West Virginia One of First States in U.S. with Proxy Law to Protect Pensions, Investments
West Virginia State Treasurer Riley Moore today praised the Legislature’s passage of his proposal to prevent money managers handling state pension funds from advancing their own environmental and social goals ahead of financial returns to the pensioners.
The bill provides that money managers cannot use pension or taxpayer dollars to engage in shareholder voting activism – making West Virginia the first states to have these anti-ESG protections codified in state law.
“West Virginia is once again leading the way to protect pensioner and taxpayer dollars from woke Wall Street activists who prioritize their own political and social agendas over the best financial interests of our people,” Treasurer Moore said. “Each year, public employees in West Virginia retire from their jobs after decades of service to our state and rely on their hard-earned state pensions to support them and their families through retirement. If a financial professional cannot commit to casting all shareholder votes in the best financial interests of our pensioners, they simply cannot be entrusted with state pension funds.”
Late Friday, the state Senate voted 30-2 to send House Bill 2862 to Gov. Jim Justice for his approval. The bill requires the state’s investment boards – which manage more than $34 billion in public pension and state investment funds – to cast proxy votes solely based on the financial interests of pensioners and taxpayers, rather than Environmental, Social and Governance (ESG) factors.
Proxy voting is an important process that allows shareholders to vote on key issues while not personally attending corporations’ annual shareholder meetings.
However, in recent years the world’s largest asset managers – including BlackRock, Vanguard and State Street – have leveraged proxy voting authority to further ESG measures that go beyond strictly financial factors, including whether the companies are curtailing business with firms tied to the fossil fuel industry, providing access to abortion care, and other social matters under the umbrella of diversity, equity and inclusion.
“Wall Street fund managers and proxy advisory firms have used the façade of ESG to impose woke, leftist policies across the private sector,” Treasurer Moore said. “Recently, Congress adopted a resolution to roll-back Biden administration rules that allow money managers to consider ESG when voting private retirement shares. Now, the states must collectively stand up against ESG proxy voting activism with our public retirement funds.”
West Virginia has spearheaded the fight against ESG. Last January, Treasurer Moore was the first state official to divest funds from BlackRock over its ESG activism. He also championed legislation to create the country’s first Restricted Financial Institutions List, which prohibits state business with firms shown to be engaged in boycotts of the fossil fuel industries.
House Bill 2862 is the latest law that will protect West Virginians from social activism in the financial services sector.
“I want to thank Delegate Dean Jeffries and Senator Rupie Phillips for sponsoring the House and Senate versions of our bill and advocating for its passage through the Legislature,” Treasurer Moore said. “West Virginians are sick of out-of-state actors trying to use our own money against us to impose their ideals. As public officials and lawmakers, we are united in our efforts to stop this undemocratic agenda.”
House Bill 2862 now goes to Gov. Jim Justice, who will have until March 29 to act on it.