The House voted 213-205 on Thursday to pass legislation that would limit retirement fund managers’ ability to consider environmental, social and governance factors in investment decisions.
The “Protecting Prudent Investment of Retirement Savings Act,” H.R. 2988, sponsored by Rep. Rick Allen (R-Ga.), seeks to limit the use of ESG considerations, particularly in fiduciaries’ management of retirement savings governed by the Employee Retirement Income Security Act.
The legislation targets a Labor Department rule finalized during the Biden administration that clarified support for fund managers’ authority to consider ESG factors when they are financially relevant and to use them as a tie-breaker when competing investments are otherwise economically equivalent.
The bill was one of several measures advanced by the House Education and Workforce Committee that were slated for floor votes this week. The Thursday vote came after six Republicans joined Democrats earlier this week to block a separate GOP-backed bill easing overtime rules.
