DENVER – Western Energy Alliance this week joined 25 state attorneys general in filing a lawsuit challenging the Department of Labor’s final rule on prudence and loyalty selecting plan investments for pension plans governed by the Employee Retirement Income Security Act (ERISA). The rule enables investment managers to elevate environmental, social, and governance (ESG) and climate change issues above fiduciary factors when making investments on behalf of retirees and workers. In addition to threatening financial returns for millions of workers and retirees, the rule is one of many the Biden Administration is enacting to deny financing for oil and natural gas projects, threatening the American energy supply, reducing energy security, and increasing energy prices. The suit was filed in the U.S. District Court for the Northern District of Texas on January 26, 2023.
“Western Energy Alliance joined 25 states in challenging this rule because it is one of many the Biden Administration is moving forward with as a means of de-financing American oil and natural gas companies. The administration continues its drive to put American oil and natural gas out of business even as the president turns to Venezuela and Saudi Arabia to increase their production. The rule raises ESG and climate change factors above maximizing returns for pension plans and 401(k)s,” said Kathleen Sgamma, president of the Alliance. “Data continue to emerge that ESG investing is highly politicized and delivers lower returns. DOL’s rule would cause retirees and employees to end up with significantly lower income in retirement, all for purposes of a one-sided political agenda.
“Congress has not changed the basic requirement for the Department of Labor to protect pensions, 401(k)s, and other retirement plans to ensure investment managers maximize returns and minimize risks. The new rule violates the law by allowing investment managers to put their political objectives above the financial health of the plans they manage on behalf of workers and retirees. The Biden Administration is putting at risk the lifetime earnings of Americans and making them less secure in retirement, all in furtherance of a political agenda that Americans have not agreed to through the democratic process,” added Sgamma.
More information is available in the court filing.
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