Who would do this?
By Evelyn Pyburn
Having goals has long been understood as essential to achieve great things.
There’s no doubt that goals work! It hardly matters what the goal is or even if it is explicitly identified. That is why almost every organization establishes a mission statement.
One has to wonder, then, about the lure of investing in companies who loudly proclaim making money is not their primary goal.
Investing in ESG – greatly regaled by the media and pushed by government edicts – has become the politically correct thing to do. That in itself should present all kinds of warning flags – the very meaning of “politically correct” is essentially that of unthinking lemmings racing to the cliff’s edge.
So as people look at the businesses in which they want to invest, one has to wonder why they are so eager to invest in a business, that has declared to the world, its goal is not to make money, but to be obedient to government, surrender to environmental causes and to give what they have to others. (ESG stands for Environment, Society and Government) Some wholly eschew the idea of making a profit as really being the evil that generations of school children have been taught.
If not making a profit is a company’s goal, be assured they won’t. And, neither will their investors. Ask any business owner— not making a profit is easy!
And yet it is, to be socially responsible, to accommodate for environmental issues, and most especially to abide by government edicts, requires that a business makes profits and lots of them.
With that being the case, what is the ESG crowd thinking? Unless it is nothing more than virtue signaling, one must assume that they are among the group that believe that business – especially “big business” – is inherently evil. Given the history of many businesses – most especially when partnered with the coercive powers of government – one can understand their concerns, because many companies are participating every day in corrupt and very evil things. All you have to do is listen to or read the daily news. But have you ever noticed that, most often, their corruption is in some way enabled by government – through laws that protect them from market forces, or suspend them from having to answer for criminal activity, or other policies of favoritism which sometimes include direct handouts funded by taxpayers?
It’s why one rarely sees “big business” espousing the beauty of Capitalism, which is nothing more than free markets – willing buyers and sellers voluntarily exchanging values with one another. The fact is there is a huge sector of the business world who hate free markets and fear them – – they survive because of their unholy alliances with politicians.
We don’t hear so much about the sound, ethical and, usually, politically unconnected businesses that function every day in our communities, working very hard to make a profit which in doing, they achieve, as a matter of course, all the things that the ESG crowd say they want. Without businesses thriving in a community there is no community, and absolutely none of the ESG goals have a chance of being attained. That’s the way it has always been and how it will always be, because the reality is, business is where wealth is generated.
You cannot help the poor without the wealth generated in the business world. All social and civic efforts in any community come from businesses or the contributions of money and volunteer time of the people who work for them.
Usually taking the actions required to protect the environment are costly and cannot be pursued without the wealth generated by businesses, which is one reason why the cleanest and most environmentally sensitive countries in the world are the wealthiest. People worried about where their next meal is coming from do not have the wherewithal to clean a polluted stream, and in fact their poverty is usually a contributing factor to the pollution. They most desperately need free markets – businesses making profits.
And, surely everyone understands that government generates absolutely ZERO wealth. Government has nothing and can accomplish nothing without the wealth it expropriates from the private sector – from its citizens and from businesses that make a profit in free markets.
Undoubtedly well-meaning people are making it a point to invest in ESG companies, believing that they will improve their communities and advance society, which are very strong American values. Of course, investors might be willing to accept less returns in exchange for better ESG performance, but according to sources like Harvard Business — ESG companies don’t seem to deliver any better, and investments in ESG-touting companies are not doing well. While the ESG companies are undoubtedly achieving their non-profit goals, they are better in terms of complying with government rules, operating environmentally friendly, or contributing more to the needy.
It’s been found that the companies in the ESG portfolios had worse compliance records for both labor and environmental rules. Might that be because they lack the “profits” needed to comply? Government regulations on business have always been onerous, requiring greater investments – and companies need profits to pay employees more.
One reason for this, as pondered by the financial experts, is that perhaps companies not doing so well in the market, loudly proclaim an ESG status as a ploy to attract investors, who would otherwise be leery, just looking at their profit and loss statements.
So what are ESG proponents thinking? One has to conclude that either they are not, or their goal is not the success of business – of our economy – but instead they are seeking the destruction of the one thing that makes all others possible.