U.S. Rep. Zach Nunn Representative for Iowa's 3rd District | Facebook Website
U.S. Rep. Zach Nunn Representative for Iowa's 3rd District | Facebook Website
The U.S. House of Representatives has passed legislation introduced by U.S. Representative Zach Nunn (IA-03) aimed at protecting Iowa retirees' investment accounts. The Protecting Retirees Savings Act was included in a package of bills that passed with a vote of 215 to 203.
"Inflation and rising costs are making it hard enough to save for retirement – that’s why it's more important than ever to do everything in our power to maximize Iowans’ retirement savings," said Rep. Nunn. "Investment managers shouldn’t be making decisions based on anything but maximizing returns. That’s exactly what this bill will help to ensure."
Current law allows investment managers to make decisions based on a company's policies or political views, rather than focusing solely on maximizing returns for the original investor. Two firms currently make recommendations on 97% of shareholder votes nationwide, often based on political motivations. Investment managers frequently accept this advice without review through a method called robovoting, which can lead to financial or political conflicts of interest that are not disclosed to the original investor. Accounts managed in this manner see an average decrease of 14% in returns.
The Protecting Retirees Savings Act aims to eliminate these conflicts of interest for financial managers by ensuring that investment decisions prioritize maximized returns over political considerations.
The legislation was passed as part of the Prioritizing Economic Growth Over Woke Policies Act and now awaits consideration in the Senate.
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