Legislation/Guidance in Effect
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Title |
Key Dates |
Nature of |
ESG Category |
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HB7071/SB7060: Foreign Investments by the State Board of Administration |
Effective Date 5/15/2024 Adopted Introduced |
Legislation | Promote Divestment from Certain Countries |
■ Prohibits the SBA from acquiring certain holdings of Chinese companies; requires the SBA board to initiate a review of its direct holdings to determine if any include securities of a Chinese company; requires the SBA board to develop, no later than September 1, 2024 (if the legislation is enacted), a divestment plan for all direct holdings in Chinese companies, and to complete the divestment of any direct holdings in Chinese companies no later than September 1, 2025 (or at such later time if necessary for the SBA board to implement the divestment plan consistent with its fiduciary duties). ■ The SBA board's actions and determinations must be adopted and incorporated into the SBA investment policy statement as required by Florida law. ■ The legislation shall take effect upon becoming law. |
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Effective Date 7/1/2024 Adopted |
Legislation | Prohibit Discrimination on Basis of Social Credit or ESG Scores |
■ HB989 expands on what HB3 did with respect to financial institutions' unsafe and unsound practices. HB989 says that it is an unsafe and unsound practice for a financial institution to suspend or terminate, in addition to deny or cancel, its services to a person on the basis of: (i) the person’s political opinions, speech, or affiliations; (ii) except as otherwise provided, the person’s religious beliefs, religious exercise, or religious affiliations; (iii) any factor if it is not a quantitative, impartial, and risk-based standard, including any such factor related to the person’s business sector; or (iv) the use of any rating, scoring, analysis, tabulation, or action that considers a social credit score based on factors including, but not limited to, certain ESG factors. It also allows a customer or member of a financial institution who suspects that a financial institution has engaged in an unsafe or unsound practice to file, within 30 calendar days of such action, a complaint with the Florida Office of Financial Regulation. ■ As amended by HB989, engaging in an unsafe or unsound practice or failing to timely submit the required compliance attestation is a violation of Florida’s Financial Institutions Codes and subjects the violator to the applicable sanctions and penalties provided in the Codes. Such acts also constitute a violation of the Florida Deceptive and Unfair Trade Practices Act (FDUTPA), which codifies law relating to the protection of consumers from those who engage in unfair methods of competition, or unconscionable, deceptive, or unfair practices in commerce. A financial institution that engages in an unsafe or unsound practice or fails to timely submit the attestation is also subject to the applicable sanctions and penalties provided in FDUTPA. |
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Effective date |
Legislation |
Restrict Use of ESG |
■ Amends existing legislation to require the Chief Financial Officer or other party authorized to invest on their behalf, to make decisions based solely on pecuniary factors and not to sacrifice investment return or undertake additional investment risk to promote any non-pecuniary factor.
SUBSEQUENT DEVELOPMENTS In a video posted on X (formerly Twitter) on January 31, 2024, Governor DeSantis announced that Florida will begin enforcing violations of its HB 3 legislation, noting how there are banks that have signed attestations that say “they are not doing ESG or social credit scores” when in fact “they are doing things outside of what they attested to that would violate Florida law.” In his message, the Governor noted how he has had discussions with members of the Florida Legislature about what actions can be taken against the banks and how his administration will enforce the law, and he indicated that more legislation will be coming (although he did not provide details). The current legislative session adjourns March 8, 2024. On February 15, 2024, SB74 was approved by the Governor. The legislation is a general reviser’s bill to delete expired or obsolete language; correct cross-references and grammatical or typographical errors; remove inconsistencies and redundancies from the statutes; etc. The legislation makes small changes to the statutory provisions added by HB3 (i.e., in Paragraph (d) of subsection (1) of section 215.681 ESG bonds; prohibitions, adding an OR ("Issuer" means the division, acting on behalf of any entity; any local government, educational entity, or entity of higher education as defined in s. 215.89(2)(c), (d), and (e), respectively, or other political subdivision granted the power to issue bonds; OR any public body corporate and politic authorized or created by general or special law and granted the power to issue bonds) and deleting the Tampa Bay Area Regional Transit Authority from the list of entities).
