Terry Newman: Mark Carney’s plan for global climate domination

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Mark Carney’s greatest skill appears to be his remarkable ability to find a soft landing when things get complicated. His most recent exit was on Jan. 15 from GFANZ, an organization he founded and co-chaired which is now being investigated by the U.S. House Judiciary Committee for allegedly violating antitrust laws by pressuring companies to adopt net-zero goals. Whatever political motivations may be behind this probe, it indicates a major decline in popularity for the kind of climate-focused agenda Carney had been pushing.

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And what did Carney do the day after his resignation from GFANZ? He officially threw his hat into the Liberal leadership race, hoping to become party leader and prime minister of Canada.

The Glasgow Financial Alliance for Net Zero (GFANZ) was launched by Carney, who was the then-UN Special Envoy on Climate Action and Finance in April 2021.

The organization was set up as a UN-backed global coalition of financial and banking institutions in order to accelerate the transition to net-zero by 2050 in line with the Paris Agreement. GFANZ operated like an umbrella, uniting various sector-specific alliances. Net Zero Asset Managers (NZAM), which was launched in December 2020 and pre-dates GFANZ, for example, is under the umbrella.

GFANZ’s most recent troubles appear to have started on June 11, 2024, when the Republican-dominated judiciary committee in Washington released a report titled, “Climate Control: Exposing The Decarbonization Collusion in Environmental, Social, and Governance (ESG) Investing.”

The report alleged that GFANZ is part of a “climate cartel” which “colludes to decarbonize companies by leveraging negotiations with management, shareholder resolutions, and board of director votes.”

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According to the committee, “This cartel forces companies to disclose their carbon emissions, reduce their carbon emissions, and enforce their disclosure and reduction commitments by handcuffing and restricting company management.”

The committee’s stated concern was that collusion on decarbonization “necessarily causes reduced output and higher prices, including in the critical fossil fuel, aviation, and agriculture industries, posing a significant threat to the economy and to the well-being of American consumers.”

Then, on Dec. 20 of last year, the pressure on GFANZ increased, albeit indirectly.

The same committee sent letters, demanding information — communications and documents — to over 60 U.S.-based asset managers in regards to their involvement with GFANZ. Documents related to what the committee calls GFANZ’s “collusive activity” are to be used to “inform potential legislative reforms.”

On Dec. 31, GFANZ suddenly decided it would restructure. According to environmental advocacy group Global Canopy, GFANZ was originally an umbrella group for various financial institution net-zero alliances, that has now shifted to a less ambitious group formed by specific financial institution executives.

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GFANZ’s focus suddenly changed as well, shifting to “directing capital towards investments in energy transition,” when only recently its focus was the more aggressive goal of “phasing out financing for activities that do not align with the Paris Agreement.” In addition, GFANZ appears to have suddenly had a change of heart about requiring members to align with the Paris Agreement targets.

Both versions of this mission statement sound bureaucratic and benign, until you consider Carney’s words from his book Value(s): “Firms that align their business models with the transition to a net-zero carbon economy will be rewarded handsomely; those that fail to adapt will cease to exist.”

Was GFANZ’s restructuring and focus change related to the committee’s request for information? Who can tell.

Relatedly, several major U.S. banks, who had been the focus of other similar investigations, exited GFANZ’s Net Zero Banking Alliance (NZBA) in December and January, including Goldman Sachs, Citi, Bank of America, Wells Fargo, and Morgan Stanley.

Were these precipitous exits likely a result of growing skepticism towards these banks’ ESG agenda?

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ESG Dive, a trade publication that covers news about environmental and social governance, appears to think so. It noted that this shift followed pressure from U.S. Republican-led entities skeptical of ESG (environmental, social, and governance) initiatives. It’s certainly interesting timing.

It appears with GFANZ, Carney found himself in an uncomfortable situation, or at least a position that was being quickly drained of prestige.

I guess ruling Canada is a pretty OK consolation prize after the organization you founded to direct global investments towards climate experiences a mass exodus. To be fair, Carney and the Liberals have been courting each other for years.

One thing’s for sure, Carney always seems to have a backup plan when things get uncomfortable.

He prematurely exited his role as Bank of Canada (BoC) governor on June 3, 2013, after word got out that the Liberal party had been courting him as leader.

Luckily for Carney at the time, he was able to slide comfortably into the same role at the Bank of England (BoE) on July 1, 2013, without having to file for employment insurance. Talk about friends in high places. Must be nice.

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Carney slipped out of his second bank governor role in March 2020, once again, before serving the standard term. This time, his early departure was pre-negotiated. Carney had at least one other position lined up to start after he finished his BoE appointment. In 2019, Carney was tapped by UN Secretary-General António Guterres for the Special Envoy on Climate Action and Finance position.

And in August 2020, Carney joined Brookfield Asset Management, becoming their vice-chair, responsible for environmental and social governance (ESG) which, according to one definition, is a “set of standards used to evaluate a company’s environmental and social impact.”

In April 2021, after firmly ensconced in these two roles, Carney appears to have merged these two interests — climate action and standards setting — launching GFANZ with himself at its helm as co-chair in order to “coordinate efforts across all sectors of the financial system to accelerate the transition to a net-zero global economy.”

Whatever Carney’s stated objectives for governing Canada, his interest clearly lies in reshaping the global economy along environmental lines.

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How far would his global climate ambitions go? If he was indeed part of a climate cartel, as the admittedly political House committee alleges, what would happen to firms that didn’t join GFANZ’s various initiatives? Would they be shunned? If so, how would being shunned affect which industries and projects received financial backing? I guess we will have to wait until the House Judiciary Committee sorts through those requested communications and documents to find out.

Canadians should be taking Carney’s ambitions into account as he is likely to lead the Liberals into the next election. Judging by his moves to-date, it doesn’t seem like his aspirations will suddenly shift from a global to a Canadian focus. As prime minister, Carney’s likely to be decidedly, obsessively one note.

National Post

tnewman@postmedia.com

X: @TLNewmanMTL

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