Gov. Ron DeSantis moves to prohibit state investments in 'woke' agenda
Posted On August 24, 2022
Gov. Ron DeSantis fired a shot across the bow of so-called corporate leftists Tuesday when the State Board of Administration adopted a resolution to prohibit consideration of political factors when investing state workers pension money.
The resolution, submitted by SBA interim executive director Lamar Taylor, bans the use of environmental and social government metrics when investing the more than $227 billion that back the Florida Retirement System, and funds for hurricane recovery and local government investments.
Taylor said the resolution was needed to protect current and future pensioners, while DeSantis argued it was an important statement in light of “a movement” by “corporate elites” and asset managers to use their economic power to advance an ideological agenda that fails at the ballot box.
“I want to have the values not of Davos imposed on us but of places like Destin, and Dunedin where I grew up,” said DeSantis, as chair of the SBA trustees meeting.
“Things like the the World Economic Forum, those policies are dead on arrival in the state of Florida. We are not going down that road,” said DeSantis.
The other two trustees, Attorney General Ashley Moody and Chief Financial Officer Jimmy Patronis, voted with DeSantis to adopt the resolution, which will serve as the basis for legislation when the Florida Legislature meets in January.
ESG is a 20-year-old movement sparked by a United Nations initiative to highlight corporate responsibility by encouraging investment in companies that have policies addressing issues like climate change, human rights and racial injustice.
The resolution explicitly prohibits state fund managers from considering ESG factors when investing and mandates the only consideration be maximizing the return on investment on behalf of Florida retirees.
Critics dismiss the resolution and call for legislation as political theater.
They point out SBA does not employ ESG metrics when making investment decisions.
The SBA website argues divesting from companies for social and political purposes, “relies on the false premise that selling a company’s stock or threatening to will change corporate behavior” and is ineffective.
Rep. Fentrice Driskell, D-Tampa, the incoming Florida House Democratic Leader, said DeSantis created a straw man out of ESG to distract from failed economic policies.
“All of us are struggling with skyrocketing rent or homeowner’s insurance. ESG, is not something Floridians are talking about,” said Driskell,
She dismissed the SBA trustees vote as a waste of time.
“It would be a better use of time if the Governor and the State Board of Administration paid more attention to the $200 million in Florida’s pension fund that is at risk because it’s trapped in assets in Russia,” said Driskell.
A Tampa attorney, Driskell and others point out there are at least three areas of Florida law where SBA investors must consider political factors when investing state funds.
It is required to “scrutinized companies” who appear on a list of those participating in a boycott of Israel.
And, the SBA must notify companies it supports the MacBride Principles (fair labor regulations) for companies doing business in Northern Ireland.
Also, the Protecting Florida’s Investment Act prohibits any investment in foreign companies with business operations in Sudan and Iran involving petroleum or energy sector, or military support activities.
The governor’s office explained in cases where the resolution conflicts with Florida law, the law will prevail.
Natasha Sutherland of the progressive group DeSantis Watch said those legal requirements reduce the resolution to nothing more than a stunt. The group suspects DeSantis is making a pitch to voters in Iowa and New Hampshire as he prepares for a possible 2024 presidential run.
The resolution comes on the heels of a contentious year in Tallahassee with DeSantis pushing high profile bills to restrict how racial history and sex is taught in public schools, and restrictions on companies’ diversity training programs.
Chief U.S. District Judge Mark Walker last week granted a temporary injunction to block enforcement of DeSantis’ Stop Woke Act. He described the state law as “bordering on unintelligible” and a violation of First Amendment.
Tuesday’s resolution will serve as the basis for legislation for the Legislative session that begins in January.
It will amend the Florida Deceptive and Unfair Trade Practices Act statute to prohibit financial institutions from refusing business based on a customers religious, political, or social beliefs.
Incoming House Speaker Rep. Paul Renner, R-Palm Bay, endorsed the proposal and said the “woke agenda” is a threat to national security.
“There’s a reason why we haven’t built new refineries. There’s a reason why we’re not drilling for oil even though we have more reserves in this country than any other place in the world, it’s because the banks and this woke agenda is choking off their ability to get financing to do that,” said Renner.
James Call is a member of the USA TODAY NETWORK-Florida Capital Bureau. He can be reached at email@example.com. Follow on him Twitter: @CallTallahassee
Never miss a story: Subscribe to the Tallahassee Democrat using the link at the top of the page.