iThis week, Congressmen Jim Jordan (R-OH), Thomas Massie (R-KY), and Dan Bishop (R-NC), sent a letter on behalf of the House Committee on the Judiciary to three major asset managers and two non-profit organizations (the Glasgow Financial Alliance for Net Zero and the Net Zero Asset Managers Initiative) demanding that these organizations "produce relevant documents and information" in connection with allegedly "collusive agreements to 'decarboni[ze]' and reduce emissions emissions to net zero by 2050." In effect, this Republican-controlled House Committee is pursuing a theory that coordinated efforts to reduce carbon emissions constitute violations of the antitrust laws of the United States.
Overall, this effort is not unexpected. Members of the Republican-controlled House of Representatives have been signaling for months that they perceived antitrust law as a potent means to combat coordination among private sector entities to reduce carbon emissions. The latest developments merely represent an escalation of that proposed tactic.
Still, these letters reveal significant details about the particular focus of the House Committee on the Judiciary. In particular, the letters are clear in requesting documents "relating to any agreement or commitment, or any effort to reach such an agreement or commitment, between or among [target], other asset managers, and alliances or initiatives . . . to advance decarbonization and net zero emissions goals," and specifically requesting "communications reflecting or suggesting agreement or commitment as to specific steps, policies, or best practices." The letters also ask about the role of the asset managers in "voting for directors and stockholder proposals" in connection with their "decarbonization and net zero emissions goals." Further, the letters indicate an ideological hostility to the "radical 'steps such as halting sales of new internal combustion engine passenger cars by 2050, and phasing out all unabated coal and oil power plants by 2040," as "[s]uch restrictions limit output and increase prices, and deprive businesses of investments and consumers of choices . . . [with] potential [far-reaching] consequences for American freedom and economic well-being." Indeed, this last point--that these "commitments" to "decarbonization and net zero emissions goals" will "affect output, price, or the choices available to consumers and investors," is echoed in their specific document requests, reflecting this particular emphasis.
In any event, it will be important to closely monitor the developments on Capitol Hill as Congressional Republicans increasingly initiate efforts to combat the use of ESG principles--particularly concerning climate change--in the private sector.
House Judiciary Chairman Rep. Jim Jordan and two other House Republicans sent four letters to the heads of massive companies such as BlackRock and Vanguard, calling on them to explain corporate environmental, social and governance (ESG) efforts that could violate federal antitrust laws. The Daily Caller first obtained copies of the letters, which were sent Thursday to the heads of Glasgow Financial Alliance for Net Zero (GFANZ), Vanguard, BlackRock and State Street. Jordan was joined by Republican North Carolina Rep. Dan Bishop and Republican Kentucky Rep. Thomas Massie. In all of the letters, the lawmakers say the companies appear to have potentially violated U.S. antitrust law by coordinating and entering into collusive agreements to “decarbonize” assets under management and reduce emissions to net zero.
