On the subject of climate change, it appears President Trump has started his administration the way he means to go on. From the wholesale denouncement of global warming as a ‘hoax,’ to the appointment of environmental naysayers Scott Pruitt and Rick Perry as head of the Environmental Protection Agency (EPA) and Department of Energy respectively, his presidency looks set to be characterised by an attempted rejection of science and mistrust of all those with climate-related expertise. To the extent that climate change deniers support Trump’s agenda, including the backing of fossil fuel generation, he will continue to promote their dissenting voices.
Undoubtedly, this is a development that will preoccupy the minds of investors, not least those with an emphasis on environmental, sustainable, and thematic (EST) investment within their portfolios. It is all the more concerning given the recent conclusion from the UK Met Office and NASA that sixteen of seventeen hottest years on record have occurred since the year 2000, and the World Economic Forum (WEF) declaration that climate change is the one of the most impactful risks currently facing our planet. Yet, despite the grave warnings from various authoritative bodies, Trump is in the midst of repealing many of his predecessor’s policies on the subject, including the ‘Clean Power Plan’ (CPP), the blueprint by which the US intended to meet its wide-ranging commitments under the 2015 Paris Climate Change Agreement.