Wyoming committee hears bill to bar nonfinancial ESG considerations from state investments

CHEYENNE, Wyo. — The Wyoming House Minerals, Business & Economic Development Committee on Monday heard hours of testimony on House Bill 80, a proposal that would require investment managers of state funds to consider only financial factors and would tighten proxy-vote controls and reporting.

Supporters, led by bill sponsor Representative Evan Knapp, said the measure is intended to ensure fiduciaries focus on the financial interests of beneficiaries and to guard state investments from income-reducing “ESG” (environmental, social and governance) policies. “This bill helps our managers to safeguard our investments and get the best return following our fiduciary responsibilities under the law,” Representative Knapp told the committee.

The bill text circulated in the hearing would (among other provisions) define “financial” factors to exclude actions taken “for the purpose to further social, political, or ideological interests,” require annual public reporting of proxy votes by Sept. 1, allow the attorney general to investigate alleged violations and impose civil damages equal to three times fees paid to an offending fiduciary.

Why it matters: Wyoming’s public funds hold tens of billions of dollars and pay pensions and other state obligations. State Treasurer Kurt Meyer and Wyoming Retirement System officials testified the language of House Bill 80 reflects the goals of protecting returns for beneficiaries, but they warned the draft’s scope and penalties could scare away top investment managers or make routine portfolio decisions subject to litigation.

Treasurer Kurt…