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week ending July 17th, 2020 Interest in environmental, social and governance (ESG) investing is growing among investors, perhaps more so now that improvements in the effects of climate change were seen during lockdowns caused by the COVID-19 pandemic and the events of this year have increased focus on diversity and inclusion. In previous guidance from the Department of Labor (DOL) it seemed amenable to including ESG factors in decisions about retirement plan investments; however, it has recently proposed a regulation that seems to dial back its stance. Whatever becomes of the proposed regulation, plan sponsors will need to be able to justify and document the selection of any ESG-related investments. Enjoy this edition of PLANSPONSOR Weekend! Editor's Choice Investing Pandemic Shines a New Light on Climate Change and ESG Investing The COVID-19 crisis is showing plan sponsors how corporate behaviors affect the environment and that encouraging positive ones with investment dollars can benefit participants as well. Compliance DOL ESG Proposal Throws a Cloud Over Prior Guidance The proposed regulation seems to create stricter limits for ESG investing in retirement plans, but experts say it is not all doom and gloom for plan sponsors and participants who want these investments. Investing Lack of Track Records Hinder ESG Investing Additional conclusive information about environmental, social and governance (ESG) investment performance may help retirement plan sponsors be less wary about making ESG investment decisions. Investing Providers Look to End the ESG Performance Debate According to Mike Hunstad at NTAM, it may take some time for the retirement industry in the U.S. to fully embrace ESG as a positive-performance factor, but he says it’s already a best practice to think about ESG from a risk-management perspective. Investing ESG Investments a Good Option for Retirement Plans Performance is not sacrificed by investing in environmental, social and governance (ESG) investments, and plan sponsors and participants can align their financial goals with their values, a white paper argues. Investing Understanding How ‘E,’ ‘S’ and ‘G’ Contribute to ESG Performance Investors need to know which factors will help them achieve their long-term and their short-term goals. Popular Reads Benefits Phased Retirement Programs Offer Perks for Employees and Employers A phased retirement program can help employers address workforce issues and help employees make a smooth transition, and it should include education and advice. 2020 Recordkeeping Survey Compliance VALIC Financial Advisors Charged With Disclosure Failures The SEC says VALIC Financial Advisors failed to disclose to Florida teachers practices that generated millions of dollars in fees and other financial benefits for the firm. Administration CARES Act Special Considerations for 403(b) Plans Participants invested in annuity contracts may face charges for distributions and limits on amounts they can take as a distribution or loan that they may not be aware of. Data and Research Different Views About Retirement Plans Shaped COVID-19 Responses Globally The U.S. can learn from other countries about instilling the mindset of preserving retirement savings and creating different pools of assets to be dipped into in case of emergency. Did someone forward you this newsletter? Sign up here to get PLANSPONSOR Weekend directly in your mailbox!

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