Skip to main content

Sign up for our newsletter.

Quality journalism. Progressive values. Direct to your inbox.

For Immediate Release

Contact

Ginny Cleaveland, Deputy Press Secretary, Fossil-Free Finance, Sierra Club, ginny.cleaveland@sierraclub.org

Press Release

Department of Labor Restores Ability for Asset Managers to Consider Climate Risks to Retirement Savings

Sierra Club applauds agency rulemaking process reaffirming ability of private retirement plan managers to consider ESG factors in investment decisions, which was removed under Trump administration.
WASHINGTON -

The Sierra Club’s Fossil-Free Finance campaign applauds a move announced today by the US Department of Labor (DOL) that restores the ability for managers of private, employer-sponsored retirement plans to consider environment, social justice, and corporate governance (ESG) factors when making investments and voting on shareholder proposals.

The decision comes nearly a year after the close of a comment period on the proposed rule, intended to undo a push by the Trump administration to impose additional costs and burdens meant to discourage fund managers from considering climate change in their decision making. 

During the comment period, the Sierra Club and Americans for Financial Reform Education Fund submitted a comment letter signed by 12 groups in support of the proposed rule. In addition, the Sierra Club helped coordinate thousands of public comments urging the DOL to go further, by requiring fund managers to consider climate risk and provide options for savers who want to invest in sustainable businesses. 

In response to the ruling, Jessye Waxman, Senior Campaign Representative for the Sierra Club’s Fossil-Free Finance campaign, issued the following statement:

“The management of systemic risks, such as climate change, is a fundamental part of fiduciary responsibility and is critical to protecting the savings of workers and retirees. The Department of Labor's ruling removes the barriers to the responsible management of these risks that were put in place by politically motivated actors. This decision lays the groundwork for future rulemakings that establish affirmative duties of retirement fund fiduciaries to manage climate and other systemic risks.”

BACKGROUND

Millions of workers in the US rely on private pension funds to manage their retirement savings. This ruling allows asset managers to better protect workers’ savings from the material ESG risks facing capital markets, and grow workers’ savings so they can retire comfortably. The health of the US economy relies on the financial wellness of the people who operate in it, so more resilient private pension funds mean healthy savings, which helps keep the economy running smoothly. 

ESG risks, particularly those related to climate disasters, are becoming increasingly material to businesses of all industries and sizes, and thus to these managers’ portfolios. The DOL’s decision gives private pension fund managers the green light to fulfill their fiduciary duty, and empowers these asset managers to uphold their responsibility to consider risks and make prudent investment decisions, without fear of legal or financial threats. 

###

The Sierra Club is the most enduring and influential grassroots environmental organization in the United States. We amplify the power of our 3.8 million members and supporters to defend everyone’s right to a healthy world.

'All of Rail Labor Is Going to Suffer': Workers Furious Over Biden Move to Preempt Strike

"This is a legacy-defining moment for Joe Biden," said Railroad Workers United. "He is going down as one of the biggest disappointments in labor history."

Jake Johnson ·


Citing Need for 'New, Inclusive Leadership,' Chuy García Files for Chicago Mayoral Race

"We have an opportunity to elect a trusted and experienced leader with a history of building coalitions and a vision for a brighter future for all Chicagoans," said the Democratic congressman.

Jessica Corbett ·


On Cyber Monday, Climate Activists Take Aim at Fashion Industry

"The fashion industry is one of the largest polluting industries globally. We can all do better, but it's on companies to make this industry better for workers, the planet, and consumers alike."

Jessica Corbett ·


Biden Accused of Selling Out Rail Workers by Urging Congress to Prevent Strike

"Biden is siding with corporate rail bosses over the rank-and-file workers who voted against this agreement," said one progressive commentator after the president urged lawmakers to take action to force through a deal without paid sick leave.

Brett Wilkins ·


Analysis Finds State Legislators Proposed 306 Bills Targeting Trans People in Past 2 Years

"Right-wing state lawmakers are obsessed with taking away the rights of trans people and we're obsessed with knocking them out of public office," said one rights group.

Julia Conley ·

Common Dreams Logo