On March 6, 2025, Bloomberg dropped a bombshell: JPMorgan Chase & Co. and State Street Corp. have quit the Climate Action 100+ initiative, a coalition of investors pushing companies to slash greenhouse gas emissions, while BlackRock Inc., the world’s largest asset manager, scaled back its role. The trigger? A lethal mix of political pressure, economic reality, and a growing revolt against the sanctimonious dogma of Environmental, Social, and Governance (ESG) investing. This retreat isn’t just a Wall Street shuffle—it’s a damning verdict on ESG’s failures, a system that’s not only unravelling financial coalitions but also crippling Europe’s ability to rearm itself in a world teetering on the edge of conflict.
The ESG Fantasy Meets Reality
ESG’s evangelists have peddled a dream: score companies on environmental impact, social justice, and governance, and you’ll save the planet, uplift society, and boost profits. It’s a fairy tale that’s crumbling fast. The Bloomberg report reveals why: financial giants are bailing on climate commitments because ESG’s mandates—exemplified by Climate Action 100+’s net-zero push—demand astronomical costs that clash with fiduciary duty. For JPMorgan and State Street, managing trillions for clients, sacrificing returns for green dogma isn’t just impractical—it’s betrayal. Clients want growth, not guilt trips.
But the damage isn’t limited to balance sheets. In Europe, ESG’s obsession with emissions has shackled industries critical to rearmament. Defense manufacturing—think steel, chemicals, and energy-intensive production—faces divestment threats and regulatory chokeholds under ESG frameworks. As geopolitical threats loom, from Ukraine to the South China Sea, Europe’s push for “sustainability” has left it industrially anaemic, unable to ramp up the weapons and infrastructure needed to deter aggression.
The Political Backlash ESG Ignited
ESG’s overreach has sparked a firestorm. In the U.S., red states like Texas and Florida have blacklisted ESG-driven firms, decrying their assault on jobs and energy security. The Bloomberg piece flags this: “US political pressure has mounted against Wall Street firms pushing sustainable investing.” But Europe’s predicament is even graver. ESG’s green fetish has gutted its energy independence—shuttering coal plants and stalling nuclear projects—while Russia’s war machine hums along. Posts on X, like those from
@clim8resistance, highlight how ESG-driven energy costs cripple manufacturing, a point underscored by Europe’s struggle to rebuild its military-industrial base.
Germany, once an industrial titan, exemplifies this self-inflicted wound. Its ESG-compliant energy policies—ditching reliable fossil fuels for erratic renewables—have left factories underpowered and defence firms scrambling. As warned on X in 2022, small and medium enterprises drown in ESG’s red tape, but now it’s clear: so do the big players Europe needs to rearm. Political backlash isn’t just American—it’s brewing across a continent waking up to ESG’s strategic folly.
The Economic—and Strategic—Casualties of ESG
The retreat from Climate Action 100+ exposes ESG’s core lie: it’s more about PR than progress.
@lhfang’s 2023 X post nails it: “There really isn’t much evidence ESG does anything other than help exploitative corporations rebrand.” Companies slap on ESG labels while asset managers rake in fees, but the real-world toll is brutal. In Europe, ESG’s war on “dirty” industries has slashed steel production and hobbled supply chains—vital for tanks, ships, and munitions. The Bloomberg report hints at the downstream chaos: as Wall Street pulls back, smaller firms and nations still face ESG’s unrelenting pressure, amplifying the economic—and now military—vulnerability.
This isn’t hypothetical. NATO’s warnings about depleted stockpiles ring hollow when ESG policies throttle the factories that could refill them. Europe’s defence giants, like Rheinmetall or BAE Systems, face higher borrowing costs and investor scepticism for failing ESG purity tests. The result? A continent disarmed by its own virtue signalling, staring down adversaries with little more than wind turbines and carbon credits.
The Hypocrisy of ESG’s Champions
BlackRock’s sidestep—staying in Climate Action 100+ but offloading its role to a quieter arm—reeks of cowardice. Larry Fink once boasted of wielding shareholder power to enforce climate goals; now, he’s dodging the blowback.
@VivekGRamaswamy’s 2023 X critique holds: ESG’s influence poisons all investing, not just labeled funds. Meanwhile, its global fallout is stark: divesting from Western fossil fuels doesn’t cut emissions—it hands the reins to China, which powers its factories and military with coal while Europe dithers.
The environment doesn’t win—nor does security. ESG’s collapse leaves Europe exposed, its industrial base eroded by a doctrine that prized optics over survival. Wall Street’s retreat is just the visible crack; the deeper fracture is a continent unprepared for the wars it can no longer avoid.
The Verdict: ESG’s Self-Inflicted Ruin
JPMorgan, State Street, and BlackRock’s flight from Climate Action 100+ isn’t a betrayal of ESG—it’s the predictable implosion of a flawed ideology. By fetishising green metrics over markets, ESG alienated its financial backers. By strangling energy and industry, it disarmed Europe at a moment of existential risk. It promised a triple win—profits, planet, peace—but delivered a triple loss: economic stagnation, political division, and strategic weakness.
Ditch ESG, and there’s hope: investing rooted in reality—growth, innovation, and resilience—could rebuild both markets and militaries. Wall Street’s exit isn’t the death of climate action; it’s the death of a delusion that confused preaching with power. Europe’s security, and the world’s, demands we bury it deep.
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