Congress enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”) as a direct response to the 2008 Financial Crisis when millions of Americans lost homes due to foreclosure. (SEC). Among myriad findings, a final report on the 2008 Financial Crisis stated that investment transactions with conflicts of interest contributed to the crisis. (Financial Crisis Inquiry Commission). For example, the commission found that financial firms marketed an investment and profited off that investment product’s decline…
Read MoreEnvironmental, Social, and Governance (“ESG”) Retirement Investing is a form of socially conscious investing where fiduciaries in a retirement plan review non-financial factors when analyzing investment decisions. (CFA Institute). Though the letters “ESG” may appear novel in the retirement context, “socially conscious” retirement investing is decades old. As early as the 1970s, public pension funds made socially conscious decisions within pension portfolios by divesting from “sin” stocks, like companies affiliated with smoking and gambling. (Jean-Pierre Aubry et. al, Center for Retirement Research). Millennials, the largest segment of the workforce in U.S. history, are now driving interest in ESG investing, putting trillions of dollars at stake for asset managers. (Chris Versage & Mark Abssy, Nasdaq). Workforce retirement plans are most of a non-retiree’s investment savings. (Economic Well-Being of U.S. Households, Federal Reserve). Therefore, because millennials are the largest segment of the work force, millennials increased attention in ESG to retirement investing…
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