S&K Briefing: DoL proposes Regulation on ESG investing

On 9 November 2021, Seward & Kissel, our alliance firm for hedge fund and asset management work, published a client memorandum on the Department of Labor’s (DoL) Proposed Regulation regarding ESG Investing and Proxy Voting.

The memorandum looks at the “Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights” or “Proposed Regulation”, put forward recently by the DoL.

The key takeaways from the memorandum are as follows:

• The Proposed Regulation presumes that ESG factors have a financial impact, affecting the risk/return characteristics of an investment and the exercise of shareholder rights.
• The Proposed Regulation removes the special ESG record-keeping and documentation requirements.
• The Proposed Regulations will affect investment managers that market to ERISA plans as well as investment managers that act as ERISA fiduciaries.

For more information, please contact Devarshi Saksena, Lucian Firth, Sarah Crabb or Richard Perry or speak to an attorney at Seward & Kissel.