Sustainable Finance Lobbying Overview: The American Retirement Association (ARA) appears to have had limited engagement with sustainable finance policy but, where it has engaged, ARA has been generally supportive of efforts to permit the use of ESG factors in investment decision making.
Top-Line Messaging on Sustainable Finance Policy: The ARA has stated its preference for sustainable finance action by a government entity rather than an industry-led entity.
Position on Regulated Corporate ESG Disclosure: In a 2021 response to the SEC’s request for public input on climate change disclosures, the ARA voiced support for a regulated climate disclosure framework, pointing to the growing use of ESG factors in retirement investing.
Position on Incorporating ESG Factors Into Investor Duties: The ARA has taken a mixed position on incorporating ESG factors into investor duties. In 2020 the Association opposed the Trump-era Department of Labor rules that sought to limit ESG investing and shareholder rights, and in 2021 ARA wrote a letter to Labor Secretary Walsh expressing its strong belief that ESG factors be considered material. However, in 2021 comments on the Biden administration’s proposed rollbacks of the Trump-era Department of Labor rules, the ARA asked the Department to remove references to ESG considerations in rule language and voiced concern about an implied requirement to consider ESG factors in investment decision making. In an October 2021 press release CEO Brian Graff initially expressed support for the Labor Department’s proposal, but in a March 2022 interview Graff expressed concern that requirements on evaluating climate risk would become “too prescriptive” and warned against “overemphasizing climate change.” In May 2022 comments to the Department of Labor, the ARA did not support regulatory action to require fiduciaries to consider climate risk in decision making. However, the ARA has pushed back on “anti-ESG” efforts to limit ESG investing, in a December 2022 press release opposing a bill that sought to overturn the Biden-era Department of Labor’s ESG rule. In March 2023, when this bill passed, CEO Brian Graff applauded Biden’s use of the veto to stop the measure.
Transparency: The ARA’s policy advocacy website lists the comment letters and statements to Congress it has submitted, including those related to sustainable finance policies, but ARA has not disclosed information on other engagement activities. ARA lists its board membership but does not disclose general membership.