Vanguard Pays $29.5 Million, Vows Profit Priority After Texas ESG Coal Suit

The settlement also stipulates that Vanguard will avoid imposing ESG goals over customer profitability. While Vanguard denies any wrongdoing, the lawsuit, initiated in 2024 by Texas Attorney General Ken Paxton, alleged that asset managers coordinated to pressure coal companies to cut production under the guise of environmental investing.

Litigation against BlackRock Inc. and State Street Corp., also named in the suit, remains ongoing.

Lawyers for the asset managers had previously argued there was no evidence of coordination or directives to cut output, but a judge ruled in August that most claims could proceed. This settlement is seen by some, like Kansas Attorney General Kris Kobach, as a significant development against asset managers pushing ESG agendas.