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In Interpretive Bulletin 2015-01 (IB 2015-01), the U.S. Department of Labor (DOL) renewed the now two-decades old battle over “economically targeted investments” (ETIs). As a matter of statutory interpretation, IB 2015-01, like its predecessors, is unpersuasive. The Employee Retirement Income Security Act of 1974 (ERISA) requires plan trustees to invest “solely” to provide participants’ retirement benefits. A trustee who invests in ETIs violates this statutory obligation by pursuing collateral economic benefits for persons other than plan participants. As a matter of policy, the social investing which ETIs exemplify is unsound. At best, such social investing in practice merely shuffles investment ownership without altering market-based allocations of capital.
Department of Labor (DOL), Pension, Employee Retirement Income Security Act of 1974 (ERISA), fiduciary duty, Diversity, Exclusive Benefit Rule
Edward A. Zelinsky,
The Continuing Battle Over Economically Targeted Investments: An Analysis of the Department of Labor's Interpretative Bulletin 2015-01,
Cardozo Law Review De Novo
Available at: https://larc.cardozo.yu.edu/faculty-articles/228