House passes anti-ESG bill without debate

The Alabama House of Representatives passed legislation Wednesday that would prevent state entities from doing businesses with companies that boycott other businesses for a variety of conservative stances.

This includes boycotting firearms companies, producers of fossil fuels, companies that fail to meet certain environmental criteria, and companies that don’t facilitate abortion or gender-affirming care.

Sb261 by Sen. Dan Roberts, R-Mountain Brook, is one of several sweeping the country in opposition to environmental, social and governance (ESG) criteria being used by companies to decide who to do business with—some conservatives have called it a “woke report card.”

“This bill requires companies that contract with the state to certify that they don’t boycott other companies based on any purpose other than ordinary business purposes,” said Rep. Chip Brown, R-Hollinger’s Island, who carried the bill in the House.

In addition to state entities, the bill would also apply to county and municipal governments.

There are numerous exceptions baked into the law, most notably that it does not apply to contract regarding debt obligations, bond issues, insurance and other financial needs.

Another exception is if doing business with a different company would “significantly increase costs” or “limiting the quality” of options or services. What qualifies for a “significant increase” in costs is not codified.

Still, the provision appears to give government entities an option for disregarding the new law if they can show that the prohibited company would save a significant amount of money or preserve the quality of services.

The bill passed 76-27 along party lines and now only needs a signature from Gov. Kay Ivey to become law in the state.