Harris and Trump’s Divergent Visions for Responsible Investing Are Clear
To Sustain Our Mission, We Must Endorse Kamala Harris.
StartingUpGood promotes responsible investing as a financially strong portfolio strategy and a good thing for the world. We are committed to sharing evidence-based information that helps all stakeholders better understand its importance and potential.
Given the impact that the 2024 presidential election will have on the future of responsible investing and corporate sustainability, we believe it is crucial to highlight the stark differences between Kamala Harris and Donald Trump’s policies and promises in the areas of:
Our Key Takeaway
- A Harris presidency will build upon and strengthen policies likely to accelerate the growth of responsible investing and positive social impact enterprises.
- A Trump return to office will lead to a rollback of positive social impact and ESG regulations creating barriers for investors prioritizing sustainability.
Read our past coverage of ESG investing fundamentals and benefits.
Public Stance on ESG Investing
Early in his campaign, Trump posted on Truth Social:
“We MUST protect Americans from Radical Leftist ESG investments — I did it once, and it’s time to do it again as I set the example for Republicans across the Country to follow my lead in fighting ESG!”
Under Trump’s presidency, the Department of Labor finalized a rule requiring fiduciaries of private-sector retirement plans governed by the Employee Retirement Income Security Act (ERISA) to prioritize financial returns over non-financial objectives. Specifically, it emphasized that investment decisions should be based solely on “pecuniary factors,” which are defined as factors expected to have a material effect on the risk and return of an investment. This move was widely seen as a way to limit the consideration of ESG factors in retirement plan investments.
The Department of Labor under the Biden-Harris administration amended the rule to allow “plan fiduciaries to consider climate change and other environmental, social, and governance factors when they select retirement investments and exercise shareholder rights, such as proxy voting.” This is just one example of Harris’s actions that support ESG investing. We explore more specifics below.
Environmental Stewardship
Harris stands out as a champion for climate action and environmental protection. Her track record includes:
- Casting the crucial tie-breaking vote in the Senate for passing the Inflation Reduction Act (IRA), which earmarked $369 billion to help the country transition away from fossil fuels, provides funds for programs to reduce pollution in low-income communities, and builds out clean energy infrastructure.
- Supporting the expansion of renewable energy projects, like the $20 billion investment in financing for community-based climate projects, $14 billion of which (more than 70% of the funds) is dedicated towards low-income and disadvantaged communities.
- As a US Senator, co-sponsoring the Green New Deal resolution, which aimed to transition the United States to 100% clean energy within a decade.
- Taking legal action against major oil companies as California’s Attorney General.
- Establishing California’s first environmental crimes unit as district attorney in San Francisco.
Trump, in contrast, during his presidency from 2017 to 2021:
- Withdrew from the Paris Climate Agreement, and his campaign confirms he will do it again if re-elected.
- Weakened fuel economy standards and emissions regulations.
- Expanded oil and gas drilling by opening up federal lands and offshore areas previously restricted as sensitive environments.
- Dismantled environmental protections with regulatory rollbacks that include:
Repealing the Clean Power Plan, giving states more authority to set their own carbon emissions standards;
Revising the Waters of the United States (WOTUS) Rule, reducing federal protections for many streams and wetlands;
Changing the Endangered Species Act to make it easier to remove species from the endangered list and reduce protections for critical habitats; and
Modifying the National Environmental Policy Act (NEPA) procedures to expedite federal approvals for infrastructure projects by reducing the scope of environmental reviews.
For ESG investors, Harris’s stance presents significant opportunities in the renewable energy sector and companies focused on sustainability. Trump’s policies, however, could pose long-term risks to portfolios exposed to climate-sensitive industries.
Social Responsibility
Harris has consistently advocated for:
- Improved labor rights
- Women’s rights
- Diversity within companies
- Environmental justice for underserved communities
These priorities align well with the ‘S’ in ESG, potentially reducing social risks for investors and promoting companies with strong diversity and inclusion practices.
