The proposed New Coersive 401(k)

[Neodymium60]

One of the best pieces of legislation written in the last 50 years was the ERISA law of 1974.  In bygone days when Democrats and Republicans worked together.

The Biden administration is quietly trying to change the rules which prevented plan administrators from focusing of ESG factors (Environmental, social, and governance) in support of progressive policies.

This is not a legislative change but a proposed rule change by the DOL.  Below is the proposal as written in the Federal Register.

https://www.federalregister.gov/documents/2021/10/14/2021-22263/prudence-and-loyalty-in-selecting-plan-investments-and-exercising-shareholder-rights

A shorter explanation for the layman.

Your New Woke 401(k) – WSJ

[Legend]

Anybody who invests their retirement based on ESG at the expense of investment returns increases risk vs return and likely gets what they deserve.

The “prudent man” principle used to mean that pension managers had to invest for investment return and not for virtue signaling. I guess that is changing.

I guess one way to look at that is the more people flow money to ESG, the higher the returns for non ESG ownership positions.

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Sic transit gloria mundi (so shut up and get back to work)

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