Consumer and Republican backlash against environmental, social, and governance (ESG) investments has increased dramatically in the past year as states, Congress, and presidential candidates have taken on the issue, promising to rein in the largely green-conscious movement of capital amid spiraling energy and food costs since 2021.

Boycotts of brands such as Bud Light, Disney, and Target, coupled with statements by Blackrock CEO Larry Fink that he no longer wanted to call these so-called sustainable investments ESG, and reported outflows from ESG funds in 2023 have painted a gloomy picture for green and socially conscious investing.

For example, Oilprice.com’s Felicity Bradstock recently reported, “ESG Investments Face Financial Hurdles,” citing “disappointing returns” and “concern among financial experts.” And the New York Post’s Charlie Gasparino reported, “Investment titan BlackRock mutes ESG talk amid backlash” even as Blackrock still controls $700 billion of “pure ESG” assets.

The closures of certain ESG ventures resulted in most recently $635 million of withdrawals from so-called “sustainable” asset funds in the second quarter of 2023, according to Morningstar.

And yet the outflows were not enough to result in negative returns in the funds, which have increased the past three quarters to $313 billion, according to Morningstar, amid rising equity and bond markets. 

In other words, ESG is no smaller than it was last year after all markets took a major hit following Russia’s invasion of Ukraine in February 2022. 

Even many of the boycotted companies still appear to be easily profitable. For example, ABInbev — which owns Bud Light, which saw U.S. sales plummet after a marketing pitch by transgender activist Dylan Mulvaney — has seen revenue increase globally by 10 percent despite a 10.5 percent drop in U.S. sales.

According to the Daily Investor’s Bianke Neethling, ABInbev’s Mulvaney-generated social media controversy and loss of sales in the U.S “was offset by growth in the company’s other key markets, including Mexico, Colombia, China, Brazil, Europe and South Africa. 

Similarly, Disney’s gross profits the past 12 months have totaled $28.7 billion, up 3 percent from the year prior. In the second quarter of 2023, it earned $7.85 billion of profits, up 0.47 percent from last year.

In 2022, ESG investments in the U.S. stood at $8.4 trillion, according to the latest data by the USSIF, The Forum for Sustainable and Responsible Investment. It will be interesting to see how 2023 turns out, but right off the bat that was a whole lot of money on the table at the end of last year.

Meaning, the negative ESG headlines we are seeing in certain financial media could mislead that the sustainable and socially conscious investment kick is going anywhere anytime soon. It’s akin to happy talk. 

In the meantime, the U.S. Department of Labor is still encouraging ESG investments by employer-based defined benefit and contribution plans. Tax deferment for retirement savings, including into ESG funds, remains alive and well. And tens of billions of dollars from Congress continues to flow to green companies from the Inflation Reduction Act as the decarbonization agenda continues largely unimpeded.

That, even as crude-oil production in the U.S. reached a new record level at 12.9 million barrels a day in July 2023 in response to the inflation and continued supply chain disruptions occurring out of the war in Ukraine, according to the U.S. Energy Information Administration. Over the next few decades, companies like Exxon and Chevron continue to say they plan on proceeding to net-zero on carbon emissions in response to green-activist investors.

Longer term, these companies could still see negative outcomes, for example, as Republican-run states and members of Congress look at violations of Title VII of the Civil Rights Act by companies offering racial and gender-based hiring and promotion preferences. These concerns are bolstered by the Supreme Court’s decision striking down affirmative action in college admissions as a violation of the Fourteenth Amendment. Or as antitrust lawsuits look at sustainable companies’ plans to eliminate carbon-based energy in a collusive manner by driving up energy costs.

There are a lot of balls still up in the air. Yes, the American people are more aware of ESG and the influence it has on the U.S. economy and have fired a few warning shots with targeted boycotts. Certain red states are no longer allowing state workers to make ESG investments in state pensions. But it could be a false comfort.

We’ll see better where everything ESG stands after the recession and/or market volatility is over. The Title VII and antitrust liability threats could still cause a big reboot, but my gut says they’ll never give up.              

Robert Romano is the VP of public policy at Americans for Limited Government (ALG). The organization says it is a “non-partisan, nationwide network committed to advancing free-market reforms, private property rights, and core American liberties.” 

As the political press continues to gear up for next year’s presidential election, I’ve been struck by how little attention many national reporters have paid to a potential third-party bid by the group known as No Labels. The organization, which says it’s committed to bipartisanship and political centrism, has secured ballot access in at least 10 states, and appears positioned to do so in others, as well.

This has Democrats worried. Third parties in presidential contests have mostly served either as after-thoughts or as spoilers, and it’s not hard to see a No Labels presidential ticket taking votes from Democrats’ likely nominee, Joe Biden, and assuring the election of the Republican candidate — probably Donald Trump. That’s an unpalatable option for most Democrats and even many independents, and it may be why some prominent Republicans are pushing for a No Labels candidacy.

It’s probably impossible for party leaders to leave strategic considerations aside, but for the rest of us, there are lessons for both parties in No Labels’ traction this year. Many Americans are tired of the intense partisanship they see at the national and state levels. And for some voters, the policies the group is promoting seem to strike an attractive ideological balance.

These include policy prescriptions that call for reining in spending to keep the national debt from growing faster than the economy; regaining control of our borders but ensuring a path to citizenship; criminal-justice reforms “so career criminals can’t keep committing crimes” while at the same time, “keeping dangerous weapons away from dangerous people”; committing to make U.S. students number one globally in math and reading within a decade; and a bold statement that “no child should be forced to go to a failing school.”

Now, as anyone with experience in creating policy will tell you, there is a big difference between promoting noble-sounding ideals and crafting legislation that will help the country live up to them. Or to put it another way, the devil’s in the details. To this end, I’m struck above all by No Labels’ overarching key point — one that many politicians of both parties who are inclined toward the center have been trying to make for years: “America can’t solve its biggest problems and deliver the results hardworking taxpayers want, need, and deserve unless Democrats and Republicans start working together side by side on bipartisan solutions.”

There’s no doubt that this is what a lot of Americans would prefer — and, ironically, it’s what a lot of politicians could make happen without a third party nipping at their heels. In fact, it already is happening. The huge 2021 infrastructure bill? Bipartisan. A new effort to regulate AI? That’s a Democratic senator from Connecticut and a Republican from Missouri working together. Modernizing STEM education? That’s from a New Hampshire Democrat and a Tennessee Republican, also in the Senate.

Of course, work like this often flies under the radar. As fall wears on, it’s more likely that what we’ll be reading about in the press is the opposite… Many ambitious politicians, looking for an edge, believe it’s in their interest to stoke division, since they can raise funds from riled-up partisans and then drive election turnout by inflaming their base.

The problem is, that’s no way to govern. Over the course of our history, bipartisanship has often produced better, longer-lasting legislation. It means a proposed law will reflect a wide range of views, win greater acceptance within a legislative body and among the public, and — just as important — last beyond the next change in power.

As voters, we don’t need a third party to help us make this happen: We can choose political candidates of both parties who, in both their rhetoric and their values, show that they can and will work across the aisle. But if No Labels’ appeal to ordinary voters can serve to remind politicians and their party leaders that there’s a hunger for centrism and bipartisanship in the public at large, then that’s all to the good.      

Lee Hamilton, 92, is a senior advisor for the Indiana University (IU) Center on Representative Government, distinguished scholar at the IU Hamilton Lugar School of Global and International Studies, and professor of practice at the IU O’Neill School of Public and Environmental Affairs. Hamilton, a Democrat, was a member of the U.S. House of Representatives for 34 years (1965-1999), representing a district in south-central Indiana.