The opinions expressed here by Trellis expert contributors are their own, not those of Trellis.​

Whether companies like to admit it or not, trade rules and sustainability targets are integrated into the same business operations that purchase orders, calendars and factory lines are. They influence the same yarn, fabric, cartons and bookings. So when they’re included in a single operating plan, execution becomes clearer and issues are more easily resolved.

Split them into unrelated sourcing and environmental programs and you pay twice. A tariff change that reroutes a fabric from, say, China to Vietnam, also affects emissions, labor exposure and paperwork. A disclosure rule altering fiber content can trigger origin rules and higher duty rates, as could be the case under the Uyghur Forced Labor Prevention Act. The levers move together regardless whether you plan for it.

By consolidating operations, sourcing and sustainability into one plan, companies are able to share data, set common milestones and have one bill of materials. If you keep the specifications stable, track changes centrally and document the process as you develop the product, you’ll end up with reduced surprises and lower airfreight costs. 

As you work to devise a streamlined plan, here are five aspects of apparel operations to consider. 

Policy is an operating variable

A tariff isn’t just a footnote; it determines where spinning, knitting, dyeing and sewing take place. Moving production to a different country changes lead times, grid mix, defect risk and vendor reliability. And price is only the beginning of the ripple effect.

When rules change, markets rush toward the same “safe harbor.” Capacity decreases, schedules become unstable and quality declines as overbooked plants spread work across more lines and shifts. In these conditions, emergency freight acts as a pressure valve, but emissions increase in response, as geographic distances could result in a larger carbon footprint.

The lesson: Plan for volatility and don’t just react to it. Double-qualify critical inputs, maintain a second finishing route and keep pre-negotiated terms ready. Clear, predictable rules attract investment and customers; whipsaw policies push those away. Treat policy like weather: always have a Plan B you can execute this quarter, not next year.

Don’t brush off disclosures 

Audits rely on records, not marketing. Indeed, effective business operations mandate lot-level traceability, credible fiber origin and chain-of-custody proof that can withstand sampling. If you can’t provide receipts, process travelers, test results and pack-out records matching the goods, reconstruction will be slow and expensive.

It’s also important to use a single workflow for production, quality and chain of custody. When documentation accompanies the order — from intake to pack-out — the records in the file match the product in the box. If compliance is stored in a separate folder, the trail is already broken.

The lesson: Brands should focus on contracting for evidence rather than marketing claims. Regulators should establish and publish acceptance criteria and identify credible systems across markets. Clear rules and expectations reduce friction and channel capital toward meaningful upgrades, not superficial efforts.

Consider where work happens

Significant supply chain costs lie in energy, process chemistry and logistics, while policy influences all three. Moving the origin alters the grid mix. Tightening origin rules introduces steps that affect transportation and packaging, while changing a dye class affects wastewater and worker exposure.

There’s no “sustainable” country, but there are sustainable networks. The resilient model is a close-knit group of capable partners following standard processes, with automation where it’s effective and measurement that continues nonstop. Documents flow with the shipments. Exceptions are identified early while they’re still inexpensive.

The lesson: Target policies with meaningful outcomes by consistently and digitally verifying renewable energy, wastewater efficiency and worker safety. Reward plants that invest and remain committed to sustainable production. Stop funding constant border-hopping that wastes time, money and credibility.

Be mindful of fibers and the proof gap

Fiber debates — cotton versus polyester, recycled versus virgin, and so forth — stir up controversy when claims exceed reality. Trade rules specify origin, but blends make labeling and duties more complicated. The basic rule is clear: If you can’t prove it, don’t claim it.

That’s why it’s important to reduce variation to make proof repeatable. Standardize blends, dyestuffs and finishes when possible and minimize one-off recipes that require new documentation each season. Fewer, better inputs scale; sprawling menus don’t.

The lesson: Pair traceability tools with a small, trusted group of mills and factories. Complexity is where quality and compliance often break down. Each new variation becomes a failure point and potentially causes a future air shipment delay.

Recognize the cost of chaos 

Late spec changes and last-minute origin flips may seem harmless when planning a new sourcing strategy. In practice, they cause rework, schedule slips and emergency freight. Waste increases, emissions go up and paperwork drifts away from what is actually shipped. The real cost becomes clear weeks later.

Instead, focus on stable programs backed by disciplined change control. Keep core components, such as raw material tracing, constant and run revisions through a formal gate. Use statistical process control at sewing and finishing to catch variations while they’re still fixable. Predictability isn’t boring; it’s a margin.

The lesson: Fewer, larger programs with clear improvement paths outperform many one-off efforts. Predictable processes allow teams to choose slower, more deliberate modes and maintain balanced capacity. Chaos results in freight in the sky and defects in the cartons.

What apparel executives can do now

To make these five aspects of apparel operations more accessible, consider the following:

Consolidate ownership: Assign trade, sustainability and sourcing to a single operating leader responsible for specifications and schedules. Link incentives to three outcomes: on-time ocean departures, landed cost versus planned costs, and clean audits without heroics. When one person owns the system, finger-pointing decreases and speed improves.

Reduce variation: Minimize the number of fabrics, trims and processes used across programs. Standardization decreases documentation errors, stabilizes quality and allows design to concentrate on silhouette and color instead of re-engineering chemistry each season. The result is fewer surprises and quicker approvals.

Buy evidence once: Replace patchwork spreadsheets with a single workflow that captures production data, quality control checks and custody records at each handoff. When the trail is integrated into the process, “prove it” becomes a matter of searching, not a crisis situation. Your most trustworthy sustainability message is accurate paperwork that withstands sampling.

