In recent years, the financial sector has become a key target of progressive activists seeking to implement their agenda. Activists have used a variety of methods to persuade and pressure financial institutions to do their bidding. They have successfully pressured the financial sector to adopt standards on environmental impact, social impact, and broader corporate governance, collectively referred to as ESG standards; they have targeted the financial sector for remaining accessible to industries deemed to conflict with ESG standards, such as oil, natural gas, and firearms.
Following 9/11, the United States Congress passed the USA PATRIOT Act, which, among other things, 1) required financial institutions to establish due-diligence mechanisms to detect and report money laundering through private bank accounts and 2) encouraged regulatory agencies and law enforcement to share information with financial institutions if an individual or entity is engaged in or reasonably suspected of engaging in terrorist acts or money laundering. Western nations followed the United States government’s leadership in broadening anti-money-laundering rules to include anti-terrorist-financing measures. Since the 2008 global financial recession, financial institutions have been heavily scrutinized for their role in exacerbating the economic collapse. To prevent intense scrutiny, financial institutions have since stayed more in line with regulators’ goals. This “partnership” has seemingly meant that financial institutions mostly succumb to regulatory demands on topics ranging from climate risk to social issues and other sensitive topics.
