In “A Socially Responsive Investing Framework for Retirement Plan Fiduciaries” Neuberger Berman says plan sponsors considering incorporating Socially Responsive Investing (SRI) strategies into their retirement plan’s investment objectives, may want to begin by discussing some questions with their financial adviser or consultant and their plan committee (or other investment fiduciaries).
Questions suggested include, among others:
- Are your employees asking for investment options that will have both a positive impact on society and generate strong financial returns?
- Does your Investment Policy Statement (IPS) currently allow for consideration of Environmental, Social and Governance (ESG) factors when evaluating investment options? If not, how would you adjust your IPS to integrate ESG/SRI objectives and expectations?
- Does your plan document contain any provisions that would restrict the use of SRI strategies?
- How would adding an SRI strategy impact your existing fund lineup (e.g., number of fund options, diversification strategy)?
- Would you need to offer additional investment education or advice services to help employees understand the impact of SRI strategies on their investment portfolios?
The document also includes an SRI Implementation Checklist. It is available here.