To get ahead, corporate America must account for climate change
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Scott Pruitt’s confirmation last week as chief of the Environmental Protection Agency was a setback for environmentalists and scientists who waged a fierce campaign against the nominee.

As Oklahoma's attorney general, Pruitt led or took part in 14 lawsuits that sought to block EPA regulations and policies intended to tackle climate change. In addition, his views on global warming put him at odds with both the stated positions of many companies and their current policies toward climate change.


Pruitt is one of many announced appointees who is hostile to efforts aimed at reducing emissions linked to global warming. Many in the administration are skeptical that climate change is caused by human activity or doubt its consequences will be significant. President Trump has expressed extreme skepticism about climate change, calling it a hoax created by China. 


Despite the skepticism from the administration, most industry leaders fully accept that climate change is real and is caused by humans. Crop production is shifting. Extreme events, such as heavy precipitation, droughts, and more powerful tropical storms, are more common or happening in places that normally wouldn’t see them.

Extreme heat waves are imperiling people around the world and affecting the productivity of those who must work outdoors. Drought, heat, and pests are damaging forests and setting the stage for wildfires. Moreover, global sea levels are rising. 

No matter what the White House says, corporate America cannot escape the effects of climate change. These changes can threaten supply chains; affect location decisions should key resources become scarce; damage important infrastructure, such as electricity, transportation and communication systems; threaten workers' health; or shut down local economies for extended time periods during extreme weather events. 

Most nations, including key U.S. trading partners (Canada, Mexico, Europe), are proceeding with policies designed to mitigate greenhouse gases. Exported U.S. products from a revamped U.S. manufacturing sector will need to meet these standards and compete in places with carbon pricing or other regulations that favor low-carbon technologies. 

An innovative corporate America, along with the rest of the nation, can benefit from developing low-carbon technologies and other greenhouse gas-reducing options. China has aggressively moved to develop its manufacturing capability for wind turbines, photovoltaics, and nuclear power.  

Is this altruism on the part of the Chinese, with these technologies aimed at its domestic market, or a realistic evaluation of the global demand for clean energy that can create new export markets? My guess is the latter, not the former.  

Thinking ahead is a competitive advantage — companies that adapt to changing markets will survive and prosper. Of course, many of America’s top companies have global reach, producing and selling around the world. A U.S. presidential administration that ignores climate change will be a short-term blip.

I recommend corporate America mostly ignore that blip and continue to develop low-carbon technologies and production processes. They will be competitive in the emerging clean energy market that is taking hold globally. Eventually, American companies will prosper domestically when science-based evidence undergirds policy initiatives again. 

For the U.S. to be a haven for forward-looking companies, it needs to lead on climate change, not deny that it is happening. Corporate America will need to continue to grapple with climate change, regardless of the direction of the new administration. The future of corporate America would be better served if the administration embraces scientific evidence and gets down to the business of deciding what to do about it.


John Reilly is senior lecturer at the Massachusetts Institute of Technology Sloan School of Management and co-director of the Joint Program on the Science and Policy of Global Change, Center for Energy and Environmental Policy Research.

The views expressed by contributors are their own and not the views of The Hill.