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Congress Blocks DOL Rule on ESG Investment Standards for Retirement Plans.

This resolution aims to nullify a Department of Labor rule concerning how fiduciaries manage retirement savings, such as 401(k) plans. If passed, the rule—which allowed plan managers to explicitly consider non-financial factors like ESG when selecting investments—will have no legal effect. This action ensures that investment decisions for retirement funds must prioritize financial returns and risk over broader social or environmental goals.
Key points
Retirement Savings Management: Congress seeks to stop a new standard affecting how citizens' pension and 401(k) funds are invested by plan managers.
Investment Criteria: Disapproval of the rule reinforces the requirement that fiduciaries must focus solely on financial prudence and loyalty, potentially limiting the formal use of ESG factors.
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Additional Information
A joint resolution providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Department of Labor relating to "Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights".
Print number: SJRES 8
Sponsor: Sen. Braun, Mike [R-IN]
Process start date: 2023-02-07