Today’s ESG Updates
- Trump Imposes Tariffs on EU: Trump has announced plans to introduce tariffs on the EU with German automakers being the most affected.
- Vanguard Moderates Diversity language: Vanguard has changed its diversity board guidelines to align with a shift in US standards.
- Microsoft’s Big Carbon Deal: Microsoft and Chestnut Carbon signed a 25-year deal for carbon removal credits.
- Banks Still Short of Energy Targets: Banks continue to invest in clean energy but are falling short of climate goals.
Trump’s imposed tariffs on the EU cause the stock market to fall
Shares across European industries have fallen in response to Trump’s EU-imposed tariff plans, with German car makers seeing up to 5% fall in shares. Germany is claimed to be hit the hardest with 30% of all EU exported transatlantic good sourced from Germany. Car giants like VW face a challenge managing their business and ESG, with its Mexico operations also being threatened with tariffs. Businesses will need to stay on top of operations with ESG solutions.
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Further reading: European carmaker shares fall after Trump imposes tariffs
Vanguard moderates diversity language for US corporate boards
Vanguard, a major mutual fund manager with $10.1 trillion in assets, removed specific guidance urging US companies to include women and minority directors on their boards. This change reflects shifting corporate diversity dynamics amid pressures from the Trump administration. Vanguard, which does not set quotas, aims to align with regional standards, such as the UK’s expectation of 40% female directors. Vanguard continues to support diversity for effective board oversight, with firms like BlackRock also adjusting their diversity targets.
Photo Credit: Jamie Street
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Further reading: Vanguard dials back diversity language for US corporate boards
Microsoft agrees on 7 million ton carbon removal deal
Microsoft and Chestnut Carbon have signed a 25-year agreement for over 7 million tons of nature-based carbon removal credits from Chestnut’s forest projects in the Southern US. This deal, the largest voluntary corporate investment in US conservation forestry, involves restoring 60,000 acres and planting 35 million trees. The collaboration supports Microsoft’s goal to become carbon negative by 2030, expanding its diverse carbon removal portfolio. Chestnut’s projects focus on afforestation, reforestation, and revegetation with community and environmental benefits.
Photo Credit: Waranont (Joe)
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Further Reading: Microsoft Inks 7 Million Ton Nature-Based Carbon Removal Megadeal
Banks moving closer to clean energy goals but still falling short
According to the latest data from BloombergNEF, bank financing for fuel fuels declined by 18% in 2023, with this trend expected to continue throughout 2024/2025. Whilst the trend is in the right direction, the energy supply banking ratio is still short of the 4:1 needed to stay in line with climate goals. Businesses wanting to hit sustainability goals can make use of ESG tools to help stay on target.
Photo Credit: Andrea De Santis
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Further reading: Banks edge towards clean energy parity, but lag on 1.5C goals
Editor’s Note: The opinions expressed here by the authors are their own, not those of impakter.com — Cover Photo Credit: Ivana Cajina
