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Reblogged:Strive's Guns Blaze Against ESG

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Over at Master Resource, Robert Bradley, Jr. briefly discusses and reproduces in full a letter, dated September 6, from Vivek Ramaswamy, the Executive Chairman of Strive Asset Management to the board of Chevron. The letter is about 3400 words long, about a ten-minute read, but is worth it for the eye-opening material and incisive arguments alone.

No less important for anyone concerned about the fossil fuel elimination movement: It will do one good to read it: It is as inspiring to see an able champion fighting a good fight as it is comforting to know that that it is happening.

Ramaswamy's Strive Asset Management seeks maximum returns on its investments, in contrast to the likes of "woke," pro-ESG funds like BlackRock, State Street, and Vanguard, which do not, opting to use their clients' funds to pressure companies to adhere to the left-wing diktats of the ESG movement instead.

Below, I'll highlight just three things I liked from the letter -- which all follow his opening contention that Chevron has a historic opportunity to increase its value.

First, Ramaswamy demolishes "Scope 3 emissions reductions," a ridiculous constraint some of these funds have pushed at times:
For an oil company like Chevron, scope 3 emissions caps may represent an existential risk to the business itself. The 2021 Scope 3 proposal effectively requires Chevron to bear responsibility for the emissions of every Amazon delivery truck that burns its fuel, without requiring a symmetric obligation from Amazon in return. This makes about as much business sense as it would for McDonald's to voluntarily commit to reducing the body weight of anyone who ever consumes a Big Mac, without asking the consumer to share any responsibility. As far as we can tell, this makes no business sense for Chevron. [bold added]
Second, Ramaswamy notes a double standard being applied to Chevron's disadvantage:
We also note that certain these institutions suffer significant conflicts of interest when representing their clients. For example, Chinese firms including PetroChina are well-positioned to acquire projects dropped by U.S. companies like Chevron who face ESG-imposed pressure to achieve emissions reductions. PetroChina recently reported strong financial results which the company attributes in part to its increased investments in production capacity. BlackRock is a large shareholder in PetroChina while imposing no emissions reduction measures on that company to our knowledge. [links dropped, bold added]
Third, Ramaswamy reminds Chevron who its actual shareholders are:
Today the three largest passive asset managers in the world -- BlackRock, State Street, and Vanguard -- manage over $20 trillion, approximately equal to the total U.S. gross domestic product. In 2021 these firms appeared in public filings as Chevron's top 3 shareholders. By contrast, the actual owners of Chevron are not BlackRock, State Street, Vanguard -- or, for that matter, Strive. Chevron's actual owners are the clients of these institutions: everyday citizens whose capital is invested in passively managed index funds.

You owe a fiduciary duty to the actual owners of Chevron
, not to the institutions who claim to represent these owners. There is strong reason to believe that these large asset managers are not voting with their clients' best interests in mind. Indeed, nineteen state Attorneys General have explicitly accused BlackRock of as much. Last month, they sent a letter alleging that the company "use the hard-earned money of our states' citizens to circumvent the best possible return on investment." It further accused BlackRock of violating the law by "commit[ing] to accelerate net zero emissions across all of its assets, regardless of client wishes." [links omitted, emphasis mine]
In addition to this outstanding letter, the post explicitly mentions as a "new front" in the war on ESG, Alex Epstein's new book, Fossil Future.

Starting at 10:15, energy expert Alex Epstein interviews Vivek Ramaswamy on Power Hour.

If there were a single short read I would recommend to a reasonable, persuadable adult on the subject of energy policy or ESG, this would be a very strong candidate.

If you agree with this assessment, please consider passing the word.

-- CAV

P.S. Ramaswamy is also author of Woke, Inc.: Inside Corporate America's Social Justice Scam.

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