Deep red state proposal triggers ESG concerns: 'Raises a lot of questions'

Senate Bill 714 would amend the Energy Discrimination Elimination Act of 2022 to take away the treasurer's "enforcement authority" of the law and give it to the state Attorney General's office.

Critics argue that wording in the legislation would lower the standards necessary for an institution to be on the list and how agencies enforce it.

"The bill actually removes the treasurer from oversight of the investment behaviors of big financial institutions and proposes to put it under the attorney general's office," Oklahoma State Treasurer Todd Russ told Fox News Digital regarding Senate Bill 714. "So, I mean, that alone raises a lot of questions.

"As a constitutional officer in the state treasurer in Oklahoma, why would you want someone that doesn't have the constitutional commitment and obligation to oversee the financial investments and affairs of the state to be under the treasury and move it to a different constitutional office?" he continued.

"Over the years, those subject matters have become very politicized. I mean, it's not a financial issue. It's a social agenda that they've woven into the investments," Russ said of ESG.

"The state of Oklahoma's not trying to get on the other side of that behavior. We're trying to take a stand to say, 'Look, stay out of the political arena with my investments. Our investments.' We are solely concerned about the financial performance and profits of our investment, and we don't want outside people using it for political leverage. So, when it comes to environmental issues, oil and gas is very important to Oklahoma. We don't want them acting against the interests of the oil and gas industry."

Oklahoma Attorney General Gentner Drummond's office said, "This bill is only necessary because of the treasurer's dismal failure to successfully defend the Oklahoma Energy Discrimination Act of 2022. That was the real slap in the face to the oil and gas industry.

"The act prohibits state contracts and pension system investments with financial institutions that discriminate against the oil and gas industry."

Republican state Sen. Dave Rader, the bill's sponsor, told Fox News Digital in an email he plans on making some amendments to the legislation, including "further clarifying the definition of boycott energy company to include voting on shareholder proposals which penalize or inflict harm, adding legislative intent to make clear that the purpose of the bill is to protect retirement systems, eliminate the word 'predominantly' in the definition of ordinary business purpose to make clear that any pro-ESG action is not allowable [and] eliminate the inclusion of transaction costs when determining a loss which presumably could keep delay divestment indefinitely." 

However, Rader's suggested amendments in the email have not yet been made official, according to the Oklahoma State Legislature's website, where the legislative text is shown.

The legislation would need to go to a vote in the full Senate by March 27 before potentially heading to the state House of Representatives.