Trump Administration Continues Attempts to Unravel US Environmental Protections Put in Place Over Many Years – Now, Shareholder Proxy Resolution Actions on Climate Issues Also In Focus For Investors




Trump Administration Continues Attempts to Unravel U.S. Environmental Protections Put in Place Over Many Years - Now, Shareholder Proxy Resolution Actions on Climate Issues Also In Focus For Investors...

We should not have been surprised: in 2016 presidential candidate Donald Trump promised that among his first steps when in the Oval Office would be the tearing up of his predecessor’s commitment to join the family of nations in addressing climate change challenges.  In 2015 in Paris, with almost 200 nations in agreement, the United States of America with President Barack Obama presiding signed on to the “Paris Agreement” (or Accord) for nations and private, public and social sector organization to work to prevent further damage to the planet.

The goal is to limit damage and stop global temperatures from rising about 2-degrees Centigrade, the issues agreed to.  As the largest economy, of course the United States of America has a key role to play in addressing climate change.  Needed: political will, collaboration among private, public and social sectors, and funding for the transition to a low carbon economy (which many US cities and companies are already addressing).

So where is the USA?  On June 1st 2017 now-President Trump followed through on the promise made and said that the U.S.A. would begin the process to withdraw from the Paris Agreement on climate change, joining the 13 nations that have not formally ratified the agreement by the end of 2018 (such as Russia, North Korea, Turkey and Iran).  Entering 2019, 197 nations have ratified the Agreement.

A series of actions followed President Trump’s Paris Agreement announcement – many at US EPA and other agencies -- most of which served to attempt to weaken long-existing environmental protections, critics charged. 

The latest move to put on your radar:  In April, President Trump signed an Executive Order that addresses “Promoting Energy Infrastructure and Economic Growth”. [Energy] Infrastructure needs – a bipartisan issue – are very much in focus in the EO.  But not the right kind to suit climate change action advocates.  The EO addressed continued administration promotion and encouraging of coal, oil and natural gas production; developing infrastructure for transport of these resources; cutting “regulatory uncertainties"; review of Clean Water Act requirements; and updating of the DOT safety regulations for Liquefied Natural Gas (LNG) facilities.

Critics and supporters of these actions will of course line up on both sides of the issues. There are things to like and to dislike for both sides in the president’s continuing actions related to environmental protections that are already in place. And then there is the big issue in the EO:  a possible attempt to limit shareholder advocacy to encourage, persuade, pressure companies to address ESG issues.

Section 5 of the EO:  “Environment, Social and Governance Issues; Proxy Firms; and Financing of Energy Projects Through the U.S. Capital Markets.”  The EO language addresses the issue of Materiality as the US Supreme Court advises.  Is ESG strategy, performance and outcome material for fiduciaries? Many in the mainstream investment community believe YES!

Within 180 days of the order signing, the Secretary of the Department of Labor will complete a review existing DOL guidance on fiduciary responsibilities for investor proxy voting to determine whether such guidance should be rescinded, replaced, or modified to “ensure consistency with current law and policies that promote long-term growth and maximize return on ERISA plan assets”.  (Think of the impact on fiduciaries such as public employee pension plans.)  The Obama Administration in 2016 issued a DOL Interpretive Bulletin many see as a “green light” for fiduciaries to consider when incorporating ESG analysis and portfolio decision-making.  The Trump EO seems to pose a direct threat to that guidance.

We can expect to see sustainable & responsible investors marshal forces to aggressively push back against any changes that the Trump/DOL forces might advance to weaken the ability of shareholders – fiduciaries, the owners of the companies! – to influence corporate strategies and actions (or lack of action) on climate change risks and opportunities.  Especially through their actions in the annual corporate proxy ballot process and in engagements. 

You’ll want to stay tuned to this and the other issues addressed in the Executive Order.  We’ll have more to report to you in future issues of the newsletter.

Click here to President Trump’s April 10, 2019 Executive Order.

Facts or not?  Click here if you would like to fact check the president’s comments on withdrawal from the Paris Agreement.

