Facing mounting political heat, major players on Wall Street, including JPMorgan Chase, State Street, and Pimco, are scaling back their involvement in prominent climate and diversity initiatives. The retreat extends to reducing discussions of environmental, social, and governance (ESG) issues on earnings calls and slowing the hiring of diversity, equity, and inclusion (DEI) roles.
Corporate Exodus: JPMorgan Chase, State Street, and Pimco Exit Climate Action 100+
In a notable move, financial giants, including JPMorgan Chase, State Street, and Pimco, recently withdrew from Climate Action 100+, a coalition aimed at encouraging emissions reduction. The decision follows increased political pressure and a subpoena from House Judiciary Committee Chair Jim Jordan. GOP’s anti-ESG stance gains momentum.
Earnings Calls Silence: ESG and DEI Mentions Hit New Lows on S&P 500 Calls
A FactSet analysis reveals declining mentions of ESG on S&P 500 earnings calls, reaching new lows compared to earlier years. Direct references to DEI are even scarcer. Companies are navigating away from these terms amidst the political backdrop, contributing to a changing discourse on earnings calls.
Hiring Slowdown: DEI-Related Roles See Downturn in Corporate Recruitment
The surge in hiring for C-suite roles related to diversity, equity, and inclusion (DEI) observed between 2019 and 2022 is now experiencing a 4.5% decline in 2023. Companies are reconsidering their hiring strategies as the political landscape evolves and DEI faces increased scrutiny.
ESG Rebranding: BlackRock Shifts Focus Amid Political Weaponization
BlackRock, the world’s largest money manager, distances itself from ESG terminology, citing its “weaponization.” CEO Larry Fink orchestrates a $12.5 billion deal to buy Global Infrastructure Partners, emphasizing clean energy trends. Corporations find ways to sidestep terms while maintaining focus on broader trends.
Political Tensions Rise: GOP Opposition and Public Perception Shift Corporate Strategies
The Republican opposition intensifies its stance against ESG and DEI, with former President Trump vowing to banish ESG “forever.” GOP pressure prompts companies to reconsider climate and diversity initiatives. A new poll highlights public unfamiliarity with ESG terms but positive responses to responsible and sustainable business practices.