Retirement: investments; investments in environmental, social, and governance funds; prohibit. Amends sec. 13 of 1965 PA 314 (MCL 38.1133).

Michigan House Bill 5237, introduced on November 6, 2025, seeks to amend the Public Employee Retirement System Investment Act to prohibit state retirement systems from investing in funds that prioritize environmental, social, and governance (ESG) factors. The bill aims to ensure that investment decisions are based solely on financial considerations, excluding non-financial criteria such as environmental sustainability or social responsibility.

Supporters of HB 5237 argue that the bill safeguards the financial interests of retirees by ensuring that pension funds are managed with a focus on maximizing returns without the influence of non-financial factors. They contend that this approach promotes fiduciary responsibility and protects the integrity of the state's retirement systems.

Critics of HB 5237 express concern that prohibiting investments in ESG funds may limit the ability of state retirement systems to consider long-term risks and opportunities associated with environmental and social factors. They argue that integrating ESG considerations can enhance investment performance and align with broader societal values, and that the bill may hinder the pursuit of sustainable and responsible investment strategies.