WASHINGTON (AP) – The U.S. House failed Thursday to override President Joe Biden’s first-ever veto of a Republican-led bill that would have barred consideration of environmental, social or governance issues in retirement and other investment decisions.
Republicans failed to muster the necessary two-thirds vote needed in the House of Representatives to override the president’s veto of the “ESG” investment bill. The override failed by a 219-200 vote mostly along party lines, as most Democrats opposed it.
The impasse was the first test of the strength of the new Republican majority in the House of Representatives as it confronts a Democratic president in the White House.
House Republicans managed to pass legislation in Congress last month, part of their agenda to roll back so-called “woke” government policies that seek to bring new ways of thinking about social and environmental issues with fairness and accountability.
The law was a rejection of the idea of ”ESG” investing, which takes into account a company’s social and environmental performance, including issues such as climate change.
Including such factors in financial planning has gained popularity as Americans look for different options for where to leave their retirement savings and other investments.
The US Department of Labor issued a rule last December that allows fiduciaries of investment plans to consider climate change and other environmental, social and governance factors in making investment decisions.
But fledgling House Republicans sought to roll back the Labor Department’s rule and effectively restore a Trump-era policy banning the investment practice. The measure received some support in the Democrat-held Senate.
Using special procedures, the House and Senate approved the withdrawal by simple majorities in both chambers, but there was not enough support in Congress to override the veto.