McCollum Statement in Support of President Biden’s Veto of H.J.Res. 30, the Congressional Review Act (CRA) Resolution of Disapproval of the Labor Department’s ESG Rule

Mr. Speaker, I rise in support of President Biden's veto rejecting legislation to overturn a Labor Department rule related to ESG (Environmental, Social, and Governance) -based investing strategies.

On December 1, 2022, the Department of Labor issued a final rule on "Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights." This rule clarifies that retirement plan fiduciaries may consider climate change and other Environmental, Social, and Governance (ESG) factors in selecting retirement investments and exercising shareholder rights, when those factors are relevant to the risk and return analysis.

The bill Republicans passed would have rejected that rule, instead mandating that retirement plan managers ignore this type of risk—whether it be a company's poor corporate management, human rights violations, carbon emissions, or any of the other factors that fall under the ESG framework.

When retirement plan managers are unable to fully explain all of the risks in a portfolio, those risks jeopardize the hard-earned retirement dollars of tens of millions hardworking Americans. ESG factors should be allowed to be taken into account in one's investment and retirement strategies. The Intergovernmental Panel on Climate Change (IPCC)'s just-released report* offers a catastrophic outlook if nations like the U.S. do not take urgent action to fight the climate crisis. Clearly superstorms, severe flooding, and sea-level rise, for example, elevate risks. ESG strategies are one tool to help individuals take an action of their own in pursuit of a future on a livable planet.

Should Minnesotans want to divest from fossil fuel interests, they should be allowed to do so. Their retirement plan managers should have the freedom to make fully-informed investment decisions—whether related to ESG or not.

Republicans' nonsensical attempt to frame ESG investments as "woke capitalism" is a waste of this governing body's efforts and would put Americans' futures at risk. Vetoing this bill is just common sense.

President Biden has made clear that Democrats believe we must protect hardworking Americans' life savings and retirement.

Thank you, and I yield back.