A new bill would allow federal employees to contribute toward their retirement by investing only in companies deemed socially responsible.

The “Federal Employees Responsible Investment Act,” introduced this week by Rep. Jim Langevin (D-R.I.) and Sen. Sheldon Whitehouse (D-R.I.), would require the Federal Retirement Thrift Investment Board to add a “Corporate Responsibility Index” to the existing five investment options available to federal employees.

In order to qualify for the index, companies would be measured in a number of areas, including corporate governance, environmental practices, workplace relations, their involvement with “repressive regimes” and their position on human rights.

“I strongly believe that federal workers should be able to invest in companies that demonstrate a commitment to sound environmental, social and governance practices,” Langevin said in a statement. “This legislation would allow federal employees to feel good about their investments, and would encourage companies to implement socially responsible and environmentally sustainable policies and practices.”

Socially responsible investing in the private sector has increased in popularity over the past few years. The Labor Department has concluded that socially responsible investments meet fiduciary standards mandated by the Employee Retirement Income Act, according to the bill’s sponsors. Investments in socially responsible funds exceeded $3.7 billion in 2012.

Financial impact of socially responsible fund

Still, the board, which is bound by strict fiduciary requirements to manage the TSP solely in the interest of all participants, has been reluctant to support such a move when it’s been raised by lawmakers in the past.

In a 2012 report that analyzed the effect of adding a hypothetical socially responsible index fund, the Government Accountability Office found that adding one “would not have both increased returns and lowered volatility” in any of the models the agency ran.

Compared to the I Fund, which is tracked to the performance of international stocks, a hypothetical socially responsible fund would have posted higher cumulative returns over the last 20 years, but would have lagged behind the C, S and I Funds over the last 10 years, alone.

GAO did note some short-term benefits, such as giving participants “broader investment choice and an opportunity to make a statement in the way they invest,” according to interviews with managers of other public retirement plans. Other officials said adding a socially responsible investment option could serve as a recruiting tool because it encourages more eligible employees to sign up.

Whitehouse, the main Senate sponsor, said federal employees deserve to have their voices heard in their investment options.

“Across America, more and more people are calling on institutions to use their investments to send the message that they do not support big polluters, and that they care about issues like climate change,” he said in a statement. “This legislation will allow millions of federal government employees and retirees to send that same message — to use the power of their individual purse to tell big polluters they can’t keep poisoning our air and water without consequences.”

(Correction: An earlier version of this article incorrectly listed Rep. Jim Langevin’s party affiliation. Langevin is a Democrat.)

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