Twenty-three state attorneys general are raising red flags about the financial industry’s latest virtue-signaling trend: the Net Zero Financial Service Providers Alliance (NZFSPA). This coalition of financial heavyweights, including the Big Four accounting firms and Bloomberg, has committed to aligning its services with the lofty goals of the Paris Agreement by 2050. But the attorneys general argue that this alliance could be skirting antitrust and consumer protection laws.
Virginia Attorney General Jason Miyares said, “Customers expect financial service firms to make objective decisions that will produce the best possible outcome for their clients.” The ESG (Environmental, Social, Governance) commitments, Miyares argues, create conflicts of interest and limit consumer choice. These firms, in essence, could be “taking actions to hamper the flow of goods and services to align with the Paris Agreement’s unrealistic standards,” according to a press release from Miyares’ office.
🚨 REPORT: Members of the Net Zero Financial Service Providers Alliance (NZFSPA) are likely violating antitrust law by colluding with climate activists to promote ESG in a highly coordinated manner:https://t.co/6sIuXWsFbx
— Consumers' Research (@ConsumersFirst) September 16, 2023
Tennessee Attorney General Jonathan Skrmetti told the Washington Examiner that the NZFSPA might violate antitrust and consumer protection laws to serve their “activist climate agenda.” After all, many of these member organizations are direct competitors that have united to use their market influence to accomplish specific environmental outcomes.
The top legal officers from their respective states note that NZFSPA’s larger members, especially the Big Four accounting firms, control about 75% of the market share in their industries. This situation may violate federal antitrust laws. These laws prohibit business competitors from taking concerted action that restrains trade or commerce. “Decisions about energy policy should be made by our elected representatives, not by transnational corporate alliances,” Skrmetti said.
This isn’t just about climate change or industry alliances. This is about companies using their financial clout to steer the market and hamstringing the American economy. Of course, this can result in higher costs for everyday Americans.
Will Hild, executive director of Consumers’ Research, said, “Financial services providers must understand that no matter what virtue signaling label they slap on it, collusion between members of an industry to drive up costs for Americans is immoral and illegal.”
There is a line between corporate social responsibility and potential legal violations. The coalition of states now looking into this includes a broad swath of the country, from Alabama to Wyoming. These states have called for more information from the NZFSPA to understand their commitments and related policies better.
As the investigation unfolds, the message from these attorneys general is crystal clear: Financial service firms need to think twice before jumping on the ESG bandwagon at the expense of American consumers and market competition.