- A coalition of 23 Republican AGs sent a letter to Fitch Ratings, Moody’s Investors Service, and S&P Global Ratings questioning whether the credit rating agencies’ ESG policies violate federal securities laws, state consumer protection laws, and antitrust laws.
- In the letter, the AGs allege that the ratings agencies downgraded fossil-fuel companies and sectors based on speculative ESG predictions that conflicted with their stated methodologies and were not reversed when assumptions about net-zero policies, fossil-fuel demand, renewable energy adoption, and ESG investment mandates changed.
- The AGs also argue that the agencies’ ESG practices create undisclosed material conflicts of interest because the agencies allegedly pledged to incorporate ESG into credit ratings while selling ESG-related products and services that could become more valuable if ESG factors affected companies’ credit ratings.
- The AGs ask the ratings agencies to explain or reverse the ESG-driven downgrades within 90 days, withdraw from or disclose ESG commitments, and address the alleged conflicts and methodology issues.