POLITICO Pro is expanding our newsroom to cover the politics and policy of sustainability. From the circular economy, energy and carbon emissions, finance and ESG, supply chain management, governance and more — we’ll bring you the latest from the topic at the center of business and policy conversations. Catherine Boudreau, POLITICO Pro's new sustainability policy reporter, answered 5 questions on our mind about sustainability policy.
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What I’ve learned so far is to look for what companies are linking some portion of executive pay to environmental, social and governance goals, or ESG in corporate lingo, so there is a personal stake in making progress. A small but growing number of companies are doing this, including Mars Inc., Royal Dutch Shell and Bayer AG. I’ve also been asking chief sustainability officers if they report directly to the CEO and how large their teams are — both signals of how serious the company is about sustainability. Three other questions: does the company have both short-term and long-term targets, are they publicly disclosing progress at least annually, and are they putting money where their mouth is.
I’ve had conversations with at least a dozen chief sustainability officers in the past month, all of whom said their companies remain committed to goals like reducing waste and greenhouse gas emissions and investing more in renewable energy, despite the pandemic. Of course, some projects will be temporarily paused or move more slowly than hoped. The CSO of Perdue Farms, the country’s fourth largest poultry company, was candid about how their plans to install methane-trapping technology on manure lagoons at two more processing plants - which would help advance their renewable energy goals - are on hold for now because project developers can’t get on site. Also, I haven’t spoken to the airlines, hotel chains or cruise lines, but these industries are bleeding cash right now, so I imagine their sustainability commitments might take a backseat for the time being.
In terms of how priorities might shift because of the pandemic, I think smart companies will recognize that the level of inequality in this country is a threat to their survival. A company can’t operate without a healthy workforce, and the pandemic has certainly exposed who we take for granted and who is most vulnerable when disaster strikes. Better benefits like paid leave and higher wages might have encouraged more people to stay home and control the spread of the virus. Investing in communities so people have greater access to healthy food and green spaces might help reduce obesity rates, which worsen the effects of Covid-19. While a company can’t bear these burdens alone, it would serve them in the long-term to improve the wellbeing of American workers.
Some days it seems like we’re living on two separate planets, because the EU is so far ahead policy-wise. The European Commission, the executive branch of the 27-member bloc, in December set a goal to become carbon neutral by 2050 known as the Green Deal. It included a legislative road map for transitioning toward cleaner energy, transportation and agriculture, as well as a more circular economy that recycles and reuses products rather than sending them to landfills. Before the Green Deal, EU’s greenhouse gas emissions had already fallen by more than 20 percent since 1990; in the U.S., emissions are about the same as they were three decades ago, but have dropped by more than 12 percent after peaking in 2007. In both cases, the pace isn’t nearly fast enough to reach Paris Agreement goals.
It’s not like the EU is without challenges, though. There is some resistance from Eastern European countries like Poland and Hungary, which are heavily reliant on coal.
In the U.S., without national leadership on sustainability, state and local governments and the business sector are leading the way. After Trump pulled out of the Paris Agreement, 24 states — and hundreds of cities and companies — said they were still committed to goals to keep global temperature increases below 2 degrees Celsius. Still, most acknowledge that without the federal government involved, it will be extremely difficult to meet Paris Agreement targets.
The short answer: not much. That’s not to say lawmakers aren’t introducing any legislation, but the chances of it being signed by President Donald Trump are pretty slim, especially when the economy has tanked and it's an election year. There is pressure from environmental groups, economists, and to some extent the public, on policymakers around the world — particularly in Europe — to ensure the trillions in stimulus money invests in low-carbon infrastructure. China remains the world’s largest maker of electric vehicles and solar panels, for instance, and proponents of those technologies argue the U.S. could be ahead of the pack with the right incentives.
I know the food and agriculture space well after spending six years on the beat, and I would say Sen. Debbie Stabenow (D-Mich) and Rep. Chellie Pingree (D-Maine) are two of the most active. Pingree introduced a bill earlier this year that sets a goal to reach net-zero agriculture emissions by 2040 by quadrupling funding for research and creating programs to reduce food waste and improve soil health to capture more carbon in agricultural soils. But it only has seven co-sponsors so far, all Democrats, and there isn’t anything similar in the Senate. My POLITICO Pro colleagues told me that Rep. Peter DeFazio (D-Ore.) is prioritizing sustainability in a big way in his transportation and infrastructure legislation, along with Sens. Tom Carper (D-Del.) and Ben Cardin (D-Md.). And of course the face of the Green New Deal is Rep. Alexandria Ocasio-Cortez. Her partner in the Senate is Ed Markey (D-Mass.)