Impact Investing’s ‘Moment of Truth’ as Trump Exits Paris Accord

He did it. President Donald Trump announced Thursday that the U.S. is withdrawing from the Paris climate accord, just like he said he would during the presidential campaign, but with a caveat, saying the U.S. would also start to negotiate for a new deal “that’s fair” to the U.S., its workers and taxpayers.

Whether that’s even possible is questionable since 194 countries have already committed to the deal to cutting greenhouse-gas emissions in an attempt to keep average global temperatures from rising more than 2 degrees Celsius, or 3.6 degrees Fahrenheit, above preindustrial levels.

Andrei Cherny, CEO of Aspiration, which manages the Aspiration Redwood Fund (REDWX), who worked in the Clinton White House on sustainability issues, said that such a renegotiation “is not going to happen. This thing will not get reopened. The rest of the world is doing a happy dance as the U.S. walks away from growing the new economy.”

The withdrawal leaves the U.S. as only one of three countries — the others are Nicaragua and Syria — to have not signed the accord. Even Russia supports the accord, and hours before Trump revealed his decision — delayed a day as White House insiders wrangled and corporate executives lobbied against a withdrawal — the Kremlin iterated its position.

In making his announcement, Trump said that withdrawing from the Paris accord “is in America’s economic interest and won’t matter much to the environment.”

Supporters of sustainable investments disagree, given the fact that the U.S. is the world’s second biggest producer of greenhouse gases, after China.

“This is the moment of truth for sustainable investing … to push companies to do the right and smart thing. Without government pushing companies to take environmental action, it’s up to individual companies to make that decision and those companies that do so will reap the rewards.” And it’s up to individual investors to push those companies as shareholders, says Cherny.