Biden Vetoes Bill to Reverse ESG Investing

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President Biden issued his first veto on Monday since taking office, rejecting the proposed bill that would prevent money managers from factoring in environmental, social and governance (ESG) investing when making decisions about retirement savings on behalf of clients, according to The Hill. Signing his veto, Biden shared that the bill would risk the retirement savings of Americans, suggesting that climate change is more important than their financial security. 

According to FOX News, “under the rule, fiduciaries who make investment decisions for the retirement plans of more than 150 million people would be explicitly permitted under federal guidelines to consider companies’ approach to climate change and other social issues, instead of focusing on only profitability and return on investment for retirees.”


Senator Joe Manchin (D-WV), an opponent of the Biden administration’s rule, criticized Biden’s veto stating that “this Administration continues to prioritize their radical policy agenda over the economic, energy and national security needs of our country, and it is absolutely infuriating.” Manchin did not stop there in attacking the Biden administration’s incompetence and failures, citing that Americans are still trying to recover from the pandemic, pay bills amid record-high inflation, and facing the “largest land war in Europe since World War II.” He added that the Biden administration’s primary concern with advancing their “radical social and environmental agenda is only exacerbating these challenges.” 

The Hill reports that Will Hild, executive director of Consumers’ Research, a group that has led opposition ESG policies, voiced a similar concern that Biden’s veto goes against the best interests of the American people. Hild said that it is “disappointing” to see the Biden administration take the hard-earned money of Americans that they saved for retirement and put it towards “progressive politics” instead of their financial security. 


The Republican-led legislation that was proposed to end this rule, which has now been vetoed, will return to Congress but they are unlikely to override Biden’s veto as it requires two-thirds majority support. 

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