During the initial days of the U.N. COP30 climate discussions taking place in Belém, an Amazonian city, California Governor Gavin Newsom was almost impossible to overlook. With the Trump Administration absent from the conference, Newsom stood out as the most recognized American official there, with many attendees appearing to intently follow his remarks. Sitting briefly in the central thoroughfare of the conference center, I observed Newsom regularly passing by, accompanied by a retinue of security personnel, journalists, and delegates seeking photographs.
Newsom presented two primary talking points this week. The first was directed at the international community, where he emphasized that U.S. state and local governments can help compensate for the federal government’s withdrawal from climate efforts. His second point, which garnered the most attention, involved his pointed criticism of Trump’s climate disengagement. At a Milken Institute event in São Paulo, he declared, “We are doubling down on stupid in the United States of America.”
Newsom, a likely presidential contender in 2028, champions himself as a proponent of free markets and expresses a strong desire to collaborate with the business sector. This stance was evident in the events he participated in across Brazil. These included the Milken Institute’s Global Investors’ Symposium, which saw broad attendance from corporate and financial leaders, as well as a private dinner with business executives where he spoke. He speaks enthusiastically about fostering entrepreneurship and streamlining permitting processes in California to accelerate investments. However, there’s an unspoken caution that companies should heed: the current U.S. climate policy might not be permanent. Regulations and rules currently being dismantled could soon be reinstated. He stated in São Paulo, “Regulation drives the certainty.” He added, “What marks the United States right now is uncertainty across the board… it’s madness from an investment perspective.”
Indeed, American businesses counting on a prolonged era of minimal climate regulation could face an abrupt realization by 2028—a timeframe that isn’t distant for companies planning long-term investments.
To clarify, the notion that American businesses have vanished from climate discussions is incorrect. I was surprised by the significant presence of corporate leaders who attended in Brazil. I noted senior executives from Google, Mastercard, Microsoft, McDonald’s, and Deloitte—and that was from observing just one of my domestic flights. Throughout Brazil, I encountered a truly diverse array of corporate leaders, ranging from ExxonMobil to PepsiCo.
Yet, it is also true that many companies have adjusted their strategies regarding climate and decarbonization as they navigate the evolving landscape. For some firms, this has entailed reducing investments—consider the American auto industry’s retreat from electric vehicles (EVs). In São Paulo, Newsom specifically called out GM as an example of automakers with their “head in the sand.” For other industries, the new environment has led to efforts to appease conservative states and the federal government. For instance, some financial institutions have eased restrictions on fossil fuel investments and highlighted their work funding oil and gas.
Naturally, at this juncture, delving too deeply into the specifics of what a Newsom climate agenda might entail is a speculative exercise. During his tenure, the state has strengthened its cap-and-trade system, developed new climate disclosure requirements, and, unexpectedly, supported the continued operation of nuclear power plants.
However, one aspect of Newsom that is unmistakably clear is his resolve. The two-term governor has, in certain instances, modified climate policy, but generally, he has refused to yield to pressures from the business community regarding the expenses of climate action. And, as demonstrated by his aggressive stance against Trump, he is unafraid to be relentless in confronting opposition.
I do not engage in predicting political outcomes (though both and indicate Newsom as the leading candidate for the Democratic nomination), but what appears probable, regardless of who wins in 2028, is that future Democratic leaders will likely view unfavorably companies that abandoned climate commitments for immediate financial gain. Trump assumed office with a punitive agenda. While Democrats are unlikely to employ such charged rhetoric, it seems improbable that companies which aligned with the Trump climate agenda will be overlooked.
