Congress proposed legislation to allow ESG

Ary Rosenbaum
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Ary Rosenbaum - The Rosenbaum Law Firm P.C.

In the 30 years that I’ve been an investor, I’ve always strived for the best performance, that’s me. Other people may want to strive for performance, but make a difference and I think they should have that right. So do some folks in Congress.

U.S. Senators Tina Smith, D-Minnesota, and Patty Murray, D-Washington, and U.S. Representative Suzan DelBene, D-Washington, have introduced legislation in Congress that they say definitively approve retirement plans to have the choice that they can choose to consider environmental, social, and governance (ESG) factors in their investment decisions or offer ESG investment options.

The bill, called the Financial Factors in Selecting Retirement Plan Investments Act, would amend the Employee Retirement Income Security Act (ERISA) to allow retirement plans to consider ESG factors in their investment decisions, as long as they consider such investments in a prudent manner consistent with their fiduciary obligations. The legislators note that this is the same legal standard that ERISA already applies to non-ESG investment factors.

As an ERISA attorney, I like certainty and I think any change to ERISA to allow ESG funds for the plans and plan participants for those that want it, is something I could get behind.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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