A senior executive at JPMorgan Chase & Co. says it’s wrong to assume that the shift in US politics under President Donald Trump means the world’s largest economy has become hostile territory for green investors.
Chuka Umunna, global head of sustainable solutions at the biggest US bank, said in an interview with Bloomberg Television’s Tom Mackenzie that the Biden administration’s signature climate law — the Inflation Reduction Act — is so popular in Republican states that the GOP has had to acknowledge it can’t undo it.
It’s why the speaker of the House of Representatives, Mike Johnson, has said Republicans are “likely to take a scalpel but not a sledgehammer” to the IRA, Umunna said. “To be honest, whatever you think about climate change, the one thing where there is consensus is that we need more energy and we need it in abundance.”
And that will require more electrification and more renewables, he said.
Trump himself has made clear he regards the climate policies of his predecessor with derision, referring to the idea of climate change as a “hoax” and instead embracing the fossil-fuel industry with a mantra of “drill baby drill”.
What’s more, the net zero goal to which a lot of green investing is pegged has been dubbed “terrible” by Trump’s energy secretary.
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Despite such political rhetoric, the direction that US policy is now taking does “not necessarily” mean the US is becoming a less desirable destination for green investments, Umunna said.
In the same interview, the JPMorgan executive said that Europe’s intensified focus on defense spending shouldn’t take the bloc’s attention away from the green transition, which he described as key to national security.
“To separate out the need for energy from your defense and national security capabilities is probably not very wise,” Umunna said.
At the same time, he underlined the need to steer investment toward assets and sectors that can generate profits.
“It’s got to deliver a return,” Umunna said. “There are very few, if any, investors who are prepared to sacrifice a decent return — total shareholder return — for sustainability. They are investing in this space because they see it as delivering profitability, adding value. This isn’t like altruism.”
