In 2017, when Donald Trump first said he was going to pull the United States out of the Paris agreement, the response from Goldman Sachs was unequivocal.
“Today’s decision is a setback for the environment and for the US’s leadership position in the world,” wrote Lloyd Blankfein, Goldman’s then chief executive, in his first post on what was then Twitter.
Facebook’s Mark Zuckerberg agreed, saying the move was “bad for the environment, bad for the economy, and it puts our children’s future at risk”.
Tesla’s Elon Musk and Walt Disney’s Bob Iger both quit White House business advisory councils. At Apple, Tim Cook said he had tried but failed to persuade Trump to abandon a move that would have “no impact on Apple’s efforts to protect the environment”. And other corporate leaders spoke out with equal force.
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What a difference nine years makes.
After the Biden administration returned the US to the Paris accord, Trump announced a second exit on his first day back in office last year.
But last week, Trump took the US retreat from global climate action to a striking new level.
In between capturing Venezuela’s president and threatening to take Greenland, he announced a US withdrawal from both the world’s most important climate treaty, the 34-year-old parent of the Paris agreement, and the UN’s 38-year-old Intergovernmental Panel on Climate Change, which produces the most authoritative climate science assessments.
They were among dozens of global groups the White House said “no longer serve American interests”.
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Even for the Trump White House, this was jolting. No nation has taken such steps before, let alone the world’s richest. But this week, when I asked all the companies mentioned above if they or their chief executive had anything to say about it, not a single one did by deadline.
Other companies, inside and out of the US, were just as reluctant to comment.
Eventually, I heard from Roy Bedlow, founder of Low Carbon, a London-headquartered group that has been building solar, wind and battery projects for more than a decade in the United Kingdom, Europe and North America.
The US voice in these international climate institutions would be missed, he said, though green energy use was increasingly “being driven by market demand, not politics, and that trend isn’t likely to change”.
We Mean Business, a coalition of organisations that work with businesses on climate action, went further. Withdrawing from such important UN climate institutions does not merely risk weakening the shared frameworks that underpin effective global action, it said. These bodies also provide common rules and trusted science that businesses and investors need.
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But these have been lonely corporate voices.
By this point, you might be thinking, so what? Be realistic. Why would any chief executive risk speaking out when it would probably change nothing except their company’s share price if it leads to retaliation? Surely it is better to quietly work behind closed doors, rather than recklessly putting your company at risk?
This is exactly what many business leaders are saying privately about a situation they see as unwinnable and increasingly fraught, one veteran corporate sustainability leader told me this week. “Much of my time is increasingly being spent with boards and leadership teams who are just on eggshells,” this person added.
I understand this, not least when executives must also grapple with increasing trade tensions, the rise of artificial intelligence, geopolitical instability and other uncertainties.
Yet I wish it were not the case. For a start, Trump’s unhindered actions encourage the idea that climate change is a fading problem when in fact the absolute opposite is true. This week, scientists revealed the world’s goal of limiting global warming to 1.5 degrees is on track to be breached by 2030, more than a decade earlier than expected at the time of the 2015 Paris agreement.
This failure is not due to a shortage of scientific understanding or technological breakthroughs. It is because we lack the political changes needed to put financial systems and economies on to paths that avoid burning fossil fuels. Achieving those changes is inordinately difficult. Public support from large businesses is important.
Ultimately, staying quiet at a time like this is self-defeating. It undermines the global institutions needed to address a growing global climate problem that poses serious financial threats.
And there is also this to consider. When even the most powerful business leaders stay quiet because they fear retribution, it says something about the state of the democracies they operate in that is undeniably dark. – Copyright The Financial Times
