A Thanksgiving Day Memo To Florida Governor Ron DeSantis – Forbes

To: Ron DeSantis

From: Bob Eccles

Cc: All ESG Haters

Subject: ESG at the University of Florida Investment Corporation

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Happy Thanksgiving! You certainly have a lot to be thankful for which makes me very happy for you.

Let’s start with your blowout victory in being re-elected governor with nearly 60 percent of the popular vote, 20 points more than your Democratic rival. Big congratulations! You clearly attracted a number of independent voters and got an eye-popping 58 percent of the Latino vote, up from 44 percent your first time around. Your strong showing in Florida is no doubt one of the reasons the Washington Post ranks you ahead of Donald Trump (#2 [from whom I haven’t heard a single utterance of “ESG” or “Woke”—a sure sign his star is fading]) and Mike Pence (#3—your most serious competitor in using ESG and Woke to get the nomination) in their poll of GOP candidates for President. The Post admiringly said, “the Florida governor’s stock has never been higher, as he emerged from Election Day as perhaps the biggest winner on the GOP side.”

And let’s not forget that flawlessly executed, iridescent but disciplined, artistic piece of political theater in which you chartered two planes to send 50 illegal Venezuelan migrants to a summer resort in Martha’s Vineyard. In my home state of Massachusetts. From Texas no less! I”m guessing Governor Greg Abbott is pretty jealous that you swooped in there and scooped ‘em up from under his nose and beat him to the partisan punch. I apologize I wasn’t there to greet them for you. I’ve been a little busy fighting for the other side in the ESG Culture Wars where you are one of, if not THE, leading general on the right flank.

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It is in this context I want to bring something to your immediate attention before I sit down for a nice Thanksgiving dinner with my family. Hope you have a nice one too 🦃.

On August 26, 2022, you, with the support of the fellow Trustees of the State Board of Administration (SBA) “passed a resolution directing the state of Florida’s fund managers to invest state funds in a manner that prioritizes the highest return on investment for Florida’s taxpayers and retirees without considering the ideological agenda of the environmental, social, and corporate governance (ESG) movement.” According to its most recent report (July 1, 2020-June 30, 2021) the SBA has $199.6 billion in assets under management. It showed an impressive growth of $38.9 billion in AUM due to a net return of 29.46 percent. Well done!

Presumably you think it’s going to do even better by eliminating that dreaded ESG stuff. Since you are the Governor, I guess you can ignore the fact that ESG is about material risk factors that are important for company profitability and shareholder returns. And that there are numerous empirical studies showing this to be true.

Putting facts aside, there’s a serious political problem that needs your immediate attention. I apologize for bothering you with this on Thanksgiving, but I think you’ll be glad I did. Especially since I have three helpful pieces of advice.

By lucky accident for you, I recently came across the Environmental, Social and Governance Policy Overview of the University of Florida Investment Corporation. The Overview states that “As a fiduciary, UFICO has a duty to act in the best long-term interest of its Investors pursuant to the Florida Uniform Prudent Management of Institutional Funds Act (FUPMIFA), which sets the standard of conduct in managing and investing institutional funds. UFICO’s primary objective is to maximize the long-term risk adjusted returns for its Investors in order to advance their mission, and, in particular, the principal mission of the University of Florida.” I’m sure you have no problem with this since you said something quite similar with respect to the SBA in stating that investment decisions “must be based only on pecuniary factors.”

Please be sure you’re sitting down for what I have to tell you now. I don’t want the leading GOP Presidential candidate to suffer any harm from a fainting spell. UFICO’s Overview then states that “The purpose of this policy is to describe how UFICO incorporates environmental, social, and corporate governance (ESG) issues into its investment process in order to achieve its primary objective.” If you’re still with me, it gets worse. “As a long-term investor, UFICO believes that risk management is critical to the investment process and our due diligence includes a manager’s consideration of material ESG factors that may impact their performance and/or risk profile over the long term.” Note that it says “material ESG factors,” not “ideological ESG factors.”

