The proposed bill aims to establish the Protecting Shareholders Act by adding two new sections to the Code of West Virginia. It introduces definitions related to the act, including terms such as "diversity, equity, and inclusion," which outlines specific actions that are not permissible in hiring and employment practices based on race, color, ethnicity, or national origin. Additionally, the bill defines "environmental, social, and governance" (ESG) as a framework for assessing a business's non-financial behavior, with a focus on the environmental impact, social considerations, and governance diversity.

Furthermore, the bill stipulates that when a director or officer of a corporation has a fiduciary duty, prioritizing any aspect of ESG interests over the financial interests of shareholders will be considered prima facie evidence of a breach of that fiduciary duty. This legislative change seeks to protect shareholders by ensuring that corporate decisions are primarily focused on maximizing financial returns rather than being influenced by non-pecuniary factors.

Statutes affected:
Introduced Version: 31D-8-870, 31D-8-871
Committee Substitute: 31D-8-870, 31D-8-871