Congress rejects ESG in retirement plans (2023)

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March 7, 2023

The House of Representatives voted on February 28 to pass a Congressional Review Act (CRA) resolution to rescind the Biden Labor Department rule permitting the use of ESG investing in ERISA-governed retirement plans. Republicans then used their temporary majority and the support of two Democrats to pass the bill in the Senate on March 1:

“

A Republican bill to prevent pension fund managers from basing investment decisions on factors like climate change cleared Congress on Wednesday, setting up a confrontation with President Joe Biden, who is expected to veto the measure. The U.S. Senate voted 50-46 to adopt a resolution to overturn a Labor Department rule making it easier for fund managers to consider environmental, social and corporate governance, or ESG, issues for investments and shareholder rights decisions, such as through proxy voting. The outcome highlighted Republicans' willingness to oppose their traditional allies in Wall Street and corporate America that adopt what party lawmakers characterize as "woke", liberal practices. Two Democratic senators, Joe Manchin and Jon Tester, voted with Republicans. Both face reelection in Republican-leaning states in 2024. The Republican-controlled House of Representatives passed the bill on Tuesday. … Republicans claim the rule, which covers plans that collectively invest $12 trillion on behalf of 150 million Americans, would politicize investing by allowing plan managers to pursue liberal causes, which they say would hurt performance.

”

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• Environmental, social, and corporate governance (ESG)
• Economy and Society: Ballotpedia's ESG newsletter

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