This bill prohibits the investment of funds of the state treasury, executive branch agencies, and the state retirement system in investments that consider environmental, social, and governance (ESG) criteria. It requires executive branch agencies to prioritize investment decisions that maximize financial returns and minimize risk, and to review their investments to ensure that no funds are invested with firms that consider ESG criteria. The New Hampshire retirement system is also required to adhere to their fiduciary obligation and not invest with any firm that considers ESG criteria. The state treasurer and the New Hampshire retirement system are required to report annually on compliance with the duty to make investment decisions based on fiduciary duty. Violating the provisions of this bill by investing state or taxpayer funds in a manner that violates fiduciary duty concerning ESG criteria is a felony punishable by imprisonment.

The fiscal impact of this bill is indeterminable. Banning investments with ESG-focused firms may affect revenue and incur transition costs if service providers change. The potential exclusion of certain financial institutions may raise costs or miss earnings opportunities, but the specifics are uncertain. The New Hampshire Retirement System states that the proposed investment restrictions could potentially reduce investment returns, but it is uncertain whether this would affect employer contribution rates financially. The Department of Administrative Services states that they do not have a role in any investment decisions or policy.

Statutes affected:
Introduced: 100-A:15