President Joe Biden “will veto” the bill, the White House said on Monday.
If the Senate and House vote to overturn a Department of Labor rule that permits retirement plan managers to consider environmental, social, and governance (ESG) factors in investment decisions, President Biden may issue his first veto.
More than 150 million Americans’ retirement funds, according to some representatives, are in “jeopardy” because of the DOL rule, which they say “politicizes” them. Indiana Republican Mike Braun and Kentucky Republican Andy Barr introduced a resolution of disapproval last month. Over a hundred organizations, including all Senate Republicans and West Virginia’s lone Democratic senator, Joe Manchin, have since come out in support of the bill.
A simple majority of the Senate (60 votes) is all that is required to send the bill to President Joe Biden’s desk for signature into law. If Pennsylvania Democrat John Fetterman continues to be absent from the Senate while receiving treatment for clinical depression, the bill can be passed with a simple majority of 50 senators.
According to Fox News Digital, even though the bill has lost the support of Senator Fetterman, a Republican aide maintains that it has enough votes to pass the Senate.
The adviser claimed that President Biden had received a bipartisan rebuke of his policy that is harming Americans’ retirement savings to fund his political agenda after Biden had spent the prior month accusing Republicans of partisanship and trying to hurt Americans’ retirements.
On Tuesday, the House of Representatives is likely to hold a vote on this, and the Republican majority means it will likely pass with little opposition. The Senate will vote on the proposal on Wednesday.
President Joe Biden “will veto” the bill, the White House said in a statement released on Monday.
“When he makes a promise to the American people, the President will always keep that promise. If he were presented with H.J. Res. 30, he would veto it immediately.” The White House has publicly defended the consideration of environmental, social, and governance (ESG) factors in investment and other fiduciary decisions through the release of a Statement of Administration Policy.
The White House has argued that the rule “reflects what successful marketplace investors already know”: that environmental, social, and governance factors can have material impacts on specific markets, industries, and companies. This is in response to the “chilling effect” the previous Trump administration had on ESG investments.
Using the CRA’s authority, a motion of disapproval was filed. Now, despite Senate Democrats’ objections, resolutions are legally able to be put to a vote. If the Republican-controlled House of Representatives passes the bill, the Democratic-controlled Senate should too.
It would be Biden’s first opportunity to use his veto power if the ESG motion were to pass. An override of President Biden’s veto would require two-thirds majorities in both houses of Congress.
Environmental, social, and governance (ESG) factors are gaining more attention in the financial markets.
Contributions to pollution or global warming by a company are examples of environmental factors. Employees, ethics, philanthropy, and community service all contribute to a company’s social impact. Leadership, ethics, and corporate standards, as well as the composition of the board of directors and the recipients of their charitable donations, are all components of corporate governance.