Senate Health, Education, Labor, and Pensions (HELP) Committee Chair Bill Cassidy (R-LA) sent a letter to Labor Secretary Lori Chavez-DeRemer expressing support for the Labor Department’s stated plans to replace the Biden-era, SWACCA-supported final rule on “Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights.” SWACCA worked with our allies during the Biden Administration to secure provisions in this final rule that clarified that the creation of union jobs and contributions to the plan are collateral benefits trustees may use to select between two equivalent investments. The final rule also included SWACCA-advocated provisions returning to the “economically equivalent” tie breaker standard for selecting between investments that offer equivalent risks and returns.
In his letter, Cassidy said that the rule allowed plans to misuse “workers’ savings in order to invest in activist causes. Under the guise of environment, social, and governance (ESG) considerations, fiduciaries choose investments or exercise shareholder rights based on subjective, unprovable factors to further an ideological agenda.” Cassidy also issued a press release on the letter, highlighting his longstanding efforts to prevent the consideration of ESG factors in investment decisions concerning retirement assets.