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After 40 years in sustainability, I’ve seen the ebb and flow of government action through many election cycles. Yet, as scientific understanding and public awareness of environmental and social impacts have advanced over the years, the pace of progress has steadily accelerated.
This momentum continues regardless of the US political landscape. Companies committed to sustainability will stay the course because it makes business sense. Investors will seek value by avoiding risks and betting on new, efficient green tech. Climate advocates will redouble their work, and the public will increasingly expect action from their elected representatives as climate risks mount. While US leadership of climate and sustainability action will undoubtedly reverse, the future of the global sustainability movement will continue.
Ajay Banga, the president of the World Bank, said, “It was never an America-only game.”
Christiana Figueres, who led the U.N. climate change body, said, “The direction is unstoppable. What we’re all focused on is scale and speed, but not direction.”
By some estimates, the second term of Trump’s Presidency could contribute an additional 4 billion tons of carbon to the atmosphere by 2030. However, the election had some green linings. When climate was on the ballot (as we covered last week), US voters supported more action in every case. And, looking back at the reaction to the first Trump Presidency, there was a huge outpouring of support for environmental NGOs—a trend we’re likely to see again.
Companies Will Still Do ESG
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The ESG backlash in the US has been running for multiple years now, yet there seems to be no slowdown in companies reporting on environmental and social issues. Two recent reports found that the number of companies reporting on sustainability continues to climb.
Data from DiversIQ found that S&P 500 companies sharing workforce diversity data rose from 5.3% in 2019 to 82.6% in 2023. Research from HIP investors revealed that the Scope 1 and 2 emissions reporting for large-cap US companies was up to 85%, from 54%, in the same time period.
Regulations, like the EU’s Corporate Sustainability Reporting Directive (CSRD), and ambitious corporate goals are driving the trend – neither will be affected by Tuesday’s election. Shiva Rajgopal of Columbia Business School said, “Most ESG problems are business problems. I’m an accounting professor. I can tell you that if you pick any company’s 10K and look at the risk factors, they are full of E and S problems.”
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