Play Live Radio
Next Up:
0:00 0:00
Available On Air Stations

Audio recording reveals coordinated push against ESG investing

A sign hangs on the BlackRock offices in New York City. (Andrew Burton/Getty Images)
A sign hangs on the BlackRock offices in New York City. (Andrew Burton/Getty Images)

There is a new culture war. It’s not over history or schools, but over your retirement plan.

The label? “Woke” investing.

Much of this battle is about fossil fuels and whether investments should keep plowing into coal, oil and gas. Many money managers think climate change makes certain investments risky. For example, investing in real estate where sea levels are rising.

“We believe more than ever that climate change is an investment risk,” Blackrock CEO Larry Fink told CNBC in 2020. “And we are seeing that through our clients. And how our clients are allocating capital.”

Fink sees this as capitalism responding to a changing world, but to critics, these are bleeding-heart liberals who want to change the world. And conservative activists are pushing to ban this investment strategy.

The groups behind this are conservative stalwarts, such as The Heritage Foundation, American Legislative Exchange Council and The Heartland Institute. Some of them are linked to fossil fuel money and climate change denial. And most of their donors are not required to be disclosed.

But Here & Now has obtained audio of a recent strategy session from the investigative journalism organization Documented that provides clues to the campaign’s leaders and tactics.

Late last year, conservative activists met in Washington, D.C. to stop what they consider “woke” investing. It’s called ESG investing, which stands for environment, social and governance investing.

“ESG investing is socialism in sheep’s clothing. This is the challenge of your generation,” said Andy Puzder, a conservative commentator and fellow at The Heritage foundation. He once ran the fast-food chains Hardees and Carl’s Jr.

“My father’s generation’s challenge was the Nazis, who, by the way, were, of course, very proud socialists. The challenge of my generation was the communists, who were, of course, very committed socialists,” Puzder said. “The challenge of your generation is ESG investing, and it’s more insidious than communism or the Nazis.”

Two people who were in the meeting, including Puzder, confirmed to Here & Now that the audio from the meeting is authentic.

In an interview with us, Puzder confirmed what he said on tape about Nazis, socialists and ESG.

“The intent of my statement was that this is the challenge this generation faces,” he says. “And I think it has characteristics that are very similar to socialism.”

Audio recordings of the ALEC work session

The American Legislative Exchange Council, or ALEC, calls itself “America’s largest nonpartisan organization of state legislators.” The organization favors limited government and free markets. It’s where lawmakers, mostly Republican, and corporate officials meet to draft bills.

The tape of the workshop was shared by the investigative journalism organization Documented.

“You have Andy Puzder, who said disclosing risk to businesses is worse than communism and worse than fascism. Obviously very hyperbolic,” says Jesse Coleman, senior researcher at Documented. “But it gives an indication of what they are trying to do, which is to insert these pro-fossil fuel policies into this greater culture war.”

A culture “war,” he says, has policy foot soldiers, like lawmakers, in the room.

Puzder and others have drafted what’s called “model legislation” that Republican lawmakers have replicated and are pushing now in state capitals.

One bill would blacklist banks that refuse to invest in key state industries, like coal in West Virginia. In the last two years, at least 14 states have passed bills or taken executive measures to restrict ESG investing, according to the law firm Ropes & Gray.

In many cases, oil and gas companies have testified in support of the bills. This movement in statehouses worries University of California, Davis law professor Amelia Miazad, who studies ESG investing. She argues these laws force money managers to put people’s money for retirement or college education into fossil fuel companies that are risky in the long term.

“This is a politically expedient way to advance the interests of very few industries at the expense of the rest of the economy and at the expense of Americans who are invested in pensions or 401k plans,” Miazad says. “It really is stealing retirement benefits from everyday working-class Americans.”

But as conservative commentator Puzder sees it, everyday Americans are watching their savings get hijacked to push a liberal agenda.

“Most people are surprised that their money was being used to advocate for political purposes. The bottom line is where people feel they no longer can trust the institutions they have trusted for decades,” Puzder says.

Puzder and his allies want to ban investment firms from factoring climate change into their decisions. And for Coleman at Documented, it’s important to reveal that process and the interest groups behind it.

Coleman says that’s why Documented shared the audio from the conservatives’ meeting.

“These groups, they hide all their funding. They’re   communicating directly with public officials, but we can’t actually access that information a lot of the time,” Coleman says. “So the only way that we find out that this is a coordinated campaign is by having this sort of curtain pulled back a little bit.”

