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Max Rogers, assistant investment manager at Rathbone Investment Management International, looks at some of the changes which the US president has already brought in.
DONALD Trump’s re-election, just before COP29 in Baku, raised concerns about the impact on global climate efforts.
He has since eliminated more than 70 climate and green-energy initiatives in his first week of office, initiating an aggressive effort to reverse climate and industrial policies introduced under Joe Biden’s presidency.
The new president is also expected to take aim at climate– friendly policies implemented under Biden’s Inflation Reduction Act, which he referred to as the “green new scam” during a campaign rally.
With the US seemingly stepping back from its leadership role on global climate action, there could be an opportunity for countries and businesses — notably in China and Europe — to not only fill the void, but also to steal a march in the green transition race.
Shifting sands
Beyond climate, Trump’s deregulatory agenda could have profound implications for shopfloor workers and corporate governance in the US. His administration may roll back workplace safety regulations, weaken child labour protections and reduce overtime pay.
On the other hand, he has also expressed openness to raising the federal minimum wage and nominated a pro-union figure, Lori Chavez–DeRemer, for Secretary of Labor, gaining support from the unions.
Shareholder power
Investors have the ability to press US companies to implement changes by voting at annual general meetings.
These are important for increasing corporate transparency and to hold companies to account.
However, Trump is expected to overhaul the Securities and Exchange Commission, which has the power to block shareholder proposals from being put to a vote, potentially making it harder for investors to express concerns and influence corporate decisions.
Major changes are afoot that are likely to alter the dynamics of ESG investing in the US. Now, more than ever, engagement with American businesses will be key to ensuring that corporate sustainability remains a priority.
