New financial options to fight ESG enter market including non-Woke ETFs even as religious organizations begin promotion of radical environmental policies and social justice investing.
Strive plans 9 ETF launches before end of 2023. DRLL is already trading and STRV will debut in September.
Strive prefers pro-excellence to label of anti-Woke.
Christian investment firm drops ESG from its ETFs.
National Association of Evangelicals promotes environmental focused investing.
Not only does Woke ideology harm America’s geopolitical security, but it can also lead to children starving. ESG—which stands for Environmental, Social, Governance—is a set of principles promoted by the World Economic Forum (WEF) elevating political issues like climate change over profit. The WEF also calls this Sustainable Responsible Investing (SRI). And Kyle Bass says this is dangerous.
Kyle Bass said on CNBC, “These policies that are ESG driven and morally driven that we should convert everything to alternative energy tomorrow are going to end up starving the poor children of the world. It’s killing many of them. It is counterintuitive that it could actually happen but that is what we are seeing with prices at $1,000 or €1,000 per megawatt hour.”
Bass is not alone in attacking the dangers of ESG. James Lindsay, an anti-Woke scholar, warns that ESG is a scam.
Big investors like Florida, Texas, and West Virginia are making their opposition to ESG known. And because they control billions, what they say will be heard. But what about the individual investor?
Investors now have options to resist ESG investing pushed by the huge firms like BlackRock, State Street, and Vanguard. Strive Asset Management launched the Strive US Energy ETF (ticker: DRLL) on August 9. DRLL already holds more than $300 million in net assets—$310 million as of Friday. (Disclosure: I’m a fan of this ETF and my wife and I already own shares in DRLL.)
And more ETFs are on the way from Strive. Currently eight more ETFs are planned before the end of 2022. In mid-September Strive 500 (ticker: STRV) will be released. The Strive 500 will be a “passively managed” fund that includes stocks in the Solactive GBS United States 500 Index, according to the Strive filing with the SEC.
The media describe these as “anti-woke ETFs”; however, Strive believes the funds are not anti-woke as much as they are pro-excellence.
“We are not particularly anti-Woke,” said Matt Cole, Head of Products & Investments at Strive Asset Management. “We are pro-excellence capitalism. We define it as where companies will focus on providing excellent products and excellent services over any social or political agenda. We are agnostic on the merits of individual social or political views. We think those views should be expressed through the political process not through proxy battles through a handful of asset managers that are managing money that is not even theirs.”
This is the Strive focus. Its website explains Strive’s purpose is to put the “focus on excellence over politics.”
Cole said the fiduciary duty is “to maximize long run value.” Other ideological views should be advocated through the political process by individuals.
“We think that an individual can have any type of view that they want and that is separate from what an asset manager should be doing as a fiduciary where they are voting and engaging corporations on behalf of their clients who invest in their funds,” Cole said.
Pro-fiduciary principles are at the center of the book Woke, Inc.: Inside Corporate America’s Social Justice Scam—written by one of Strive’s founders Vivek Ramaswamy. However, even as many investors begin to reconsider Social Justice as an investing thesis, ESG principles are spreading.
Economic troubles loom because of explosive energy costs that many blame on ESG reducing investment in new oil and gas projects; however, that is not the only imbalance caused by ESG policies. For example, Bank of America having forgotten the lessons of the 2008 financial crisis plans to offer zero-down mortgages. This time the loans will only be available to Black and Latino borrowers.
And it is not just secular companies captivated by ESG. Social Justice principles are finding its way into the Christian investment community too.
As society wakes up to the dangers of ESG, evangelical elites begin push for climate justice. NAE urges Christians to pursue ESG investing.
And now churches are joining the ESG push. World Relief announced its “Commitment to environmental stewardship.” World Relief said, “environmental stewardship will be an increasingly fundamental part of how World Relief carries out our mission through both policy and action.” Also, World Relief joined with other nonprofits in signing The Climate and Environment Charter for Humanitarian Organizations.
This follows the National Association of Evangelicals (NAE) releasing a report providing a “biblical basis for climate activism.” And not to put too fine a point on it, the NAE report claims, “We worship God by caring for creation.” The justification for all of this focus on the environment is the harm it allegedly causes the poor. NAE President Walter Kim explains in the forward, “Although the changing environment impacts all of us, the disproportionate devastation upon the most defenseless must break God’s heart.”
In other words, climate change harms the poor (or least of these) and requires Christian action. The action advocated by NAE? In the “Join the Good Work” it urges Christians to “join in advocating for wise action to decrease our carbon footprint, provide international assistance, promote sustainability and consider climate change in any long-term plans.”
Among other tips from the NAE include this gem urging Christians to “Contribute to environmental missionaries.”
Environmental missionaries? Good grief.
Also, the NAE urges Christians to pursue ESG investment strategies. According to the report, “Many Christians are investors. Push your investments into corporations with sustainability goals, into emerging energy-efficient technologies and into new ventures with sustainability built into the fabric of their business. Demand transparency, accountability, and reports on their carbon footprint, success of carbon offsets, and ongoing climate actions. Ask companies to prioritize decarbonization of their activities.”
What evidence does the NAE have to show ESG helps the poor? In fact, doesn’t present experience suggest the exact opposite? Who will be forced to do without air conditioning in 100-degree summers? The rich? The Evangelical Elites who issued the NAE statement? Of course not. The poor will suffer the most.
And there are signs that this type of investment thinking is already filtering into evangelical thinking. GuideStone—the retirement investment service of the Southern Baptist Convention—through its affiliate GuideStone Capital Management offers a Global Impact Fund. The Global Impact Fund prioritizes investments “in both public and private markets and provides the opportunity to own investments and organizations working to support disadvantaged, underserved global communities in need.”
And what are some of those investments? It mixes investments focused on mortgages for special classes (low-income women) along with owning bonds for Christian schools.
According to the GuideStone press release, “Investment examples within the fund include a mortgage-backed security comprised of home mortgages for women with low-to-moderate incomes, a multinational organization that seeks to provide underprivileged communities abroad with greater access to technology, and a municipal bond backing a large community college district in which two-thirds of the student body comes from a low-income, food or housing insecure background. In addition, the fund owns bonds that fund Christian schools and universities.”
However, some faith-based investment firms are dropping ESG investing. Inspire Investing announced it was eliminating the ESG label from some of its funds.
In an August 18, 2022, blog post Inspire CEO Robert Netzly said, “Let me get straight to the point: We hereby renounce ESG. We have removed ESG from the names of all our products and no longer identify our investment approach as being part of the ESG category.”
Inspire launched a “faith-based ESG” investing approach in 2019, Netzly wrote. He hoped it would provide a “counterpressure on the overwhelming progressive-left dominance” in ESG investing. The result was attack from the left. “Unfortunately, ESG has become weaponized by liberal activists to push forward their harmful, social-Marxist agenda, hence the problem,” Netzly said.
The pushback on ESG owes a great deal to the work of scholars like James Lindsay and investment leaders like Vivek Ramaswamy. The question that conservative evangelicals should ponder is why, even as secular circles begin to pushback against ESG, are Christian groups actively promoting extreme environmental activism?
As Kyle Bass and others have said—ESG will harm the poor—but so-called Christian groups are promoting the idea that climate activism will help the “least of these.”