Climate in the Crossfire
Tuesday's US Presidential debate was remarkable for many reasons - but climate was not one of them. However, we listened hard and a few key points shed some light on the topic.?
In the verbal sparring, there was only one point where climate came up, and it was the final question of the night. Framed by the moderator as “important for a number of Americans, in particular younger voters,” each candidate was asked about their position on climate change.
Former President Donald Trump largely ignored the question, instead focusing on “fracking” (the hydraulic fracturing process used to extract natural gas), saying “She will never allow fracking in Pennsylvania…If she won the election, the day after that election, they’ll go back to destroying our country and oil will be dead, fossil fuel will be dead.”??
Trump then went into convoluted discussion on renewables saying he is “big fan” of solar power but then complaining that solar farms take up too much space. He has railed against electric vehicles but then also said he was a “big fan” after receiving an endorsement from Elon Musk, the head of Tesla. He has pledged to “drill, baby, drill” and shred President Biden’s climate policies. He has promised to dismantle the Environmental Protection Agency, and withdraw the United States from the Paris Climate Agreement, as he did during his first term.
Vice President Kamala Harris responded to the question with this: “The former president has said that climate change is a hoax, and what we know is that it is very real.” She also played both sides by boasting about the Biden administration's record-breaking gas production, reiterating, “I will not ban fracking,” and saying that developing oil and gas was necessary for national security.
The Harris campaign issued a tiny glimmer on climate and energy policy before Wednesday’s debate saying: “She will unite Americans to tackle the climate crisis as she builds on this historic work, advances environmental justice, protects public lands and public health, increases resilience to climate disasters, lowers household energy costs, creates millions of new jobs, and continues to hold polluters accountable to secure clean air and water for all.”?
Reactions from environmental groups were mixed: Stevie O’Hanlon of the Sunrise Movement said Ms. Harris “spent more time (at the debate) promoting fracking than laying out a bold vision for a clean energy future.” But most think she is doing enough to show the difference between the two candidates. Sarah Burton of the Sierra Club said, “One candidate is offering an ambitious vision for a clean energy future, and the other is spouting incoherent lies and conspiracy theories.”
While climate is an existential threat, it will be in the background for this campaign. The New York Times did a nice job imagining the five climate, energy, and environmental questions that should have been asked at the debate. They also did their best to suggest how each candidate might answer the questions based on their historic policies and speeches - oh to dream!
Gensler’s Best Laid ESG Plans Go Awry
As the US election approaches, it could also mean the end for Gary Gensler's tenure as SEC Chair. Gensler had planned to create a suite of ESG rules requiring companies to report on their human capital, board diversity, carbon emissions, and climate risks and for ESG labeled funds to justify their investments.
The backlash to this agenda has been intense and most of Gensler’s rules lie at different stages in the regulatory process, but none are fully finished. The estimated date for his human capital and board diversity bill proposals have been repeatedly postponed and are now expected to be released in October and April 2025, respectively.? His cornerstone climate disclosure rule adopted in March is currently under a self-imposed stay and tied up in the courts.?
The ESG disclosures for investment funds and the “Names Rule” are faring better. The SEC adopted an update to the Names Rule, requiring funds with names like ESG, sustainability, and others to have 80% of their portfolio aligned with the name. And are set to finally adopt the proposals for ESG disclosures for investment funds bill in October.
Despite the mixed record, most experts say ESG will be back at the SEC even if Gensler loses his position, because investors want material ESG data in financial statements. Alexandra Thornton of the Center for American Progress said, “Depending on what happens in the election, it may not be next year… But they’ll (ESG policies) come back,” because investors want this information.?
House Republicans to Retry Anti-ESG Rules
Just after we predicted its peak, the anti-ESG movement was back in force this week. House Republicans are reigniting anti-ESG bills - some of which were already vetoed by Biden last year, and new policies including a bill to ban “political views” in certifying universities. The college accreditation bill will join other “culture war votes” in the two-months before the House breaks for the election.?
