US SIF Commends Department of Labor Repeal of 2008 Bulletin Discouraging Fiduciaries from Incorporating Social and Environmental Investment Factors

US SIF commends today's announcement by Secretary of Labor Tom Perez in New York that the administration is rescinding a 2008 bulletin that discouraged investors from considering environmental and social factors in the companies and funds in which they invest. 

WASHINGTON, D.C. (October 22, 2015)—US SIF: The Forum for Sustainable and Responsible Investment commends today's announcement by Secretary of Labor Tom Perez in New York that the administration is rescinding a 2008 bulletin that discouraged investors from considering environmental and social factors in the companies and funds in which they invest.  Through his leadership, Secretary Perez is supporting fiduciaries that engage in sustainable and responsible investing, a mission that US SIF has advanced throughout its history.
The Department of Labor bulletin on Economically Targeted Investments, 29 CFR 2509.08-1, issued in October 2008, arbitrarily disfavored the consideration of environmental and social risks and opportunities in assessing potential investments. It was issued alongside a bulletin on Shareholder Rights, 29 CFR 2509.08-2, which was not addressed today. 
Today's Interpretive Bulletin brings ERISA guidance in step with today's realities by noting that "fiduciaries need not treat commercially reasonable investments as inherently suspect or in need of special scrutiny merely because they take into consideration environmental, social, or other such factors.” 
Indeed, the 2008 bulletin on economically targeted investments was out of step with the growing consensus view that fiduciary duty may compel fiduciaries to consider environmental, social and governance (ESG) factors in investment analysis and ownership practices.  US SIF's Report on US Sustainable, Responsible and Impact Investing Trends 2014 documents that $6.57 trillion in assets are held today by US institutional investors and investment firms that review the environmental, social and governance practices, risks and opportunities of their portfolio companies and funds.  This is a 76 percent increase from the 2012 Trends report.  Many of these asset owners and managers use their votes as shareholders to encourage companies to reduce their greenhouse gas emissions and to take other steps to improve their environmental, social and governance performance.   Companies themselves increasingly understand that environmental, social and governance issues and risks are important considerations in creating long term value.
US SIF Chief Executive Officer Lisa Woll, who spoke at today's press conference, noted of the decision:
“Responsible investors review their portfolios for environmental and social risks and opportunities.  Today's action enables investment professionals to exercise their judgment and expertise in the service of beneficiaries without concerns about possible conflicts with ERISA.   It clearly signals that ERISA-governed plans, and by extension, those plans influenced by ERISA, may integrate critical environmental, social and governance issues into their investment decisions.  We thank the many organizations that worked in coalition with us on this issue and the leadership of DOL for advancing today's action.”
US SIF member Trillium Asset Management also spoke at today's event.  CEO Matthew W.  Patsky commented that:
“We know that integrating Environmental, Social, and Governance factors into the investment process can help identify companies best positioned to deliver strong long-term performance. With Secretary Perez's announcement, the gold standard for fiduciary duties in the United States—the standard that impacts Trillium and our peers—now recognizes consideration of ESG as a valid part of the investment discipline.  Using our rights as shareholders, Trillium has a long history of engaging directly with companies in our portfolios to move them toward more sustainable business practices.  We look forward to working with the Secretary on this issue, as well.”
Additionally, US SIF Member Morgan Stanley spoke at today's event.  Audrey Choi, CEO of the Morgan Stanley Institute for Sustainable Investing, said: 
“Integrating environmental, social and governance considerations into investment decisions can enhance an investor's abilities to identify material risks and opportunities.  Today's announcement from the Department of Labor opens the door for investors to think strategically about their long-term positions with a far richer data set, consistent with their fiduciary duty."

About US SIF
US SIF:  The Forum for Sustainable and Responsible Investment ( advances sustainable, responsible and impact investing. US SIF's members include investment management and advisory firms, mutual fund companies, research firms, financial advisors, broker-dealers, community investing institutions and asset owners whose  investment practices consider environmental, social and corporate governance criteria to generate long-term competitive financial returns and positive societal impact . See
# # #
Michelle Manoff, Rubenstein Public Relations, 212-843-8051, [email protected]