Legislators Exploring Ways To Fight Back Against Woke Banks Which Are Attacking Fossil Fuels

The House Minerals Committee considered a bill that would create a list of companies with anti-fossil fuel policies. Wyoming could then refuse to do business with the companies on the list.

January 30, 20237 min read

House Minerals Chip Neiman 1 30 23
(Cowboy State Daily Staff)

Wyoming legislators are exploring ways to fight back against “woke” financial policies, which are associated with the environment, social and governance (ESG) movement. 

The movement has become a primary driver of directing investment away from fossil fuel industries, which has led to a large depletion of lending options for oil, gas and coal companies.

Rep. Chip Neiman, R-Hulett, introduced House Bill 210, which would direct the state treasurer to make a list of financial institutions that are actively engaged in discrimination against energy companies and refuse to enter into contracts with them.

Not Perfect

Members of the House Minerals, Business and Economic Development were supportive of the general goal of the bill, as was much of the testimony it heard Monday, but a number of questions came up over how the bill would work if it passed. 

“This is not a perfect solution by any stretch. But it’s a framework,” Neiman said. 

Given their support of the spirit of the bill, the committee agreed to make it an interim topic in committee meetings later this year, with a goal of producing a bill that would effectively address the problem. 

Neiman told Cowboy State Daily he appreciated that the committee was willing to take up the issue as an interim topic and believes a viable bill for the next legislative session will emerge. 

“Legislators are willing to open this conversation about how much effect ESG is having on a broader scale,” Neiman said. 

Neiman explained during his presentation of the bill to the House Minerals, Business and Economic Development meeting that he was trying to “push back” against a “woke attempt to undermine our state’s ability to generate revenue.” 

These “institutions that have more of an interest in trying to be woke than being financially prudent,” Neiman said.

Various Concerns

While the committee agreed something needed to be done about the state doing business with institutions actively working to starve businesses associated with fossil fuels, which provide the bulk of the state’s irevenues, there were many questions about how Neiman’s bill would work in practice. 

Among the concerns about the bill as it’s written is how it would impact community banks. A few years ago, Wyoming law was changed to allow local banks to hold state deposits. 

Rep. Donald Burkhart, R-Rawlins, said that these banks serve small communities where they may be the only bank within 50 miles. If that bank were to take a position that would land it on the list, Burkhart asked if it could continue to do business with the state? 

Neiman that the bill would create competition. 

In 2018, Bank of the West adopted anti-fossil fuel policies. 

Mark Gordon, who was state treasurer at the time, vowed to deny applications from Bank of the West for funds that are part of a program that allows banks to apply to use Wyoming cash reserves as loans to bank customers. 

At the time, Bank of the West had received $63 million in state money through the program.

Neiman said that many people, when they learned of the bank’s hostility toward businesses engaged in some fossil fuel activities, “pulled their money out in droves.” 

What this did, he argued, was create an opportunity for an institution that’s supportive of Wyoming’s extractive industries to come in and compete with banks that aren’t. 

“I think that’s where we allow capitalism to do its job,” Neiman said. 

Negative Perception

Some financial institutions receive high rankings for their ESG commitments while continuing to invest in fossil fuels. 

Bloomberg reported on how Wells Fargo, Citigroup, and Morgan Stanley received upgrades to their ESG ratings, while arranging for a complained $74 billion in loans to fossil fuels.

Burkhart and Rep. Martha Lawley, R-Worland, asked about institutions that speak in support of ESG but, in practice, continue supporting Wyoming’s extractive industries. 

Neiman said that institutions that promote the anti-fossil fuel agenda while supporting the industries are still harming those industries by creating a negative public perception.

“If you’re not going to try to actively support these industries, and you’re actively campaigning and working to undermine them, then I would refrain from doing business with you. It’s just the way it is,” Neiman said. 

Rep. Scott Heiner, R-Green River, said the bill gives institutions 45 days after notification that they’re going on the list before they’re officially on it, which would give them time to appeal the decision. 

Other Institutions

Burkhart also asked if the bill would apply to other financial institutions, such as credit card companies and credit unions. 

Neiman said that would depend on the discretion of the committee. His goal was to make sure the state has lending institutions that support the state’s key industries. If achieving that goal would be served by expanding it to credit unions, then that should be considered, Neiman said. 

“This is important to the people of this state, and this is something that needs to be addressed,” Neiman said. 

Bill Pilger, general counsel for the Wyoming State Treasurer’s office, said that other financial institutions, such as credit card companies, don’t fall under the purview of the treasurer’s office. 

Bobbie Frank, representing Wyoming Credit Unions, said the credit unions are supportive of Wyoming’s extractive industries and wouldn’t likely be impacted by the bill. 

More Clarity

Pilger also pointed out various areas in which the bill’s language needs more clarity. 

For example, it has the State Loan and Investment Board voting on the proposed list of banks that engage in anti-fossil fuel activities, but the language would still require the treasurer’s office to refuse to do business with them. 

The bill would also need to contend with the time it takes to put out an RFP for a financial service and the contracts the state entered into with these institutions. So, if an institution ends up on the list, the state wouldn’t have an opt out pathway to comply with the law. 

“There’s only a handful of institutions in the country that can actually handle the amount of money we have. And so either we would have to terminate that contract immediately, or at least not renew that contract,” Pilger said. 

Decarbonization Goals

Keith Rittle, representing the Wyoming Outdoor Council, spoke in opposition to the bill. 

“Whether we’d like it in Wyoming or not, the underlying goal is decarbonization,” Rittle said. 

Some institutions have outright bans on doing business with fossil fuel companies, Rittle continued, but others are pursuing a more gradual transition that considers other factors, such as keeping energy affordable. 

With the state heavily invested in oil, gas, and coal, Rittle said, it goes against the goal of diversification to remain so focused on it. 

Rittle said that, when the topic is taken up during the interim, these issues can be considered further. 

Sending A Message

Neiman said in an interview that he understood there were a lot of concerns to be explored before an effective bill could be developed in the committee. 

Among them is how pervasive ESG is in the financial world, and by limiting Wyoming’s ability to do business with companies that champion it could reduce options for state investing. 

“My mother taught me he should never answer a question with a question. But what’s the alternative?” Neiman said. “If nothing else, it sends the message to these companies that this matters, and that we are diligently looking at this.” 

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