ESG isn't even close to illegal. Investment firms offer hundreds of different funds to choose from, you pick the one you like best and go with that. This concept would be illegal with your reasoning.

But it's all irrelevant. A person that invests in a BlackRock S&P500 fund will pay fewer fees than a person that invests in a Texas-approved S&P500 fund. These two funds will have the same return over the course of your 40-year career, but the person with the BlackRock account will have tens of thousands of dollars more money. It's basic math.

If ESG is bunk, the market will reject it. In fact, billions of dollars have been pulled from ESG funds over the last year. I suspect that there will be an eventual equilibrium found, but that's just me. In the meantime, BlackRock is making serious cash on their ESG funds (higher fees). Money that firms that don't offer ESG funds aren't making.