Va. AG Miyares joins multistate inquiry into asset managers’ environmental investments

Attorney General Jason Miyares is introduced in the Senate gallery. (Ned Oliver/Virginia Mercury)

Virginia Attorney General Jason Miyares joined a cohort of 24 attorneys general seeking answers from financial institutions that are prioritizing investments in companies with greenhouse gas reduction targets.

Miyares signed onto a letter citing research from Consumers’ Research, a nonprofit organization, that highlighted large asset managers voting for recommendations by Institutional Shareholder Services on climate-related shareholder proposals. ISS is a proxy advisory firm that investment companies can use for recommendations.

The attorneys general asked the companies if they consult or rely on recommendations of proxy firms, such as ISS or other third parties, when voting on shareholder proposals relating to environmental issues. 

“We are concerned that the [the companies] may have outsourced their voting in this area to ISS or another third party and are failing to carry out their fiduciary duties,” the joint letter to 25 of the nation’s top asset managers read.

Miyares’ inquiry comes after he joined challenges to other emission reduction policies and joined an investigation into other banks’ net-zero goals.

Meanwhile, Consumers’ Research is critical of ESG investing and has a “woke alert” feature on its website. ESG is an umbrella term used to describe companies’ consideration of environmental, social and governance factors like climate change and diversity, equity and inclusion efforts in their business dealings. The ESG investing lens has prompted pushback from lawmakers and attorneys general in several states in recent years.

The letter, sent last week and seeking answers from the asset managers by next month, is led by Montana Attorney General Austin Knudsen. Miyares is joined by his counterparts in Alabama, Arkansas, Georgia, Idaho, Indiana, Iowa, Kansas, Louisiana, Mississippi, Missouri, Nebraska, New Hampshire, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, West Virginia, and Wyoming. 

“Sound economics should take priority over social fads,” Miyares said in a press release announcing he’d joined the letter. “Asset managers have a fiduciary responsibility to be proper custodians for their investors, not to have those resources pocketed by those driven by irresponsible social and political agendas.”