The following is an excerpt from Jon Hale, Ph.D., CFA | June 8, 2017 | morningstar.com |
President Donald Trump's decision to withdraw from the Paris climate agreement may be a setback for the United States as a global leader, but not for global efforts to combat climate change, and investors are playing a key role.
The decision is a setback for U.S. global leadership, as it in essence gives up a seat at the table where major decisions will be made affecting climate change and the global economy. Instead of a rash of countries following Trump's lead and pulling out of the agreement, we're likely to see bolder commitments to it from the rest of the world, with both the European Union and China taking on leadership roles.
Within the U.S. over the past week, we've seen cities, states, businesses, and universities reaffirm their commitments to the agreement. Led by California, New York, and Washington, the U.S. Climate Alliance (12 states plus Puerto Rico as of June 5) "is committed to upholding the Paris Accord and taking aggressive action on climate change." The Mayors National Climate Action Agenda, endorsed by 257 mayors of American cities as of June 6, promises to uphold the goals of the Paris agreement and "intensify efforts" to meet their cities' climate goals and "work together to create a 21st century clean energy economy." And finally, more than a thousand universities, businesses, and investors have signed a declaration of their intent "to continue to ensure the U.S. remains a global leader in reducing carbon emissions."
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