The Public Retirement System Fiduciary Duty Act establishes a new legal framework requiring state and local public retirement systems to prioritize the financial interests of their participants and beneficiaries in all investment decisions. This bill introduces Chapter 5-E to existing law, defining key terms such as "fiduciary" and "financial," and mandates that fiduciaries must only consider financial factors, explicitly prohibiting the consideration of environmental, social, political, or ideological interests. It also requires that proxy votes be cast solely in the financial interest of participants and beneficiaries, and outlines strict guidelines for proxy voting authority and engagement with portfolio companies. The bill amends RSA 100-A to reinforce the fiduciary duty to act in the interest of members and beneficiaries, deleting any references that allow for non-financial considerations in investment decisions.

Furthermore, the bill includes enforcement provisions that empower the Attorney General to investigate violations and impose penalties, including fines of up to $10,000 per violation. It mandates the appointment of an independent auditor to review compliance with the new investment standards, with the first audit scheduled for FY 2028. The legislation also requires fiduciaries to document their financial decision-making processes and stipulates that any shareholder proposals must be supported by a written economic analysis demonstrating a financial benefit. The act is set to take effect on January 1, 2027, ensuring that public retirement systems focus exclusively on financial performance in their investment strategies.

Statutes affected:
Introduced: 100-A:15
HB1585 text: 100-A:15