WASHINGTON, D.C. — Proposals by the Securities and Exchange Commission to prevent misleading use of labels on funds that weigh environmental, social and governance factors and to require critical disclosures about these funds’ strategies are a welcome step toward protecting investors who choose these types of investments.
“Investors know that climate change is a threat that some companies aren’t taking seriously enough. They need information that lets them better understand climate risks and opportunities to see who they can trust to thrive in a low-carbon future economy.”
–Alex Martin, Senior Policy Analyst, Americans for Financial Reform Education Fund
Americans for Financial Reform joined ninety-five organizations and public interest leaders to send a letter calling on President-elect Joe Biden to embrace a bold and vigorous regulatory agenda to protect the public, workers and our environment, and help restore public trust in government.
Following last month’s explosions at a petrochemical plant near Beaumont, Texas on the Gulf Coast, a new report draws attention to the private equity industry’s growing control of companies in this sector through a business model that may increase health, environmental, and safety risks. This financial engineering often allows private equity firms to extract wealth from the companies they purchase, but can result in intense pressure to cut costs, resulting in layoffs or reduced spending on operations that can lead to substandard products or services.
The day before Thanksgiving, a chemical plant operated by the TPC Group exploded in Port Neches, Texas spewing contaminants, forcing over 50,000 people to evacuate, and leaving the community with the lingering aftereffects of an industrial disaster. The TPC Group is owned by two private equity (PE) firms, SK Capital Partners (SK) and First Reserve. The private equity owned chemical plants in Texas held by SK Capital have a long record of environmental violations — not just the TPC Group factories but other SK Capital portfolio firms.