I 

116TH CONGRESS 

2D SESSION H. R. 8959 

To amend the Employee Retirement Income Security Act of 1974 to require 

retirement plans to establish Sustainable Investment Policies. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 14, 2020 

Mr. LEVIN of Michigan (for himself, Mr. BRENDAN F. BOYLE of Pennsylvania, Mrs. AXNE, and Mr. GARCI ́A of Illinois) introduced the following 

bill; which was referred to the Committee on Education and Labor 

A BILL 

To amend the Employee Retirement Income Security Act 

of 1974 to require retirement plans to establish Sustainable Investment Policies. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Retirees Sustainable 

5 Investment Policies Act of 2020’’. 

6 SEC. 2. FINDINGS. 

7 The Congress finds the following: 

8 (1) Fiduciaries for retirement plans should— 


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1 (A) incorporate all relevant factors, includ2 ing environmental, social, and governance (here3 inafter in this Act referred to as ‘‘ESG’’) fac4 tors, into investment analysis and decision-mak5 ing processes, consistent with the investment 

6 time horizons of plan participants and bene7 ficiaries; 

8 (B) encourage the adoption of best prac9 tices for ESG performance in the companies or 

10 other entities in which they invest; 

11 (C) consider plan participants’ and bene12 ficiaries’ sustainability-related interests and 

13 preferences when making investment decisions; 

14 (D) consider the impact of plan invest15 ments on the stability and resilience of the fi16 nancial system; and 

17 (E) disclose how they have implemented 

18 these commitments. 

19 (2) There is now incontrovertible evidence that 

20 ESG factors are financially material to investors and 

21 relevant to investment decisionmaking. 

22 SEC. 3. PURPOSE. 

23 The purpose of this Act is to require retirement and 

24 welfare benefit plans that are covered by the Employee 

25 Retirement Income Security Act of 1974 (29 U.S.C. 1001 


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1 et seq.), to adopt and implement policies in consideration 

2 of ESG factors when making investment decisions, be3 cause considering ESG factors is relevant to the fiduciary 

4 duty of prudence, as such factors help ensure investments’ 

5 long-term sustainability. 

6 SEC. 4. AMENDMENTS TO THE EMPLOYEE RETIREMENT IN7 COME SECURITY ACT OF 1974. 

8 (a) DISCLOSURE OF SUSTAINABLE INVESTMENT

9 POLICIES.—Section 102 of the Employee Retirement In10 come Security Act of 1974 (29 U.S.C. 1022) is amended 

11 in subsection (b), by inserting ‘‘the sustainable investment 

12 policy of the plan (as established under section 

13 402(b)(5));’’ after ‘‘collective bargaining agreement;’’. 

14 (b) ESTABLISHMENT OF SUSTAINABLE INVESTMENT

15 POLICY.—Section 402 of the Employee Retirement In16 come Security Act of 1974 (29 U.S.C. 1102) is amend17 ed— 

18 (1) in subsection (b)— 

19 (A) in paragraph (3), by striking ‘‘and’’; 

20 (B) in paragraph (4), by striking the pe21 riod and insert ‘‘, and’’; and 

22 (C) by inserting after paragraph (4) the 

23 following: 

24 ‘‘(5) provide a sustainable investment policy of 

25 the plan in accordance with subparagraph (d) unless 


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1 the plan elects to rely on the sustainable investment 

2 policies of the plan’s fiduciaries as defined by section 

3 3(38)’’; and 

4 (2) by adding after subsection (c) the following: 

5 ‘‘(d)(1) A sustainable investment policy under sub6 section (b)(5) shall include guidelines with respect to— 

7 ‘‘(A) corporate governance practices by entities 

8 in which the plan invests, including executive com9 pensation, board diversity, the independence of 

10 board chairs, political spending and lobbying disclo11 sure; 

12 ‘‘(B) characteristics of workforces employed by 

13 entities in which the plan invests, including com14 pensation and benefits, health and safety, diversity 

15 and demographics, skills and training, retention and 

16 turnover, full-time and part-time employment, and 

17 the use of independent contractors; 

18 ‘‘(C) labor and human rights compliance by en19 tities in which the plan invests, including workers’ 

20 freedom of association, the right to collectively bar21 gain, and the prevention of employment discrimina22 tion, child labor, and forced labor in company oper23 ations and supply chains; 

24 ‘‘(D) the implementation, to the extent prac25 ticable, of practices which enhance diversity and inVerDate Sep 11 2014 00:27 Dec 28, 2020 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H8959.IH H8959

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1 clusion performance within the workforce, senior 

2 leadership, business procurement, philanthropy, and/ 

3 or board of directors; 

4 ‘‘(E) environmental risks to the assets and 

5 properties of entities invested in by the plan and re6 lated disclosures, including— 

7 ‘‘(i) climate risks and contributions; 

8 ‘‘(ii) environmental risks that may not be 

9 related to climate, such as industrial pollution, 

10 habitat destruction, and other forms of environ11 mental degradation; 

12 ‘‘(iii) impact to species endangerment and 

13 extinction; and 

14 ‘‘(iv) pollution of land, air, and water re15 lated to the operation of the entities invested in 

16 by the plan; 

17 ‘‘(F) due diligence and practices regarding sup18 ply chain management, including environmental, 

19 human rights, and worker compensation consider20 ations; and 

21 ‘‘(G) tax practices of entities in which the plan 

22 invests, including international tax avoidance strate23 gies and tax payment disclosure. 


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1 ‘‘(2) A plan subject to the requirements of section 

2 402(d)(1) shall conduct a review of the sustainable invest3 ment policy under subsection (b)(5) on an annual basis. 

4 ‘‘(3) Section 404(a) shall not be construed to prohibit 

5 a plan fiduciary from doing the following: 

6 ‘‘(A) In choosing among investments with com7 mensurate degrees of risk and rates of return, to se8 lect one or more such investments based on environ9 mental, social, and governance considerations. 

10 ‘‘(B) To monitor or dispose of a plan invest11 ment alternative based on considerations that in12 clude environmental, social, and governance consid13 erations. 

14 ‘‘(C) Vote proxies in accordance with the plan’s 

15 proxy voting guidelines.’’. 

16 (c) QUALIFIED INVESTMENT ALTERNATIVES.—Sec17 tion 404(c)(5) of the Employee Retirement Income Secu18 rity Act of 1974 (29 U.S.C. 1104(c)(5)) is amended by 

19 adding at the end the following: 

20 ‘‘(5) A qualified default investment alternative 

21 (as defined in section 2550.404c–5(e) of title 29, 

22 Code of Federal Regulations, or a successor regula23 tion) may include an investment alternative— 

24 ‘‘(A) with an environmental, social, and 

25 governance investment mandate; or 


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1 ‘‘(B) that was selected, in part, on the 

2 basis of an environmental, social, and govern3 ance consideration.’’. 

Æ 


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