No ESG at TSP Act
Bill: H.R.7896 | Sponsor: Rep. Roy, Chip (R-TX)
Policy area: Government Operations and Politics

Summary:
No ESG at TSP Act
This bill prohibits investments under the Thrift Savings Plan in mutual funds that are based on environmental criteria (e.g., emissions standards), social criteria (e.g., company diversity), political criteria (e.g., political affiliations), or corporate governance criteria that differ from the standards that currently apply under law.

To prohibit investments under the Thrift Savings Plan in certain mutual 
funds that make investment decisions based primarily on environmental, 
                    social, or governance criteria.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``No ESG at TSP Act''.

SEC. 2. PROHIBITION ON CERTAIN MUTUAL FUNDS UNDER THE THRIFT SAVINGS 
              PLAN.

    (a) In General.--Section 8438(b)(5) of title 5, United States Code, 
is amended by adding at the end the following new subparagraphs:
    ``(E) The Board may not offer through the mutual fund window any 
mutual fund, exchange traded fund (as defined in section 270.6c-11 of 
title 17, Code of Federal Regulations), or other investment vehicle 
that invests in bonds or equities that is invested based on any one or 
more of the following criteria to the extent that such criteria are 
unrelated to maximizing monetary returns for investors:
            ``(i) Environmental criteria, including--
                    ``(I) emissions, climate change, sustainability, 
                environmental justice, pollution, or conservation; or
                    ``(II) whether a company is engaged in the 
                exploration, production, utilization, transportation, 
                sale, or manufacturing of fossil fuel-based energy.
            ``(ii) Social criteria, including--
                    ``(I) diversity criteria, including--
                            ``(aa) the race, ethnicity, gender 
                        identity, sexual orientation, or socioeconomic 
                        status of the owners, board members, employees, 
                        or customers of companies; or
                            ``(bb) whether such board members, 
                        employees, or customers are members of a labor 
                        organization (as such term is defined in 
                        section 2 of the National Labor Relations Act 
                        (29 U.S.C. 152)); or
                    ``(II) whether a company is engaged in the 
                manufacture, transportation, or sale of firearms, 
                firearms accessories, or ammunition.
            ``(iii) Political criteria, including the perceived or 
        actual political affiliations, donations, or associations of 
        companies.
            ``(iv) Criteria for corporate governance standards that 
        differ from the applicable standards required under State and 
        Federal law as in effect on the date of the enactment of this 
        subparagraph.
    ``(F) The Board may not offer through the mutual fund window any 
mutual fund, exchange traded fund (as defined in section 270.6c-11 of 
title 17, Code of Federal Regulations), or other investment vehicle 
that is marketed as being invested based on environmental, social, or 
governance criteria, commonly known as `ESG criteria'.''.
    (b) Existing Investments in Impermissible Mutual Funds.--
            (1) In general.--An employee or Member (or former employee 
        or Member) may elect to have any covered sums credited to the 
        account of such individual in the Thrift Savings Fund 
        reinvested in accordance with section 8438 of title 5, United 
        States Code, as amended by this Act.
            (2) Notice.--Not later than 30 days after the date of the 
        enactment of this Act, the Board shall notify each employee or 
        Member (or former employee or Member) that may make an election 
        under paragraph (1) of the option to make such election.
            (3) Mandatory reinvestment.--Not later than the date that 
        is 30 days after the date on which notice is provided under 
        paragraph (2) to an employee or Member (or former employee or 
        Member), the Board shall reinvest, in accordance with section 
        8438 of title 5, United States Code, as amended by this Act, 
        any covered sums credited to the account of such individual in 
        the Thrift Savings Fund with respect to which such individual 
        has not made an election under paragraph (1).
            (4) Definitions.--In this subsection:
                    (A) Board; employee; member.--The terms ``Board'', 
                ``employee'', and ``Member'' have the meanings given 
                such terms in section 8401 of title 5, United States 
                Code.
                    (B) Covered sums.--The term ``covered sum'' means 
                any sums of the Thrift Savings Fund that, on the date 
                of the enactment of this Act, are invested in a mutual 
                described in section 8438(b)(5)(E) of title 5, United 
                States Code.
                    (C) Thrift savings fund.--The term ``Thrift Savings 
                Fund'' means the fund established under section 8437 of 
                title 5, United States Code.
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