And why are so many advocates of liberty deeply concerned about them?

Klaus Schwab and a growing list of powerful global economic and political elites, including BlackRock CEO Larry Fink and President Joe Biden, have recently committed to a global “reset” of the prevailing school of economic thought. They seek to supplant the entrenched “shareholder doctrine” of capitalism, which—as Milton Friedman famously espoused over 50 years ago—holds that the only purpose of a corporate executive is to maximize profits on behalf of company shareholders.

To replace shareholder capitalism, Schwab, Fink, Biden, and a legion of their peers have promulgated a nouveau “stakeholder doctrine,” commonly referred to as “stakeholder capitalism.” This approach, which aims to harness the growing clamor for more socially conscious corporate decision-making, authorizes, incentivizes, and even coerces corporate executives and directors to work on behalf of social objectives deemed by elites to be desirable for all corporate stakeholders—including communities, workers, executives, and suppliers.

Environmental, social, and governance (ESG) scores—a social credit framework for sustainability reporting—are being used as the primary mechanism to achieve the shift to a stakeholder model. They measure both financial and non-financial impacts of investments and companies and serve to formally institutionalize corporate social responsibility in global economic infrastructure.

Environment, social, and governance scores are theoretically supposed to incentivize “responsible investing” by “screening out” companies that do not possess high ESG scores while favorably rating those companies and funds that make positive contributions to ESG’s three overarching categories. A company’s ESG score has become a primary component of its risk profile.

Who Are the agents responsible for this shift, and what have they done to bring it about?

Although there have been many ESG frameworks developed over the past decade, in the past three years alone, three major documents and compacts have been signed by a coalition of corporate governors, political elites, central bank directors, international organization representatives, and other powerful individuals. Together, they have had a substantial impact on the global economy and the shift to ESG.

In August 2019, The Business Roundtable (TBR)—comprised of 181 of the most powerful corporate executives in the United States—officially revised its conception of a corporation’s purpose to “promote an economy that serves all Americans.” The companies these CEOs represent hail from nearly all sectors of the U.S. economy, including major financial institutions, media conglomerates, technology firms, defense contractors, pharmaceutical companies, and myriad others.

Many of these executives are likely unaware that their  ESG ideas come dangerously close to the social credit system run by the Chinese Communist Party. It applies to corporations instead of individuals, but the principles are the same. Nor do they likely recognize that their policies result in starving the fossil fuel industry of capital, thus contributing to soaring energy costs to consumers and rampant inflation. Besides Biden, think of these leaders when you fill up your tank!

For businessmen to betray the principles of private ownership of capital, and free enterprise, and buy into the agenda of a particular political party, marks quite a change in the role of business in society. Heretofore, with the exception of tax-free foundations funded by businesses (think of the Ford Foundation), corporations rarely have been so politically active outside of election activities. This is causing evolutionary tension with our political parties. The Democrat party increasingly has become the party of Big Money and Big corporations, while the Republican party is increasingly less friendly to Big Business and sides more with small business people and consumers.

A case in point is the state of Florida. Previously quite friendly to Walt Disney, state leaders took affront when that giant corporation that had received special favors from the state, decided it would take it upon itself to interfere directly and publicly with legislation that would restrict the teaching of transgender ideology to those in kindergarten through the third grade. The result was the loss to Walt Disney of the Reedy Improvement district, which gave that corporation almost the power of self-government.

You will note in the map provided, that Arizona has down well on this front, largely due to Republicans in the legislature.

If the upcoming elections go badly for Democrats and the Green New Deal, Republicans need to keep in mind that Big Business has not been their friend. The result should be a reexamination of the relations of business to government. Special favors, subsidies, and tax breaks, all need to be eliminated. Republicans should strive to eliminate regulations and barriers that reduce competition.  It is bad enough to have socialism constantly foisted upon us by Democrats. It is quite another to expect that from Big Business. Republicans will have to deal with “Business Roundtable” types within our own ranks.

Vote with your dollars as well and try to avoid doing business with corporations that betray your trust and the economic system that made this country great. More than half the country identifies as conservative so make these companies pay whenever you can. True, it takes some work to find substitutes, but where you can, hit them in the pocketbook. But it is easy in some cases to avoid buying shoes for example from Nike, buying anything from Disney, buying a car from GM, and turning off the NBA is quite easy. Some choices, like the NBA, are not even “necessities” in the normal course of life and can easily be dismissed. Find money managers other than BlackRock, and move your checking account away from Chase and other large banks, to smaller independent banks. It can be difficult finding substitutes on occasion but where you can, avoid doing business and avoid buying the stocks of companies in the Business Roundtable, or at least directors of the Roundtable.You can actually make spending your money a political “lifestyle” choice.  It is fun and you will feel good about doing so.

Corporate leaders will soon get the message.  If you go woke, you will go broke.  Other than the transgender craze, nothing has been more woke than ESG.

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This article is adapted from materials published by The Heartland Institute and is reproduced with permission.  However, the opinions are that of the author.