ESG is a scam – No Safe Bets

This is a slightly modified excerpt from Fishy Corporate Proxy Advisors that elaborates and expounds on ESG ratings.

ESG is a rating that measures companies and evaluates them based on Environmental, Social, and (Corporate) Governance impacts. Which is purely speculative and subjective.

ESG ratings also play a role into data analytics and Proxy Advisors recommendations and vote. What you may not know is that ESG is a bunk rating and used as a casus to vote or lean directions of corporate response. Which totally undermines the G in the ESG rating, I mean, how can you have a shit rating that recursively evaluates itself? That’s called a feedback loop.

Things don’t have to make the world a better place, but the ratings can point to a shit future for the company, and that can be used as an underlying reason to vote a certain way.

The big takeaway is that ESG is bunk and is a part of the bunk inputs going into the underwriting to vote a certain way, meaning Proxy advisors can just make up anything and decide how they want to vote. Which they could do that before, it’s just better when you assign fictitious values that sounds socially justice-like, that way you sound like an asshole if you disagree of ignore ESG.

And ESG and racial diversity are among the things Proxy Advisors like ISS evaluate voting decisions, (as a reminder, the G in ESG is corporate governance. So having this be weighed in by outside third party proxy advisors, means ESG is fucked)

ESG and racial diversity is used to determine if the board members are a good fit.

You know, that sounds pretty fucking bad, and racist.

First off, you should vote board members by skill, competence, and loyalty to shareholders.

Secondly, voting someone on or off based on the color of their skin is racist. Voting to force the numbers to meet a quota based on skin color is retardedly racist as fuck.

Thirdly voting people based on Climate impacts sounds Orwellian, and is driven by politics and opinions rather than objective bottom lines. I bet the WEF gets a load from this (fun fact, they do).

Profit matters, and I guarantee someone is profiting from the inability for a company to profit. So sabotage is indeed a thing, my guy.

Also, ESG is inevitably biased because these bean counters don’t understand the deep intricacies of how literally all energy methods are fucked (besides objectively Nuclear). So petrol and oil companies will be rated differently compared to Solar Tech companies. This is obviously a bad thing because it makes the ‘free market’ less free-er than it already is by incentivizing certain models and products. of course, that’s like, my take on it.

(Corporate) Society is slowly building a gun aimed at it’s head, it’s fucking great.

Anyways,

Here’s evidence that I found after ranting about ESG ratings,

I mean, who gives a shit and how does this make proxy voting decisions?

-seriously, bunk ratings
Sauce

And in turn of making Proxy Voting Decisions, it undermines (again) the G in ESG.

ESG and MSCI,

So ESG is created and Governed by a company called MSCI, who is owned by Morgan Stanley.

I went sleuthing on Linkedin, and found a lot of connections with current Executives of ISS with MSCI,

You know, there just might be a deeper story here with a conflict of interest. Maybe MSCI and ISS have something in common. ISS being Institutional Shareholder Services, which provides Proxy Advise and voting for Corporate Governance.

A Managing Director,

an MD of ISS

Exec director,

an ISS Executive Director

The CEO of ISS,

Quite the jump from MD to CEO, WHILE overlapping the work history between 2011 and 2014. Kind of makes you think? How bad ass do you have to be to be a CEO of one company and an MD of another? That’s a huge work load.

Maybe a typo, who knows?

And I’d like to apologize, I’m not trying to pick on ISS specifically, this is just the funny thing I found with specifically them. It’s just a convenient little circle connecting dots with MSCI’s ESG ratings in which MSCI is owned by Morgan Stanley and is used to possibly indirectly influence companies behest Morgan Stanley.

MS -> MSCI -> ESG -> ISS -> Company control (basically).

Of course that’s just an implication. . .

I mean, it’s not like MS has an army of Business Analysts that heavily rate companies and their performance based. on. . ESG. . . wait a minute. . .

who knows? Maybe a nothing burger of coincidence, but probabilistically not.

ESG and Lord Musk,

Lord Elon Musk has been a heavy critic of ESG ratings, rightfully so. As the Owner of a technology company that builds quite advanced batteries, modes of transportation, communication networks, travel infrastructure, and space technology, being valued as the richest man in the world. . . You kind of have to ask if this person knows a thing about E,S,G. . .

Mainly Lord Musk is upsetti at ESG valuation of Tesla, probably the only real innovative green company in all of automobiles.

The rating is bunk,

I mean, love him or hate him, Lord Musk is hella smart. So when he says statements like this;

It makes you think, why?

It’s obviously retarded that ESG rating rate highly the War Machine over Eco-friendly technology. Because apparently war is a problem for getting oil or some shit;

Resulting in obviously the fact that ESG should not exist;

Basically,

And people are catching on;

Do you hear the people sing? Singing a song of Angry Men Disgruntled Investors.

If this populism momentum keeps going and redistributes the power back to the people, away from the chains that enslave corporations which Corporations that indirectly enslave people. Then maybe life might get pretty neat in the future. Just saying.

ESG is basically a credit score,

Again, I’m saying it’s a scam.

It’s simply and irrefutably a scam.

It’s a scam of ‘good boy’ points for corporations. Utterly Dystopian. Apply everything in a Credit Score to ESG, there are obvious parallels. Credit scores are simply proto- social credit systems. ESG is that, but for companies.

And lastly,

The WEF is also supporting this ESG rating scheme, those lame ducks.

The WEF so friendly on climate change initiatives that they’ll support the ESG rating that allocates money and ratings favorably to the military industrial complex than actual climate innitiatives.

In Closing,

ESG is a Scam.

The whole TLDR on ESG, is that it’s one of many bunk ratings that are used to dictate the future of a company. It’s like a (Corporate) Credit score, it’s a scam.

That’s all folks.

*Not Valid Financial, Legal, Life, or Any Advice


Update,

Apparently Chamath also talked about ESG, So here’s the video and a transcript,

“(ESG is) a complete Fraud”- Chamath

Yea, the whole idea of carbon credits is just fucking lame. It’s a huge scam. The fact that you can offset carbon credits by borrowing or buying it from others who have allocated carbon credits, is also a huge scam. You’re gonna get a whole bunch of shell companies providing negative net value to offset imaginary taxes.

Because taxes are a fucking scam too.

Great.

Author: Elsie Hughes