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An Anti-ESG Activist Investor Presses for Changes at Apple and Disney

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An activist investor who has been a sharp critic of so-called environmental, social and governance, or ESG, investing is urging

Apple Inc.


AAPL 1.57%

and

Walt Disney Co.


DIS -1.47%

to not engage in political discussions and to make employment decisions without taking an individual’s race, sex or political opinions into account.

Vivek Ramaswamy,

who recently launched Strive Asset Management, said Disney should no longer take public positions on political issues that aren’t related to the company’s core business. The letter cited how Disney Chief Executive

Bob Chapek

took a stance on Florida’s parental rights in education bill.

“Disney must act now,” Mr. Ramaswamy wrote in his letter, dated Monday. “If Disney continues speaking out on political issues that do not affect its business, it will face even greater pressure to act when they do. And the sides Disney will be expected to take won’t be the ones that are favorable to its business.”

A Disney spokesman said in an email that the company regularly receives input from its shareholders. “We listen to their perspectives,” he said. 

In a separate letter to Apple, Mr. Ramaswamy pushed back on the company’s plans to conduct a racial-equity audit and asked the tech giant to make all hiring decisions without taking into account political beliefs, race or sex.

Apple declined to comment.

Strive holds positions in Apple and Disney in a recently launched exchange-traded fund that invests in large public companies. The fund has roughly $11 million in net assets.

Mr. Ramaswamy is the author of “Woke Inc.,” a book that argues companies shouldn’t be swayed by politics. Strive Management’s main fund, focused on energy, has $320 million in assets. Earlier this month, he publicly called on

Chevron Inc.

to pump more fossil fuels over the next decade and slow spending on its energy-transition plan. His energy ETF holds a position in Chevron. 

He says companies have a fiduciary duty to their shareholders, not the firms who represent those stockholders, like big asset managers such as

BlackRock Inc.

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“You owe a fiduciary duty to the actual owners of Disney, not to the institutions who claim to represent them,” Mr. Ramaswamy wrote in his letter to Disney. “There is strong reason to believe that these large asset managers are not acting with their clients’ best interests in mind.”

Many asset managers have previously pushed back on criticism of ESG—the loosely defined practice of considering issues beyond short-term profits when making financial decisions—by noting that companies that take into account environmental risks and opportunities tend to be more profitable over time

Earlier this year, Disney’s Mr. Chapek changed course on his policy of staying out of politics. At the company’s annual meeting, he said he had told Florida Gov.

Ron DeSantis

that he was concerned about the education bill’s potential impact on LGBT children. He also pledged to spend $5 million on contributions to LGBT causes. Florida in April passed a law eliminating Disney’s special tax benefits in the state.

In his letter to Disney, Mr. Ramaswamy also called on the company to commit to having human resources policies making it clear that both customers and employees won’t be punished for expressing their political beliefs. 

He said Disney should make all of its decisions based on profitability “without regard to social, cultural, or political pressure from employees, activist groups, or other stakeholders.”

Earlier: Since 1967, the Florida land housing Disney’s theme parks has been governed by the company, allowing it to manage Walt Disney World with little red tape. WSJ’s Robbie Whelan explains the special tax district that a Florida bill would eliminate. Photo: AP

Write to Allison Prang at [email protected]

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the September 21, 2022, print edition as ‘Apple, Disney Pressed on Politics.’

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