Calling it “a move that will ignite billions in smarter long term investing,” Robert F. Kennedy Human Rights praised the Department of Labor for eliminating certain restrictions on ERISA fiduciaries that kept pension funds from factoring human rights as well as environmental sustainability and good governance into their investment decisions.
“Thanks to this ruling, we will now see more investments that will respect rights along the supply chain, and help lead to the end of child labor, exploitation of women, and abusive practices. Furthermore, thanks to Secretary Perez’s leadership, more funds will invest in creating jobs, protecting the environment, and rewarding good governance. This is a clear win for pension funds, their members, and everyone who believes the best corporations are those which respect their workers and the communities in which they operate,” said Kerry Kennedy, President of Robert F. Kennedy Human Rights.
In 2008, the Bush Administration’s Department of Labor announced pension trustees were prohibited from selecting investments on the basis of any factor outside the economic interest of the plan.
This decision prevented pension funds from considering such factors as exploitative labor conditions, worker rights, internet freedom, community development and environmental impact before deciding where to invest. A diverse coalition of human rights advocates, investors, labor unions and others advocated to overturn the ruling. In addition to Robert F. Kennedy Human Rights, firms such as Vista Equity Partners, Domini Social Investments, Blue Wolf Capital Partners, Boston Provident, and Ariel Investments expressed support for lifting the restriction.
Source: Federal Register