By Nellie Binder
Never before has the marriage of law, business, and the environment been more decisively significant than it is today. As an aspiring corporate lawyer who sees climate change as a global threat—one of the great crises of our time—I see the critical role businesses can take in tackling climate change. Getting corporate America on board with the green movement may be our only chance of preserving the environment for our children and for ourselves. The first step in this journey is to demonstrate that protecting the environment and securing U.S. business interests can indeed go hand in hand.
This reality clearly escaped President Donald Trump when he decided to withdraw the United States from the Paris Climate Agreement, even in the face of opposition from politicians, institutions, businesses, and civilians. Trump simultaneously began to roll back Obama-era climate legislation and emissions standards. This raises questions about how Trump can claim to be a pro-business president when his actions decidedly endanger American business prospects.
Here’s how Trump’s decision will devastate U.S. businesses in all sectors of the economy:
- Withdrawing from international climate negotiations will allow Europe and other increasingly sustainable nations to control the shift towards clean energy while sacrificing American business interests.
- American corporations and consumers will suffer as green jobs flow into progressively low-carbon economies like India and China.
- The Paris Agreement goals are fundamental for the survival of many U.S. businesses that source ingredients like vanilla, cocoa, and coffee from nations affected by global warming.
Even for companies that do not rely on vulnerable materials, reaching Paris Agreement goals makes business sense. Corporate sustainability decreases costs, creates a more likable brand, and alleviates risk. Increased accessibility to clean energy and growing sustainable energy markets abroad are forcing multinational companies to care more about renewables in order to stay competitive.
Trump’s justification for his decision is nonsensical. Trump claimed that this decision will protect coal jobs, but coal is a dirty and dying industry. While solar jobs grew by 25 percent and wind jobs increased by 32 percent, coal mining jobs have decreased by almost 40 percent since 2009 in the United States. Solar and wind combined employ almost half a million American workers, while coal employs only 74,000. If we sit idly by, the United States will be stuck trying to revive a lagging industry as the rest of the world frees itself from dirty energy. How can we possibly “make America great again” while we allow countries like China to take advantage of the growing renewable market as the United States drags its feet?
Multinational corporations, which traditionally have been drivers of extensive environmental degradation around the world, increasingly realize that they not only benefit from climate action, but that they have an obligation to account for their environmental and social impacts. This obligation is amplified by the fact that many U.S. corporations operating abroad are more powerful than sovereign nations. In recognizing their ethical duty and global influence, companies have ramped up their corporate social responsibility platforms and joined sustainability coalitions that effect real change. More than 450 American corporations participate in the United Nations Global Compact and work together to manage global climate risks by acting locally. Similarly, in the wake of Trump’s decision to withdraw from the Paris Agreement, hundreds of U.S.-based corporations pledged to continue working towards the agreement’s climate goals.
The effort cannot end here. As consumers, we can put pressure on corporations and demand that climate action become a mandatory facet of corporate governance, not just a desired one. With no coherent national policy, states and cities can also incentivize corporations to take climate action. For example, through the Clean Energy and Climate Plan for 2020, Massachusetts expects to drastically reduce greenhouse gas emissions while saving businesses millions of dollars in energy costs. Massachusetts has also been providing loans and grants to a growing sector of green tech companies in the state. If local and state leaders throughout the nation join the climate action initiative that the Paris Agreement envisions, corporations operating in those states will likely follow suit.
The future of the global economy rests on striking a balance between climate action and ensuring that sustainability efforts benefit corporations and consumers. As the world shapes a clean-energy future, American businesses will continue to take the lead on climate action, even while U.S. political leaders at the federal level fail to do so. The coming months and years will determine whether corporations are up to the challenge of saving American business interests abroad and, as a result, the earth as we know it.