Donald Trump called climate change “a Chinese hoax” and said global emissions goals would be “very hard on our business.” But when the former president pulled the U.S. out of the Paris accord in 2017, there was no celebrating in the C-suite.
Instead, Corporate America went where the federal government wouldn’t, with companies issuing their own Paris-aligned pledges even without pressure from regulators. The We Are Still In campaign — hundreds of corporate leaders, nonprofits and cities — was born and had an outsized presence at climate meetings that year in Bonn, where several companies committed to targets for cutting emissions.
Now those business leaders have allied with President Joe Biden to push Congress to do its part. Executives who stepped into the vacuum left by Trump say they need Washington to standardize corporate risk disclosure, modernize the electrical grid, price carbon, and put money into technology if the U.S. is to meet its goal on greenhouse gas emissions.
“We can’t do it alone,” HP Inc. CEO Enrique Lores said at a World Wildlife Fund event last week. “There is a limit to how far private industry can take this.”
The shift by business, a group long tied to Republicans, has raised hope among environmentalists that corporate lobbyists will be able to do what they couldn’t —persuade lawmakers, particularly conservatives, to limit the release of greenhouse gases.
In the past, “you couldn’t go to a board and have a real conversation about climate. People thought you were making a political statement,” said Helen Clarkson, CEO of The Climate Group, a nonprofit that partners with business on climate action. “Suddenly you saw these companies stepping forward and lobbying President Trump not to pull out of Paris.”
It’s a fight for survival, and profits. Some corporations are long on virtue-signaling and short on action, but many others, including HP, Microsoft Corp., General Motors Co., Danone S.A. and Gap Inc., are spending millions of dollars to push the boundaries of renewable energy, protect water resources, and deploy new technology as they rush to deal with climate change and gain a competitive edge.
Their impact has been significant. As of last year, corporate buyers had reached deals for a combined 10.6 gigawatts of renewable capacity, the equivalent of 33 million solar panels. On Wall Street, firms with $37 trillion under management, including mutual fund giants State Street and Vanguard, have pledged to go net zero.
If just 80 of the largest corporate emitters meet their pledged targets, they could reduce global emissions by more than 8 billion metric tons, or about 25 percent, according to an analysis by BloombergNEF. That’s the equivalent of zeroing out all emissions in the U.S. and Japan combined.
“The magnitude of this is colossal,” BNEF analyst Kyle Harrison said. “This is only 80 companies, and what they can achieve is ridiculous.”
More than 400 companies this month urged Biden to align with their own promises to cut emissions, what’s known in climate lingo as a nationally determined contribution or NDC. Biden committed to reducing emissions by half during a global climate summit he convened last week.
“The last time an NDC was set, who even knew what an NDC was? It wasn’t as if companies were engaged. Now they’re on the front lines,” said Anne Kelly, vice president of government relations at CERES, a nonprofit that helped organize the Biden letter. “There’s a genuine recognition of climate change. I don’t see this as virtue signaling.”
Armed with economic data, executives are working Capitol Hill to make a case for carbon pricing and, in some cases, convince Republican lawmakers that the cost of Biden’s multitrillion-dollar jobs plan is greater than the cost of inaction.
Privately, many lawmakers are listening, lobbyists say. But publicly, climate remains politically divisive. Senate Minority Leader Mitch McConnell has decried “woke” corporations for weighing in on social issues, and fewer than half of Republicans think the U.S. should reduce its greenhouse gas emissions, according to a survey from the Yale Program on Climate Communication.
“We’ve had offices call us up and say, ‘We want to figure out stuff that makes sense for us,’” said Chris Adamo, vice president for federal and industry affairs at Danone North America. “The actual dialogue, for Republicans, can be very constructive.”
The food multinational, like hundreds of other companies, has set its own internal price on carbon — about $42 per metric ton — and is pushing for government help on sustainable agriculture.
“We need policies,” Adamo said. “We’re going to invest millions of dollars of our money. To do it alone is going to be very difficult and probably a lot slower. That’s true for most sectors.”
Even the U.S. Chamber of Commerce, long the dominant force in corporate lobbying in Washington, has changed its approach. In 2019 the group ceded to pressure from members to abandon its obstruction on climate action, and last week it endorsed Biden’s Paris pledge. The test will be how — or whether — the chamber works to bring Republicans on board.
“What those statements did in my mind was free up Republican members of Congress who had been progressive on climate issues but were afraid to talk about it,” said Hugh Welsh, president of nutrition giant DSM North America. “We’ll have to wait and see when the first big climate bills come up whether the chamber actively promotes them or lobbies against them. I’m going to give them the benefit of the doubt for the time being.”
College students organizing under the banner of Change the Chamber — think a battalion of Greta Thunbergs — last year began naming and shaming the association’s members on social media. Their message: Customers won’t let brands get away with hiding behind the trade group.
Plenty of businesses were on board the last time Congress tried a heavy lift on climate. The contours of a 2009 cap-and-trade bill from then-Reps. Henry Waxman (D-Calif.) and Ed Markey (D-Mass.) were designed by a committee in which business played a prominent role.
“Chemistry, oil, auto — they were all part of it,” Waxman said in an interview. “We had important business backing. It wasn’t enough.”
“I worked on the assumption that Republicans were the party of business. I was wrong,” Waxman said. “Let’s hope this time I’m not wrong.”
Read more: politico.com