Partisan battle brewing over regulators’ ESG focus
By Neil Haggerty
For months, regulators and Democratic policymakers have shined a brighter spotlight on social disparities in the financial system and banks’ climate-change risks. But GOP objections to that focus are also getting louder….“That’s really the heart of the debate, which is: What are banks for?” said Karen Petrou, managing partner at Federal Financial Analytics. “Are they essentially lending utilities that must lend unless a regulator deems it too risky based on a traditional credit risk metric? Or are they allowed to make their own decisions about risk and incorporate social welfare factors when they do so?”