House Oversight and Accountability Committee Chairman James Comer, R-Ky., is pressing the IRS for information on practices related to environmental, social, and governance (ESG) actions by retirement plan administrators and whether they violate the service’s “exclusive benefit” provisions.

The “exclusive benefit” rule applies to all tax-sheltered retirement plans and stipulates that that all activities of the plan must be for the exclusive benefit of the plan beneficiaries.

“As part of an ongoing investigation into efforts by leftist activists to impose favored environmental, social, and governance (ESG) policies across the U.S. economy and society, the Committee on Oversight and Accountability is investigating whether state-sponsored pension funds are violating provisions of the Internal Revenue Code (IRC) related to investing for the exclusive benefit of their enrollees,” Comer wrote to IRS Commissioner Danny Werfel Thursday.

“The Committee seeks certain information from the Internal Revenue Service (IRS) to advance its oversight of this matter.”

“Recently some state pension funds have acted in ways that clearly are not ‘for the exclusive benefit’ of employees, instead using the plans’ assets and their associated shareholder voting rights to pursue their own political agenda,” Comer continued. “Blue-state retirement plans’ administrators have become aggressive in using the voting rights associated with their participant retirement assets to pursue anti-oil and gas policies, potentially in violation of the IRC’s exclusive benefit requirements.”

ESG, which refers to a set of standards used to measure an organization’s environmental and social impact, is typically used in the context of investing, although it also applies to customers, suppliers, employees and the general public.

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