A two-thirds majority is required in the House and Senate to override a presidential veto. Still, the move brings the topic of environmental, social, and governance, or ESG, back to the fore.
Biden’s veto blocked a resolution to cancel the Labor Department rule, which allows retirement plan managers to weigh ESG when making investments.
The rule, part of a broader ESG push, allows, though does not require, fiduciaries to weigh ESG factors when making investment decisions for retirement accounts.
The Senate voted 50-46 to rescind the rule, with backing from centrist Sens. Joe Manchin (D-WV) and Jon Tester (D-MT). The House voted 216-204 to pass the rollback, with Jared Golden (D-ME) being the sole Democratic defector in the lower chamber.
Anti-ESG sentiment has been growing among Republicans, although particularly among those in energy-producing states, who fear that the ESG push could end up “blacklisting” fossil fuel companies. Both West Virginia and Montana, represented by Manchin and Tester, rely disproportionately on coal.
Manchin hit back at Biden after he signed the veto.
Manchin said the administration’s ESG policy “prioritizes politics over getting the best financial returns for millions of Americans’ retirement investments.”
“Despite a clear and bipartisan rejection of the rule from Congress, President Biden is choosing to put his Administration’s progressive agenda above the well-being of the American people,” he said in a statement.