On Nov. 22, 2022, the Department of Labor issued a final rule that permits plan fiduciaries to take into account ESG factors and other ancillary factors if the fiduciary concludes that the investment “equally serve[s] the financial interests of the plan over the appropriate time horizon” without creating “expected reduced returns or greater risk” (Final Rule). The Final Rule also eliminated a recordkeeping requirement that the prior rule had imposed.

This Bloomberg Law article, “New DOL Guidance on ESG Factors in ERISA Plan Investments,” authored by Groom principal Kevin Walsh and Groom associate Jacob Eigner, provides an overview of the interplay between ESG factors and fiduciary duties in plan investments, background of the dichotomy in guidance issued during previous administrations, and a summary of key provisions in the Final Rule applicable to ESG factors in plan investments.

To read the article, click here.


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