To ensure that the most vulnerable among us have enough food and energy, we need to end the back-door politicization of financial assets through schemes like ESG. Over the past few years, ESG investing has won converts it doesn't deserve. It presents itself as the solution for socially conscious investing, but the reality is far different.

In short, environmental, social, and governance principles not only harm states like Nebraska, where I was born and raised, but the poorest countries in the world.

I have a unique perspective on how ESG hurts my home state. After getting my start in politics as a state senator, I now serve as Nebraska's state treasurer. Whereas previously I engaged in the partisan politics of the day, in my new role I think and act only as the state treasurer, and I am committed to carrying out the duties of my office apolitically. In other words, I'm not here to use the money I oversee to achieve my own political ends, and I'm certainly not trying to achieve through the back door goals that even our own legislature hasn't been able to achieve.

But that's precisely what ESG investing does. Unelected investment managers and other financial institutions make decisions based on their own political agendas with the investments, savings, and pensions of millions of Americans.

What is that political agenda? One pillar is a commitment to so-called net zero, the idea that by 2050 we will achieve net-zero carbon emissions. This means an increasing reluctance (and sometimes outright refusal) to invest in fossil fuels, an industry which has improved the lives of so many around the world. Indeed, affordable and reliable energy is a critical factor in enabling an economy to grow, prosper, and help the poor. But ESG gets in the way of that, hindering not only the energy that powers communities around the world, but potentially hampering the ability of farmers to grow the food and livestock that feed those communities.

In the name of "net zero," some financial institutions and asset managers are trying to impose a worldview diametrically opposed to the values and economic interests of my state, and many others all around the world. Asset managers should be politically agnostic, not only because following ESG principles rather than focusing on investment returns is likely a violation of their fiduciary duty, but because doing so hurts their clients in states like Nebraska.

But the implications of ESG go far beyond any individual state or nation. Around the world, ESG and net-zero policies not only harm the poor but also empower tyrants.

For example, emissions policies in the Netherlands and concerns about nitrogen runoffs now put more than 11,000 farms at risk of being closed. In the meantime, Sri Lanka has also run into immense difficulties because of a disastrous attempt to enforce organic -farming techniques. If we don't take action, these same policies will devastate the agricultural sector of Nebraska and many other states, hurting not only our ability to produce food for our own citizens, but those of developing countries as well (America is the largest food exporter in the world).

What's more, when ESG prevents the production of affordable energy in the U.S. and investment in developing countries, it empowers countries like China. China is happy to invest in developing nations to extend its control. While we in the West are imposing net-zero policies, any reduction in our emissions is more than made up by China, which emits more greenhouse gases than any other country. In 2020, for instance, China built more than one coal plant per week, despite its supposed commitment to lower its emissions. To get China on track for net-zero emissions would cost $8.2 trillion dollars – more than a third of the American economy, and almost $2 trillion more than our entire federal budget, which is already bloated beyond imagination.

ESG is also using the carrot of capital to wield the stick of net-zero emissions against poorer nations who desperately need affordable energy to build their economies, but simply can't afford to go green right now. I recently spoke at an event where, for the second time in less than a month, leaders from developing nations shared concerns about ESG despite potential backlash from the Biden administration.

For these reasons, we need a profound reevaluation of the back-door politicization of financial assets through schemes like ESG and all net-zero policies. We can care for the environment and our communities without hamstringing ourselves. We live in an increasingly dangerous world. Now more than ever, we need to ensure that we can produce necessities such as food and energy – not only for our own citizens, but for the most vulnerable around the world.

John Murante is the 44th Treasurer of the State of Nebraska.