Source: United States Senator for Nebraska Deb Fischer
WASHINGTON, D.C. – U.S. Senator Deb Fischer (R-Neb.) recently joined 49 of her colleagues to introduce a bipartisan joint resolution of disapproval under the Congressional Review Act (CRA) to overturn President Biden’s environmental, social, and corporate governance (ESG) rule. The rule allows retirement plan fiduciaries to use millions of Americans’ retirement investments to push far-left political agendas instead of getting the best returns for hard-working Americans. U.S. Senator Mike Braun (R-Ind.) led the introduction of the resolution.
“The Biden administration shouldn’t be playing games with Americans’ hard-earned retirement funds. I’m proud to join my colleagues in pushing to overturn this misguided rule that could hurt the financial security of millions of Americans,” said Senator Fischer.
In addition to Sens. Fischer and Braun, the resolution was cosponsored by U.S. Senators Mitch McConnell (R-Ky.), John Thune (R-S.D.), John Barrasso (R-Wyo.), Marsha Blackburn (R-Tenn.), Tedd Budd (R-N.C.), Katie Britt (R-Ala.), Bill Cassidy, M.D. (R-La.), Shelley Moore Capito (R-W.Va), Susan Collins (R-Maine), John Cornyn (R-Texas), Tom Cotton (R-Ark.), Kevin Cramer (R-N.D.), Mike Crapo (R-Idaho), Ted Cruz (R-Texas), Steve Daines (R-Mont.), Joni Ernst (R-Iowa), Lindsey Graham (R-S.C.), Chuck Grassley (R-Iowa), Bill Hagerty (R-Tenn.), Josh Hawley (R-Mo.), John Hoeven (R-N.D.), Cindy Hyde-Smith (R-Miss.), Ron Johnson (R-Wis.), John Kennedy (R-La.), James Lankford (R-Okla.), Mike Lee (R-Utah), Cynthia Lummis (R-Wyo.), Roger Marshall, M.D. (R-Kan.), Jerry Moran (R-Kan.), Markwayne Mullin (R-Okla.), Lisa Murkowski (R-Alaska), Rand Paul (R-Ky.), Pete Ricketts (R-Neb.), Jim Risch (R-Idaho), Mitt Romney (R-Utah), Marco Rubio (R-Fla.), Mike Rounds (R-S.D.), Eric Schmitt (R-Mo.), Rick Scott (R-Fla.), Tim Scott (R-S.C.), Dan Sullivan (R-Alaska), Thom Tillis (R-N.C.), Tommy Tuberville (R-Ala.), J.D. Vance (R-Ohio), Roger Wicker (R-Miss.), Todd Young (R-Ind.), and Joe Manchin (D-W.Va).
Background:
In November, President Biden instituted a rule that explicitly permits ERISA retirement plan fiduciaries to consider environmental, social, and corporate governance (ESG) factors when selecting investments and exercising shareholder rights.
This rule replaces a previous rule which mandated fiduciary decisions be made solely on getting the best returns for the 152 million American workers that depend upon ERISA for their retirement.
Under President Biden’s rule, retirement fund managers can prioritize ESG factors instead of financial returns in their investment decisions for workers’ hard-earned savings. Plan participants could unknowingly be enrolled in ESG funds, which may not align with their political views.
A number of studies have shown that ESG investing policies have worse rates of return. For example, a study by UCLA and NYU found that, over the past five years, ESG funds underperformed the broader market, averaging a 6.3% return compared to 8.9% return respectively. Additionally in comparison to other investment plans, ESG investors generally end up paying higher costs for worse performance.