President Joe Biden recently issued a message to the U.S. House of Representatives that vetoed H.J. Res. 30. This resolution would disapprove of a final environmental, social, and governance (ESG) rule by the U.S. Department of Labor (DOL) entitled “Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights.”

In his message, Biden stated that the DOL’s final rule protects the retirement savings and pensions of millions of workers and retired workers nationwide. The rule allows retirement plan fiduciaries to make investment decisions based on all relevant factors that could impact those investments. This strategy allows fiduciaries to maximize financial returns for workers and retirees.

Biden also cited extensive evidence that ESG factors significantly impact financial markets and businesses, including the physical risks of climate change and poor corporate governance. H.J. Res. 30, Biden said, would force retirement plan fiduciaries to ignore these risk factors, which could jeopardize the retirement savings of working families. Instead, fiduciaries should be free to consider any factor that maximizes the growth of investments for workers and retirees, which should not be controversial.