Biden may use financial pressure to drive climate policy
Published Date: 11/13/2020
Source: axios.com
Joe Biden's presidency could bring new efforts to use regulation on Wall Street and action from the Fed and the Treasury to press big companies to take climate change more seriously.Why it matters: There's a lot of pent-up interest in employing financial regulation to promote better disclosure of climate-related risks and to pressure companies to cut emissions.It's hardly a new thing for the climate movement, but advocates see a chance to have an ally in the White House now, and it's on the minds of influential figures including Sen. Elizabeth Warren.Democrats' slim odds of Senate control are only adding to pressure for a government-wide strategy that goes beyond agencies that directly oversee energy and environment.Driving the news: The Climate 21 Project posted a new agency-by-agency set of recommendations from advocates that count a number of senior Obama-era people in their ranks. The transition memo with goals for Treasury include...Immediately appoint a special counselor for economic growth and climate.Work with financial regulators to develop climate-focused priorities and "regulatory initiatives."Elevate the topic's prominence within the Treasury-led Financial Stability Oversight Council.Where it stands: They're not alone.Evergreen Action, a new(ish) group that includes former campaign aides to Warren and Jay Inslee, a few weeks ago offered a bunch of ideas, ranging from Fed "climate stress tests" of large banks to pressuring them to create decarbonization strategies. They also want appointees to a range of agencies — like FDIC, the Comptroller of the Currency — committed to addressing climate risks.The umbrella Stop the Money Pipeline coalition, which includes lots of groups on the left flank of the green movement, is calling for a "true climate hawk" to be Treasury secretary.What we're watching: Personnel and the transition. For instance, Fed governor Lael Brainard is reportedly a leading Treasury candidate and she gave a widely covered speech in late 2019 noting that climate-related risks are "projected to have profound effects on the U.S. economy and financial system."Plus, the "agency review teams" unveiled this week by the Biden transition office already include people with a climate background.The Treasury team includes Andy Green, a former SEC lawyer currently with the liberal Center for American Progress. He co-authored a memo this year arguing that financial regulators must take "swift and aggressive steps to measure and mitigate climate-related risks and impacts."Several other members of the teams also have a history of working on climate. E&E News points out that the team handling the Fed, banking and securities includes Amanda Fischer, "a vocal advocate of the Fed accounting for climate risk and a former chief of staff to progressive Rep. Katie Porter (D-Calif.)."The Fed has already been stepping up its work on climate-related risks to the financial system lately.