Politics of climate change put corporations in tough spot

• September 01 2019
• http://www.jamaicaobserver.com/sunday-finance/politics-of-climate-change-put-corporations-in-tough-spot_173708

The polarising politics of climate change have forced companies to choose between supporting the Trump Administration's deregulation policies that could boost profits, or opposing them to win over environmentally conscious consumers.

That dynamic played out again Thursday when President Donald Trump's Environmental Protection Agency sought to revoke regulations on methane gas emissions from oil facilities. British Petroleum, ExxonMobil and Royal Dutch Shell voiced opposition to the plan but smaller oil and gas companies welcomed the possibility.

Before that, it was the auto industry grappling with a proposal to loosen fuel economy requirements. And this summer, it was electric utilities dealing with lower pollution standards for coal-fired power plants.

Some corporations have acted against conventional thinking by showing a willingness to forego short-term profits in favour of long-term planning and combatting global warming. But it comes at the risk of hurting their bottom line while also incurring the wrath of Trump on Twitter.

“It's particularly a problem for any industry that is capital intensive,” said Tim Calkins, a marketing professor at Northwestern University. “I think almost every industry where there are long-term investments and there's a long- time horizon, they're going to be looking at questions around this.”

Experts say a lot goes into the decision of whether to support or oppose regulations, and there may not be agreement within an industry or even inside a corporation. Industries clearly have benefited from deregulation. For example, at the behest of trucking companies, the Administration is working to ease restrictions on the hours truckers can drive.

But public image is also a big part of a company's stance, especially with the nastiness of today's politics and social media amplifying people's opinions. Millions are spent on ads trying to convince consumers that companies are good citizens and aren't out to destroy the environment, said Erik Gordon, a professor of business and law at University of Michigan.