Gov. Ron DeSantis has proposed new laws restricting financial institutions from using environmental, social, and governance (ESG) principles to guide investment decisions.
In a press conference held at Florida SouthWestern State College in Naples, Florida, on Feb. 13, DeSantis said he was partly acting to protect Florida public employees’ pensions, as ESG-driven investing may not be in the beneficiaries’ best financial interests. The state will require financial institutions to uphold their responsibilities, he said.
“They will have to honor the fiduciary obligation as understood from time immemorial until just about a few years ago. That’s what their job is,” DeSantis said.
The proposed legislation would also protect Floridians from discrimination by banks and financial institutions “for their religious, political, or social beliefs,” he said. “We believe in non-discrimination and we think that’s an important principle.”
He said the state would also prohibit financial companies from using social credit scoring in banking and lending decisions.
“We’re making sure to protect this as a sphere of economic decision making, not political activism.”
Neither would the state—which currently has more than $20 billion in surpluses—bank its money with companies that violate these laws, he said.
“None of these deposits will be permitted to be done in institutions that are pursuing this woke ESG agenda.”
If the legislation passes, the state won’t invest its money in places that make their financial decisions that way. Banks engaging in corporate activism won’t be allowed to be a “Qualified Public Depository.”
He said the laws would forbid state and local governments from using ESG to make investment, procurement, or contracting decisions or in bond issuance. Banks and financial institutions won’t be allowed to discriminate against customers for their political, religious, or social beliefs.
“I believe we’ve done more with these proposals than any state in the country,” he said.
“This is an elite-driven phenomenon,” he added. “It is not ultimately going to be a road that is going to be good for this country, and it’s not going to be good for other industrialized countries.
“They really want to jam this on society. They don’t have the persuasive ability to get this done through the democratic process, so they’re hoping if they can just spread this to all the elite rungs of society; they can impose it and basically we just have to sit and take it.
“That’s not going to happen in the state of Florida.
“We will stand up for folks in places like Daytona and Destin. We will not be following the elites in places like Davos.”
DeSantis gave examples of businesses or industries that financial companies sought to shut out through ESG decision-making, including oil and gas, guns, and border security.
A private corrections company that supplied prisoner labor to the Department of Immigration and Customs Enforcement found itself debanked, he said, because progressives were looking to get rid of ICE completely and institute open borders.
Gun dealer Brandon Wexler spoke about how his business, Wex Gunworks in Delray Beach, was nearly ended by such policies. He'd banked with Wells Fargo for 25 years. He went into his branch one day, and the teller told him, “Hey, your bank accounts are being closed down.”
“If your bank accounts are closed down, your life has just turned upside down,” Wexler said.
He was referred to a customer service representative who confirmed it and told him he had a month to get his money out of the bank. The accounts included his business and personal accounts, plus a joint account he has with his ex-wife concerning their daughter’s finances.
“I said, ”Why?“ They said, ”It’s a business decision.”
A letter he received a week later said the bank doesn’t lend to certain industries. A second letter said the bank had done a risk analysis, “‘and we want you out of here,’ which pretty much made no sense at all,” he said.
A Wells Fargo spokesperson said: “Wells Fargo does not have a policy against doing business with firearms companies, and provides financial services to firearms businesses. Based on our analysis of the risk associated with this customer, we made a decision to close the accounts. Our decision is not based on the industry.”
Regarding risk, Wexler said he’s never been arrested and never bounced a check. He was later able to open accounts at another bank.
“What they did was wrong and I’m here to tell my story,” Wexler said.
Lieutenant Tom Moore of the Collier County Sheriff’s Office, who spoke after Wexler, said, “It was very frustrating to learn that my retirement currently being managed by the state was helping support radical causes and that in all actuality had nothing to do with the best rate of return.
“I was advised that the investors who are managing my retirement funds were voting to invest my retirement for causes like ESG, Chinese investments, and discriminatory companies who push political agendas that they can’t get past at the ballot box, instead of making the number one priority, maximizing returns on investment,” Moore said.
State Senate Majority Kathleen Passidomo, whose district the event was held in, said, “The governor is doing things that we all wish we could do.” She salute him for “having the courage to stand up and do the things that those of use who are a little bit quieter can’t do.”
House Speaker Paul Renner slammed ESG decision-making for attacking the fossil fuel industry and disinvesting in oil and gas production.
“We haven’t built a refinery since the 70s,” Renner said. “It’s crazy, and then you have Joe Biden going to Venezuela and saying, ‘Please give us fuel.’”
ESG-driven money managers like Black Rock, he said, take people’s money and “invest it in one narrow ideological direction. They don’t speak for your voice or mind. They speak for their voice, and, as the governor said, it’s being hatched out of the U.N. and out of Davos on their values, not ours.”
“ESG is a direct threat to the American economy and individual economic freedom,” the governor’s office said in a written statement. “This attempt by the corporate elite to discriminate against those who do not follow a particular ideological agenda will be outlawed in Florida.”
