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07/21/2024 12:33 AM
Pennsylvania House of Representatives
https://www.legis.state.pa.us/cfdocs/Legis/CSM/showMemoPublic.cfm?chamber=H&SPick=20230&cosponId=38144
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House of Representatives
Session of 2023 - 2024 Regular Session

MEMORANDUM

Posted: December 2, 2022 02:19 PM
From: Representative Perry A. Stambaugh and Rep. David H. Zimmerman
To: All House members
Subject: Prohibiting Use of ESG as a Credit Score (Former HB 2799)
 
To protect Pennsylvanians, in the near future we will be reintroducing the Liberty, Virtue and Independence Act (HB 2799 from last session) to prohibit any business or corporation doing business in the Commonwealth from using environmental, social, and governance (ESG) scores as a credit score or sole condition of financing and providing services. In addition, it will prevent ESG scores from being exclusively or primarily used in decision-making in consumer transactions, and to block state Treasury and retirement plans from exclusively utilizing ESG scores when making investment decisions.

Over the past decade, Wall Street has been leveraging the power of transnational corporations to control access to capital through the use of ESG scores. Banks, investment firms, and finance institutions have used these scores to determine what businesses qualify for loans and other necessary services like insurance.

Unfortunately, ESG scores no longer apply just to corporations. Merril Lynch, for one, already applies ESG scores to clients’ investment portfolios.

Clearly, we’re reaching a point where people with “good” ESG scores may receive lucrative offers, easier loan terms, and even targeted packages designed to reward certain behaviors tied to subjective and ever-changing values and narratives. Many who espouse ESG “principles” believe that access to capital is not a right, but a privilege. They contend that financial and business plan metrics should no longer drive investment − instead, their subjective version of “responsible and sustainable” practices should.

 Pennsylvania’s motto − Virtue, Liberty, and Independence − embodies the role of the General Assembly to protect the God-given rights of its citizens from abuses and erosion. Our duty to defend the individual rights of Pennsylvanians soars above every other objective of governance. Please join us in co-sponsoring this timely legislation aimed at fulfilling our highest duty − protecting the freedoms of individual Pennsylvanians.
 



Introduced as HB334