Senate votes out Labor Department ESG rule

A bill that could overturn a Labor Department rule about retirement investments moved to President Joe Biden’s desk on Thursday. In November, the Labor Department expanded the factors retirement fund managers could consider to include the environmental and social causes and governance of the company in which they’re investing. The vote to overturn the so-called ESG rule passed the Senate 50-46, with two Democrats voting for the bill. The House passed a version of the bill on Tuesday. Biden has said he would use his first veto on the bill. 

What are the objections to ESG investing? The ESG industry says it helps highlight companies outside traditional investing guidelines. But financial analyst and adviser David Bahnsen told WORLD that ESG investing could cause significant harm. He said the problem with ESG investing is that it is an ideological movement, not an environmental one. Prioritizing ideological goals rather than financial gain could harm retirees, senators said. 

Dig deeper: Read Jerry Bowyer’s column in WORLD Opinions on the backlash against ESG investing.