Tilting at Goldman-Sachs' windmills

The Free Enterprise Action Fund strikes again. Be very afraid.

By Andrew Leonard
March 22, 2006 4:48AM (UTC)
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That joker Steve Milloy is up to his nitwit tricks again. When last we saw the anti-environment pundit he was crowing about having forced General Electric to allow a vote on a shareholder resolution aiming to stop GE from supporting global warming regulation. Today, a press release for his "Free Enterprise Action Fund" is chortling that it has succeeded in getting yet another resolution on a ballot. But this time around, the goal is to alert Goldman-Sachs shareholders to a different dark horror: the invidious truth that the company's CEO, Hank Paulson, is also chairman of the board of the Nature Conservancy.

Before getting into the details, let's just state for the record that the Free Enterprise Action Fund is a pathetic front for anti-environmentalist propaganda. As noted here previously, Milloy has spearheaded several advocacy groups and Web sites largely funded by ExxonMobil, the world's No. 1 corporate foe of attempts to cut back on greenhouse gas emissions. If one were disposed to be charitable, one could call Milloy's attempts to sally forth against the consensus of climate scientists and vast preponderance of evidence as quixotic.


But we're not so inclined. At How the World Works, we think Steve Milloy is a bad, bad man. Our one worry is whether by paying any attention at all to his witless machinations we're just giving him exactly the publicity he craves. That keeps us up at night.

The Free Enterprise Action Fund dresses up its resolutions in language that purports to represent the interests of shareholders. Milloy and his band of merry pranksters saw their opening in the widely publicized decision by Goldman-Sachs earlier this year to make a pro-environment platform central to its corporate mission. The company even backed up its rhetoric by donating an island in Chile to the Wildlife Conservation Society.

But how, asks a letter sent by the fund to Goldman-Sachs shareholders, does such environmental advocacy benefit shareholders? How can protecting biodiversity possibly help an investment bank's bottom line? Since Hank Paulson is chairman of the board of the Nature Conservancy, and his daughter is on the board of advisors to the Wildlife Conservation Association, Paulson is clearly guilty of a pernicious conflict of interest! Throw in a few references to the Washington Post's huge 2003 exposé about a host of shenanigans at the Nature Conservancy, and there's just no hiding the scandal! Off with his head.


Put aside for the moment the niggling little fact that in the first quarter of 2006, Goldman-Sachs registered the largest quarterly profit -- some $10 billion -- any investment bank anywhere has ever enjoyed. Where Milloy and company really part ways with rationality is their failure to understand that true responsibility to one's shareholders now requires paying serious attention to environmental issues.

As we noted here last week, European insurance companies are getting increasingly nervous about being on the hook for legal damages incurred by the executives of companies who behave irresponsibly with respect to climate change. And just today, an investors group released a significant report that evaluates 100 American and foreign corporations on their corporate governance records with respect to climate change. As the report notes, "Shareholders and financial analysts will increasingly assign value to companies that prepare for and capitalize on business opportunities posed by climate change -- whether from greenhouse gas regulations, direct physical impacts or changes in corporate reputation."

By committing to invest in green energy, sustainable development and environmental protection, Goldman-Sachs is being as responsible, in the most important legal sense of the word, to its shareholders as it can be. And to the world, to boot.


Some day, if we survive climate change, we'll look back at the antics of Steve Milloy and laugh. In the meantime, though, it's hard to do anything else but seethe.

Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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Environment Global Warming Globalization Goldman Sachs How The World Works Wall Street