Okay, there you have it. UFICO is directly contradicting you (THEIR GOVERNOR 😱) about ESG since you claim pecuniary factors “do not include the consideration of the furtherance of social, political, or ideological interests” and stipulate that the SBA “may not sacrifice investment return or take on additional investment risk to promote any non-pecuniary factors” when making investments or proxy votes.

Here’s the rub. While you and your ilk are on this massive, well-funded, and nonsensical campaign to make ESG an ideological punching bag, the corporate and investment communities are trying to manage material risk factors. And you’re doing your very political best to stop them from doing so. To learn more what ESG is really about, if you’re not too sleepy after you’ve had your pumpkin pie, you might enjoy reading “A Tutorial On ESG Investing In The Oil And Gas Industry For Mr. Pence And His Friends.” Not wanting to show any favoritism, I’d be happy to provide you a tutorial as well. Even a personal one in person!

I also cordially invite you, your other SBA trustees, and pretty much anyone else you can think of to attend a free public webinar “ESG Isn’t ‘Woke,’ It’s Capitalism.” It is being sponsored by the law firm K&L Gates. The panelists are my GOP buddy Dan Crowley and me. Our moderator is Karishma Page. Both are partners at the firm. It will be held on November 29, 2022, from 11:00 a.m.-12:00 p.m. EST.

Okay, I admit this was just a bit of rhetorical flourish to market our webinar. I know you wouldn’t deign to have even the most junior staffer on your payroll spend an hour of their time listening to the webinar. God forbid, they might actually learn something! You are playing a much bigger game. Running for President! Here’s where I think I can be helpful with some good advice.

You should demand that William Reeser, the Chief Executive Officer and Chief Investment Officer of UFICO, immediately come to your office for some deep and searing self-criticism. Order him to revise UFICO’s Policy Overview on ESG. Look him squarely in the eyes and sternly tell him, “Change the language to what we did with the SBA—or else!”

Or else what? Well, that’s really your call. I don’t know if you have the authority as Governor to fire Mr. Reeser. If you do, you should if he doesn’t comply within 24 hours to your command. In which case, I look forward to hearing from you ASAP that UFICO’s ESG policy has been eliminated. And I won’t find evidence of it if I search the Internet. (I have saved a PDF just for the historical record.)

If you don’t have this authority, bring public pressure to bear. You have shown yourself to be very effective at using the bully pulpit. But what if Mr. Reeser doesn’t bend his knee to your imperial will and show proper obeisance? What if, in order to maximize the long-term returns of UFICO, he refuses to subjugate himself and pay homage to your campaign to wipe out ESG and Woke in the Sunshine State?

Here’s where I can be helpful again. Charter a plane and fly him up to The Bay State. If you don’t mind, Sir, I actually prefer Nantucket to Martha’s Vineyard so please send him there. I will meet Mr. Reeser and host him to a traditional New England Clambake at the very swish and exclusive White Elephant. My treat.

Mr. Governor, you cannot afford to fail here. You will look weak to your fellow anti-ESG Warriors. One of whom is close behind you in the Post’s ranking. Who got a three-month jump on you by publishing a May 26, 2022, letter in the GOP’s House Organ, the Wall Street Journal. He clearly established his anti-ESG bona fides by ominously noting that “ESG is a pernicious strategy, because it allows the left to accomplish what it could never hope to achieve at the ballot box or through competition in the free market. ESG empowers an unelected cabal of bureaucrats, regulators and activist investors to rate companies based on their adherence to left-wing values.”

Admit it. This is much more powerful mobilizing language for an anti-ESG campaign than your rather staid technical language like “not sacrifice investment return or take on additional investment risk to promote any non-pecuniary factors.” One last piece of advice. Commission the State Financial Officers Foundation to produce a little video for you like they have with “Our Money Our Values – What is ESG?” For background, I’ve written in glowing terms about its mesmerizing Orwellian message and production quality. You’ll like it very much. Although you won’t like the subliminal diversity, equity, and inclusion theme that infuses it.

Mr. Governor, for the sake of your Presidential ambitions, I urge you to act with alacrity and exorcise UFICO’s apostasy.

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