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Target Entities That |
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Prohibit Discrimination on Basis of Social Credit |
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Adopted and in effect |
Treasurer Position |
Restrict Use of ESG |
■ Florida's Chief Financial Officer issued a directive barring asset managers within Florida’s deferred compensation program from investing participants’ compensation in financial products associated with ESG standards. |
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Target Entities That |
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Adopted and in effect |
Enforcement / Divestment |
Target Entities That |
■ The State Treasury announced that Florida will divest $2 billion of funds from BlackRock due to BlackRock’s stance on ESG issues. According to a press release from the Florida Chief Financial Officer, “Florida’s Treasury Division is divesting from BlackRock because they have openly stated they’ve got other goals than producing returns.” Previously, BlackRock managed $1.4 billion of the state’s long-duration portfolio as well as the Treasury’s $600 million short-term investment fund. |
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Governor Ron DeSantis Eliminates ESG Considerations from State Pension Investments |
Adopted and in effect |
IPS Revisions |
Restrict Use of ESG |
■ The State Board of Administration (SBA)’s revised investment policy statement requires the evaluation of any SBA investment decision to be based only on “pecuniary factors.” These are factors the SBA prudently determines are expected to have a material effect on the risk and return of an investment based on appropriate investment horizons consistent with the fund’s investment objectives and funding policy. They do not include the consideration of the furtherance of social, political, or ideological interests.
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Governor Ron DeSantis Announces “Initiative to Protect Floridians from ESG Financial Fraud” |
Adopted and in effect |
Governor Position |
Restrict Use of ESG |
■ Governor DeSantis's proposed legislation for the 2023 Legislative Session is aimed at "protecting Floridians from woke capital" as it will (i) prohibit large banks, credit card companies and money transmitters from discriminating against customers for their religious, political, or social beliefs; (ii) prohibit State Board of Administration (SBA) fund managers from considering ESG factors when investing the state's money; and (iii) require SBA fund managers to only consider maximizing the return on investment on behalf of Florida's retirees.
SUBSEQUENT DEVELOPMENTS On February 13, 2023, DeSantis said during a press conference in Naples that his plans include “no investment decisions at the state or local government with ESG, no use of ESG in procurement and contracting and no use of ESG when issuing local or state bonds.” |
Pending Legislation
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Title |
Key Dates |
Nature of |
ESG Category |
Summary |
| HB651/SB700: Florida Farmer Financial Protection Act |
Introduced 2/14/2025 |
Legislation | Restrict Use of ESG Factors; Focus on Pecuniary Characteristics |
■ Prohibits financial institutions from discriminating in the provision of financial services to agricultural producers based, in whole or in part, on ESG factors. ■ Creates an inference that a financial institution's denial or restriction of financial services to an agricultural producer violates this prohibition if the financial institution has made any ESG commitment related to agriculture, which the financial institution may overcome by demonstrating the denial or restriction was based solely on documented risk analysis. ■ Provides that a violation constitutes an unfair trade practice and authorizes the Attorney General to investigate and seek damages as provided in general law. |
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HB651: Revises and provides provisions related to powers, duties, & functions of DACS. |
Introduced |
Legislation |
Restrict Use of ESG Factors; Focus on Pecuniary Characteristics |
■ Florida House Bill 651 (2025) introduces a comprehensive set of amendments and new provisions affecting various statutes related to the Department of Agriculture and Consumer Services. The bill encompasses a wide range of topics, including electric utilities, agricultural land classification, mosquito control, electric vehicle charging stations, and more. This bill specifically introduces the "Florida Farmer Financial Protection Act," which specifically addresses the issue of Environmental, Social, and Governance (ESG) factors in the provision of financial services to agricultural producers. This amendment is codified in Section 72 of the bill. ■ Financial institutions are prohibited from discriminating in the provision of financial services to agricultural producers based, in whole or in part, on ESG factors. ■ If a financial institution has made any ESG commitment related to agriculture, there is an inference that the institution's denial or restriction of financial services to an agricultural producer violates this prohibition.
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