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November 05, 2012
For Sustainable Investors, Obama or Romney?
    by Robert Kropp

The candidates differ markedly on climate change, financial reform, and health care, issues on which sustainable investors have engaged with corporations for many years.

A couple of weeks ago, Forbes Magazine published a brief but interesting take on tomorrow's presidential election. Entitled Which Presidential Candidate Will Increase Corporate Responsibility?, the business-friendly publication concluded that neither President Obama nor candidate Romney would, because business leaders adopt corporate social responsibility (CSR) as a corporate strategy on the basis of self-interest, and not in response to regulation.

In a regulatory environment where CSR reporting remains voluntary, there is undoubtedly an element of truth in the response by corporate executives to the question posed by Forbes. But as Lisa Woll, CEO of
US SIF: The Forum for Sustainable and Responsible Investment, stated in 2011, "We could spend the next 40 years getting companies to have better carbon footprints and doing less damage to the climate, or we could get a bill that addresses it."

And 40 years may be a span of time that the planet's inhabitants no longer have. As Mindy Lubber, president of
Ceres, warned earlier this year, "Sustainability has yet to gain traction at anywhere near the scale and speed required given the global threats we face."

So the question for those going to the polls tomorrow will be, which candidate is more likely to oversee the restoration of a national economy in the early stages of recovery from the financial crisis, while seeking to embed within that recovery the environmental and social justice required for sustainable development? Obama and Romney offer starkly different views on how to go about realizing these goals.

As much as too many climate deniers in Congress wish it were otherwise, climate change is the single most important sustainability issue confronting us today, as recent destruction by Hurricane Sandy reminds us. Obama's record on climate change may not be all that environmentalists wish for, and its absence from this year's Presidential debates is a reminder that politics as usual is among the many significant impediments to meaningful action in a rapidly narrowing time frame.

However, ambitious fuel economy goals have been established, and the Environmental Protection Agency (EPA) has established new rules for mercury emissions and greenhouse gas (GHG) reporting from the largest emitters. Obama's 2009 economic stimulus provided an estimated $90 billion for renewable energy technologies, and wind energy in particular has accounted for a significant portion of new energy installations since then.

Where Romney stands on climate change can be somewhat difficult to discern. In 2010, he wrote, "I believe that climate change is occurring—the reduction in the size of global ice caps is hard to ignore. I also believe that human activity is a contributing factor."

However, "I do not support radical feel-good policies like a unilateral US cap-and-trade mandate," he continued. "Such policies would have little effect on the climate but could cripple economic growth with devastating results for people across the planet."

Then, in 2011, while he was seeking the Republican nomination, Romney said, "My view is that we don't know what's causing climate change on this planet."

On the subject of financial reform, sustainable investors spoke out loudly in support of the Dodd-Frank legislation that attempted to return a semblance of a regulatory framework of a financial industry that by causing the financial crisis clearly demonstrated its inability to govern itself. When the President signed the legislation in 2010, he said, "Our financial system only works—our market is only free—when there are clear rules and basic safeguards that prevent abuse, that check excess, that ensure that it is more profitable to play by the rules than to game the system."

Romney, on the other hand, has stated his intention to "repeal and replace" Dodd-Frank. While he has not offered much in the way of explaining what replacements he might have in mind, his widely circulated comment about writing off 47% of the electorate provides critically important insight as to his allegiances.

Obama has been criticized, often with justification, for not pushing hard enough on the issue of climate change. His reliance for financial advice on an inner circle of powerful representatives of financial institutions has met with concern as well. But one issue that he fought for relentlessly, with the widespread support of the sustainable investment industry, has been health care. The Affordable Care Act, passed in 2010, will extend health insurance coverage to tens of millions of Americans.

While Romney was governor of Massachusetts, he signed into law a health care law similar in many respects to what is now widely known as Obamacare. As a presidential candidate, however, he now says he will repeal the Affordable Care Act on day one of his term, should he be elected.

Get out and vote!


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