Moody’s has been promoting DEI initiatives and ESG ratings for five years and their CEO, Robert Fauber, opposes President Trump.

Republican state attorneys general are asking federal regulators to scrutinize the big three credit rating agencies over allegations they continue relying on questionable climate assumptions when assessing financial risks, the Daily Caller News Foundation has learned.

The coalition, led by Republican Montana Attorney General Austin Knudsen, argues in a letter to the Securities and Exchange Commission’s (SEC) Office of Credit Ratings that Moody’s, Fitch Ratings and S&P Global Ratings continue incorporating environmental, social and governance (ESG) considerations in ways that can affect fossil-fuel companies, industries and governments dependent on energy revenues.

The letter, first obtained by the DCNF, follows an earlier effort by 23 state attorneys general demanding the three agencies explain allegedly ESG-driven rating decisions. Republican Louisiana Attorney General Liz Murrill’s office said at the time that the coalition was questioning whether the agencies’ ESG policies complied with federal law.

The SEC designates Moody’s, Fitch, and S&P as nationally recognized statistical rating organizations.

As the Daily Caller notes, credit ratings measure a borrower’s capacity to repay debt, so a downgrade can raise borrowing costs and make bonds less appealing to some investors. Put simply, a lower rating from any of those three firms can inflict serious financial damage on a borrower.

Moody’s has issued a report indicating that the rating agencies continue to rely on ESG forecasts. Folding those forecasts into ratings can disadvantage fossil-fuel energy companies, energy-dependent states, and related industries.

As a result, the attorneys general issued a new letter, citing a retracted manuscript published in Nature, saying Moody’s basis for its rating is seriously flawed resulting from its using a discredited climate scenario, RCP 8.5 which is a high-end climate scenario, not a forecast. The 8.5 is extra heat-trapping energy by 2100 (8.5 W/m²), not a temperature.

It assumed little climate policy and a huge rise in fossil fuels, especially coal—often producing ~4–5°C of warming in models. It was a worst-case “what if,” not “business as usual.” That emissions path now looks implausible and has been dropped from the next IPCC scenario set.

Current policy paths still point to roughly 2.5–3°C by 2100.

The retracted Nature study attorneys general cited used the RCP 8.5 scenario and forecast multi-trillion-dollar damages plus a sharp drop in global GDP.

In April 2026, the World Climate Research Programme dropped RCP 8.5 and called it implausible. The IPCC has also moved away from that high-end warming pathway.

Moody’s, however, continues to rely on it.

Halting the use of ESG scores to determine credit worthiness cannot happen a moment too soon.