December 10, 2021
Acting Assistant Secretary Ali Khawar
Employee Benefits Security Administration
US Department of Labor
200 Constitution Ave., NW
Washington, DC 20210
Re: RIN 1210-AC03, Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights
Dear Secretary Khawar:
The Securities Industry Financial Markets Association (“SIFMA”)1 appreciates the opportunity to comment on the Department of Labor’s (“Department”) proposed amendments to the “Investment Duties” regulation under Title I of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”). We support the efforts of the Department and we appreciate the Department’s extensive outreach to stakeholders in putting together this new proposal.
We appreciate the Department’s recognition that a fiduciary should be able to consider all factors, including environmental, social and governance (“ESG”) factors, that it determines are relevant to its investment and risk management decisions. We believe that the proposed rule2 comports better with the requirements of ERISA and allows a fiduciary’s prudent investment process to guide its decisions with respect to the factors to be considered when making an investment decision. We believe putting in place a standard that does not tip the scales in any direction and, further, does not allow the subordination of the interests of participants and beneficiaries in their retirement income or financial benefits under a plan to other interests, will provide future certainty for fiduciaries, as well as provide the best result for plan participants and their beneficiaries.
1 SIFMA is the leading trade association for broker-dealers, investment banks and asset managers operating in the U.S. and global capital markets. On behalf of our industry’s nearly 1 million employees, we advocate for legislation, regulation and business policy, affecting retail and institutional investors, equity and fixed income markets and related products and services. We serve as an industry coordinating body to promote fair and orderly markets, informed regulatory compliance, and efficient market operations and resiliency. We also provide a forum for industry policy and professional development. SIFMA, with offices in New York and Washington, D.C., is the U.S. regional member of the Global Financial Markets Association (GFMA). For more information, visit http://www.sifma.org.
2 86 Federal Register 196, p. 57272 (October 14, 2021), “Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights” can be found at: https://www.govinfo.gov/content/pkg/FR-2021-10-14/pdf/2021-22263.pdf