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Gov. Henry McMaster Ceremonially Signs H. 3690, the ESG Pension Protection Act

February 14, 2024

COLUMBIA, S.C. – Governor Henry McMaster today was joined by members of the General Assembly for a ceremonial bill signing of H. 3690, the ESG Pension Protection Act. The bill ensures all investment decisions by the South Carolina Retirement System Investment Commission (RSIC) are based solely on maximizing the highest rate of return for participants and beneficiaries and not based on factors like 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 – which passed with overwhelming bipartisan support – 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 provides a list of factors for the RSIC to consider when investing and managing assets, including general economic conditions, the possible effect of inflation or deflation, the role of an investment within the overall retirement system portfolio, the needs for liquidity, and the adequacy of funding for the plan based on reasonable actuarial factors.

“The goal of this bill is to take the politics out of the pension investments of South Carolina,” said State Representative Bill Taylor. “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.”

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 an explicit statement that all investment decisions must be based only on pecuniary factors.

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

The bill passed the House 103-5 and the Senate 45-0.