Senator proposes limits on proxy voting in federal retirement plan (2025)
| Environmental, social, and corporate governance |
|---|
|
| • What is ESG? • Enacted ESG legislation • Arguments for and against ESG • Opposition to ESG • Federal ESG rules • ESG legislation tracker • Economy and Society: Ballotpedia's weekly ESG newsletter |
What’s the story? On Nov. 25, Senator Ted Cruz (R-Texas) proposed legislation affecting the federal Thrift Savings Plan (TSP), the retirement program for civilian federal employees and active-duty service members.[1] The proposal would bar the firms that manage TSP assets—primarily BlackRock and State Street—from casting shareholder votes tied to those holdings.
Cruz said he wants to stop the firms from using TSP shares to support proposals related to environmental, social, and governance (ESG) issues and diversity, equity, and inclusion (DEI) initiatives.[2] The bill states that the restriction covers all proxy voting the asset managers conduct on behalf of the TSP.
Why does it matter? The Thrift Savings Plan recently passed $1 trillion in assets.[3] For comparison, California Public Employees' Retirement System reported $556.2 billion for the same period.[4] This scale gives the TSP substantial influence in corporate elections and shareholder proposals, and restricting proxy voting would change how one of the country’s largest retirement programs is represented in those decisions.
Cruz’s bill adds to ongoing policy questions about how large asset managers should participate in corporate governance when they handle public retirement funds. Shifting proxy authority away from BlackRock and State Street would change how TSP-held shares are voted.
What’s the background? BlackRock and State Street have been central to several developments this year involving proxy voting and climate-related investment pledges. In early November, State Street withdrew the U.S. arm of its business from the Net Zero Asset Managers initiative.[5] Around the same time, BlackRock’s support for ESG proposals fell to less than 2% of the proposals it voted on, marking the fourth straight year of decline.[6]
See also
- Environmental, social, and corporate governance (ESG)
- Economy and Society: Ballotpedia’s ESG newsletter
External links
Footnotes
- ↑ Congress.gov, "S.3263 text", accessed December 10, 2025
- ↑ Senate.gov, "Sen. Cruz Introduces Bill to Stop Abuse of Federal Retirement Funds for DEI and ESG", accessed December 10, 2025
- ↑ ESG Today, "Ted Cruz Targets BlackRock, State Street With New Bill to Block ESG Voting", accessed December 10, 2025
- ↑ CalPERS, "CalPERS Announces Preliminary 11.6% Return for 2024–25 Fiscal Year", accessed December 10, 2025
- ↑ Ballotpedia, "Economy and Society: November 5, 2025", accessed December 10, 2025
- ↑ Ballotpedia, "Economy and Society: September 17, 2025", accessed December 10, 2025
| |||||||||||||||||||||||
