Florida’s and Texas’s futile attempts at doing away with ESG

By Trey Thoelcke Updated Mar 16, 9:52AM EDT · Published Mar 16, 4:49AM EDT

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Florida’s and Texas’s futile attempts at doing away with ESG — © Thinkstock

(Mark Hulbert, an author and longtime investment columnist, is the founder of the Hulbert Financial Digest; his Hulbert Ratings audits investment newsletter returns.)

CHAPEL HILL, N.C. (Callaway Climate Insights) — Ready for today’s climate investing pop quiz?

How can you tell the real-world difference between:

A “woke capitalist” who avoids fossil fuel companies because they contribute to global warming, and
A “Milton Friedman-loving capitalist” who avoids fossil fuel companies because he thinks they won’t beat the market?

Give up? The answer is that you can’t. Their portfolios could be identical.

Nevertheless, Florida and Texas, along with a growing number of other states, are trying to prevent the first of my hypothetical pair from doing business with their pension funds, without simultaneously preventing the second. The states are destined to fail, since there is no objective definition that can do the trick.

Consider the definition that the Texas legislature came up with when banning investment advisers from managing any state pension funds if they boycott fossil fuel companies. Section 809.001 of the Texas Government Code defines “boycott energy company” to mean:…

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About the Author Trey Thoelcke →

Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.

Beyond 24/7 Wall St., Trey has created and edited financial content for Benzinga and AOL's BloggingStocks, contributing additional hundreds of articles to the investment community. He previously oversaw the 24/7 Climate Insights site, managing editorial operations and content strategy, and currently oversees and creates content for My Investing News.

Trey's editorial expertise extends across multiple publishing environments. He served as production editor at Dearborn Financial Publishing and development editor at Kaplan, where he helped shape financial education materials. Earlier in his career, he worked as a writer-producer at SVE. His freelance editing portfolio includes work for prestigious clients such as Sage Publications, Rand McNally, the Institute for Supply Management, the American Library Association, Eggplant Literary Productions, and Spiegel.

Outside of financial journalism, Trey writes fiction and has been an active member of the writing community for years, overseeing a long-running critique group and moderating workshop sessions at regional conventions. He lives with his family in an old house in the Midwest.