The last few weeks have been among the most wrenching in our nation’s history, marked by insurrection and violence in the nation’s capital, loss of lives and an unprecedented second impeachment. As we work through the aftermath of these disturbing events, we all hope that justice will be served and national unity will be restored. But as the Biden administration assumes office, there is probably no better time than now to start looking forward as well.    

With the smoke clearing from the Capitol and President Biden announcing his final cabinet nominees just before his swearing in, we can also be encouraged by the clearer picture that is emerging of what the Biden‑Harris administration will look like across a range of issues, including climate change. In contrast to the previous administration, Biden’s nominees and appointees are seasoned public policymakers who reflect our nation’s rich racial, ethnic and gender diversity. 

Climate focus

President Biden’s climate and environment picks, in particular, have the experience, expertise and track records that will be needed to implement his ambitious climate agenda. A new White House Office of Climate Policy led by special presidential envoy, former Secretary of State John Kerry, will assuage international allies that the United States is ready to rejoin the Paris Climate Agreement, something Mr. Biden has pledged to do immediately, and play a leadership role in global efforts to advance net-zero carbon emissions. Former EPA administrator Gina McCarthy will oversee the massive cross‑agency effort to implement the Biden climate plan and put the U.S. on track towards net-zero carbon domestically.

At the Environmental Protection Agency, nominee Michael Regan is expected to reverse damaging Trump-era regulatory rollbacks and restore morale at an agency whose beleaguered scientists and other professionals will be charged with bringing the Biden climate plan to life. With a record of achievements on energy efficiency, air quality, pollution and climate already behind him, Regan seems up to the task.1

Other nominees with strong climate credentials include New Mexico Congresswoman Deb Haaland as Secretary of the Interior — she  will be the first indigenous person to hold a cabinet position — and former Michigan governor Jennifer Granholm for Energy secretary. Granholm “envisions clean energy investments and deployments that create millions of good union jobs and support a stronger, more inclusive middle class.”2

Attorney General nominee Merrick Garland, whose Department of Justice will prosecute enforcement cases under environmental laws like the Clean Air Act and Clean Water Act, has a strong environmental background as well, having sat for more than two decades on the DC Circuit Court of Appeals where he has decided many cases involving federal air, water and energy policies. 

Environmental justice

Collectively, Biden’s nominees and appointees signal that, as pledged,1 environmental justice will be a much greater focus for the new administration. EPA nominee Regan has long acknowledged the link between pollution and public health and created an environmental justice advisory board as North Carolina’s top environmental regulator. Brenda Mallory, Biden’s pick for chair of the White House Council on Environmental Quality, is set to expand the Council’s focus on environmental justice.2 And, importantly, Vice President Kamala Harris literally wrote the bill on environmental justice, the Climate Equity Act of 2020,3 which aims to address racism in environmental policy.4 That bill died in committee but may be reintroduced in the new Congress.

This is a welcome development that ties into our work here at Impax, where we are engaging with companies on issues including hazardous chemical substances threatening health in minority communities and racial discrimination arising from facial recognition software and algorithms used to assess creditworthiness.5

Diversity

Perhaps most remarkable about the Biden-Harris cabinet is the equal representation of women and men — 12 of each. It’s also the most racially and ethnically diverse cabinet in our nation’s history. The importance of this cannot be overstated. Diverse organizations tend to make better decisions than homogeneous ones. We know this from the work we do, and we know this because it is underscored by a massive body of research. We believe the diversity of the Biden‑Harris cabinet is likely to lead to greater collaboration, less groupthink, less herd behavior, more innovation and better results.1 This could be particularly critical in connection with the administration’s audacious climate goals: To arrest this existential global threat, we’ll need a multitude of solutions, and research has shown that more diversity in climate‑related decision‑making positions could help deliver them.

As President Biden said when announcing his final picks: “This is a cabinet … that looks like America. It taps into the full range of talent we have in our nation.”3

Congressional and executive action

As noted by others, the Biden climate plan is ambitious: $2 trillion in investments in clean energy, low-carbon transport, building energy efficiency and infrastructure over four years; targeting zero-emissions power generation by 2035 and a net-zero economy by 2050; and the creation of about 12 million jobs, which means that Biden’s climate plan is a cornerstone of his economic recovery plan.

