Financial advisors and pension managers under the jurisdiction of the U.S. Department of Labor (DOL) can now consider environmental, social and governance (ESG) factors, along with financial returns, when managing retirement plans, under new guidance issued Thursday by the DOL.

The new guidance aims to address concerns that previous guidance that was published back in 2008 has “unduly discouraged fiduciaries” from considering ESG factors under appropriate circumstances, the DOL says in a statement.

The new guidance sets out the DOL’s view that “fiduciaries may not accept lower expected returns or take on greater risks in order to secure collateral benefits, but may take such benefits into account as “tiebreakers” when investments are otherwise equal with respect to their economic and financial characteristics.”

Additionally, the guidance acknowledges that environmental, social, and governance factors may have a direct relationship to the economic and financial value of an investment, the DOL says, and that these factors may be considered more than just tiebreakers, “but rather are proper components of the fiduciary’s analysis of the economic and financial merits of competing investment choices.”

“Investing in the best interests of a retirement plan and in the growth of a community can go hand in hand,” says U.S. Secretary of Labor Thomas Perez, in a statement. “We have heard from stakeholders that a 2008 department interpretation has unduly discouraged plan fiduciaries from considering economically targeted investments. Changes in the financial markets since that time, particularly improved metrics and tools allowing for better analyses of investments, make this the right time to clarify our position.”

In response to the news, Morgan Stanley expressed its support for the DOL’s decision, saying that this represents a “major boost” for sustainable investing.

“Prudent investors want to make investment decisions using as much materially relevant information available to them as possible,” says Audrey Choi, CEO of the Morgan Stanley Institute for Sustainable Investing, in a statement. “Our work at Morgan Stanley has found that a large number of investors want to invest for both social impact and financial return, and today’s announcement will enable Americans saving for retirement to more easily do exactly that.”