The SEC Goes After Greenwashing

Back in 2019 I proposed the Money Stuff S&P ESG Fund, “a mutual fund whose stated mission would be to invest in the 500 companies in the S&P 500 index with the best environmental, social and governance ratings judged by my proprietary rating system.” Because there are 500 companies in the S&P 500 index, the details of my rating system would not matter very much; all of the companies in the S&P 500 would get in, and the fund would exactly track the index.1 The fund would just be an S&P 500 index fund. But it would have “ESG” in its name. This, I argued, would be good:

Since I wrote that, ESG investing has become an even bigger and more important industry. There have been various backlashes. One sort of backlash is along the lines of: No, ESG is bad. (And so various US politicians try to make it illegal for investors to consider environmental or social impact in making investments, etc.)