Pennsylvania

Title

Key Dates

Nature of
Action

ESG Category

Summary

■ Requires public funds to use best efforts to identify all direct and indirect holdings and alternative investments of foreign companies domiciled in or organized under the laws of China ("scrutinized companies") and the government of China within 30 days of the effective date.

■ Requires public funds to divest from (i) direct holdings of all securities of the government of China initially and (ii) beginning on the effective date, all investments in scrutinized companies and  all remaining investments in securities of the government of China. Requires divestment to be 50% completed within 3 years, 75% within 5 years, and 100% within 10 years of the effective date. Provides that divestment shall be made in accordance with  applicable fiduciary or prudent investing responsibilities and  obligations of a public fund with respect to choice of asset managers, investment funds or investments for the public fund's securities portfolio.

■ Prohibits public funds from acquiring any investments in scrutinized companies or the government of China.

■ Requires public funds to provide annual reports listing investments in scrutinized companies and describing divestment and investment activity.

■ Applies to the State Employees' Retirement Fund, the Public School Employees' Retirement Fund, the Pennsylvania Municipal Retirement Fund, and any Commonwealth fund of which the State Treasurer is the custodian.

Title

Key Dates

Nature of
Action

ESG Category

Summary

HB334: Requiring Fair Access to Financial Services

Introduced in 2023, carried over to 2024

Legislation

Prohibit Discrimination on Basis of Social Credit or ESG Score

■ Requires financial institutions to disclose to individuals seeking financial services if they were denied services based on standards or guidelines based on nonfinancial, nontraditional and subjective measures, including environmental, social and governance criteria.

■ Requires the disclosure of these standards or guidelines used to support the denial to the consumer.

HB2799: Prohibiting financial institutions from using social credit or environmental, social or governance scores; and imposing penalties

Introduced, but did not pass in the 2022 legislative session

Legislation

Target Entities That Boycott Certain Industries

■ Prohibits financial institutions and businesses doing business in Pennsylvania (directly or indirectly) from discriminating against, advocating for, or causing adverse treatment of citizens or businesses based on “subjective or arbitrary standards,” including use of “a social credit score or an environmental, social, or governance score or other similar values” when conducting transactions.

■ Does not apply to investments, products, and services that include “subjective standards” if fully disclosed and explained to potential customers or investors before entering into a contract.

■ Imposes a fine of $50,000 for a first offense and $250,000 for subsequent offenses, and criminal prosecution may be pursued for five or more offenses.

Prohibit Discrimination on Basis of Social Credit or ESG Scores

SB748: Amendment to Protecting Pennsylvania’s Investments Act

Introduced, but did not pass in the 2021 legislative session

Legislation

Promote Divestment from Certain Industries

■ Applies to the Pennsylvania State Employees' Retirement System and the Public School Employees' Retirement System.

■ Prohibits investment in assault weapons manufacturers. Requires divestment within 26 months from restricted companies that do not cease their weapons manufacturing activities within 180 days of receiving notice of the state entity's intention to divest.

■ Does not apply to indirect holdings or holdings in alternative investments.