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Republican AGs warn financial service providers their ESG practices may be illegal

"Although many NZFSPA signatories are direct competitors with each other, they nevertheless commit to using their market influence to enforce their collective climate agenda in the broader economy and to '[w]ork in coordination' with other UN-convened 'Net Zero' groups," they wrote.

Published: September 13, 2023 3:39pm

A group of 22 Republican attorneys general have warned a bloc of financial service providers that their commitments to environmental, social, and corporate governance (ESG) practices may violate federal and state law.

Writing to members of the Net Zero Financial Service Providers Alliance (NZFSPA), the group of attorneys general, led by Tennessee's Jonathan Skrmetti, contended that the climate bloc's commitment to spreading such practices potentially violate antitrust and consumer protection laws.

"Although many NZFSPA signatories are direct competitors with each other, they nevertheless commit to using their market influence to enforce their collective climate agenda in the broader economy and to '[w]ork in coordination' with other UN-convened 'Net Zero' groups," they wrote. "Further, these pressure tactics are backed up by substantial market power."

The Republicans noted that the "Big Four" accounting firms, Ernst & Young, Deloitte, KPMG, and PwC, are members of the NZFSPA and that those entities collectively account for nearly three-quarters of the entire accounting industry.

"Given the extraordinary market power of participants in the agreement, many companies may have no choice but to comply with your policy preferences, requiring them to restrict further the variety and output of goods and services that are not 'aligned' with your activist climate agenda," the group asserted. "Moreover, many of the companies you influence will be forced to stop dealing with other companies whose practices are inconsistent with your standards."

"In addition, the actions required by your NZFSPA commitments may create consumer-disclosure requirements that your companies are failing to meet," they went on.

The group set an Oct. 13 deadline for members of the NZFSPA to provide them with documents of the communications with other bloc members, the details of their climate commitments, and any materials related to changes in business operations due to the adoption of climate goals.

"If financial service providers are colluding to limit consumer choices and manipulate market outcomes in support of international climate activists, that could violate our antitrust and consumer protection laws," Skrmetti said in a statement. "Decisions about energy policy should be made by our elected representatives, not by transnational corporate alliances."

Ben Whedon is an editor and reporter for Just the News. Follow him on X, the social media platform formerly known as Twitter.

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