When President Trump announced his plans to withdraw from the Paris Agreement in 2017, businesses spoke out en masse in opposition to this plan – conveying that long-term, global competitiveness demands climate action. Soon after, the We Are Still In Coalition was born to showcase widespread commitment to the Paris Accord.
This week, as the Trump administration cedes global leadership on climate by formally withdrawing from the Paris Agreement, We Are Still In membership now stands at more than 2,200 businesses and investors – including big names like Walmart, Hewlett Packard, Dropbox, and Apple.
Continued commitment to the Paris Accord is critical – but it’s also only one part of what is needed to fill the climate leadership void, build the clean energy economy, and remain “in.”
President-elect Donald Trump made claims of his own business smarts a cornerstone of his campaign. Vote for him, the logic went, and send a first-rate businessman to the Oval Office to apply business acumen to make America great. Unfortunately, Trump’s actions to date on climate and energy – notably charging a climate change denier with leading the EPA transition and signaling desire to abandon the historic Paris climate accords – send a message of business obliviousness.
In contrast, a smart business approach would embrace tackling greenhouse gas emissions and supporting clean energy. Here are four reasons why:
- Create American jobs – The opportunity to create new American jobs in the transition to clean energy is tremendous. There are now more jobs in solar energy than in coal mining, and the number of solar jobs has grown more than 20 percent in each of the last three years. States like Florida and Nevada are bountiful in sun and can contribute to American energy self-sufficiency.Moreover, just as smart action to nurture domestic clean energy can accelerate jobs in the renewable sector, there are jobs on the line helping the oil and gas industry reduce its air pollution in a cost effective way. Environmental Defense Fund found that there are over 70 American firms employing Americans to help keep potent methane emissions in natural gas pipelines and out of the atmosphere. These jobs, thriving in states like Texas and Pennsylvania, are mainly small business and above average wages – exactly what we all want to see more of. Of course, it’s a competitive global economy, and taking our foot off the pedal in creating green jobs could well cede the space to others like China, which already leads the United States in clean energy investment. Whatever a politician’s personal views on climate change, it is undeniable that global demand is growing for clean energy solutions. Growing demand means growing commercial opportunity for the United States in terms of innovation and exports. But only if we seize it.
- Listen to leading American businesses – Savvy business people listen to each other. So Mr. Trump should be interested to learn that 154 American businesses supported the American Businesses Act on Climate Pledge in the run-up to the Paris climate accords. These businesses are a part of the backbone of the American economy, employing nearly 11 million people across all 50 states, with a then market capitalization of over $7 trillion. Participating companies of particular interest: 21st Century Fox, Dupont, Wal-Mart, even a name that will be familiar to any casino magnate – MGM Resorts.These companies not only voiced support for a strong Paris outcome, they committed to increase their low-carbon investments in line with the direction of America’s leadership. Pulling out the rug from American businesses investing in low-carbon would send a destabilizing signal to the market. More recently, 365 companies including Unilever, Intel, General Mills and others reinforced that “implementing the Paris Agreement will enable and encourage businesses and investors to turn the billions of dollars in existing low-carbon investments into the trillions of dollars the world needs to bring clean energy and prosperity to all”. In sum, the overwhelming voice of businesses who have weighed in on the Paris talks are supportive of climate action. This business groundswell cannot be ignored. Nor should Trump ignore his own prior signing of a 2009 letter that failure to act on climate and the environment would cause “catastrophic and irreversible consequences for humanity and our planet.”
- It hits home – Continued American leadership on climate change can help mitigate physical risks to some of Mr. Trump’s most cherished investments, for example the Mar-a-Lago golf club in Palm Beach. NOAA found that “tidal flooding is increasing in frequency within the U.S. coastal communities due to sea level rise from climate change and local land subsidence.”Just a week before the election, the Palm Beach Daily News reported that the local Shore Protection Board unanimously recommended a six-figure “coastal vulnerability evaluation” as flooding has remained long after high tide in certain cases.
- Voters want clean energy – One of many things that will change for Donald Trump is that going from CEO to President means having a boss – actually about 300 of million of them. A recent Gallup poll found that 64% of Americans worry “a fair amount” or “a great deal” about climate change, an increase from last year, and including 84% of Democrats, 64% of independents, and 40% of Republicans. Clean energy is also wildly popular, with over 80% of Americans saying they support increased wind and solar, according to a recent Pew Poll.
Early on the campaign trail, Donald Trump often used his association with his alma mater, the Wharton School at the University of Pennsylvania, as Exhibit A in establishing his business smarts. Political leaders including Mr. Trump must learn from experts like Wharton’s Professor Eric Orts, who noted that moving away from President Obama’s climate change polices would come with stiff costs.
From missing out on job creation to ignoring business leaders who have studied the issue and have a stake in its resolution, and from fueling risk to Trump’s own business interests to overlooking voter desires, the case is clear that the costs are stiff indeed. Climate action is good business, and the smart money says it’s time to stay the course.
This Earth Week, I want to continue the call for a new type of corporate leadership – one that allows both the planet and business to thrive.
It’s time for corporate leaders to ramp up their sustainability goals, embed sustainability across their business strategy, and most importantly, look at the positive momentum they can drive beyond the walls of their own operations. What lies beyond those walls? Their supply chain, their partners, their competitors, their consumers, and yes, even policy.
And it’s time, this Earth Day, for corporate leaders to use their voices to amplify support for smart climate and energy policy.
Today 110 companies came together to to celebrate the historic Paris Agreement, encourage investment in the low-carbon economy, and reinforce support for the Clean Power Plan. These companies know that U.S leadership is critical to making the pledges of Paris a reality and to enable the transition to a thriving, clean energy economy.
I’m encouraged by the commitments that these and other corporations have made so far this year, but also recognize the need for more private sector leadership to make progress on climate action.
Now is the perfect opportunity to step forward and align your internal sustainability strategy with your external engagement in policy, and there are many key areas that need your support. Read more
This post is part of an EDF+Business ongoing series on sustainable finance, highlighting market mechanisms and strategies that drive environmental performance by engaging private capital. EDF is actively engaging leaders with the capital and expertise needed to catalyze sector-wide changes—from accelerating investment in energy efficiency and clean energy, to protecting tropical forests, restoring depleted fisheries and saving habitats of endangered species.
Green bonds were a glimmer in the eye for investors when we first reported on them two years ago, but since then these sustainability-oriented debt financing instruments have exploded onto the investment scene. In fact green bonds were held up as a key instrument to keeping warming below the global high-end target of 2°C at COP21.
In the past year, the market to buy these bonds — which, by design, are linked to an environmental benefit — has significantly grown and matured. Over the course of 2015, the green bond market expanded from $37 billion to $42.4 billion, with much of this growth due to diversification — both in who is issuing them and for what wider types of projects.
While expansion of this market is encouraging, its growth is much slower than most experts had originally anticipated. Early predictions for 2015 had the green bond market booming to $80 billion, or even $100 billion. Instead, numbers seem to have stagnated. What does the future hold for this market, especially in the wake of COP21? Read more