Equilibrium/Sustainability — GOP to go after ESG investing if they win Congress

The Republicans have announced plans to analyze what they see as “woke capitalism” in the event that they retake Congress — by targeting Wall Street firms that treat climate change as an economic risk. 

“My view is that ESG investing is a cancer inside our capital markets,” Rep. Andy Barr (R-Ky.) told The Washington Post, referring to environment, social and governance-focused investing funds. 

Such funds are “a fraud on American investors,” Barr added. GOP members of the up-for-grabs Senate are pushing for laws that penalizes corporations for prioritizing ESG goals over purely financial goals. 

Lawmakers within the House introduced a bill earlier this month that will prohibit the Department of Labor from considering ESG aspects in deciding between pension plans, in response to Pensions & Investment magazine. 

But for firms looking down the barrel of regulatory and climate risk, the difference between sustainability and profitability is an increasingly meaningless distinction — raising the likelihood that the GOP push is just “political hay making,” Ivan Frishberg of Amalgamated Bank told the Post. 

“But I don’t think that is changing what asset managers or banks are doing when it comes to …their stewardship of assets in a changing climate,” Frishberg added. 

A primary driver behind the anti-ESG effort appears to be the fossil fuel industry, which has fought to weaken the brand new climate disclosure rules proposed by the Securities and Exchange Commission.  
“Banks and investors mustn’t use ESG as a premise to only discriminate categorically against a whole sector,” Aaron Padilla, a vp on the American Petroleum Institute, told the Post. 

The accusations of a fossil fuel boycott has caused the large asset manager BlackRock to roll out a recent site in October to argue that it does no such thing

Welcome to Equilibrium, a newsletter that tracks the growing global battle over the longer term of sustainability. We’re Saul Elbein and Sharon Udasin. Send us suggestions and feedback. A friend forward this text to you? 

Today we’ll take a look at the U.K.’s latest about-face on the United Nations climate summit, followed by a have a look at some suspicious evidence of illegal fishing on the high seas. Plus: Why investors just spent $2 billion on a forest. 

UK prime minister to attend COP27

British Prime Minister Rishi Sunak confirmed on Wednesday that he’ll attend next week’s United Nations climate summit — reversing course just days after he said he was skipping the meeting, our colleague Zack Budryk reported for The Hill.  

Sudden U-turn: “There isn’t a long-term prosperity without motion on climate change,” Sunak tweeted Wednesday.  

  • “There isn’t a energy security without investing in renewables,” he continued.  
  • “That’s the reason I’ll attend @COP27 next week: to deliver on Glasgow’s legacy of constructing a secure and sustainable future,” the prime minister added. 

Initial hesitance: Just after Sunak took office last week, a spokesperson for the prime minister said he wouldn’t attend the U.N. Climate Change Conference (COP27).

  • The summit is about to start in Sharm El Sheikh, Egypt, on Sunday. 
  • Sunak’s office had cited “pressing domestic commitments,” including an upcoming budget deadline. 

Under pressure: But amid wide-ranging pushback, Sunak’s office indicated on Monday that he was reconsidering his previous decision, as we reported.  

  • Political opponents had jumped on Sunak’s initial announcement that he would skip the summit. 
  • Alok Sharma, the British president of last 12 months’s climate summit (COP26) in Glasgow, also agreed that the prime minister should attend.  

Could the king now also attend? Sunak’s announcement can also open the door for King Charles III — whom Downing Street had told to remain home — to attend the summit, The Guardian reported.  

Sharma, meanwhile, said he was “delighted” by Sunak’s reversal, in response to The Guardian. 

Fishing vessels could also be hiding criminality

Researchers have identified tens of 1000’s of events by which fishing vessels have disabled their tracking devices — potentially to cover up illegal activity.  

Legitimate versus cover-ups: Harnessing data from the shipboard Automatic Identification System — created as a collision avoidance tool — the scientists have homed in on what they consider could also be illegal, unreported and unregulated fishing activity.  

  • While some disabling events may occur for legitimate reasons, others look like attempts at illegal cover-ups.  
  • The researchers published their findings on Wednesday in Science Advances.  

Thousands and thousands of hours of hidden activity: The researchers said they spotted greater than 55,000 suspected intentional disabling incidents from 2017-2019.  

These events obscured nearly 5 million hours — about 6 percent — of fishing vessel activity, in response to the study. 

Suspicious behavior: The scientists uncovered two specific situations by which the disabling occurred “for potentially nefarious reasons,” lead writer Heather Welch, of the Institute of Marine Sciences on the University of California Santa Cruz, said in an announcement.    

  • Such reasons likely involved fishing in unauthorized locations or obscuring unauthorized transshipments, in response to Welch.  
  • “The information are produced in real time, so it may possibly be used to focus on inspections and improve fisheries management,” she added.  

Problematic places: Greater than 40 percent of the entire hours obscured by suspected disabling occurred in 4 hotspots, the scientists found. 

  • Three of those hotspots are areas of concern for illegal fishing: the Northwest Pacific and two other areas near the exclusive economic zones of Argentina and West African countries.  
  • These zones contain wealthy fishing grounds and have limited oversight.  

And the fourth hotspot? The culprits in these cases were U.S. trawlers disabling in U.S. waters off the coast of Alaska.  

Quite than conducting criminality, these ships were likely “hiding from competitors,” in response to Welch. 

