Audit, Compliance and Risk Blog

Organizations around the world are responding to the latest climate-related risk assessment produced by the Intergovernmental Panel on Climate Change (IPCC), which replaced earlier cautionary information with an urgent warning that climate change is “widespread, rapid, and intensifying.” On August 31, the US Federal Insurance Office (FIO), an element of the Department of the Treasury, published a “Request for Information on the Insurance Sector and Climate-Related financial Risks” (RFI) in the Federal Register, posing 19 questions it will use to focus its application of climate-related risks to the domestic insurance sector. Insurers should obviously be interested in these questions and their answers, but any entity that buys insurance should consider them as well. The remainder of this note summarizes FIO’s questions.

On April 30, 2021, the US Environmental Protection Agency (EPA) proposed rules to phase down production and consumption of specified hydrochlorofluorocarbons (HFCs), consistent with directives included in the 2016 Kigali Amendment to the United Nations-sponsored Montreal Protocol on Substances that Deplete the Ozone Layer. These rules were authorized by the massive coronavirus relief bill (American Innovation and Manufacturing Act of 2020 (AIM Act)) enacted in December 2020, which included dozens of unrelated provisions within its 5,593 pages.

President Biden is moving quickly to review and revise many of former President Trump’s administrative actions. As I discussed HERE, the fastest mechanisms for these reversals are executive orders (EOs) and slightly less formal executive memoranda from the President or his agency heads. One of the EOs signed on president Biden’s first day of office starts immediate action to review all Trump administrative actions. EO 13990 of January 20, 2021, “Protecting Public Health and the Environment and Restoring Science To Tackle the Climate Crisis”, applies to all federal agencies but focuses on President Trump’s environmental actions. The remainder of this note discusses this particular EO. 

President Biden and the Democratic majorities in Congress have announced sweeping plans to reverse most of the Trump Administration’s environmental policies. The timing and practicality of these reversals depends very much on each of the targeted policy’s legal status – laws, regulations, Executive Orders, or guidance documents. The remainder of this note comments on each of these sets of situations, highlighting examples of each. I’ll discuss them in order ranging from quickest/easiest to most time consuming/difficult.

Even if the latest polar vortex has ended by the time you read this, employers in most parts of the continent should be worrying about protecting workers against winter weather. Occupational safety and health regulators include “environmental” hazards as those that may require employers to provide their employees with personal protective equipment (PPE), and employers also bear a “general duty” to protect workers against recognized hazards. These requirements cover potential harm from extreme temperatures including cold, as well as slippery surfaces and other hazards from frozen and melting snow or other precipitation.

Although carbon dioxide (CO₂) is the most common and most-discussed greenhouse gas (GHG), it is by no means the only one. And on a per-unit basis, it is by no means the most potent GHG either. Air quality agencies and climate change scientists also focus attention on so-called “short-lived climate pollutant (SLCP)” means an agent that has a relatively short lifetime in the atmosphere, from a few days to a few decades, and a warming influence on the climate that is more potent than that of carbon dioxide. Individual jurisdictions have addressed individual SLCPs, but comprehensive approaches have been limited.In 2014, California legislation assigned that state’s Air Resources Board (ARB) to adopt a SCLP Reduction Strategy (I wrote about the legislation and 2016’s draft strategy here).

While domestic climate politics in the U.S. and Canada generate hot air about the reality and urgency of climate change, climate science proceeds largely on its own pathways, and climate policies to reduce greenhouse gas (GHG) emissions are being proposed and developed by a wide variety of entities. On November 23 – often referred to as “Black Friday” by retailers and shoppers in the U.S., regardless of their attitudes about global warming – the U.S. government’s U.S. Global Change Research Program (USGCRP) delivered urgent recommendations for aggressive policies. This Fourth National Climate Assessment (NCA4) builds on last year’s Climate Science Special Report (which I wrote about here).

Many of the items that make their way into your home are designed with only one purpose in mind.  After you’ve opened up a bottle of champagne, the cage and cork become destined for the landfill.  Once you’ve eaten all of the fruit out of the colourful plastic mesh bag, it can’t be recycled and it’s pushed into the trash bin.  You can sit around getting blue about all the waste that abounds or you can do what I do and give those items a second chance at life.

On February 12, the Trump Administration issued its budget proposal for federal Fiscal Year (FY) 2019 (October 1, 2018 through September 30, 2019), subtitled “An American Budget”. The proposal included a 34% cut in the Environmental Protection Agency (EPA) budget, from $8.2 billion in FY 2016 (stable in FY 2017 and FY 2018 under a Continuing Budget Resolutions rather than a fully-new federal budget), to $5.4 billion for FY 2019, with corresponding personnel cuts from 15,408 full-time-equivalent employees (FTE) to 12,250. (these are numbers for EPA in the government-wide budget from the Office of Management and Budget (OMB); the stand-alone budget document on EPA’s website cites $6.1 billion).