,,ii  #aahth ,,congress  #b;d ,session  
,s4 #eagd  ,,in ,,the ,,senate ,,of     
,,the ,,united ,,states  ,september #be1
 #bjbd,mr4 ,cassidy introduced the      
following bill2 which was read twice and
 referred to the ,committee on ,health1 
,education1 ,labor1 and ,pensions  ,a   
,,bill  ,to amend the ,employee         
,retirement ,income ,security ,act of   
#aigd to clarify the criteria by which  
fiduciary responsibility is exercised in
 protecting shareholder rights4  #a4    
,short title ,this ,act may be cited as 
the ,restoring ,integrity in ,fiduciary 
,duty ,act4  #b4 ,exercise of fiduciary 
duty  7a7 ,in general ,section #djd7;a7 
of the ,employee ,retirement ,income    
,security ,act of #aigd 7#bi ,u4,s4,c4  
#aajd7;a771 is amended by adding at the 
end the following3  7#c7 ,investments   
based on pecuniary factors  7,a7 ,in    
general ,for the purposes of paragraph  
7#a71 a fiduciary-- 7i7 may evaluate an 
investment or investment course of      
action based only on pecuniary factors1 

except as provided in subparagraph 7,b72
  7ii7 may not subordinate the interests
 of the participants and beneficiaries  
in their retirement income or financial 
benefits under the plan to other        
objectives2  7iii7 may not sacrifice    
investment return or take on additional 
investment risk to promote nonpecuniary 
benefits or goals2 and  7iv7 shall      
weight each pecuniary factor in a manner
 that appropriately reflects a prudent  
assessment of the impact of the factor  
on risk and return4  7,b7 ,use of       
nonpecuniary factors for investment     
alternatives ,notwithstanding           
subparagraph 7,a71 when choosing between
 or among investment alternatives1 if a 
fiduciary is unable to distinguish      
between or among investment alternatives
 or investment courses of action on the 
basis of pecuniary factors alone1 the   
fiduciary shall use the capita aut navia
 standard as the deciding factor in the 
investment decision1 provided that-- 7i7
 the fiduciary documents detail-- 7,i7  

why pecuniary factors were not          
sufficient to select the investment or  
investment course of action2  7,,ii7 how
 the selected investment compares to the
 alternative investments with regard to 
the composition of the portfolio with   
regard to diversification1 the          
liquidity1 current return of the        
portfolio relative to the anticipated   
cash flow requirements of the plan1 and 
the projected return of the portfolio   
relative to the funding objectives of   
the plan2 and  7,,iii7 how the selected 
investment is consistent with the       
interests of the participants and       
beneficiaries in their retirement income
 or financial benefits under the plan2  
and  7ii7 the fiduciary demonstrates    
that it did not expend any resources    
during the investment course of action  
on nonpecuniary factors that place      
weight between or among investment      
alternatives for the purpose of the     
investment decision4  7,c7 ,investment  
alternatives for participant-directed   

individual account plans ,in selecting  
or retaining investment options for a   
pension plan described in subsection    
7c77#a77;,a71 a fiduciary may consider1 
select1 or retain an investment option  
on the basis that such investment option
 promotes1 seeks1 or supports #a or more
 nonpecuniary benefits or goals1 only   
if-- 7i7 the fiduciary satisfies the    
requirements of paragraph 7#a7 and      
subparagraphs 7,a7 and 7,b7 of this     
paragraph in selecting or retaining any 
such investment option2 and  7ii7 such  
investment option is not added or       
retained as1 or included as a component 
of1 a default investment described in   
subsection 7c77#e7 7or any other default
 investment alternative74  7,d7         
,definitions ,for the purposes of this  
paragraph3 7i7 ,capita aut navia ,the   
term capita aut navia means a standard  
by which a fiduciary chooses at random  
between or among investment alternatives
 where pecuniary factors are equal and  
does not give added weight to #a        

investment or another1 provided that the
 investment alternatives have identical 
risk and return attributes and choosing 
among the investment alternatives would 
have comparatively negligible impact1   
not considering liquidity constraints or
 transaction costs4  7ii7 ,investment   
course of action ,the term investment   
course of action means any series or    
program of investments or actions       
related to a fiduciary's performance of 
the fiduciary's investment duties1 and  
includes the selection of an investment 
fund as a plan investment1 or in the    
case of a plan described in subsection  
7c77#a77;,a71 a designated investment   
alternative under the plan4  7iii7      
,material ,the term material1 when used 
to qualify a financial risk or financial
 return-- 7,i7 means a financial risk or
 financial return in which there is a   
substantial likelihood that a reasonable
 investor would attach importance when--
 7aa7 evaluating the potential financial
 risks or returns of an existing or     

prospective investment2 or  7bb7        
exercising1 or declining to exercise1   
any rights with respect to securities2  
and  7,,ii7 does not include furthering 
nonpecuniary1 environmental1 social1    
political1 ideological1 or other goals  
or objectives4  7iv7 ,pecuniary factor  
,the term pecuniary factor means a      
factor that a fiduciary prudently       
determines is expected to have a        
material effect on the risk or return of
 an investment based on appropriate     
investment horizons consistent with the 
plan's investment objectives and the    
funding policy established pursuant to  
section #djb7;b77#a74  4  7b7 ,effective
 date ,the amendments made by this      
section shall apply to actions taken by 
a fiduciary on or after the date that is
 #a year after the date of enactment of 
this ,act4