Yesterday, California Democrat Congresswoman Maxine Waters told CNBC that “everyone is going to have to participate in the environmental crisis, social activity, and of course corporate governance”.

“Even if these attempts to deny or to delay are taking place, in the final analysis, we are going to have to have ESG,” Waters said during an interview with “Squawk on the Street” co-host Sara Eisen.

“So, yes, we’re paying a lot of attention to it. We’re going to fight back against these attempts to deny or destroy the whole idea of environmental, social, and governance, but we have to do it in order to save this planet,” Waters continued.

This is interesting considering the left has spent over two years accusing anyone on the right of pushing “conspiracy theories” and claimed that ESG wasn’t happening. Now the narrative has shifted from it’s not happening it’s all just a right wing conspiracy theory, to okay, it is happening but it’s for your own good.

Environmental, Social and Governance (ESG), also known as “sustainable investing,” according to the Corporate Finance Institute, can factor in corporate policies on gun control, environmental issues, abortion or other issues in addition to or instead of strictly looking at a corporation’s profitability.

The Republican-held House Financial Services Committee is pushing back against ESG this week and met on Wednesday to consider a list of proposals that aim to strengthen public markets and that would require the U.S. Comptroller General to study the drawbacks of corporate sustainability reporting for public American companies.

Committee Chair Rep. Patrick McHenry warned that the Biden administration’s focus on climate-related policy through the Securities and Exchange Commission will discourage private companies from going public.

“Rather than focusing on sound financial regulation, the SEC has turned its attention towards non-material, environmental, social and political issues,” McHenry, R-N.C., said. “These politically motivated regulations not only discouraged private companies from going public but also hinder the competitiveness of American public companies.”

Democratic Representative Maxine Waters criticized Republican attempts to undermine what she claimed was the federal government’s responsibility.

“Today is the first of six hearings this month where Republicans will partner with a network of dark-money climate deniers and conspiracy theorists to wage their latest culture war against responsible investing and divert attention away from what really matters in people’s lives,” Waters, D-Calif., said in opening remarks. “The Republican effort to dismantle ESG is integral to their agenda to gut diversity and inclusion across the board.”

“If ESG is capitalism, why do we need the government to interfere in the free market?” Rep. Andy Barr, R-Ky., asked during the hearing. “That’s what ESG is, that’s what the free market is doing.”

Rep. Juan Vargas, D-Calif., called the timing of the hearing amid global climate disasters “fascinating.”

“Timing is everything. It really is fascinating to me that these bills are coming up right when the scientists are saying, ‘This is a disaster, and human beings are causing it because of the burning of fossil fuels,’” Vargas said.

“How in the hell can that not be material?” he added. “That’s what investors want to know.”

Barr warned that “This is the government’s intervention to distort the free flow of capital and that “I don’t understand why anyone would say this is about assessing climate risk. Increasing energy prices … does not promote financial stability.”

Republicans weren’t the only ones pushing back at the hearing. David Scott, a Georgia Democrat on the committee, also expressed concern about what the SEC’s climate disclosure proposal and what it would mean for farmers. He said he feared it would cripple small farmers and ranchers, and that it could potentially jeopardize their ability to receive loans if banks embrace ESG.

The proposal that Scott is referring to is known as Scope 3. Scope 3 requires larger companies to determine their broader carbon footprint by factoring in the emissions of other public companies as they do business within their supply chain, even if they do not have control over the companies that they are doing business with.

“I hope that [SEC Chairman Gary Gensler] would not implement this Scope 3 situation. I think we need to carefully look at the impact it has on our agriculture community,” Mr. Scott said. “My hope is he will continue to review feedback on this Scope 3 emissions and make the appropriate change before any rule is final.”

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