In a long interview with an international banker several months ago, there was only one answer he insisted on putting “off the record.” What effect, I had asked, has President Trump’s decision to leave the Paris climate accord had on private sector investment in clean energy?
“Galvanizing,” he said. In China, India, Latin America and even the Middle East, wind and solar projects were moving ahead in spite of, and perhaps to spite, the suddenly outlier policies of the U.S. government.
Indeed, China accounted for fully 45% of the global total of $280 billion in renewable energy investment last year. There were dramatic increases in clean energy investment in Australia, Mexico, the United Arab Emirates and across the developing world.
So let’s get it on the record: the world is moving ahead to a low-carbon future. Hundreds of American cities and companies as well have declared “We are still in” the global climate agreement, no matter what the White House says.
And clean energy is only the most mature of the sustainable investment sectors that are decoupling from American government leadership. Leading corporations, investors and entrepreneurs, including Americans, are distancing themselves from a closed, cramped view of the world and lining up behind a global growth agenda.
To be sure, investors certainly like policy tailwinds more than headwinds. It was only 2015 that U.S. officials helped lead other countries into the Paris climate agreement, as well as the United Nations’ Sustainable Development Goals. But if the Trump administration insists on missing the bus of history, a growing corps of Agents of Impact are intent on climbing on board nonetheless.
On Monday, ImpactAlpha published perspectives from a range of contributors, who declared their commitment to global approaches to global problems.
On Tuesday, we tried to show how America benefited from an inclusive, expansive approach – to migration, diversity, entrepreneurship, innovation. (And ImpactAlpha’s New Revivalist series profiled investors, organizers and entrepreneurs in cities and communities across the country delivering quality jobs, affordable housing and inclusive growth.)
“Mr. President, on trade, climate, migration and so much more, our response need not be to protect, withdraw and barricade,” we wrote. “Rather than scarcity, think abundance: open, connected and generous.”
Now, we’re seeing signals that companies and countries, and many Americans as well, are moving on regardless. What choice to they have? Every industry is being disrupted, from supply chains to distribution channels, and we don’t mean by President Trump.
It’s not just the still-declining costs for wind and solar. Or steady improvements in batteries and a surge in electric vehicles. Meat substitutes are growing faster than processed meats. Material consumption is declining across many developed markets. The ways food is grown, water is used and health care is delivered are changing rapidly.
The 2030 global goals offer a shorthand for this menu of opportunities – and risks. The “Better Business, Better World” report last year suggests that a a global food and agriculture system aligned with the SDGs could deliver nutritious, affordable food for the world’s growing population, raise incomes for smallholder farmers and restore forests, freshwater resources and crucial ecosystems. The added economic value by 2030: more than $2 trillion.
That’s just part of the opportunity set the report suggests could account for $12 trillion in annual cost savings and revenues and create 380 million new jobs by 2030.
“Moving business to a sustainable growth model will be disruptive, with big risks as well as opportunities at stake,” acknowledges the report, prepared by the Business and Sustainable Development Commission. But it advises, “First movers who have already aligned their resource use and workforce management with the Global Goals will have a five to 15 year advantage on the sustainable playing field.”
It’s an interesting time to be in when many companies and investors are more squarely lined up behind positive social and environmental impact than the U.S. government. Nevertheless, the growing corps of global agents of impact are not about to miss out.
My banker friend suggested that it’s the nature of government to identify problems, while the private sector looks for successes to replicate. “We have access to the capital markets,” he said. “We have the means to do it.”