The Biden government is thus reversing restrictions from the Trump administration.
The US Department of Labor on Tuesday authorized companies that manage employee retirement savings to take into account environmental, social and governance (ESG) criteria in their investments, thus reversing restrictions from the Trump administration.
The latter had not issued a formal ban, but considered that so-called ESG investments presented “gaps in the rigor of analysis” with regard to the duties of prudence and loyalty that pension funds must respect.
In a rule adopted at the end of 2020, shortly before Joe Biden’s arrival in the White House, it accordingly directed pension plan managers to focus on the financial interests of beneficiaries rather than other non-profit objectives. financial or political.
The new rule announced on Tuesday “clarifies” that pension plan managers can use ESG criteria, current Labor Minister Marty Walsh said in a statement.
This subject has become in recent months a new hobbyhorse for several Republican officials in the United States, who believe that taking ESG criteria into account in financial decisions is an ideological posture. Lawmakers in Florida, Texas and West Virginia, among others, have taken steps to limit their use.
Responsible investments have nevertheless gained in popularity in recent years with investors or managers who are more sensitive to these issues or who believe that they make it possible in the long term to limit financial risks.
The organization As You Sow, which campaigns for corporate environmental and social responsibility, welcomed the initiative.
“Ignoring climate change, racial injustice, the violation of workers’ rights or poor governance in the management of employee pensions does not make these risks go away,” said the head of the organization Andrew Behar, in a message. forwarded to AFP.
“While some officials are playing with retirees’ hard-earned money for political purposes, the administration’s new rule will protect employees and their families,” he said.