The resolution on the DOL ESG rule is passed by the House of Representatives; Biden vetoed

The rule, effective January 30, allows ERISA fiduciaries to consider ESG factors. He also supports the department’s position that fiduciaries cannot sacrifice investment returns or take on higher investment risks as a means of advancing related social policy goals. This rule is a reversal of two rules promulgated at the end of the Trump administration that said pension plan fiduciaries could not invest in “non-monetary” instruments that sacrifice investment returns or take on additional risk, and outlined a process that should be taken by the fiduciary when deciding to vote by proxy.

The Congressional Review Act allows Congress to disapprove — by a simple majority vote — a final rule issued by a federal agency if it has not been in effect for more than 60 legislative days. In addition, if a joint decision to disagree is made, the CRA provides that the rule may not be issued “substantially in the same form” as the rejected rule, unless specifically permitted by subsequent law.

In filing a CRA resolution earlier this month, Rep. Andy Barr-R-Kay said in a statement that unless Congress “blocks a Labor Department rule that allows ESG to invest in retirement plans, retirees will suffer a reduction in income from investing their hard-earned earned money.”

The same CRA resolution in the Senate received support from all 49 Republicans and Senator Joe Manchin, DW.V., meaning another Democratic vote is needed for the coalition to pass it. The Senate will vote this week, Minority Leader Mitch McConnell, of Kentucky, said. tweet Tuesday.

But on Monday, Mr. Biden officially announced his plans to veto the resolution if it passes both houses of Congress. This would be the first veto by a president of his administration.

The White House said in a statement that the new rule “reflects what successful market investors already know: there is ample evidence that environmental, social and governance factors can have a significant impact on certain markets, industries and companies.”

A Labor Department spokesperson did not respond to a request for comment, but Lisa M. Gomez, assistant secretary of labor for the Employee Benefits Administration, said the department sees the rule as “a return to neutrality and based on the core principles of ERISA.” .”

In addition to congressional efforts to repeal the rule, two lawsuits have also been filed in recent weeks challenging it, including one last month from a group of 25 Republican state attorneys general.

Democrats in the House and Senate introduced bills this month to make the rule into law.

Content Source

News Press Ohio – Latest News:
Columbus Local News || Cleveland Local News || Ohio State News || National News || Money and Economy News || Entertainment News || Tech News || Environment News

Related Articles

Back to top button