Don’t put all Your Eggs in the ESG Basket

ESG is something we talk about often in the oil and gas space, but is the hype waning?

 

Articles in the WSJ and Bond Buyer highlighted Utah’s decision about ESG: “Utah’s top elected officials demanded on Thursday that S&P Global Ratings cease applying environmental, social, and governance factors to the state through the use of what they called a politicized rating system based on indeterminate factors.”

 

Utah’s government is expressing frustration with just how subjective these ratings can be. The energy industry experiences this is a particularly powerful way, especially in the “E” of ESG. The push for green energy slams fracking and everyone involved in it.

 

Obviously, everyone wants companies to make society better. People within companies are (generally) good people. People don’t choose to invest in companies that unnecessarily destroy nature; we don’t invest in companies that mistreat their employees; no one invests in companies with fraudulent investors.

 

While we believe that companies will continue to push for ESG values (and we support that), we will watch over the next decade how investors view such subjective metrics.

 

While we’re still ideating the topics for our agenda, you can guarantee that ESG will be a part of this November’s Frac Sand Conference. To learn more, click here: Learn More