Exclusive | State treasurers press Moodys, Fitch and S&P on ESG guidance that gives higher rankings to Chinese companies, downgrades US biz

Twenty-two state financial officers are demanding answers from top credit rating agencies including Moody’s, Fitch and Standard & Poor’s that allegedly rely on outdated climate change policies — bizarrely leading to higher rankings for Chinese businesses while US companies get downgraded, The Post has learned.In a letter sent to the agencies Wednesday, the state treasurers and auditors argued their own finances could be hurt if the bodies use the discredited “Environmental, Social, and Governance” framework, or ESG, to downgrade publicly traded companies in which the states have invested billions of dollars.If those companies start losing money, the states could see smaller funds – threatening their ability to pay for roads and schools, as well as pensions for police officers, firefighters and teachers, according to a copy of the letter obtained by The Post.In one egregious case, the letter claimed, S&P downgraded US oil and gas companies based on ESG-related “risks” – but reaffirmed an A+ rating for two Chinese state-owned oil and gas companies, saying they were “likely to fare better than their international peers.”The financial officers argued it is “nonsensical by any objective standard” to find that Chinese state-owned firms are better positioned on ESG, since China emits more pollution than any other country and the Chinese Communist Party is a “prolific human rights abuser.”While the letter focuses on the rating agencies’ alleged tree-hugging goals, it specifically cites ESG, a policy that notoriously champions DEI in addition to the environment.“The ratings agencies’ use of ESG is so subjective and inconsistent that while American companies were downgraded, ratings were affirmed for state-owned Chinese companies that are worse by every objective ESG metric,” the letter said.“Ratings agencies should use objective and consistent methodologies instead of using false and retracted ESG predictions, and should revers...