Trump, on the other hand, has generally favored deregulation and reducing government oversight, which could lead to less corporate accountability on social issues. For example:
- Trump revoked the Fair Pay and Safe Workplaces Rule that required companies bidding on federal contracts to disclose labor law violations. The rule aimed to ensure that companies with a history of violations could be identified during the contracting process.
- He reversed bans on certain pesticides like chlorpyrifos, which had been linked to developmental issues in children.
Corporate Governance
On governance matters, the candidates’ approaches diverge significantly:
- Harris supports greater corporate transparency, including mandatory disclosures of climate-related risks and carbon emissions.
- Trump’s administration opposed such mandatory disclosures, arguing they impose unnecessary burdens on businesses. The Securities and Exchange Commission under a second Trump administration would likely curtail the rules recently adopted on climate disclosure.
For ESG investors, Harris’s approach could provide clearer insights into companies’ long-term sustainability, while Trump’s stance might leave investors with less information on potential ESG risks.
Conclusion
As an organization committed to promoting positive environmental, social and governance practices, we believe that Harris’s approach aligns more closely with the principles of responsible investing. Her policies would likely create a more favorable environment for ESG considerations in investment decisions, corporate practices, and regulatory frameworks. For these reasons, StartingUpGood is formally endorsing Kamala Harris.
Regardless of the election outcome, we encourage investors to remain committed to ESG principles. The long-term benefits of considering ESG factors in investment decisions extend beyond any single administration’s policies.
Learn More
For additional information, we recommend the following sources:
Sources
We used these sources to fact-check our content:
- US Department of Labor announces final rule to remove barriers to considering environmental, social, governance factors in plan investments | 22 November 2022
- FACT SHEET: Two Years In, the Inflation Reduction Act is Lowering Costs for Millions of Americans, Tackling the Climate Crisis, and Creating Jobs | 16 August 2024
- Biden-Harris Administration Announces Historic $20 Billion in Awards to Expand Access to Clean Energy and Climate Solutions and Lower Energy Costs for Communities Across the Nation | 4 April 2024
- Where Kamala Harris stands on Green New Deal and climate initiatives | 21 July 2024
- Harris’ record as Calif. AG hints at aggressive approach to polluters | 26 July 2024
- United States withdrawal from the Paris Agreement | Wikipedia
- Trump would withdraw US from Paris climate treaty again, campaign says | 28 June 2024
- Trump Administration Weakens Auto Emissions Standards | 31 March 2020
- Trump Signs Executive Order On Offshore Drilling And Marine Sanctuaries | 27 April 20217
- The Trump administration’s major environmental deregulations | 15 December 2020
- Trump’s EPA just replaced Obama’s signature climate policy with a much weaker rule | 19 June 2019
- Trump Administration Cuts Back Federal Protections For Streams And Wetlands | 23 January 2020
- Trump Administration Makes Major Changes To Protections For Endangered Species | 12 August 2019
- Biden Administration Walks Back Key Trump Era NEPA Regulation Changes | 26 April 2022
- AFL-CIO Unanimously Endorses Kamala Harris for President | 22 July 2024
- Kamala Harris: What She’s Said About Women’s Issues | 22 July 2024
- FACT SHEET: Vice President Harris Announces New Efforts to Expand Capital Access and Contracting Opportunities for Minority-Owned and Underserved Businesses at the Freedman’s Bank Forum | 25 October 2023
- Biden-Harris Administration Announces Historic $20 Billion in Awards to Expand Access to Clean Energy and Climate Solutions and Lower Energy Costs for Communities Across the Nation | 4 April 2024
- Workers’ health, safety, and pay are among the casualties of Trump’s war on regulations | 29 January 2018
- FACT SHEET: Biden-Harris Administration Proposes Plan to Protect Federal Supply Chain from Climate-Related Risks | 10 November 2022
- A Trump SEC would aim to reverse climate disclosure rule, ratchet up ESG fights, sources say | 2 May 2024
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Disclaimer: This article uses various LLMs to research, edit, and proof-read. All content for the article was hand-curated and checked for quality.
