Passing the “Protecting Prudent Investment of Retirement Savings Act” (HR 2988)

The bill

Protecting Prudent Investment of Retirement Savings Act

Topic: Labor and Employment

What the bill does

This bill modifies the requirements for fiduciaries of employer-sponsored retirement plans. First, the bill generally requires a plan fiduciary to make investment decisions based solely on pecuniary factors (i.e., factors that a fiduciary prudently determines are expected to have a material effect on the risk or return of an investment based on appropriate investment horizons consistent with the plan's policies and objectives). The bill allows nonpecuniary factors to be considered in certain situations, such as when selecting investment options for certain participant-directed retirement plans or if the fiduciary is unable to distinguish between investment alternatives on the basis of pecuniary factors alone. The bill also prohibits a plan fiduciary from discriminating when selecting, monitoring, and retaining any fiduciary, counsel, employee, or service provider of the plan. The bill requires a plan fiduciary to act solely and prudently in accordance with the interests of the plan's participants and beneficiaries when exercising a shareholder right (e.g., voting of proxies).

Source: Congressional Research Service summary

Bill on congress.gov(opens in a new tab)