A US federal judge has rejected an effort by 25 states to stop a rule by President Biden allowing pensions to consider ESG in its investment decisions.
As reported by Reuters, last week Texas District Judge Matthew Kacsmaryk declined to block the rule which took effect from January 30 this year. The judge rejected the states’ claim that the rule violates the federal law governing retirement plans. The rule still requires that in investment decisions financial considerations should take priority, and does not create “an overarching regulatory bias in favour of ESG strategies”.
The Biden administration has said the rule was needed to replace limitations on ESG investing imposed by the Trump administration.