Ramaswamy's Strive takes new swipe at ESG priorities
The firm led by activist investor Vivek Ramaswamy is launching a new nationwide campaign aimed at getting major corporations to separate growth goals from increasingly polarized cultural issues characterized by environmental, social and governance (ESG).
Driving the news: Starting Tuesday, Strive Asset Management will air digital ads that invoke a spirit of bipartisanship to "promote excellence over ESG priorities" that some view as divisive.
Why it matters: ESG has become a flashpoint between investors and critics who argue the strategy encourages companies to involve themselves in politically-charged, "woke capitalism" that ultimately fails to benefit shareholders.
- In recent months, private equity giant BlackRock, Apple and Disney have found themselves in the crosshairs of anti-ESG efforts. Ramaswamy, who has become a controversial figure in investing circles, has often led the charge.
Zoom out: ESG battle lines have hardened ahead of the midterm elections, where Republicans, many of them critical of the strategy, currently have the edge in public polls.
- According to Strive, companies like ExxonMobil, Chevron, Home Depot, Amazon and Citigroup have "untapped potential" that could be unleashed if they weren’t subject to ESG constraints.
What they're saying: "Everyday Americans have extraordinary yet unrealized power at their fingertips," Ramaswamy, who serves as executive chairman of Strive, said in a statement.
- "They don’t just vote as citizens at the polls in two weeks. They vote every day with their investment dollars — which are too often used by other asset managers to inject political agendas into corporate America's boardrooms."
Yes but: It's not just Ramaswamy who thinks ESG could be less politically charged and more profit-oriented. At least one firm, ENV Ratings, aims to use quantitative metrics to make environmentally friendly investments less politically charged, and more objective.
- "ESG is a co-mingling of environmental, social and governance factors," Marcos Carrington, CEO of ENV Ratings, tells Axios in an email.
- "Isolating environmental ... from social and governance ... allows companies and investors to measure and track an objective indicator for focused investment."