Dr. Wayne Winegarden, PRI senior fellow in business and economics, today submitted comments to the Office of the Comptroller of the Currency responding to their proposed rule on “Fair Access to Bank Services, Capital and Credit.”
In the letter, Winegarden writes, “it should go without saying that banks should not discriminate against potential creditworthy borrowers and/or clients who are operating in legal industries. Yet, thanks in part to the growth in ESG, there is a growing tendency for this disconcerting discrimination to occur.”
“ESG also suffers from a fundamental contradiction, which is relevant to the proposed OCC rule,” Winegarden writes. “ESG proponents, who are often from outside of the organization, pressure companies and investors to implement ESG strategies. These same advocates also claim that ESG programs and investing will enhance profits. But, these two claims are contradictory.”
“The problems created by this inherent contradiction with respect to ESG programs is applicable to the OCC’s proposed rule,” Winegarden concludes. “Banks are pressured by the same broader ESG activists to forgo serving politically disfavored industries such as energy companies, gun manufacturers or private prisons. However, if these industries are unprofitable, no pressure to discriminate against them is required.”
