I have always been a guy who seeks to integrate various things in my life. What I mean by that is that I seem always to come upon overlaps or areas of common interest in different aspects of my life and rather than treat them as coincidental, I have always enjoyed finding ways to have them connect in more meaningful ways. For one minor example, this past weekend when our friend Chris was visiting, he brought up a number of issues that connected to the subject of Factory Farming and the negative impacts on our society thereof. When I was teaching business ethics at University of San Diego a few years ago, I had been approached by a Factory Farming awareness and advocacy group (as in a group focused on increasing public awareness of the bad effects of Factory Farming). Their outreach efforts were concentrated on sending out speakers (people employed by them) to address everything from high school groups to graduate business school classes. I saw a good fit in my course for a discussion of the business ethics of Factory Farming, specifically as it related to the entire ESG (Environmental, Social & Governance) arena, so I incorporated that guest lecture into my curriculum. I got to listen three times over three semesters to the Factory Farming arguments and feel that I became quite aware of the issues at play, which are quite fascinating and in many ways central to our everyday lives. I also got a better appreciation for the perspective of how central the ESG topic is to the entirety of business and the ethical fabric of our existence. When Chris started talking about Factory Farming, I was excited to see the two subjects come together and it felt like a mini-integration of sorts to find one side of my life (the teaching), which had already integrated with my business life (the investing arena), now getting somewhat integrated with my social life (my friend conversations with Chris).
In the past few years we have seen some extreme politicization of certain flashpoint topics that seem to reside in the great divide that exists in this country between the right and the left. And when I say these topics reside in the middle, that is not to suggest that they are clearly on one side or the other. Take Factory Farming as an example again. On the surface there seems to be a strong do-gooder aspect to those that oppose Factory Farming. It seems to the province of vegans and vegetarians as opposed to strong meat-eaters. But it is so much more nuanced than that. A large part of the Factory Farming business is populated with employees that are a combination of illegal aliens, convicted felons (I guess those a bit less affluent than our Convicted Felon In Chief….Elect), and the other less able and connected members of our society. The marginalized nature of that employee base combined with the perceived necessity of the functions (to feed our people) makes certain allowances like the suspension of OSHA requirements and the apparent overlooking going on by ICE. Meanwhile, despite the lack of red blooded American workers ready to put life and limb on the line for our hamburger patties, the forces of MAGA are just as adamant that these illegal aliens need to be rounded up and deported at great cost to U.S. taxpayers (not to include billionaires since they will likely be exempted by the early Trump executive orders). So is MAGA supportive of Factory Fsrming or agin’ it? Hard to say.
The DEI (Diversity, Equity & Inclusion) topic has been even more on the front lines of the political battle than almost any topic. It epitomizes the worst of wokeness, which is as much a flashpoint as any in the culture wars of 2025. The business notions that diversity, equity and inclusion are valuable to the highest performance of businesses, universities and all manner of organizations has been overwhelmed by the sense that DEI is woke and woke is bad for society, business and life in these United States. Even many otherwise “liberal-minded” people seem to dislike DEI and what it seems to stand for to them. Not far from DEI in the alphabet hate list is ESG. A few years ago, not unlike the thinking that diversity was healthy for innovation and business in general, a view developed in the investing community that ESG policies and efforts by businesses were a key ingredient for sustainable success. It was all perfectly logical. Better environmental policies not only endeared the growing population of eco-conscious consumers to those businesses, but it also reduced environmental fines and improved employee retention by caring about things those employees cared about. But for one reason or another, the Right decided early on that ESG was much like DEI in that it was about wokeness and might interfere with the Drill, Drill, Drill mentality that Trump likes to espouse, not to mention whatever in hell some Libtard might want to suggest for social and governance leanings or limitations for the corporations. Larry Fink, one of the most accomplished money management professionals of all time, who created, built and still leads Blackrock was quite outspoken in the BUSINESS value that ESG and insuring that policies are set and followed by companies for the benefit of their long term sustainability was party of the investment protocol at Blackrock. It always struck me as a very enlightened and businesslike approach that was backed up by solid empirical data showing how much better strong ESG companies performed than those which ignored those concerns. None of that mattered to the MAGA leadership particularly in places like Florida and Texas, and they went on a hell-bent-for-leather campaign to discredit Fink and Blackrock with extreme prejudice. In a vendetta that has rarely been equaled in the money management industry, those states, led by their governors and attorneys general set about legal campaigns to disconnect their state and their various retirement systems from using Blackrock and any other investment managers that espoused ESG strategies. In the face of that, from what I could tell, Larry Fink just shrugged and said what any competent guy running a $10 Trillion business (the largest manager in the world) would say, “So be it.” the truth is that none of those efforts took a bite out of Blackrock’s growth, which proceeded unaffected by this politicized tempest in a teacup.
Now I see that the American Airlines 401(k) plan has been sued (to be accurate, the plan sponsor and its committee has likely been the defendant) in a class action effort to indict them for breach of fiduciary duty to their participants by virtue of using Blackrock in what they describe as an “incestuous” relationship in managing money under the voodoo of ESG parameterized investing. That case went before a Texas federal judge who is known by the Right to be sympathetic to their ideology (they try to position many of their legal battles in front of him like the MAGA folks in Florida try to do with Judge Aileen Cannon). That Judge has ruled in summary judgement (no jury decision) in favor of the plaintiffs and made an award and issued an inflammatory anti-ESG narrative in the ruling saying that American Airlines done their participants wrong and needs to compensate them for the damages inflicted by these ESG-loving folks (American Airlines is headquartered in Dallas).
I was recently approached on an expert witness case where I was being asked to help defend Blackrock and Vanguard against some legal onslaught by the coal industry for their ESG-based investment decision-making. I’m not sure where that case stands, but I am hoping to get it since I feel strongly that the hard evidence strongly supports the pro-ESG movement. What strikes me as so strangely hypocritical (not unlike many other Right wing driven ideological stands) is that the cries to depoliticize the investment process by eliminating the ESG screening are driving to eliminate ESG processes in investment decision-making for….political reasons. All I can say is ES-Gee….