When asked why ‘anti-woke’ policies are a current priority for the GOP, House Majority Leader Steve Scalise (R-Lou.) said, “The woke policies are actually having an effect on people too…if you’re investing your money in a 401(k)… most people expect that the people that they’re giving their money to are…looking for the best return financially for them.”?
Scalise's comments coincided with a new report explaining why anti-ESG policies do not make financial sense. The report from a centrist think tank criticizes red state ESG policies and throws shade on blue states for divesting from fossil fuel. The key message is “Any time constraints are imposed on assessing risks or opportunities for long-term value creation, there will almost certainly be added costs and unforeseen consequences.”
Bill Huizenga (R-Mich.), who leads the House Republicans’ anti-ESG working group, claims the laws are not the point. It's the publicity they draw. He said, “You can make the argument we have effectuated change, regardless of whether there’s additional legislation or legislative activity,.. There have been publicly traded companies, there have been the big managers and others, who have adopted new and different policies because of the work that we’ve done.”
EU Competitivity Report Risks CSRD and CSDDD
A report on “The Future of European Competitiveness” from former Italian Prime Minister and European Central Bank president Mario Draghi confirms that red tape is the cause of Europe’s stagnation, saying, “There are too many barriers to scale up and commercialise innovation.”
The report calls for investment in climate tech as a critical part of the EU's competitiveness. It also calls for simplifying rules - including the Corporate Sustainability Reporting Directive (CSRD), Corporate Sustainability Due Diligence Directive (CSDDD), Carbon Border Adjustment (CBAM), and others, claiming they are “a major source of regulatory burden, magnified by a lack of guidance to facilitate the application of complex rules and to clarify the interaction between various pieces of legislation,” which risks “over compliance.”
The report raised alarms with European NGOs: Antoine Oger of the European Environmental Policy think-tank is worried that all the red tape rhetoric will weaken or stop the CSRD, CSDDD, and other policies saying that “ambitious frameworks on ESG standards represent the basis to address our unsustainable production and consumption patterns in Europe.”
Australia Requires Climate Reporting
Australia passed a mandatory climate reporting bill this week. It will require public companies and some large private companies to report climate risks and opportunities and Scope 1, 2, and 3 emissions. The reporting will be largely aligned with the International Sustainability Standards Board's (ISSB) climate related standards and will be phased in as follows:
All companies will be given an additional year to report on their Scope 3 emissions. The Australian standard-setting bodies will finalize standards for disclosures and assurances before the end of 2024.
UK’s Greenwashing Rule Postponed
While the Aussies forge forward with their rules, the UK’s financial regulator, the Financial Conduct Authority (FCA), postponed their naming and marketing rules for sustainable funds. Asset managers will now have until April 2025 instead of December 2024 to start complying. The rules are designed to reduce greenwashing risk and ensure that investors accurately label financial products.
The views expressed on this website/weblog are mine alone and do not necessarily reflect the views of my employer.?
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Professor Associado na Funda??o Dom Cabral
2 个月Sociabilizado!
Founder, Indoor Vertical Farming financed with Green Bonds
2 个月20% of all Food GHG emissions are created by moving food from where it's grown to where it's eaten. 1) Growing food in cities in Indoor Vertical Farms reduces these GHGs. 2) Indoor Vertical Farms uses 1% of the space used by field agriculture, 3) Indoor Vertical Farms provides climate proof reliable food security, and 4) Indoor Vertical Farming uses 5% of the water used by Field Farming. The Farms are being financed with Green Bonds. DM me for details. 20% of all Food GHG emissions are created by moving food from where it's grown to where it's eaten. 1) Growing food in cities in Indoor Vertical Farms reduces these GHGs. 2) Indoor Vertical Farms uses 1% of the space used by field agriculture, 3) Indoor Vertical Farms provides climate proof reliable food security, and 4) Indoor Vertical Farming uses 5% of the water used by Field Farming. The Farms are being financed with Green Bonds. DM me for on the tech and how we are organizing the Green Bonds.
Thanks for sharing insights Tim Mohin
Founder at EU LISBOA
2 个月O que é isso? Clima..... Os nossos antepassados alguma vez falaram disso....? E o que plantar árvores e fazer de nós totos