Posted on 11/23/2022 6:07:53 AM PST by Red Badger
The Labor Department cleared the path for employers to consider environmental, social, and governance principles when choosing investment funds for their 401(k) plans.
The move, which was announced on Tuesday, rolls back restrictions put in place during the Trump administration that made ESG considerations more challenging for employers. The final rule on the matter will take effect in 60 days.
REPUBLICANS AIM TO TURN ESG INTO 2024 LIABILITY FOR DEMOCRATS
The change is part of a broader push in favor of the ESG movement that has pleased Democrats and earned derision from Republicans.
The previous restrictions “unnecessarily restrained” plan fiduciaries’ ability to weigh ESG factors when picking investments, even when those factors would benefit plan participants financially, the Labor Department said in a news release.
“Today’s rule clarifies that retirement plan fiduciaries can take into account the potential financial benefits of investing in companies committed to positive environmental, social, and governance actions as they help plan participants make the most of their retirement benefits,” Labor Secretary Marty Walsh said.
“Removing the prior administration’s restrictions on plan fiduciaries will help America’s workers and their families as they save for a secure retirement,” he added.
The change is welcome news for those involved in pushing for ESG investing, which includes major financial institutions such as BlackRock. Other agencies, including the Securities and Exchange Commission, have also pitched rules aimed at expanding the ESG movement.
For instance, the SEC proposed a rule to compel companies to disclose climate-related risks, a policy that would lead to indirect pressure on the private sector to turn away from fossil fuels and reduce carbon emissions.
Republicans have been fighting against the growing wave of ESG investing. They contend that the concept runs counter to the most fundamental tenet of investing, which is to return value. Opponents of ESG contend that it uses finance as a vehicle to achieve political ends rather than simply making the biggest gains possible.
BlackRock has been the biggest target in the GOP crusade against ESG. Earlier this month, South Carolina Treasurer Curtis Loftis’s office confirmed it will be divesting all its BlackRock holdings. Several other states also divested from the firm.
Some, including West Virginia Treasurer Riley Moore, expect the fight over ESG to grow and become more prominent as it becomes increasingly wedged into the national political debate.
“It’s gonna be part of this national conversation, I think. If you’re at the national level, they are talking about this issue,” Moore told the Washington Examiner during a recent interview.
This is one problem that will fix itself. ESG based companies will collapse and go away, and all the Liberals' money will disappear............................
It should be mandatory all government employees invest 100% of their retirement funds in ESG.
So now your hard earned 401k savings will be with woke/broke corporations and you will still never get to retire.
Unfortunately it will now take conservatives money too when that leftist in HR decides that your 401k money must be invested in FTX because the CEO is doing so much good.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.