DC Lens Q4 2023

In this quarter's DC Lens, we provide an update on ESG (Environmental, Social, and Governance) investing, a summary of Q3'23 litigation, administrative and legislative updates, details about the SECURE Act 2.0, and strategies for retirement planning for longer life spans.

The ESG update sheds light on the performance of ESG investments, revealing that US companies with high ESG ratings have outperformed lower-rated companies by nearly 50% between 2013 and 2021. However, ESG investing remains a topic of controversy, with ongoing legal challenges and increased regulatory scrutiny. The document also provides clarity on different ESG management styles, emphasizing the importance of understanding ESG terminology.

The Q3'23 litigation summary delves into various lawsuits and settlements related to retirement plans, underscoring the significance of documenting and adhering to a prudent decision-making process. It highlights the potential consequences of failing to do so.

The administrative and legislative update addresses notable developments, such as the contentious DOL Fiduciary Rule, which seeks to redefine fiduciary investment advice under ERISA. Additionally, it explores the proposed SAFER Banking Act, which could expand retirement plan access for marijuana firms.

The SECURE Act 2.0 section outlines the collaborative efforts of the DOL, Congress, and the IRS to ensure a smooth implementation of the Act. It also delves into proposed legislation aimed at promoting automatic enrollment in retirement plans and the IRS's initiatives to address issues related to Roth catch-up contributions.

The final section focuses on retirement planning strategies tailored to longer life spans. It emphasizes the importance of being prepared for retirement and provides insights into managing retirement income effectively. The document underscores the role of advisors in helping plan participants, particularly women, achieve their retirement goals.

View past editions of the DC Lens here.