As the new administration embarks on these ambitious plans, there will much to undo and reconstruct in the weeks and months ahead, such as reversing environmental rollbacks at the EPA and reversing Department of Labor and SEC rules that exclude ESG funds from retirement plans and make proxy voting more onerous for investors. Most of these public policy reparations will fall to the nominees, and Biden has pressed the Senate to quickly confirm them. However, smooth sailing is not assured. Lawmakers in big oil states, for example, may challenge the nomination of Janet Yellen as Treasury secretary, not because of her qualifications but due to her past support for a carbon tax.1

In December, the Federal Reserve showed a new willingness to adapt by finally joining the Network for Greening the Financial System, a group of central banks that focus on the risks associated with climate change. The move, which Fed chair Jerome Powell made despite the protestations of 47 Republican lawmakers,1 is one of many signals that climate change deniers will no longer hold sway in the nation’s capital. 

Finally, and perhaps most importantly, the new administration will only be able to accomplish so much through executive and administrative measures. Indeed, it would not be surprising to see the conservative majority on the Supreme Court weigh in to further limit those prerogatives. Much of the Biden-Harris agenda will ultimately depend on  legislative action by Congress. The special elections in Georgia were critical in this regard, delivering to Democrats a thin “majority” in a 50-50 U.S. Senate where Vice President Kamala Harris, as President of the Senate, will be able to cast a deciding vote. It is too early to tell how this will play out. It depends in part on whether Republican leader Mitch McConnell can marshal all 50 of his Republican votes, and whether Democrats can summon and hold all 50 of theirs on a given piece of legislation. On environmental legislation, for example, Democrats like Senator Joe Manchin (D-WV), who represents coal country, will bear watching. That said, and despite Mr. McConnell, the filibuster and other challenges, the Democrats will effectively control both houses of Congress and this means the Biden-Harris climate agenda is more likely to include a robust legislative component.

Whether the new administration and Congress can deliver on an ambitious climate agenda remains to be seen. And our nation obviously has some healing and self-reflection to do in the months ahead. Despite our divisions, however, there is reason for optimism, not only on climate but on a range of issues that are important to the American people, and, in particular, those who have been left behind by an imperfect economy and an imperfect union. We have important work ahead of us. Here at Impax, we pledge to do everything we can to make a positive contribution in this regard. 


1 The Website of the Office of President-elect Joe Biden, 2021, Michael Regan, Environmental Protection Agency Administrator | President-Elect Joe Biden (buildbackbetter.gov), Accessed Jan. 12, 2021

2 https://www.BuildBackBetter.gov, last accessed Jan. 10, 2021

3 The Website of the Office of President-elect Joe Biden, 2021, https://joebiden.com/environmental-justice-plan, Accessed Jan. 11, 2021.

4 Lisa Friedman, “With the Biden-Harris Ticket, Environmental Justice Is a Focus,” The New York Times, Aug. 12, 2020.

5 The Website of Senator Kamala Harris, 2021, https://www.harris.senate.gov/news/press-releases/harris-ocasio-cortez-introduce-landmark-legislation-to-empower-frontline-communities, Accessed Jan. 11, 2021

6 Lisa Friedman, “With the, Biden-Harris Ticket, Environmental Justice Is a Focus,” The New York Times, Aug. 12, 2020.

7 Julie Gorte, “The Racial Geography of Pandemic Mortality,” Impax Asset Management LLC, Dec. 16, 2020.

8 Julie Gorte, “The Financial Impact of Diversity,” Impax Asset Management LLC, July 16, 2020.

9 Julie Gorte, “Gender Equality and Climate: Synergies,” Impax Asset Management LLC, April 13, 2020.

10 AFP, “Biden Promises Economic Help Is on the Way,” Jan. 8, 2021.

11 Amanda Shendruk, “Janet Yellen Supports a Carbon Tax, But What Exactly Does That Mean?” Quartz, Nov. 26, 2020.

12 Katanga Johnson, “Fed Joins Global Club of Peers in Climate Change Fight,” Reuters, Dec. 15, 2020.

 IMPX-20210119-0052

Joseph Keefe

President

Joe is President of Impax Asset Management LLC, the North American division of Impax Asset Management Group and investment adviser to Pax World Funds. Based in the Portsmouth office, he is responsible for US managed strategies as well as distribution of Impax’s full capabilities across North America.

Prior to joining the firm in May 2005, Joe was President of NewCircle Communications, a strategic consulting and communications firm specializing in corporate social responsibility and public policy communications. He served as Senior Advisor for Strategic Social Policy at Calvert Group from 2003-2005 and as Executive Vice President and General Counsel of Citizens Advisers from 1997-2000. He is a former member of the Board of Directors (2000-2006) of US SIF, the trade association representing asset managers and investors engaged in sustainable investing throughout the United States. Before entering the investment management industry, Joe worked in private law practice for 16 years.

Joe holds a Juris Doctor from the University of Virginia School of Law and a Bachelor of Arts in philosophy from the College of the Holy Cross.

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