President Ronald Reagan warned us of the dangers of big government when he said, “Nothing lasts longer than a temporary government program.” He was right about that, but some things were meant to last. One example is the Texas Permanent School Fund (PSF).
Created in 1854, 170 years ago, the PSF was established to provide a stable funding source for public schools, ensuring that education could be supported without solely relying on you, the taxpayer. Our forefathers’ vision today results in significant financial support to Texas kindergarten through 12th-grade public schools, distributing nearly $2.2 billion annually from a fund with assets worth over $56 billion. That is a program worth protecting.
The assets that back the Permanent School Fund are Texas public lands, leases on those lands, revenue from oil and gas mineral rights, and investments made by the fund.
As Texans, it is your birthright to reap the benefits of our state’s God-given resources: a reduced tax burden and a continuous, sustainable source of revenue whose long-term investments serve current and future generations.
This generational gift is threatened by the Environmental, Social, and Governance (ESG) movement that began to take shape in the 1960s. The term “ESG” was coined in 2004 by the United Nations Global Compact with the publication of a report titled “Who Cares Wins.” This UN report focuses on considering environmental, social, and governance factors in investment decisions.
Using ESG as a filter in investment decisions is not only subjective, but it can lead to lower returns on investments, can clash with traditional financial analysis, is a distraction from more pressing financial considerations, and is a potentially high-cost example of virtue signaling. It is no secret that the ESG movement targets Texas oil and gas, the lifeblood of the Texas Permanent School Fund.
As your Land Commissioner, I am committed to protecting over 13 million acres of Texas public land and minerals. I also serve as a member of the board of the Texas Permanent School Fund. I recently voted to create a first-of-its-kind in-the-nation policy whereby the proxy votes authorized by the PSF will focus on strengthening Texas and opposing anti-Texas ESG initiatives.
Each year the investment team at the PSF authorizes 40,000-50,000 proxy votes where a ballot is cast by a firm on behalf of the PSF. These proxy votes can include decisions such as the election of board members, merger or acquisition approvals, or approval of stock compensation plans and corporate governance policies such as ESG initiatives.
The new, common-sense policy focuses on our legal and ethical responsibilities, not political activism. It ensures that the money we invest will not be used to destroy the very industries that provide billions of dollars annually to Texas schoolchildren.
Imagine a farmer growing a special type of crop that generates incredible profit because of its unique properties, let’s say, a rare medicinal plant. This crop is a huge part of the economy, creating jobs and driving prosperity. Now, consider if this farmer were to vote in favor of regulations that severely restrict the cultivation of this crop despite there being no viable alternative that could sustain the same level of economic benefit. By doing so, the farmer would be acting against their own economic interests and potentially harming the local community.
This is what was happening when the PSF’s proxy firm cast votes in favor of policies and companies that actively work to harm the oil and gas industry in Texas. I believe it is immoral to work against the interests of Texas taxpayers and schoolchildren. By working in the best interest of Texas we will have greater latitude to produce more wealth and higher-quality lives. I have confidence in a free enterprise system, where individuals can freely engage in voluntary exchanges unrestricted by self-destructive virtue signaling.
This new policy will help make the Permanent School Fund truly permanent and produce vast benefits from our natural resources. I am committed to ensuring that the PSF continues to play a crucial role in supporting Texas schoolchildren, reflecting the vision of its founders to provide a robust and reliable educational system for the state.
I am proud to support this newly developed proxy voting policy, ensuring that ESG initiatives are eliminated and Texas values are fully represented. As a longtime advocate and ally for Texas’s robust oil and gas industry, I will always support bold moves to protect our state’s assets—especially when it comes to funding for our children.
Dr. Dawn Buckingham is Commissioner of the Texas General Land Office and Chairwoman of the Texas Veterans Land Board.