With the ink on the Labor Department’s new ESG regulation barely dry, U.S. Senator Tom Cotton (R-AK) has introduced legislation to stop it.
“Retirement plans should prioritize investments with the highest return, not ESG scams,” said Sen. Cotton in a press release.
That said, the legislation is perhaps one of the shortest dealing with retirement plans in recent memory. It reads “Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, that Congress disapproves the rule submitted by the Department of Labor relating to ‘‘Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights’’ (87 Fed. Reg. 73822 (December 1, 2022)), and such rule shall have no force or effect.”
Yep. That’s it.
In response, American Retirement Association CEO Brian Graff commented, “This is a nonsense legislative proposal that is going nowhere in a democratically controlled Senate. It’s a political reaction that fails to reflect what the regulation actually does and doesn’t do.”
As for what it does, and doesn’t do, you can check out our coverage here. Based on its publication in the Federal Register, the regulation is slated to become effective Jan. 30, 2023.
