Maximize Americans’ Retirement Security Act

Bill Name: Maximize Americans’ Retirement Security Act
Bill Sponsor: S. 4613, sponsored by Sen. Mike Braun (R-IN)

Summary: The Maximize Americans’ Retirement Security Act seeks to protect the retirement of millions of Americans by ensuring that pension fund managers invest to minimize risk and maximize return.

The legislation aims to codify a recently rescinded regulation from the Department of Labor that curtailed the use of pension funds being used for political causes.

Background on ESG: The Biden Administration is seeking to expand and encourage the practice of retirement plans using workers’ invested funds to support environmental and social causes.

Known as ESG (Environmental, Social, and Governance), these investment funds use retirement savings to advance environmental, social, and governance causes.  The Department of Labor in 2020 under former President Trump required plan fiduciaries to only consider financial factors rather than ESG purposes. However, that rule was rolled back early in the Biden administration and followed by a new rulemaking to “remove barriers” to ESG investing.

The Maximize Americans’ Retirement Security Act, introduced by Sen. Mike Braun, would ensure that retirement plan administrators consider first the risk and reward associated with investment decisions for the managed fund, for the benefit of those saving for retirement.  Should financial factors alone be insufficient when making investment decisions, plan managers could use non-financial factors so long as the decision is explained to plan participants.

Sen. Braun said in a press release announcing the bill, “The Biden Administration should not be sacrificing the retirement savings of thousands of individuals to promote liberal policy objectives.”

Bill Status: The Maximize Americans’ Retirement Security Act was introduced in the Senate on July 26, 2022, and referred to the Committee on Health, Education, Labor, and Pensions.

Additional resources:

PRESS RELEASE: Sen. Braun, colleagues introduce bill to maximize Americans’ retirement funds
July 26, 2022, Braun.senate.gov

An Inconvenient Truth About ESG Investing
March 31, 2022
Sanjai Bhagat, Harvard Business Review

Wicker Co-Sponsors “Maximize Americans’ Retirement Security Act”
July 28, 2022
FreedomWorks

PRESS RELEASE: “Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights
Oct. 13, 2021, DOL.gov