Your 401(k) could shrink due to climate risks. A lawsuit argues that your employer has a duty to protect it

"Though often misrepresented as a purely ethical issue, climate risk is actually a severe economic risk. You cannot claim to be a prudent fiduciary while ignoring the biggest systemic threat to the global economy."

"If successful, climate experts say, the lawsuit would mean that both asset managers and employers can no longer ignore the economic costs of climate change, and that they have a duty to invest retirement savings with that consideration."

A former Cushman & Wakefield employee filed a landmark lawsuit claiming the company breached its fiduciary duties under the Employee Retirement Income Security Act by failing to protect workers' 401(k) savings from climate-related financial risks. The case, Kvek v. Cushman & Wakefield, argues that climate risk represents a severe economic threat rather than merely an ethical concern. Climate-fueled disasters disrupt supply chains, damage infrastructure, and devalue investments, particularly in fossil fuels. If successful, the lawsuit could establish that asset managers and employers have a legal obligation to consider climate risks when managing retirement savings, potentially affecting the $12 trillion U.S. retirement market.

Read at Fast Company