Sustainable Switch-What a Trump return means for ESG
Nov 7 -
By Sharon Kimathi
Energy and ESG Editor, Reuters Digital
sharon.kimathi@thomsonreuters.com
Hello!
Former U.S. President Donald Trump is back. But what does the Republican candidate’s victory mean for environment, social and governance (ESG) issues? Here, I break down what Trump’s return means for each ESG metric, both domestically and internationally.
Starting with the E
When it comes to the environment, Trump has vowed to increase U.S. production of fossil fuels by easing the permitting process for drilling on federal land and would encourage new natural gas pipelines.
He has said he will again pull the United States out of the Paris Climate Accords, a framework for reducing global greenhouse gas emissions, and would support increased nuclear energy production.
He would also roll back Democratic President Joe Biden's electric vehicle mandates and other policies aimed at reducing auto emissions.
However, the Republican win is unlikely to dramatically slow the U.S. renewable energy boom.
Subsidies for new solar, wind and other clean energy projects would be near-impossible to repeal and many of Trump's allies also benefit from Biden’s Inflation Reduction Act through their investments in clean energy technologies, as Reuters previously reported.
Unpacking the S
As part of the social ‘S’ in ESG, we’ll take a glance at what may be in store for Americans and people around the world impacted by Trump’s return.
First up is diversity.
A majority of the two dozen Black Americans who spoke to Reuters said they feared a second Trump term, including a rollback of civil rights after his pledge to end federal diversity and inclusion programs.
Trump has pledged to purge U.S. colleges and universities of diversity programs and to "defend American tradition and Western civilization."
He said he would direct the Justice Department to pursue civil rights cases against schools that engage in racial discrimination.
How about women’s rights?
The second ‘S’ in ESG we’ll take a look at is what Trump has in store for American women’s rights.
Trump appointed three justices to the U.S. Supreme Court who were part of the majority that did away with Roe v. Wade's constitutional protection for abortion.
He likely would continue to appoint federal judges who would uphold abortion limits.
At the same time, he has said a federal abortion ban is unnecessary and that the issue should be resolved at the state level.
He has argued that a ban on abortions beyond the sixth week of pregnancy, favored by some Republicans, is overly harsh and that any legislation should include exceptions for rape, incest and the health of the mother.
Trump has suggested he would not seek to limit access to the abortion drug mifepristone after the U.S. Supreme Court rejected a challenge to the government's approach to regulating it.
He supports policies that advance in vitro fertilization (IVF), birth control and prenatal care.
What about human rights?
Third on the ‘S’ in ESG triumvirate is human rights, especially during conflicts.
Trump has backed Israel in its fight against Hamas in Gaza but has urged it to wrap up its offensive.
Palestinians, locked in war with Israel for more than a year, expressed fear at Trump's return to the White House, while the leaders of the militant group Hamas and the Palestinian Authority urged him to act for peace.
He said if he became president, he would "stop the suffering and destruction in Lebanon," but has not said how he might achieve that.
And finally, the G
Donald Trump will likely dial back some of the antitrust policies pursued under the Biden administration, potentially including a bid to break up Alphabet’s Google over its dominance in online search, experts said.
Trump is expected to continue cases against Big Tech, several of which began in his first term, but his recent skepticism about a potential Google breakup highlights the power he will hold over how those cases are run.
The Federal Trade Commission and Department of Justice would likely scrap merger review guidelines crafted under Biden, said Jon Dubrow, a partner at law firm McDermott Will & Emery.
Talking Points
International companies and the government of Namibia had high hopes to quickly cash in on offshore oil discoveries. But they have since discovered an unexpectedly high percentage of gas in the fields, meaning they need to install additional infrastructure. Namibian law bans flaring – or burning gas off, releasing CO2 into the atmosphere – meaning companies will have to inject the gas back into the reservoir or process it for consumption
In Conversation
Lucy Yu, CEO of the Centre for Net Zero, an international non-profit organization, spoke to me about her thoughts on the U.S. election outcome and what it means for the clean energy space:
"In his previous term, Donald Trump withdrew the U.S. from the Paris Agreement and I assume that’s on the cards and will happen again for a second time.
“That would be a real shame for climate targets globally as we need the United States to be in a strong leadership position.
“When we look at the adoption, installation and deployment of renewables globally, it's an upward trajectory – whilst costs are falling downwards. We should expect those things to continue.
“We shouldn’t assume that progress will grind to a halt. There’s a huge amount of dedicated, good work globally and that will continue.
“More people understand the devastating impact of climate change and what it's going to take to address that. In some ways there is still a lot of societal momentum for change.
"Although the President-elect has railed against elements of Biden's flagship climate law, The Inflation Reduction Act, it's unlikely we'll see the policy fully repealed, as it is currently bringing significant investment and employment opportunities to the red states that have put him in power."
ESG Spotlight
Today’s spotlight shines a light on volunteer veterinarians in eastern Spain's flood-hit Paiporta who are treating pets that have caught infections from the devastated town's mud-filled streets.
The volunteers have set up an improvised first-aid station with donated medicines and equipment.
Paiporta is among the Valencia suburbs considered "ground zero" of last week's deadly flash floods that have killed at least 219 and left 93 people missing. Eight days on, its streets are still mired in mud and refuse - a hotbed for bacteria such as Leptospira to thrive in.
Today’s Sustainable Switch was edited by Mark Potter
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