The ESG Initiative at the Wharton School

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Investors focus ESG on contrast between climate words and actions

Outlet: Roll Call
According to the Center for Political Accountability and the Zicklin Center for Governance and Business Ethics at the Wharton School’s CPA-Zicklin Index, nearly 78 percent of companies in the S&P 500 index fully or partially disclosed political spending last year.

Companies have increased their disclosures of lobbying information in recent years. The Jan. 6, 2021, attack on the Capitol prompted major companies to pause political contributions and reexamine their policies, and gave activist shareholders and other advocates more leverage to pressure companies to improve their transparency around their advocacy.

However, asset management firms and investing coalitions interested in ESG issues now want corporations to explain how their political spending aligns with their publicly stated values and business goals, such as reducing greenhouse gas emissions.