Although I'm sure Cleary would not approve of my headline:
On Wednesday, March 10, after engaging in conversations with stakeholders, the U.S. Department of Labor’s Employee Benefits Security Administration issued an enforcement policy statement in which it declined to enforce two DOL rules put in place by the Trump administration in 2020.
I.e., stakeholders like Senators Sanders and Warren.
The first of these rules placed limitations on the ability of plans subject to ERISA to invest in environmental, social and governance (“ESG”) funds. In particular, it provided that a fiduciary’s duty of loyalty and prudence under ERISA would only be satisfied if investments were selected solely on the basis of pecuniary factors (defined as factors that have a material effect on the risk and return of an investment), and that ESG factors could only be considered to the extent they created economic risks or opportunities that qualified investment professionals would treat as material economic considerations under generally accepted investment theories. ...
A related second rule provided that ERISA plan fiduciaries could not harness plan assets to vote on policy-related, political or ESG issues in proxy resolutions that are not solely in the economic interests of plan participants and beneficiaries or likely to enhance the economic value of the plan’s investment.
So if you're a beneficiary of an ERISA regulated retirement plan, for example, you'll no longer be able to rest confidently that the plan managers are putting your interests ahead of woke politics.
