite that knows best.
No goal is pursued more tenaciously than the elimination of carbon-based fuels. Consumers must be pushed into using renewables, principally by regulating fossil fuels into being scarce and expensive.
Green New Dealers may be thrilled to have the backing of the ESG behemoths, but the problem is that Europe is already experiencing a full-blown energy crisis, with America not far behind. For a year now, a post-COVID demand surge, combined with nuclear plant closures worldwide, long-standing over-investment in impractical renewables, and a global drop of over 50% in oil and gas investment since 2014, have combined to put serious pressure on economies worldwide.
Aluminum smelters, glass factories, and other EU manufacturers have had to shutter plants for lack of affordable energy. In the UK, the number of people behind on their energy bills ballooned from 3 million to 11 million earlier this year. Even in relatively secure Germany, there is deep concern over looming shortages of heating oil this winter after being shut off by Russia.
The hard fact is that, in our current state of technology, fossil fuels are the mainstay economic resource, whether we like it or not. We need more oil, natural gas, and nuclear energy, not less.
The hard-core environmental left, now joined by ESG interests, has worked itself into a lather insisting we can only avoid global catastrophe by achieving zero carbon emissions by 2050. Environmental alarmists achieve about the same accuracy with their predictions as the apocalyptic preachers of yesteryear. But even in the early stages of the project, it’s becoming obvious that it simply can’t be done.
Even if eliminating all emissions of carbon would significantly reduce atmospheric temperatures, and even if humans are the main villains of global warming, and even if we could somehow convince China and India to not sabotage the effort, it doesn’t matter. It’s neither economically nor politically possible to deprive humankind of the benefits of carbon fuels.
The financial titans pushing ESG are blowing an opportunity to do some real good. We need respected leaders who can stand up to the hysteria and exaggerations to propose practical, feasible solutions that would protect humanity from the worst effects of atmospheric warming.
Instead, the self-appointed experts are using other peoples’ trillions to push us down the road to dystopian government and perpetual poverty.
Dr. Thomas Patterson, former Chairman of the Goldwater Institute, is a retired emergency physician. He served as an Arizona State senator for 10 years in the 1990s, and as Majority Leader from 93-96. He is the author of Arizona’s original charter schools bill.
Six U.S.-based global banking firms which participate in Environmental, Social, and Governance (ESG) practices that seek to restrict investment in companies engaged in fossil fuel-related activities are under investigation by 19 states, it was announced this week.
Arizona Attorney General Mark Brnovich and 18 other state attorneys general served civil investigative demands against Bank of America, Citigroup, Goldman Sachs, JP Morgan Chase, Morgan Stanley, and Wells Fargo related to each company’s involvement with the United Nations’ Net-Zero Banking Alliance (NZBA). The demands act as legally enforceable subpoenas.
NZBA-member banks have promised to set emissions reduction targets in their lending and investment portfolios to reach net zero by 2050. It is one example of ESG practices which have come under scrutiny for prioritizing policy initiatives ahead of sound investment strategies.
In the case of the NZBA initiative, it could lead to some farmers, oil leasing companies, suppliers, and other businesses connected with fossil-fuel production being unable to get loans or find investors from the six banking firms and their affiliates, according to Brnovich’s office.
“American banks should never put political agendas ahead of the secure retirement of their clients,” Brnovich said in announcing Arizona’s involvement in the investigation. “These financial institutions are entrusted with protecting a different type of green.”
Arizona, Kentucky, Missouri, and Texas are the leadership states on the NZBA investigation. Some of the 10 interrogatories included in the civil investigative demands served on the six banking firms seek information on:
All divisions, groups, offices, or business segments whose responsibilities relate or used to relate to membership in the Net-Zero Banking Alliance or to ESG Integration Practices, and identify all executives, directors, officers, managers, supervisors, or other leaders of each division, group, office, or business segment;
Each Global Climate Initiative with which the firm is affiliated and an explanation of the reasons for choosing to join such Global Climate Initiatives;
Who made the decision to join each Initiative, including any involvement or input from the Board of Directors, investors, or Covered Companies;
All involvement in each Global Climate Initiative, including dates as well as “any promises, pledges, or other commitments” made by each company;
A detailed description of the company’s involvement with the Net-Zero Banking Alliance, including identities of all individuals who have represented the company within the NZBA.
