Biden Administration Considers Reversing Trump’s ESG Rule Change
The “Financial Factors in Selecting Plan Investments” rule was the only Department of Labor regulation listed for review.
The Biden administration is taking steps to possibly reverse the decision by Donald Trump’s U.S. Department of Labor to make it more difficult for fiduciaries of retirement plans to direct money to ESG-focused funds.
The so-called ESG rule, or “Financial Factors in Selecting Plan Investments,” was the only Department of Labor rule listed for review by President Joe Biden’s transition team.
After the presidential election in November, Trump’s Department of Labor adjusted the Employee Retirement Income Security Act of 1974 to require those overseeing pension and 401(k) plans to always put economic interests ahead of so-called non-pecuniary goals, in a direct attack on environmental, social and governance investing. More than 130 fund management and financial advisory firms wrote letters opposing the plan after it had surfaced in June.