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DOL Issues Final Rule Amending Investment Duties Regulation – Provides New Guidance on Consideration of ESG Factors in Plan Investing
December 8, 2022On November 22, the United States Department of Labor (“DOL”) released its final rule (the “Final Rule”) adopting certain revisions to its investment duties regulation under ERISA at 29 CFR Section 2550.404a-1 (the “Section 404a-1 Regulation”). The revisions in the Final Rule are intended to clarify the application to ERISA plan fiduciaries of the ERISA duties of loyalty and prudence in respect of investments and the use of written proxy voting guidelines and policies. The Final Rule clarifies that ERISA plan fiduciaries may consider climate change and environmental, social and corporate governance (“ESG”) factors when making investment decisions and exercising shareholder rights for plans.
