DOL Blog: September 22, 2022

Removing Barriers to Considering ESG Factors in Retirement Plan Investments

By Secretary Marty Walsh

Our nation’s workers deserve a secure retirement. They work hard to earn their retirement benefits and rightfully expect the people who manage their plans to work just as hard to invest and protect their retirement plan’s assets wisely. One of the Department of Labor’s primary objectives is to make sure those savings are safeguarded.

Your interests as a retirement saver should always come before politics. In 2020, the previous administration issued regulations that had a strong chilling effect on the ability of workplace retirement plan managers to consider all appropriate information when making decisions about how to invest your retirement funds. This means that they were sometimes stopped from making the best possible choices about how to protect your hard-earned savings.

In particular, careful retirement plan investors may often want to consider environmental, social and governance factors, or “ESG” factors, as they measure the potential value of a particular investment option. Research shows that companies can be more profitable than their competitors when they treat their workers fairly, run their business with an eye on its impact on the environment, and ensure gender, ethnic and cultural diversity on their executive teams. [READ MORE]