What does Preamble of Restoring Integrity in Fiduciary Duty Act do?

This bill proposes to amend the Employee Retirement Income Security Act of 1974. The proposed amendment aims to clarify the criteria for fiduciaries when evaluating and selecting investments based on nonpecuniary factors. It also seeks to clarify how prudence and exclusive purpose duties apply to the exercise of shareholder rights.

What does SHORT TITLE. of Restoring Integrity in Fiduciary Duty Act do?

This bill is formally titled the Restoring Integrity in Fiduciary Duty Act.

What does EXERCISE OF FIDUCIARY DUTY IN EVALUATING AND SELECTING of Restoring Integrity in Fiduciary Duty Act do?

This section amends Section 404(a) of the Employee Retirement Income Security Act of 1974 to clarify how fiduciaries should evaluate and select investments. Fiduciaries generally must evaluate investments based solely on pecuniary factors, meaning factors expected to materially affect risk or return. Fiduciaries may not subordinate participant interests or sacrifice investment return to promote nonpecuniary benefits. If fiduciaries cannot distinguish between investment alternatives based on pecuniary factors, they may use the 'capita aut navia' standard (choosing randomly) but must document the rationale and demonstrate consistency with participant interests. For participant-directed individual account plans, fiduciaries may consider nonpecuniary benefits when selecting investment options, provided they meet specific requirements and the option is not a default investment. The term 'capita aut navia' is defined as choosing randomly between investment alternatives with equal pecuniary factors and identical risk/return attributes. The term 'material,' when used to qualify a financial risk or return, means a financial risk or return in which a reasonable investor would attach importance. The amendments apply to actions taken by a fiduciary on or after one year after the date of enactment of this Act.

What does EXERCISE OF SHAREHOLDER RIGHTS. of Restoring Integrity in Fiduciary Duty Act do?

This section amends the Employee Retirement Income Security Act of 1974 (ERISA) to establish rules regarding the exercise of shareholder rights by plan fiduciaries. Fiduciaries managing plan assets in the form of shares of stock are required to manage shareholder rights, including the right to vote proxies, prudently and solely in the interests of participants and beneficiaries. When exercising shareholder rights, fiduciaries must act solely in accordance with the economic interest of the plan, consider costs, evaluate material facts, and maintain records of voting activity. Fiduciaries are prohibited from subordinating participants' retirement income to non-pecuniary objectives. The section outlines requirements for selecting and monitoring advisors assisting with shareholder rights exercise. Plan fiduciaries may adopt proxy voting policies, including safe harbor policies, to guide proxy voting decisions based on economic interests. Safe harbor policies may limit voting resources to proposals substantially related to the issuer's business or expected to materially affect investment value, or establish thresholds based on asset percentages. The amendments apply to exercises of shareholder rights occurring on or after January 1, 2026.

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Restoring Integrity in Fiduciary Duty Act

Last updated: 10/30/2025 · Introduced: 10/30/2025

Author: Bill Cassidy (R-LA)

TL;DR (AI)

This bill clarifies that fiduciaries evaluating investments must primarily consider financial factors, prohibiting them from prioritizing non-pecuniary benefits over participant interests or investment returns.
Plan fiduciaries are required to prudently manage shareholder rights, ensuring voting decisions are based solely on the economic interests of participants and beneficiaries.
The bill establishes guidelines for fiduciaries exercising shareholder rights, including requirements for record-keeping, advisor selection, and the potential adoption of proxy voting policies focused on economic impact.

119th Congressin committeeHR. 1996(In Committee)Official page

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Other Sections

Includes provisions on preamble, short title., and 2 more.

4 sections

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