The Labor Department's (DOL's) rule on environmental, social, and corporate governance (ESG) investing, which took effect on January 30, 2023, ended a Trump-era ban preventing retirement investment managers from considering ESG factors in their investment decisions. Earlier this month, 26 Republican-led states argued to a federal appellate panel that the rule should be overturned.
But since the U.S. Supreme Court overturned Chevron deference on June 28, limiting federal agencies' ability to interpret laws and impose regulations where Congressional statutes are ambiguous, the appeals court sent the case around the ESG rule back to the Texas district court where it originated.
"Given the up-ended legal landscape, and our status as a court of review … we vacate and remand so that the district court can reassess," said the appellate court.
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