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Wall Street trade group sues Missouri over rules opposing ESG in private investments (2023)
| Environmental, social, and corporate governance |
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| • What is ESG? • Enacted ESG legislation • Arguments for and against ESG • Opposition to ESG • Federal ESG rules • ESG legislation tracker • Economy and Society: Ballotpedia's weekly ESG newsletter |
The Securities Industry and Financial Markets Association (SIFMA) is suing the state of Missouri over its recently enacted rules requiring the disclosure of ESG considerations to private investors. SIFMA claims the state has overstepped its authority:
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A top U.S. trade group for financial firms filed a lawsuit accusing Missouri of "overstepping its boundaries" after the state passed a rule to curb the impact of environmental, social and governance (ESG) factors in investment decisions. Under the new rule, broker-dealers in Missouri would be required to obtain consent from customers to purchase or sell an investment product based on social or other non-financial objectives, such as combating climate change. The Securities Industry and Financial Markets Association (SIFMA), which represents banks, asset managers and broker dealers, said on Thursday the rule was in conflict with federal securities laws, which advocate a uniform regulatory regime across the country. "The rules fail to acknowledge that federal law, regulations, and applicable rules already require financial advisors to act in the best interest of their clients when providing personalized investment advice," SIFMA said in its lawsuit. The lawsuit, filed against Missouri Secretary of State John Ashcroft and Securities Commissioner Douglas Jacoby, marks one of the biggest challenges to a Republican-led backlash that has engulfed major Wall Street firms such as BlackRock (BLK.N) and Wells Fargo (WFC.N). The rule is not in conflict with the federal securities laws as SIFMA decries, Ashcroft said in a statement. "The rule implements client disclosure standards pertaining to security investments and how investment advisors and broker-dealers disclose investment strategies that propagate values-based agendas that are not purely focused on generating profit for their clients," Ashcroft added.[1] |
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See also
- Environmental, social, and corporate governance (ESG)
- Economy and Society: Ballotpedia's ESG newsletter
External links
Footnotes
- ↑ Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
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