In February, Bank of America offered its employees a notable perk: If they had worked at the bank for at least three years and earned less than $250,000, then it would give them $4,000 to buy a new electric car. (Employees interested in simply leasing an EV could claim $2,000.) The move, along with a round of company-wide wage increases, was not the first time the bank had made the offer; have done a similar one in 2015and again in 2020although those incentives had also been applied to gas-electric hybrids.
Bank of America’s move isn’t going to make a dent in climate change, but it’s also far from the worst corporate climate action I’ve ever heard of. Many corporate actions to reduce global warming don’t actually help the climate, and if they involve carbon offsets, they can even add carbon into the atmosphere. But about 15 percent of US carbon pollution comes from cars and light trucks, even though gasoline use, and thus carbon emissions, is disproportionately concentrated among a small group of consumers who drive larger vehicles and live in rural areas (which probably doesn’t include many bank tellers or financial analysts). You’ve heard the spiel: electric vehicles are cheaper to manage and own than gas-burning cars in many states, but that’s if buyers can stomach the larger down payment. A subsidy provided by the employer helps to achieve this.
Companies seek climate action for a variety of reasons, but Bank of America’s announcement helped clarify one of the less discussed aspects of corporate climate action: It’s a job benefit. When companies try to appear as if they are decarbonizing, or more broadly, doing the right thing for the climate, it’s not just because of their allegiance to eager asset managers. In many cases, it’s also because they want to retain their employees, and their mostly center-left employees, in turn, want to feel like they’re working in a virtuous place.
Bank of America’s offering makes this fact unusually prominent ($4,000 donations make good headlines), but you can see the same idea in some of the tech giants that first pursued aggressive climate action in the 2010s. When Google became “carbon neutral” in 2007, it was already sitting on a massive river of cash. Since then he has started power all your data centers with renewable energies, drastically reducing emissions. Apple and Microsoft have done the same. Some tech companies now aspire to be carbon negative; Frontier, an initiative hosted within the payments company Stripe, you are paying to remove carbon from the atmosphere to help advance carbon suction technology. But these firms have (and had) something in common: they are competing in some of the country’s markets. tighter labor markets, demanding highly technical talent from a relatively small pool of skilled workers. These disproportionately young, urban and highly educated engineers and programmers lean to the left, as their demographics suggest, which is why most tech workers are eager to see climate action.
The recent move hasn’t been limited to tech companies, either. Frontier sponsored by McKinsey, and dozens of Fortune 500 companies, including McDonald’s and United, have made some sort of net-zero pledge. This has been understood as a corporate do-gooder, but it is also a type of employee benefit. In part, that’s because education has become an even stronger predictor of one’s political beliefs in recent years, aligning some segments of corporate America and its workforce more closely to the left. At the same time, the need for companies to follow the wishes of their employees could be particularly acute right now, with US labor markets so tight. In other ways, too, companies are taking steps that cross the line between political statement and job benefit: many companies they have already agreed to pay their employees to travel out of state for an abortion.
However, even if labor markets weaken as rising oil prices and interest rates increase pressure on the economy, competition in tighter markets—for young, urban, highly educated and (for therefore) progressives—will remain. And those workers will continue to vote with their feet. In a way, corporate climate action at high-tech companies mirrors the plummeting enrollment in petroleum engineering programs: Young people have less interest than ever in plundering the climate for their daily work.
Still, it’s worth adding a few asterisks to this idea. First, just because corporate climate action appeals to employees doesn’t mean it can’t be dishonest or insufficient. Many progressives (and a fair number of conservatives) tend to dismiss corporate climate action as nothing more than “green wash.” I’m not saying that greenwashing doesn’t exist; rather, employees, not consumers, are the primary audience for greenwashing.
I’m also not saying that the desire to look good is the only factor driving corporate climate action right now. High energy prices are clearly giving companies more incentive to consider decarbonization right now. With gasoline around $5 a gallon in the United States (and significantly higher in Europe), companies have yet another reason to look into electrifying their vehicle fleet or buying clean energy.
That’s one of the reasons I’m skeptical that Republicans can stop these efforts. As Florida Gov. Ron DeSantis’s attack on Disney has shown, Republicans are now trying to make the companies act less “woke.” Some of their suggested policies flow from a belief that executives and middle managers, sometimes empowered by the people in charge of big asset managers like BlackRock, act outside the real interests of investors. But if corporate climate action is partially an epiphenomenon of the labor market, even a pervasive conservative regime is unlikely to undermine it entirely.
Last year, I wrote about the “green vortex”, the set of economic, technological and financial forces that drove a virtuous cycle of decarbonization with only minor government intervention. It’s time to think about job pressure, and the more generic desire of employees for a “good employer,” as one of those key forces.