Bill Seeks to Provide Plan Sponsors With Legal Cover for ESG Investing
A trio of congressional legislators is looking to end regulatory uncertainty and provide legal cover for employers and retirement plan sponsors that consider environmental, social, and governance (ESG) factors in their retirement plan investments.
The Financial Factors in Selecting Retirement Plan Investment Act, introduced by Sens. Tina Smith, D-Minnesota, and Patty Murray, D-Washington, and US Rep. Suzan DelBene, D-Washington, would amend the Employee Retirement Income Security Act (ERISA) to clarify that retirement plans are allowed to consider ESG factors in their investment decisions when they are expected to have an impact on investment outcomes.
The sponsors of the bill say that despite strong demand for sustainable investment options, relatively few workplace retirement plans take sustainable investing principles into account because of the legal uncertainty regarding ever-changing regulations.
Source: CIO Magazine (link opens in a new window)
- employment, ESG, governance, impact investing