Texas wants to go after corporations which prioritize climate initiatives and decline to invest in Texas fossil fuels.
Attempts by Texas Republicans to compel corporations to enforce conservative values have now expanded to include climate initiatives.
Earlier this year, Texas state lawmaker Briscoe Cain sent a cease-and-desist letter to corporations that provide funds for their employees to get abortions outside of the state. Now the state wants to target corporations that prioritize climate initiatives and decline to invest in Texas fossil fuels.
Texas wants to mandate reporting from investment firms and other large corporations to inform the state about their climate policies. State comptroller Glenn Hegar sent a letter to corporations doing business in the state asking them to clarify what their policies are. Texas recently passed a law that forbids the state from doing business with corporations that boycott traditional energy companies.
“We know some of these companies hold investments in oil and gas today, but what about the future? Are they selling the hope of a ‘green’ tomorrow with promises to divest or reduce their fossil fuel exposure?” Hegar asked in a recent statement. “A handful of companies are echoing promises by the Biden administration about a ‘transition’ to green energy. They’ve managed to convince people that electric cars and wind and solar power generation can meet our energy needs, and if we just stop investing in oil and gas, the transition will be swift and painless. Anyone who has paid any attention to recent events knows that just isn’t true.”
The statement goes on to say that if the corporations don’t respond within 60 days, the state of Texas will assume they are boycotting fossil fuel energy companies, which could put their ability to do business with the state at risk. Rob Greer, a professor in the Bush School of Government and Public Service at Texas A&M University, said that Texas could be going against broader global trends. “The state of Texas is a large state with a lot of money,” he said. “They can certainly sort of make a difference. But when you’re talking about the largest financial institutions…the global trends are going to be those that dictate a lot of this – and the state of Texas may be out of sync with some of those global trends.”
Studies have shown that oil and natural gas companies have failed to meet their lofty climate promises, which could explain why investment firms are looking to divest. Fossil fuel dependency also puts additional strain on democratic states to be reliant on authoritarian countries like Saudi Arabia and Russia who remain major global producers of traditional energy sources.
Texas’s efforts to prevent corporations within its borders from divesting from oil and natural gas companies could have a chilling effect in the future. This could lead to corporations who want to do business with the state investing in traditional energy companies instead of those focused on renewable energy. This behavior could become the norm as more Republican-led states push to enforce their moral values on corporations that have taken a greater interest in social and climate action.