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Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

  • work Practice Area

    ERISA

Date & Time
  • event Date

    Wednesday, February 8, 2023

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    90 minutes

Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.

$347.00
CLE
ALL

This CLE webinar will provide employee benefits counsel, plan sponsors, and asset managers guidance on the new DOL final ESG investments and proxy-related rules. The panel will discuss key provisions of the final rules and challenges, the permissibility of ESG factors in investments, the impact on qualified default investment alternatives (QDIA), and clarity for duty of loyalty provisions. The panel will also provide insight into the tiebreaker test, investment alternatives in participant-directed individual account plans, provisions on shareholder rights including proxy voting, and next steps for plan sponsors and administrators.

Faculty

Joshua A. Lichtenstein
Partner
Ropes & Gray

Mr. Lichtenstein is a partner in the tax & benefits department in the firm's New York office and focuses on ERISA and employee benefits. He advises asset managers and employee benefit plans regarding the investment of plan assets and a wide range of related issues, including how to operate as an ERISA fiduciary, the prohibited transaction rules and related exemptions, and on how to structure and maintain a fund so that it qualifies as a venture capital operating company (a VCOC) or Real Estate Operating Company (REOC) or satisfies the so called ERISA “25% test."

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Sharon Remmer
Partner
Ropes & Gray

Ms. Remmer is a partner in the employee benefits department and focuses on ERISA matters. With more than 20 years of experience, she advises clients across the asset management and private equity industries on ERISA issues that arise whenever a transaction involves plans or plan assets. Ms. Remmer works with private funds, hedge funds and credit funds on complex issues associated with the investment of plan assets under Title I of ERISA. Her experience ranges from structuring and administering funds to avoid holding plan assets, to advising managers on how to operate funds with plan assets in accordance with ERISA. Ms. Remmer has long been a trusted adviser to plan sponsor clients on all aspects of their fiduciary responsibilities under ERISA, including plan governance, ERISA fiduciary best practices, and the ever-changing regulatory environment regarding ESG. In addition, she works with private equity and other clients to address significant ERISA liabilities in transactions, with an emphasis on finding creative solutions for complex issues that might affect the deal. She also works with many hospitals and universities on employee benefits matters that are unique to tax-exempt institutions, including issues relating to 403(b), 457(b) and 457(f) plans.

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Description

In response to 2021 executive orders issued by President Biden, the DOL has issued final new rules relating to ESG investments for retirement plans. In light of these new regulations, employee benefits counsel, plan sponsors, and asset managers must review their plan investments, QDIA options, and investment policy statements and determine if changes to the plans' investment options or strategy are appropriate.

Generally, ESG investing may run afoul of ERISA duties of loyalty and prudence imposed on plan sponsors and investment fiduciaries in selecting investments on behalf of a retirement plan. This is mainly due to the impact of such investments on financial returns and risks to plan participants with prior DOL regulations prohibiting the inclusion of an investment fund or portfolio in a plan's QDIA with a focus on factors relating to ESG investments.

On Nov. 22, 2022, the DOL issued final rules that reverse the impact the prior regulations had on ESG investing by retirement plans. The final rules eliminate certain terminology that previously restricted ESG factors, clarify ERISA fiduciary duties in relation to ESG investing, ease the QDIA rules, and provide various changes to proxy voting rules for ESG investments.

Listen as our panel discusses critical factors for plan fiduciaries in selecting plan investments, modifying or developing investment policy statements for ESG considerations, the use of ESG-themed options in 401(k)-type plans and QDIAs, and best practices for plan sponsors and asset managers in pursuing ESG investments.

Outline

  1. Overview of new DOL final rules for ESG investing
  2. ESG considerations and vetting investment risks
  3. Considerations for drafting or modifying investment policy statements
  4. ESG-themed options in 401(k) and QDIAs
  5. Best practices for plan sponsors and asset managers

Benefits

The panel will review these and other critical issues:

  • Key components of DOL final rules for ESG investments by retirement plans
  • Permissible ESG factors in investments in light of the final rules
  • ERISA regulations and requirements that must be followed by plan investment committees
  • ESG considerations and vetting plan investments
  • Minimizing fiduciary breach of duty claims stemming from ESG investment decisions
  • Drafting considerations for investment policy statements
  • The use of ESG in 401(k) plans and QDIAs
  • Techniques and best practices for plan sponsors and asset managers for ESG investments