An article titled “ESG: Mind the gaps” published by HFM InvestHedge on Oct. 8 explores where some of the gaps between perception and implementation lie concerning environmental, social and governance. The article includes commentary from a Ropes & Gray alert titled “DOL Publishes Guidance on ESG Investment Considerations by Retirement Plans – Takeaways for Managers, Plan Sponsors and Public Companies.” Partners Isabel Dische, Joshua Lichtenstein, Michael Littenberg, George Raine, Brian McCabe, James Thomas, Peter Rosenberg, Jessica Taylor O’Mary and Melissa Bender contributed to the alert featured.
“In the US, this perception is also reflected in guidance issued by the US Department of Labour where ERISA fiduciaries are prohibited from sacrificing investment returns or assuming greater investment risks to promote “collateral social policy goals”, the article cites, also including the note that according to the Ropes & Gray alert, it also cautioned that fiduciaries “must not too readily” treat ESG factors as economically relevant to investment choices and that they must properly incorporate economically-relevant ESG factors to reflect their level of risk and return.
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