ALEC, the group hosting the meeting, called it a “private” meeting, and said the audio was obtained without their permission. They did not agree to speak to Here & Now on tape or to an interview.

“This was a private meeting, and the recording violates ALEC’s media policy,” ALEC wrote in a statement. “The conversation was recorded in Washington, D.C. without consent and obtained without our or ALEC’s permission. We do not agree to its use within the interview.”

In this meeting, the interest groups discussed PR tactics, such as how to sell the idea that ESG is bad business.

Heritage Action lobbyist Catherine Gunsalus spoke at the meeting captured on the recording. Gunsalus is a registered lobbyist in more than 18 states. She can be heard on the audio offering to help conservative lawmakers with friendly media hits and opinion pieces in newspapers.

“There are resources there as well as model legislation and that really exists to be another hub for you to access and say, ‘Okay, I need social media graphics, I need what’s the latest op-ed that was drafted on this issue,'” she said at the meeting.

“She is saying we’ll provide you with the words that you need to wage this campaign,” says Coleman.  “We’ll provide you with connections to the media that you need, to get her words heard through somebody else’s mouth.”

Here & Now asked Gunsalus for an interview several times and received no response.

Conservatives take direct aim at BlackRock

This campaign against ESG investing is targeted specifically at BlackRock and its CEO Larry Fink.

“Every big problem needs a face and a name. And the worst offender out there is BlackRock and Larry Fink,” said Will Hild, executive director of Consumers’ Research. That comment was recorded at the ALEC meeting, and Hild verified that the audio is authentic.

In the recording, you can hear him urging state lawmakers to investigate BlackRock.

“Your committees have investigative powers under your state’s constitutions in many states. I would look at that as another way in which you can hit them,” Hild said at the meeting.

Hild’s group, Consumers’ Research, is also calling for taking monies out of BlackRock. Several states have answered that call. Texas, Arkansas, Utah, Louisiana, Arizona and Florida have pulled a total of $4 billion and say they moved their money to firms that they deem “non-woke.”

In an interview with Here & Now, Hild said he expects states to also sue BlackRock along with other money managers, accusing them of breaking antitrust laws. His argument is that the big asset managers are colluding against fossil fuel companies.

“They’re pushing them to reduce the supply of energy. I believe this is potentially one of the most brazen and open antitrust conspiracies in the United States,” Hild said.

BlackRock CEO Larry Fink has said that critics have their facts wrong. He says BlackRock sees climate change as a risk, but he says it’s not boycotting oil and gas companies, as some allege.

“We are trying to address the misconceptions,” Fink said at a Bloomberg event at the World Economic Forum in Davos, Switzerland, in January. “Unfortunately there are some politicians who are taking some parts of a sentence out of context. And that’s the world we live in today.”

BlackRock did not agree to an interview, but sent Here & Now this statement:

“There are many people with opinions about how BlackRock should manage our clients’ money. But the money doesn’t belong to these people. It’s not ours either. It belongs to our clients, and our responsibility and our duty is to them.

We manage money on behalf of our clients to help them or the people they serve achieve their financial goals, including saving for retirement, a home, or a child’s education. It’s a huge source of pride for everyone at BlackRock that we play a role in helping millions of people around the world experience financial well-being.”

The impact of anti-ESG investing

If the backlash to ESG investing racks up wins, professor Miazad thinks the climate will end up being the loser. She thinks antitrust lawsuits would be a real risk to the Wall Street giants that have signed onto climate partnerships.

“The merit of those antitrust lawsuits doesn’t really matter that much,” Miazad says. “Because it is very expensive to defend against an antitrust investigation. So just threatening it might chill, and is already chilling. these collaborations.”

But the larger risk, to Miazad, is that it could put this environmental, social and governance investing trend out of fashion.

Investors big and small, and the financial companies where they put their money, could steer tens of trillions of dollars away from companies with greener futures. Anecdotally, Miazad sees some big companies already slowing down their climate work.

“This anti-ESG movement is designed to change business norms. It can be pervasive,” Miazad says.  “In other words it’s not just BlackRock, but it’s BlackRock clients who are now maybe second guessing whether to embrace ESG.”

Jill Ryan produced and edited this interview for broadcast with Catherine Welch. Ryan, Welch and Scott Tong adapted it for the web.

This article was originally published on

Copyright 2023 NPR. To see more, visit