Texas bill would curb ESG underwriting considerations
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Legislation introduced in Texas last month that would prohibit shareholder proposals that stop insurers from covering companies for environmental or related reasons moved on for committee consideration on Friday.
S.B. 1060, which was introduced by Sen. Bryan Hughes, a Republican, would bar insurers in the state from including “a political shareholder proposal in a proxy statement.”
The bill defines a political proposal as, among other things, a proposal that would “limit an insurer’s ability to insure an entity involved in legal activity for the purpose of achieving environmental, social, or political ends.”
The term is also defined to include limits on insurers’ ability to underwrite fossil fuel projects and requirements for insurers to reduce or track greenhouse gas emissions, including the emissions of their policyholders or entities in which they invest.
Environmental groups have increasingly targeted insurers over the past several years urging them to cut ties with various fossil fuel projects and several insurers have faced shareholder proposals that would limit their ability to underwrite fossil fuel companies.
The bill was referred to the Senate’s State Affairs committee, which is chaired by Sen. Hughes, for consideration.
