I 
117TH CONGRESS 
1ST SESSION H. R. 3605 
To amend the Investment Advisers Act of 1940 to enable consideration 
and promote disclosure and transparency of sustainable investment poli-
cies by large asset managers, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 28, 2021 
Mr. LEVIN of Michigan (for himself, Mrs. AXNE, Mr. BRENDAN F. BOYLE 
of Pennsylvania, and Mr. GARCI´A of Illinois) introduced the following bill; 
which was referred to the Committee on Financial Services 
A BILL 
To amend the Investment Advisers Act of 1940 to enable 
consideration and promote disclosure and transparency 
of sustainable investment policies by large asset man-
agers, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Sustainable Invest-
ment Policies Act of 2021’’. 
SEC. 2. FINDINGS. 
The Congress finds the following: 
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(1) Environmental, social, and governance (in 
this Act referred to as ‘‘ESG’’) include the potential 
for economic benefits, such as local job creation and 
economic development, in addition to investment re-
turns, as provided by investments sometimes re-
ferred to as ‘‘Economically Targeted Investments’’ 
or ‘‘ETIs’’. 
(2) There is now incontrovertible evidence that 
ESG factors can have substantial effects on invest-
ment performance and are important to many inves-
tors and that investors have a significant interest in 
such findings. 
(3) Investor findings show a dramatic interest 
in investments that consider ESG factors. 
(4) Decades of policy interpretations from the 
Department of Labor and the Securities and Ex-
change Commission have created confusion as to the 
obligations of a fiduciary with regard to ESG 
intergration. 
(5) Recent policies of the Securities and Ex-
change Commission have had a chilling effect on 
ESG integration and active ownership with a view 
toward advancing a sustainable economy. 
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SEC. 3. SUSTAINABLE INVESTMENT POLICY OF INVEST-
MENT ADVISERS. 
Section 203 of the Investment Advisers Act of 1940 
(15 U.S.C. 80b–3) is amended by adding at the end the 
following new subsection: 
‘‘(o) SUSTAINABLE INVESTMENT POLICY.— 
‘‘(1) IN
GENERAL.—No person may be reg-
istered as an investment adviser under this section 
unless such person— 
‘‘(A) files a sustainable investment policy 
with the Commission; and 
‘‘(B) complies with such policy in carrying 
out the duties of an investment adviser. 
‘‘(2) CONTENTS.—A sustainable investment 
policy described under paragraph (1)(A) shall in-
clude the policies of the person with respect to the 
following: 
‘‘(A) Environmental concerns, including 
environmental risks to the assets and properties 
of entities in which the funds invest, includ-
ing— 
‘‘(i) climate risks and contributions; 
‘‘(ii) associated environmental risks, 
including— 
‘‘(I) industrial pollution; 
‘‘(II) habitat destruction; 
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‘‘(III) deforestation; and 
‘‘(IV) other forms of environ-
mental degradation; and 
‘‘(iii) pollution of land, air, or water 
related to the operation of the entities in 
which fund invests. 
‘‘(B) Social considerations, including— 
‘‘(i) characteristics of workforces em-
ployed by entities in which the fund in-
vests, including— 
‘‘(I) compensation and benefits; 
‘‘(II) health and safety; 
‘‘(III) 
diversity 
and 
demo-
graphics; 
‘‘(IV) skills and training; 
‘‘(V) retention and turnover; 
‘‘(VI) full-time and part-time em-
ployment; and 
‘‘(VII) the use of independent 
contractors; 
‘‘(ii) labor and human rights compli-
ance by entities in which the fund invests, 
including— 
‘‘(I) workers’ freedom of associa-
tion; 
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‘‘(i) corporate governance practices by 
entities in which the fund invests; and 
‘‘(ii) tax practices of entities in which 
the fund invests, including international 
tax avoidance strategies and tax payment 
disclosure. 
‘‘(D) Other relevant economically targeted 
investment, or environmental, social, and gov-
ernance considerations and factors. 
‘‘(3) COMPLIANCE AUDIT.— 
‘‘(A) IN GENERAL.—Not less than annu-
ally, each registered investment adviser shall 
contract with an auditor to perform an audit of 
the adviser’s compliance with the sustainable 
investment policy filed with the Commission. 
‘‘(B) REPORT.—An auditor performing an 
evaluation under subparagraph (A) shall file, 
and make publicly available, a report on such 
evaluation to the adviser and the Commission. 
‘‘(C) 
FIDUCIARY
SAFE
HARBOR.—The 
Commission may, by order, determine that an 
investment adviser has not breached its fidu-
ciary duty with respect to consideration of fac-
tors outlined under this subsection if the invest-
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ment adviser is in compliance with this sub-
section.’’. 
Æ 
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