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🤍 First things first: we want to acknowledge that it’s been an overwhelming few weeks.  Our hearts go out to all of the victims and families affected by the systemic issues ravaging the U.S.

Shareholders coming together to hold corporations accountable and change them for a safer world never feels more important than in moments of crisis. Amid *gestures at everything* we find inspiration in our collective mobilization, and we’re here, as always, to continue driving this mission forward.

At the same time, activist investing is facing new criticism and rebuke from the most powerful people in the world. They’re scared fr. This issue of In The Loop surveys the ESG landscape and breaks down everything you need to know about the debate.

Happy Pride and have a safe month 👐

🎤 Expert Mode

  • Watch our CEO and co-founder Felix Tabary drop knowledge – Felix hopped over to Paris for the ChangeNow summit to speak about Troop’s journey so far and how the purpose-minded origins of corporations got so corrupted. Check out his hair (and follow us!) on TikTok.

👥 Casting Call

  • Troop is hiring! – We’re currently seeking a Frontend Developer, PR Coordinator, and Art Director. If you’d like to help empower everyday investors in shaping corporate impact, learn more about the roles here.

You may have noticed that billionaires and conservative politicians can’t stop talking about “ESG.” The term is everywhere lately. Loyal readers will know it’s something we cover consistently, but in light of recent headlines, we wanted to offer a simple introduction. Consider this ESG 101.

👥 What Is ESG?

  • ESG stands for Environmental, Social, and Governance. These three principles are used to evaluate companies in ways other than how they’re maximizing profit. (What an idea, right?) They’re also an investment strategy, accounting for risks associated with things like climate change, inequality, and poor corporate transparency.

🗽 Where Did ESG Come From?

  • Society-minded conceptions of corporations, ironically, date back to America’s early days: founding states granted incorporation selectively to firms whose work would benefit the public. (How that idea decayed is a whole other newsletter.)

  • The term “ESG” was first popularized in a 2004 United Nations report, published in partnership with financial institutions, which argued that better integrating ESG issues was crucial to smart investment in a changing world.
  • Purpose-minded investment in the U.S. was rejuvenated in the 20th century by union pension funds that focused on things like housing infrastructure, then by divestment campaigns targeting South African companies complicit in apartheid.

🚩 What’s the Controversy?

  • Politicians like Mike Pence and outspoken billionaires like Peter Thiel have started targeting ESG as a culture war boogieman, calling it things like “woke capitalism” and “corporate cancel culture.” Elon Musk called ESG a “scam.”

  • Critics often argue that ESG can conflict with American energy independence and that its standards are at times arbitrary. Musk has pointed out that, according to one ESG rating, ExxonMobil was rated higher than Tesla.

  • But it’s more than just a talking point. West Virginia recently divested public funds from BlackRock for advocating net-zero investment strategies and Texas banned state investment in banks that boycott fossil fuels or firearms.

👀 Wait, Doesn’t Elon Have a Point?

  • Totally. Many constructive critiques about ESG’s efficacy have been made in good faith (i.e. not by billionaires) and ESG-washing by investment companies and rating systems using the term for marketing purposes is common.

  • As ESG grows—by one metric, sustainable assets under management recently hit $35 trillion—ensuring this money is invested meaningfully is crucial. Responsible capital management alone can’t stop climate crisis or solve every problem, but it’s a necessary part of the solution.
Data points simplified for aesthetic purposes 💅

👀 What Does This Mean For Me?

  • Do your homework. (Sorry!) Not all ESG investment funds or products are built the same, nor are the ways they’re evaluated. Understand how your money’s actually being used and review the rating standards (like SASB) that take themselves seriously.

  • Encourage your friends to sign up for Troop, so they can mobilize with other shareholder activists, and learn important info like this (and not fall for the ESG-washing trap!)
  • You knew we were gonna say this: Vote and organize for shareholder resolutions! Proxy voting provides clear and concise deliverables, making them essential tools for ESG action and accountability.

A few other quick bites from the Troop braintrust.

  • After years of organizing, shareholders of the gun manufacturer Sturm Ruger passed a proposal for the company to study the impact of its products on human rights. Not that you’d hear about it from the suits. – The New York Times (~2 min, 🔍)

  • Direct action is hot rn. Money Rebellion activists disrupted AGMs for Barclay’s and Standard Chartered to protest fossil fuel financing, while shareholders protested Dollar General’s annual meeting to speak out against low wages and unsafe working conditions. – Nashville Scene (~3 min, ✊)

  • As Grindr prepares for a much-hyped IPO, the company announced that a majority of its board of directors are members of the LGBTQ community (well, the LG part, at least). While not necessarily representative of diverse identities across a truly queer spectrum, is this at least a sign that rainbow washing is coming out with some more tangible outcomes?. – Fortune (~3 min, 🌈)

  • Florida is escalating its war against Disney for speaking out (after protests from employees and shareholders) against the state’s “Don’t Say Gay” law. Much like Halloweentown, the future of local residents in the theme park’s contested jurisdiction are hanging in balance. – CNN (~3 min, 🐭)

  • House Speaker Nancy Pelosi’s husband Paul, the face of congressional insider trading accusations and *ahem* other recent headlines, just scooped up a bunch of Apple and Microsoft stock options. – Insider (~2 min, 👀
  • The spectacular collapse of Terra Luna’s stablecoin is reportedly under SEC investigation. Experts say the coin’s crash, at the same time as BTC and ETH downturns, is fueling momentum for a crypto crackdown in Washington. – Politico (~7 min, 📉)

  • Happy 20th anniversary to a classic tale of boardroom politics and shareholder activism. We’re talking, of course, about Adam Sandler’s Mr. Deeds. – Starz (~96 min, 🎾
Wishing a summer of abundance for all of our lovely readers ☀️

Thanks again for reading. Remember to follow us on social and tell your friends to join the movement. We’ll see you next month.

🦍The Troop Team 🦍

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