Palmetto State News

COLUMBIA, S.C. – Governor Henry McMaster ceremonially signed H. 3690, the ESG Pension Protection Act, alongside members of the General Assembly. The bill, which received overwhelming bipartisan support, ensures that investment decisions made by the South Carolina Retirement System Investment Commission (RSIC) prioritize maximizing the highest rate of return for participants and beneficiaries, rather than being influenced by the environmental, social, and corporate governance (ESG) movement.

"South Carolina's economy continues to break records thanks to our conservative, fiscally responsible approach," said Governor Henry McMaster. "This bill is yet another example of our commitment to responsible financial stewardship and will safeguard the interests of our retirees and taxpayers from the liberal ESG agenda."

The bill outlines a set of factors for the RSIC to consider when making investment decisions and managing assets. These factors include general economic conditions, the potential impact of inflation or deflation, the role of an investment within the overall retirement system portfolio, the need for liquidity, and the adequacy of funding for the plan based on reasonable actuarial factors.

State Representative Bill Taylor highlighted the goal of the bill, stating, "The goal of this bill is to take the politics out of the pension investments of South Carolina. This bill very simply makes sure that we make money for those that are in the state pension program. We want them to have a happy and fulfilling retirement with money in their pocket."

In addition to these provisions, the bill also requires the RSIC to adopt a statement of investment objectives and policies for the retirement system. This statement must include an overall desired rate of return for the portfolio, a desired rate of return and acceptable levels of risk for each asset class, asset-allocation goals, and a clear directive that all investment decisions must be based solely on pecuniary factors.

The RSIC holds exclusive authority for investing and managing all assets held in trust for the participants and beneficiaries of the five state-defined benefit plans collectively known as the Retirement System.

The ESG Pension Protection Act received resounding support in both the House and the Senate, with the bill passing the House by a vote of 103-5 and the Senate unanimously with a vote of 45-0.

By passing this legislation, South Carolina is demonstrating its commitment to responsible financial management and ensuring the best possible outcomes for retirees and taxpayers. The ESG Pension Protection Act will provide a solid framework for investment decisions that prioritize financial stability and security, setting a precedent for other states to follow.