AFT’s Weingarten on President Biden’s Veto of Extremist Attack on ESG

WASHINGTON—American Federation of Teachers President Randi Weingarten issued the following statement after President Biden decided to veto the rollback of a Department of Labor environment, social and governance rule protecting fiduciary responsibility. AFT members participate in pension plans with $4 trillion under management. 

“President Biden showed us again today that he is on the side of workers, not special interests. He understands that ESG doesn’t violate fiduciary duty, it’s a core component of fiduciary duty. 

“By putting workers’ pensions over politics, the president stood up for the short- and long-term health of these funds. This hypocritical attack was always about assuaging fossil fuel donors. The same people behind this push talk about their love of the free market, but their obsession with eliminating ESG throws a spoke in the wheel of investment managers’ best judgment.

“Projections in states such as Indiana and Kansas show that banning ESG considerations would cost pensions several billions of dollars over a decade, at a time when market stability and predictability should be paramount. 

“Pension fund trustees’ core duty is to ensure the health and viability of the assets they oversee―and management of risk is an integral part of achieving the investment objectives of funds. When extremists attack ESG, they increase risk. They thwart the economic and physical health of communities. What used to be a virtuous circle becomes a vicious cycle.

“When we consider all risks, ESG done appropriately is not just a long-term win for working people and communities, it creates better alignment between Wall Street and our members whose retirement funds they manage.”