We are still in!  For the reaction of top US companies to the Trump announcement on pulling out of the Paris Accord, check The Guardian coverage of the day.

At year end 2018, this was the roundup of countries in/and not.

For commentaries published by G&A Institute on the Sustainability Update blog related to the above matters, check out it here.

Check out our Top Story for details on President Trump’s recent EO.

This Week's Top Stories

Trump Order Takes Aim at Shareholders Pushing Companies to Address Climate Change
(Wednesday - April 77, 2019) Source: Climate Liability News – President Trump has ordered a review of the influence of proxy advisory firms on investments in the fossil fuel industry, a mot that…

 

Global Sustainability: Continuing Forward Momentum!

Change The World With What You Buy: Procurement Steps Up To Sustainability
(Wednesday - April 24, 2019) Source: Forbes - Determining risk from data across multi-layered digital supply chains is no easy task for professionals in companies or consumers. After working with upwards of 50 million consumers who would ask which vendors to buy products...

The path to sustainability is the key to survival
(Monday - April 22, 2019) Source: Desert Sun - As the CEO of The Living Desert Zoo and Gardens, one of my responsibilities is to stay abreast of the latest conservation research to help ensure that our educational message is accurate and up to date...

NAR: Sustainability sells
(Monday - April 22, 2019) Source: Inman - 59% of respondents to a survey among members of the National Association of Realtors said clients were interested in energy efficiency and sustainable housing features...

Sustainable thinking
(Wednesday - April 24, 2019)  Source: Logistics Manager - Walmart’s Sustainability Index Program gathers and analyses information across a product’s life cycle, and was developed by The Sustainability Consortium.  As HSBC’s Natalie Blyth points out, for many large... 

Corporate water sustainability goals are mostly just talk
(Wednesday - April 24, 2019) Source: Quartz - Corporations in many sectors of industry use a lot of water. In general, industry uses around 20% of the world’s freshwater withdrawals, while in the wealthiest nations, corporate water consumption can be as much as 40% of the... 

Supermarkets ramp up sustainability push
(Wednesday - April 24, 2019) Source: Supermarket News - On Earth Day 2019, supermarket retailers highlighted efforts to promote environmentally friendly practices in their operations and communities.

Packaging Is Killing the Planet—These Start-Ups Offer Luxe, Sustainable Solutions
(Thursday - April 25, 2019) Source: Vogue - There’s a common thought that for a brand to be sustainable, it has to sacrifice something along the way. Maybe it’s a certain material, or a slice of the profit, or a sense of luxury.

Green Bonds And The Pathway To Sustainability
(Friday - April 26, 2019)  Source: Seeking Alpha - What’s ahead for green bonds. In 2018, reports from the Intergovernmental Panel on Climate Change and the U.S. National Climate Assessment provided at least two grim conclusions. First ... 

Want to Live More Sustainably? Start With These 17 Items for Your Home and Closet
(Tuesday - April 23, 2019) Source: Vogue - Below, we’ve found 16 more Earth Day–friendly items to consider, from a plant-based comforter to a laundry bag that filters out micro-plastics and a few of our favorite sustainable fashion buys as well. In addition to supporting... 

Considerable Attention Being Paid to Sustainability...in Fashion & Retail

Walmart and Patagonia were once the 'odd couple' of sustainability. Now, the world's biggest apparel brands are lining up to follow their example.
(Friday - April 26, 2019)  Source: Business Insider - But the odd couple found common ground, and together they began the Sustainable Apparel Coalition (SAC). That coalition now has more than 250 members, and more than 10,000 manufacturers use its main offering, the Higg Index tool... 

How to Shop Sustainable Denim For Earth Week
(Thursday - April 25, 2019) Source: Forbes - Fortunately, there are now a ton of companies committed to creating more eco-conscious jean offerings. Read on to discover some of the best sustainable denim brands to shop this Earth Week. 

