Department of Labor Updates Guidance on ‘Social’ Investing and Proxy Voting

ReedSmith
November 6, 2008

DOL Issues Economically Targeted Investment and Proxy Voting Guidance

Fried Frank
October 24, 2008

This Memorandum reviews two interpretive bulletins from the US Department of Labor (the “DOL”) which modify and supersede the DOL’s prior guidance for benefit plan fiduciaries who are considering (and/or making) “economically targeted” or “socially responsible” investments. As the Memorandum notes, the overriding message for plan fiduciaries is to focus on economic factors, ie  “maximize the economic value of the plan’s assets.”

DOL Revises ERISA Interpretive Statements on Shareholder Rights and Economically Targeted Investments

Sutherland
October 17, 2008
This Alert examines the October 17, 2008 interpretive bulletins of the U.S. Department of Labor which modify and supersede prior bulletins on the exercise of shareholder rights, including proxy voting (“voting of proxies must be based solely on factors relating to the economic value of the investment”) and on economically targeted investments by ERISA-governed employee benefit plans (where “fiduciaries may never subordinate the economic interests of the plan to unrelated objectives, and may not select investments on the basis of any factor outside the economic interest of the plan except in very limited circumstances …” ).