The U.S. Impact Investing Alliance again called on regulators today to suspend an unnecessary and harmful rulemaking effort given the ongoing global health and economic crises. The Department of Labor has proposed a rule that would effectively prohibit ERISA-regulated retirement and pension plan fiduciaries from engaging corporate managers through the proxy vote process, singling out engagement on environmental, social and governance (ESG) issues in particular. The Alliance and many in the field view this proposal as an attack on shareholder engagement and the broader principles of impact investing.

“This move by the Department of Labor will disenfranchise millions of retirement savers and make it harder and more expensive for retirement plan sponsors to effectively protect the assets of American workers,” said Fran Seegull, Executive Director of the U.S. Impact Investing Alliance. “At a time when corporate America is being asked to step up in service of our collective efforts to rebuild and recover from profound social and economic crises, this regulatory move would strip away one of the most important tools we have for holding companies accountable.”

This rushed process by the Department follows on the heels of another recent anti-ESG proposal that was almost unanimously opposed by the over 8,700 financial advisors, asset managers, industry associations, institutional investors and retirement savers who submitted comment letters last month.

The Alliance’s letter today requests an extension to the comment period well beyond the 30 days allotted, and the Alliance plans to follow up with a more detailed list of substantive concerns with the proposal in a future letter.