Unmasking hidden details: “We may not all the time give you the option to see what vessels are doing,” coauthor Tyler Clavelle, a knowledge scientist on the nonprofit Global Fishing Watch, acknowledged in an announcement.   

“But knowing after they’re intentionally hiding their movements provides helpful information that managers and scientists didn’t have before,” Clavelle added. 

Investment firm buys nearly $2B in trees

A Wall Street company is betting nearly $2 billion on a climate-saving technology that’s each cutting-edge and potentially lucrative: trees, The Wall Street Journal reported.

  • Oak Hill Advisors — a subsidiary of T. Rowe Price — is generally known for purchasing up corporate debt. 
  • However it is now leading a consortium to purchase up 1.7 million acres of forest for
    $1.8 billion. 

That investment is an element of a recent wave of broad interest and funding of forestry. 

Market opportunity: In doing so, Oak Hill hopes to construct a wealthy storehouse of assets that could be sold to polluters participating in regulated carbon markets, like California’s cap-and-trade system. 

A right away growth opportunity exists in so-called “voluntary carbon markets,” by which corporations should buy into carbon reduction schemes at levels above those required by their governments. 

Oak Hill could sell to corporations that may need to use the credits — created because the growing trees pull carbon dioxide from the atmosphere — to offset investor concerns about their emissions levels or as a marketing tool to deflect a public relations hit around greenhouse gas emissions. 

Contracting out: Oak Hill is partnering with Houston-based environmental services company Anew to oversee its 56 recent properties, that are mainly hardwood deciduous forests east of the Mississippi, in response to the Journal. 

  • A lot of these properties are so-called working forests income has traditionally come from logging. 
  • Anew plans to scale down logging levels to 10 to twenty percent — down from prior levels of 80 to 90 percent — in favor of growing a longer-term investment. 

Those involved in the hassle say they’re the difficulty when it comes to “a long time, not years.”

Long-term bet: With carbon markets still a comparatively young phenomenon, Oak Hill is aiming to let its recent investments vest.

  • In May, for instance, the London Stock Exchange Group announced a recent trading marketplace for carbon funds, in response to an announcement issued on the time. 
  • “Ultimately, making a balance sheet of those assets needs to be helpful because everyone else has it on the liability side,” Adam Kertzner, an Oak Hill senior partner, told the Journal. 
  • Kertzner was referring to the considerable emissions most corporations may have to eliminate or offset, a necessity far larger than the available supply of high-quality credits. 

More investment needed: The worlds of forestry, finance and tech are increasingly converging, industry experts told cleantech news site Greenbiz. 

  • Further investment could unleash a flood of “natural tech,” Angeline Chen of coral reef protection nonprofit Global Coralition told the audience at a clean energy conference last week.  
  • A primary problem concerns high-tech limitations — it is difficult to define and measure how much carbon a forest has stored or lost. 

Don’t delay: “I feel like too often we sort of wait for the right measurement, we wait for the right definitions, we delay motion, and everybody points at one another and nothing changes,” Martha Stevenson, director of forestry research and strategy on the World Wildlife Fund, told Greenbiz. 

“Don’t wait for perfect numbers — just start,” she added.

Daylight saving time could reduce deer-car collisions

The everlasting imposition of daylight saving time would result in dramatically lower rates of collisions between cars and deer, a recent study has found. 

The change to a permanently later sunset would save greater than 30 human lives, greater than 30,000 deer lives and nearly $1.2 billion per 12 months, in response to the study, published in Current Biology.

Dramatic difference: By analyzing greater than one million deer-vehicle collisions, the team found that collisions are 14 times more likely within the two hours after sunset than before. 

And the week following the “fall back” to plain time sees a 16 percent uptick within the crashes.

  • “It surprised me how striking this pattern was, of how way more likely deer are to get struck within the hour or two after darkness,” first writer Calum Cunningham of the University of Washington said in an announcement.
  • “This one-hour shift in human activity could have such a major effect,” Cunningham added.  

Didn’t this occur? Form of. Last 12 months, the Senate voted unanimously to pass the Sunlight Protection Act of 2021, which made daylight saving time everlasting. However the bill has been in limbo within the House.

Water Wednesday

Winter is coming within the U.S. West, Ian’s damage to Florida waterways could last for months and why Germany is asking for deep-sea mining to halt before it’s even begun. 

Snow in store for U.S. West 

  • A storm system coming in from Canada is predicted to bring snow to all
    11 Western states
     over the following two days, in addition to a tornado threat to the South, CNN reported. The Sierra Nevada region will likely receive from 1 to
    4 inches of snow, while the Rockies will likely be hit hard because the cold front moves east, in response to CNN. 

Florida’s waterways could stay contaminated for months 

  • Within the aftermath of Hurricane Ian, residents are concerned that Florida’s waterways could remain contaminated for months, The Washington Post reported. Weeks after Ian’s departure, a whole lot of pollution reports — most linked to sewage system leaks — have been filed to the state’s environment agency, in response to the Post. 

Germany says ‘nein’ to undersea mine 

  • Germany is asking for a “precautionary pause” on all deep-sea mining until the there’s sufficient research and regulation to make sure that the marine environment “will not be seriously harmed,” a national representative wrote in an announcement to the U.N. Costa Rica, Recent Zealand, Chile and Spain have made similar proposals, but Germany is the most important economy to call for a pause. 

Please visit The Hill’s Sustainability section online for the online version of this text and more stories. We’ll see you tomorrow.


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