You should be able to invest your retirement funds in whatever company or stock you want, says Sen. Mike Braun.
The Republican from Indiana has an issue with new Biden administration rules that he says impede on your ability to choose what you invest in. He’s proposing an amendment to laws already on the books that set standards for private companies to abide by when it comes to retirement planning for workers.
Braun accuses the White House of pushing new rules that force participants and fiduciaries to invest in businesses or corporations that have a good ESG rating. ESG stands for environmental, social, and governance index, which is a rating system that takes into account an entity’s environmental standards and also efforts to combat racism in the workplace.
“The Biden Administration Department of Labor has proposed a rule that will essentially force workers and businesses into supporting corporations deemed ‘woke’ through ESG,” Braun said in a Senate hearing on Tuesday.
“A number of studies have shown that regardless of what you’re wanting to do there, it will give you worse rates of return. I think those two purposes need to be separated,” he added.
Braun cites the removal of Tesla from the S&P 500 ESG Index in May because of a poor ESG rating. Because of the ESG system, Braun said many workers are now denied the ability to invest retirement funds in Tesla.
Apple, Amazon, Microsoft, and Exxon Mobile are still trading in the S&P 500 ESG Index.