How Brands Can Really Make their Businesses Sustainable
(Friday - April 26, 2019) Source: YAHOO! - Commitments to sustainability are no longer a niche practice in the footwear industry. In fact, the Sustainable Apparel Coalition (SAC) counts more than 240 members in the apparel, textile and footwear industries, with total...

Are these ‘sustainable’ clothing brands the real deal?
(Friday - April 26, 2019) Source: Grist - I’ve been seeing a lot of ads for “environmentally friendly” or sustainable fashion brands that have cute designs, but it almost seems too good to be true. Is buying “eco-friendly” fashion actually good for the planet? 

Why Fashion Can No Longer Ignore Sustainability
(Tuesday - April 23, 2019) Source: HypeBeast - No one can afford to ignore sustainability, especially fashion. While the oft-repeated quote about the industry being the world’s second biggest polluter has been debunked, that doesn’t mean fashion has suddenly become a...

Keep These Sustainable Brands In Mind When Shopping On Earth Day (& Every Day After)
(Monday - April 22, 2019) Source: Refinery29 - While preparing to write about the mutable, ever-evolving and increasingly pressing topic of “sustainability” in time for Earth Day, we had deep thoughts. Here in the Shopping department...

Tune in to Corporate Sustainability Activity...

Dr. Scholl’s Shoes Launches Sustainability Initiative
(Wednesday - April 24, 2019)  Source: The Valdosta Daily Times - DDr. Scholl�s Shoes is making a deliberate choice to invest in sustainable, eco-conscious design to create environmentally lower-impact shoes.... 

NRG Energy’s 2018 Sustainability Report Showcases 37% Reduction in Carbon Emissions  
(Friday - April 26, 2019)  Source: CSR Wire - NRG Energy Inc. today released its 2018 Sustainability Report, providing an update on the Company’s comprehensive sustainability strategy. NRG demonstrated advancement across...

Timberland 2018 CSR Report Shows Steady Progress Toward 2020 Sustainability Goals
(Friday - April 26, 2019) Source: CSR Wire - On the heels of Earth Day, global outdoor lifestyle brand Timberland today releases its 2018 corporate social responsibility (CSR) report, showing steady progress toward its 2020 sustainability... 

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Headlines: ESG Topics & Front of Mind Issues

Growing number of Americans think environment will be worse for next generation, CBS News poll finds
(Tuesday - April 23, 2019) Source: CBS 

Top auto executives are privately very worried about the state of auto sales
(Tuesday - April 23, 2019) Source: CNBC 

Climate change makes poor countries poorer, widening global inequality, researchers say
(Wednesday - April 24, 2019) Source: CNN

American millennials have less money than other generations did at their age — but studies show an alarming amount of them have delusional ideas about their wealth
(Thursday - April 25, 2019) Source: Greenwich Time 

Wait, Reusable Cotton Bags Are Bad for the Environment?
(Thursday - April 25, 2019) Source: Care2 

Despite Demand for More Diversity and Refreshment, Half of Russell 3000 Companies Report No Change in Board Composition
(Friday - April 26, 2019)
  Source: PR Newswire 

Headlines From the Corporate Sector

Tesla Ousts 4 Pro-Elon Musk Directors, Weeks After Shareholders Sue Board
(Monday - April 22, 2019) Source: CNN

The best companies for employees in 2019
(Tuesday - April 23, 2019) Source: Yahoo Finance

Bed Bath & Beyond's co-founders retire from board, adds five new members
(Tuesday - April 23, 2019)  Source: Reuters 

What’s Jamie Dimon’s salary got to do with income inequality?
(Tuesday - April 23, 2019) Source: American Banker

Abigail Disney's Criticism Of CEO Bob Iger's Pay Raises Difficult Questions
(Thursday - April 25, 2019) Source: Forbes 

McDonald’s is teaming up with AARP to hire older workers
(Thursday - April 25, 2019) Source: CNBC

Chipotle’s stock drops 6% after the company discloses subpoena related to 2018 illness incident
(Friday - April 26, 2019) Source: CNBC

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