In August, Brnovich joined Arizona in a 21-state coalition in commenting on a U.S. Securities and Exchange Commission (SEC) proposed rule that would add requirements for investment funds which consider ESG factors in their investment decisions. The proposed SEC rule was seen by the states as an attempt to transform the agency from a “federal regulator of securities into a regulator of social ills.”
The same month, Arizona was one of 19 states which sent a letter that put investment firm BlackRock on notice that its actions on a variety of governance objectives may violate multiple state laws by using “the hard-earned money of our states’ citizens to circumvent the best possible return on investment.”
BlackRock, which oversees some pension funds in those states, has been engaging in a “quixotic climate agenda” that appeared to be sacrificing pensioners’ retirements instead of focusing solely on financial return.
“Fiduciary duty is not lip service. BlackRock has an obligation to act in the sole financial interest of its clients,” the Aug. 4 letter stated. “Given our responsibilities to the citizens of our states, we must seek clarification on BlackRock’s actions that appear to have been motivated by interests other than maximizing financial return.”
And in November 2021, Brnovich announced a review of Climate Action 100+ and its investment company members which manage trillions of dollars in assets. This was prompted by concerns that the firms will put their ESG goals ahead of well-established fiduciary duties.
This could include inappropriate pressure and anticompetitive conduct against the members’ own clients and customers who do not comply with the ESG practices of Climate Action 100+, according to the attorney general’s office.
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.
Arizona may place another major company on a list of prohibited investments for allegedly boycotting the state of Israel. It would be the second company deemed in violation of Arizona’s ban against Boycott, Divestment, Sanctions (BDS) of Israel. Arizona already placed Unilever on that list over the Israel BDS enacted by its subsidiary, Ben & Jerry’s.
Arizona Treasurer Kimberly Yee gave the Chicago-based financial services company, Morningstar, 30 days to prove that they weren’t boycotting Israel. In a press release on Monday, Yee shared that her office suspected Morningstar of boycotting because its subsidiary, Sustainalytics, employed environmental, social, and corporate governance (ESG) policies that punished companies doing business in Israel with poorer scoring.
Arizona doesn’t have any public funds invested in Morningstar presently.
Yee said that ESG-focused companies benefitting from taxpayer dollars victimize other companies in order to advance “woke political gamesmanship.”
“ESG ratings are a political scorecard, not a financial scorecard,” said Yee. “I will not allow companies to promote policies that are antisemitic and discriminatory efforts against Israel, which is America’s longtime friend and ally, and a significant trade partner with Arizona.”
In her letter, Yee pointed Morningstar CEO Kunal Kapoor to his company’s own 117-page report investigating Sustainalytics released in early June. Morningstar insisted in an affiliated press release that it didn’t support boycotts of Israel, and cleared Sustainalytics of boycotting accusations. However, Yee said that pages 69-73, 86-93, and 97-99 of the report proved otherwise.
“ESG, in itself, is a subjective exercise and suffers from inherent bias. While [the] report says there was no bias against Israel, that is not the question presented to us under Arizona law,” wrote Yee. “The very fact that Sustainalytics has chosen to review companies doing business in Israel under the guise of its ESG ratings system, violates Arizona law as your company is ‘performing actions that are not intended to limit commercial relations with entities doing business in Israel.’”
ESG began in 2004 when former United Nations Secretary General Kofi Annan convened over 50 CEOs from the top financial institutions in a bid to influence markets. Annan’s coordination prompted the rollout of early ESG models, such as the New York Stock Exchange’s Principles for Responsible Investment (PRI) in 2006 and the Sustainable Stock Exchange Initiative (SSEI) in 2007.
Today, ESG models award scoring to measure companies based on equity-based initiatives. For example, environmental criteria might include waste reduction efforts or natural resource conservation; social criteria might include restorative justice initiatives or reproductive care funding like abortions; and governance criteria might include weighing issues that impact company stakeholders.
Unilever reversed Ben & Jerry’s boycott in late June. They repudiated the ice cream company’s actions, insinuating that they were antisemitic. However, Yee didn’t reverse the state’s divestment.