Clearly, the U.S. political climate creates the current mood music when it comes to sustainable development and, with President Trump’s re-election, the stakes have perhaps never been higher or more divisive.

Immediate withdrawal from the 2015 United Nations Paris Climate Agreement heralds a bold President driving immediate action to dismantle a complex multilateral process nearly four decades in the making. It took 48 years of multilateral action to land the General Agreement on Trade & Tariffs (GATT) in 1995, unleashing global free trade, and just 25 days for the new U.S. administration to unwind it.

However, mood music does not replace the orchestra playing out at a planetary level – socially, environmentally, and in terms of security. It’s ominous for those corporates and investors thinking beyond the immediate. For all its financial, military, and moral power, the US is not the only player in the global game if you are a multinational, a large global investor, or anyone with supply and value chains outside of national boundaries.

How is the legal leader’s role changing?

The chief legal officer’s [CLOs] role has grown exponentially more complex for those committed to guiding boards with strong governance while navigating emerging, converging risks. Globally, these risks are profound – the flip side of sustainability – and carry serious implications for those with corporate fiduciary duty.

Can CLOs, fiduciaries, and board members ignore risk due to populist political shifts? Can companies and investors deeply invested in a just energy transition or managing complex supply chain risks afford to pause for four years? Here are just a few pressing questions – rooted in key challenges and missed opportunities – CLOs and their teams should bring to their boards and executives:

• Climate-related risks – drought, fire, flooding, water security, and infrastructure resilience – are driving up insurance and reinsurance costs, with some coverage disappearing altogether. How should boards manage, mitigate, or transfer these escalating macro risks?
• Climate and human rights litigation, including cases on human trafficking and modern slavery, are gaining momentum. With third-party litigation funders eyeing corporate missteps, how can we safeguard our reputation and stay on the right side of history?
• Risk isn’t just about downside protection – missing out on sustainable investment opportunities is a threat, too. The Inflation Reduction Act sparked a renewable energy investment boom in the U.S., but will capital now shift back to Europe and Greater China? How might this shift impact our business?
• A global green backlash against President Trump’s policies is considered by some to be brewing. Though the progressive movement is wounded, it’s poised to expose companies and investors lacking authenticity. How can legal teams sharpen their risk radars to navigate reputational landmines on the sustainability front?
  
  

The ripple effect

But how are President Trump’s withdrawal from the Paris Agreement, environmental rollbacks, and focus on fossil fuels impacting enterprises such as The Blended Capital Group with a portfolio of sustainable infrastructure projects and work in Brazil?

The U.S. mood music is heard across emerging markets hungry for balanced growth; the sustainability upside and potential of new ideas and leap-frogging old business practices is often the Zeitgeist. Hosting United Nations Climate CoP30 in Belem in late 2025, Brazil is in a special place to re-polish the country’s sustainable development credentials gained in June 1992.

In that year, Brazil hosted the first gathering of world leaders to discuss sustainable development at what was the UN Conference on Environment and Development (UNCED) and became known as the Rio Earth Summit. In October 2024, after twelve visits in a year, The Blended Capital Group (TBCG) concluded an MoU with the State of Espirito Santo (ES) to create a Sustainable State Investment model (SSIM TM) by the 40th anniversary of the Rio Earth Summit in June 2032.

ES, aspiring to become the ESG capital of the world by 2032, is an economically diversified state with offshore oil and gas, minerals, a powerful agricultural base, and rates AAA with the Federal Treasury. The State comes fifth in the Human Development Index for the country’s 27 States. ES has the only Brazilian State Sovereign Wealth Fund [FUNSES] where oil and gas-based revenues are dedicated to a sustainable future for the State.

Whether in the EU, UK, China, the U.S. itself – or in dynamic emerging markets – there is so much momentum built up in recent decades around climate action at the sub-sovereign state, province, city and industry sector levels.

Internationally, the accelerating emergence of new markets where sovereigns, sub-sovereigns, cities and corporates, can issue and trade carbon securities far more effectively than carbon credits, will unleash powerful financial forces.

Simply watch the evolving work of the International Swaps and Derivatives Association (ISDA) in climate change to get a feel for just how quickly these new markets are forming. A real carbon El Dorado is emerging as thirty years of the CoP process comes to fruition, and with a US withdrawal, who’ll be reaping the dividends?