A judge in Oklahoma has halted the enforcement of a state law that restricted state pension funds from doing business with companies that limit investment in the oil and gas industry. The law, enacted in 2022, is one of many GOP-backed measures designed to protect fossil fuel companies from climate-related investment decisions by Wall Street firms.
The judge, Sheila Stinson of the Oklahoma County District Court, issued a temporary injunction after finding that the law might be too vague and could violate the state constitution. This decision came in response to a lawsuit brought by retiree Don Keenan, who challenged the law’s legality. The injunction means the law can’t be enforced while the lawsuit proceeds, and Keenan’s case appears likely to succeed, according to Stinson’s finding.
An Oklahoma judge has halted the implementation of a state law designed to limit environmental, social, and governance (ESG) practices in public investments. The ruling temporarily prevents the law from taking effect, pending further legal review.
The Oklahoma law would hinder state agencies from investing with financial firms that boycott energy companies for no “ordinary business purpose” because they engage in “fossil-fuel-based energy” and do not intend to meet environmental standards, The Hill reported.
Oklahoma State Treasurer Todd Russ included BlackRock, Wells Fargo, JPMorgan Chase, and Bank of America among the 13 prohibited companies on the list, The Hill reported.
Don Keenan, former president of the Oklahoma Public Employees Association, challenged the legislation, arguing it violates the state constitution and free speech rights, The Hill reported.
In her ruling, Stinson said the law appears to be aimed at countering the “political agenda” of financial companies and to “assist the economic status of the oil and gas sector,” The Hill noted.
A statement from Russ said he was “looking out for the financial interests of Oklahoma’s citizens and industries,” Reuters reported.
“This ruling is not going to stop the fight for Oklahomans against activists using ESG [environmental, social, and governance] in the state,” Russ said, adding that he’s preparing to appeal the order.
Bryan McGannon, managing director of sustainable investment organization US SIF, said the judge’s action shows the anti-ESG laws are not in beneficiaries’ best interests.
Financial professionals, ultimately, should have the freedom to make the best investment choices for their beneficiaries without partisan legislative interference,” McGannon told Reuters.
