A new regulation issued by the U.S. Department of Labor goes into effect at the end of January. Employers will be allowed to put politics over profits by favoring ESG-friendly options when choosing investments for the 401(k) plans they provide for their employees.
In fact, they will even be able to choose ESG funds as the default option when a worker doesn’t choose one for their 401(k) — despite studies like this one cited by the Harvard Business Review that suggest ESG funds underperform their non-ESG counterparts.
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