From Pensions to Power: ERISA, Stewardship and a Transatlantic Clash over Capitalism
20 April 2026
By Sarah Wilson
The US Department of Labor has quietly opened a new front in the long‑running campaign against proxy advice and stewardship. On 15 April, it issued Interpretive Bulletin 2026‑01, signalling that proxy advisory firms and certain stewardship services may be treated as ERISA fiduciaries. Framed as technical guidance, the move is better understood as a regulatory workaround after courts blocked more direct securities‑law approaches.
At first glance, Interpretive Bulletin 2026‑01 looks narrow. It focuses on definitions, suggesting that proxy research, voting analysis, and recommendations can amount to “authority or control” over shareholder rights, and therefore fall within ERISA’s fiduciary framework. In practice, this collapses the distinction between advice and decision‑making. The result is not clarification, but leverage: supervisory and litigation risk imposed without the procedural discipline of rulemaking.
Why ERISA, and why now
The choice of ERISA is the story. In July 2025, the DC Circuit held in ISS v. SEC that proxy voting advice is not “solicitation” under Exchange Act section 14(a), striking down the SEC’s 2020 proxy adviser rule. That decision closed off the securities‑law route. Five months later, Executive Order 14366 dispersed an explicitly hostile stance toward proxy advisers and stewardship across federal agencies, including the Department of Labor. IB 2026‑01 is that instruction switching from theory to execution.
ERISA offers a different enforcement architecture. Unlike the SEC’s rules‑based regime, EBSA supervision relies heavily on examinations, information requests, and post‑hoc settlements. Guidance does not need to be binding to be effective. Once cited in supervisory settings, it quickly becomes a practical constraint on behaviour.
“Pecuniary” as a pressure point
Substantively, the bulletin leans on “pecuniary” considerations as the limiting principle for fiduciary conduct, but never defines the term in decision‑useful ways. That ambiguity creates a structural bind. Climate risk, governance quality, board composition, and human capital are all routinely disclosed by issuers as material risks in Form 10‑Ks. A fiduciary who considers legally mandated disclosures can be accused of pursuing non‑pecuniary objectives. A fiduciary who ignores them can be accused of ignoring risk. The contradiction is not accidental. As former EBSA head Lisa Gomez put it, this is a fiduciary trap.
Litigation risk
Any pushback to IB 2026‑01 would not be a fight about ESG. It would be a procedural administrative‑law challenge. The claim would be straightforward: the Department of Labor attempted to change legal obligations through guidance rather than rulemaking.
BOX: Procedural vulnerability
IB 2026‑01 was issued without notice and comment and without formal economic analysis. Under settled US administrative law, agencies may not use interpretive guidance to create new obligations or materially expand regulatory scope without complying with the Administrative Procedure Act (Azar v. Allina Health Services (2019); Perez v. Mortgage Bankers Association (2015)). Courts have repeatedly struck down “regulation by memo”, including high‑profile rebukes of the SEC for procedurally defective proxy‑voting guidance (Business Roundtable v. SEC (2011)). Against that backdrop, assertions in the bulletin about state‑law pre‑emption carry no independent legal weight.
Missing safeguards, familiar personnel
Along with definitional problems, there looks to have been a process failure. ERISA includes a statutory Advisory Council intended to act as a safeguard on contested interpretive questions. That council has not met in years. One day after members of Congress asked the Inspector General to investigate that dormancy, the Department issued IB 2026‑01 anyway.
Finally, there is a key personnel context. Project 2025 laid out an explicit programme to narrow fiduciary duty to undefined “pecuniary” considerations and to attack ESG and proxy voting. Several contributors to that agenda now hold roles responsible for implementation. At EBSA, the newly promoted Director of Policy, Justin Danhoff, previously worked in anti‑ESG advocacy and at Strive Asset Management a firm positioned to benefit if ERISA plans retreat from ESG‑integrated proxy advice. In a stewardship setting, that would normally raise conflict questions.
What to watch next
- Whether EBSA begins citing IB 2026‑01 in examinations, information requests, or settlements
- Whether plans and managers over‑correct by dropping research inputs rather than documenting retained discretion
- Whether the ERISA Advisory Council is reconvened, and what it says
- Whether administrative‑law challenges are filed once guidance is treated as binding in practice
- Whether similar pressure emerges through parallel SEC review of issuer risk disclosures
For international investors, the risk is indirect but immediate. Stewardship capacity is increasingly mediated through US‑regulated asset managers, proxy advisers and voting infrastructure. When US regulators turn “guidance” into an operational constraint, the effects cascade through global stewardship chains, quietly narrowing the practical choices available to European fiduciaries without debate, scrutiny or regulatory process.
The key question is not whether IB 2026‑01 is “law”, it’s how quickly guidance becomes constraint once embedded in supervision. That matters because it directly erodes sovereign shareholder rights and regulatory obligations. By using ERISA supervision to chill stewardship, US regulators restrict how non‑US asset owners can exercise their lawful voting rights through global intermediaries, without any change in European law or mandate.
On its face, this looks like another piece of pension regulation. In the wider geopolitical context, IB 2026‑01 is not a technical US pensions issue but part of a broader transatlantic contest in which market infrastructure is being used to blunt the practical impact of European regulation on US technology and energy firms. Where EU rules on platforms, AI and climate cannot be overturned through courts or legislation, pressure is being applied instead through supervision, proxy advice and stewardship channels, a dynamic openly associated with US billionaire interests critical of regulatory constraint and well documented by the Financial Times and the Wall Street Journal.
For trustees, the core risk is mandate fragility: shareholder rights and stewardship expectations that remain valid in European law may no longer be executable in practice through US‑regulated intermediaries, creating hidden geopolitical and trade‑retaliation exposure within portfolios (FT; WSJ; Bloomberg).
Key sources
Financial Times on Thiel and regulatory constraint:
https://www.ft.com/content/d2259cd1-704d-4cd4-814d-994c4e754695
Wall Street Journal on EU–US confrontation over X and regulation:
https://www.wsj.com/tech/eu-fines-musks-x-140-million-over-blue-check-system-ad-transparency-484778b7
Bloomberg on EU tech enforcement and trade pressure:
https://www.bloomberg.com/opinion/articles/2025-12-05/musk-120-million-fine-shows-the-eu-is-losing-its-nerve