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Kamala Harris and Donald Trump couldn’t be further apart when it comes to climate change, and the election will have profound impacts for how the country—and the world—addresses the issue going forward. But no matter the election results, companies should think about new ways to talk about climate change.
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In the years following the emergence of climate change as a global issue, companies often portrayed their environmental initiatives as efforts to “do the right thing.” Since then, the business case for acting on climate change has become stronger, from regulatory pressure to cut emissions to the effects of extreme weather on supply chains. Yet, rather than pivoting to talk about the business case, for many companies the “do the right thing” messaging approach persists. Other businesses have simply tried to avoid talking about the topic publicly, fearing political backlash.
“Businesses are often facing a ‘damned if you do, damned if you don’t’ situation on climate action,” says María Mendiluce, CEO of the We Mean Business Coalition. “This has to change.”
Potential Energy Coalition, a non-profit marketing firm that works on climate change, collaborated with We Mean Business on some research into this topic, and their findings suggest a different way forward. The non-profit convened a series of surveys and focus groups with consumers and retail investors to interrogate their views on how companies talk about climate change. The research found that the vast majority of consumers believe companies have a responsibility to act on climate, but that many are turned off by suggestions that it’s a moral imperative. On the other hand, talking about the costs and benefits of acting—in other words, the “materiality” of acting—faces limited opposition.
“The data is really clear. If you position it as a morality issue or political issue, you’re going to impress a lot of people, and you’re going to upset a lot of people,” says Potential Energy CEO John Marshall. “That doesn’t work very well for a business.”
The solution, according to the research, is fairly simple. Talk about the risks extreme weather poses to infrastructure, about participating in growth markets, and about the real financial impacts. Indeed, the research found that consumers and retail investors across the political spectrum expect that firms should evaluate the implications of climate and clean energy on the business. At the same time, the research says businesses should avoid talking about “right and wrong,” and skip loaded, amorphous words and phrases like “sustainability” and “ESG,” short for environment, social, and governance.
Anchoring business discussions of climate in their financial materiality would be a crucial move in the event of a Trump victory next week. In recent years, Trump and Republicans in Congress have targeted ESG initiatives and claimed that companies engaged in them are wasting money in the interest of so-called “virtue signaling.” Explaining climate efforts in financial terms could help, at least to some extent, avoid some of those critiques. It would also give companies language to fight back against potential Trump-led environmental rollbacks.
But, even if Harris wins, it will be useful for companies to rethink their language. A “materiality” lens appeals to a broader consumer audience—while minimizing risk of a backlash. And it could help make political headway as policymakers increasingly worry about spending money on anything that could raise costs.
It’s also just true that climate change is having material impacts for companies, consumers, and investors. To my mind, it’s more useful for society if companies tell us about those impacts than explain right and wrong.