Pre-wire options: Use dual-source critical yarns, qualify a second dyehouse and map out tariff scenarios so product and paperwork move together when rules change. Keep commercial terms ready to avoid the need for a new legal review under pressure. Optionality is cheapest when implemented early.

Measure what matters: Track on-time ocean rate, rework percentage, airfreight incidents and audit exceptions. Improve these quarter by quarter, and the rest, such as cost, carbon and credibility, will follow. These four metrics show whether integration is real or just for show.

The through-line

Trade and sustainability are the same production reality seen from different desks. Plan them together, and you avoid duplicate spending, cut down on last-minute fixes and build a supply base that keeps its promises.

Perform the unglamorous work diligently. Use stable specifications, dependable partners, clear documentation and ensure the results appear where they matter most. Fewer line stops, fewer delays, steadier profit margins and goods arriving as scheduled.

That’s the standard. If your process can pass a random Tuesday sampling audit and stay on track, the system works. If not, fix the system — not the story.

The post 5 ways to streamline sustainable apparel operations in a time of tariffs appeared first on Trellis.

Startup Electra is building a Colorado demonstration facility that will produce 500 tons of low-carbon iron annually, backed by a $50 million grant from Breakthrough Energy and corporate contracts with Meta, Nucor, Toyota Tsusho and Interfer Edelstahl Group.

The 130,000-square-foot facility in Jefferson County is scheduled to open by mid-2026. It will also benefit from an $8 million state tax credit, the maximum amount available under the Colorado Industrial Tax Credit Offering, which has allocated up to $168 million through 2032 for projects that reduce manufacturing energy loads.

Nucor, the largest U.S. steel producer, which uses largely recycled scrap, will buy some of Electra’s iron. Electra also has contracts with two big steel distributors, Toyota Tsusho and Interfer Edelstahl Group, as well as other companies that Boulder-based Electra declined to name. Social media company Meta will buy the environmental attribute certificates related to Electra’s production, which it can use to claim emissions reductions related to data center construction.  

The corporate contracts were crucial for the $50 million grant commitment by Breakthrough Energy Catalyst, which funds first-of-a-kind manufacturing projects to help early-stage companies build stronger commercial cases.

“We like to fund projects that derisk technology and move it up the curve,” said Mario Fernandez, head of Breakthrough Energy Catalyst.

Tough economics

Electra uses a low-temperature process to refine iron ore — one that relies on chemistry and renewable electricity rather than a blast furnace fired with coke, a carbon-heavy form of coal. The steel industry, where much of this iron is used, contributes almost 8 percent of global emissions. 

Startups like Electra and established players such as ArcelorMittal are working on low-carbon or near-zero steel, but progress has been slow because of the furious pace of construction in countries like China and India and an onerous tariff landscape.

Electra has raised $214 million, not counting the recent grant, from investors including Breakthrough Energy’s venture arm and the Amazon Climate Pledge Fund, which has invested in low-carbon cement and steel to help decarbonize data center construction. (The company will be featured in an Oct. 29 session about “Scaling Low-Carbon Steel” at Trellis Impact 25 in San Jose, California.)

Several buyer coalitions have formed to send early buying signals: both General Motors and Ford Motor, for example, have committed to shifting some of their procurement to favor low-carbon steel.  

A lot more supply is needed to meet those promises. It takes at least 1.5 tons of iron to make steel the conventional way, and far less, about 0.60 tons, for steel produced using an electric arc furnace, the process that Nucor uses. A typical U.S. steel plant produces close to 2 million tons annually.

Electra’s initial production at this site wouldn’t fill the construction needs of a hyperscale data center, which might require as much as 20,000 tons. Toyota Tsusho, part of the Toyota Group, plans to sell Electra’s iron for automotive use, while Interfer will target other speciality applications. Electra is also exploring how its iron might be used in magnets and batteries.

The goal at Electra’s site in Jefferson County, near Denver, is to calibrate the company’s processes and test the purity of its product. “We are on track, and this is an important step,” said Kellyn Blossom, head of policy and communications at Electra. “We are hitting our marks and feel confident that we will meet this demand.”  

The post Why Nucor and Meta are supporting a new low-carbon iron factory appeared first on Trellis.

BioFluff, which makes plant-based “fur” for jackets and stuffed animals, named as interim CEO Luke Henning, chairman of the company’s board since 2023. He comes from Circ, a textile-to-textile recycler making headway among apparel brands.

Henning joins BioFluff, headquartered in Paris and New York City, as it pursues $2.5 million in pre-Series A funding. The small, 3-year-old company has grand ambitions to displace traditional, high-carbon materials for apparel and toys with alternatives made with hemp, nettles and flax.

“Their mission of no animals, no oil, no compromise, I find inspiring,” Henning told Trellis. “BioFluff has the potential to not only reduce the demand for specially farmed fur animals but also the amount of oil we use for fur alternatives.”

BioFluff has raised over $3 million, last in 2023 with a seed round of $2.5 million led by Brussels-based B Corporation Astanor Ventures.

“I couldn’t have asked for a better partner in the journey to revolutionize the textile industry in fashion, interior and toys,” wrote BioFluff Co-founder and Chief Commercial Officer Roni Gamzon on LinkedIn on Oct. 17.

From polycotton to ‘comfort materials’

With Henning as chief business officer of Circ for a dozen years, the Danville, Virginia, company built up partnerships including with H&M, Zara and Birla Cellulose, drawn in part for Circ’s capability to recycle polyester as well as wood- or plant-based materials. As Henning led collaborations with brands and other partners, Circ in January kicked off the Fiber Club partnership with Fashion for Good and Canopy to advance circular materials. Eileen Fisher, Everlane, Bestseller and Arvind are also involved.

“My experience in scaling sustainable hard tech, focused on sustainable textiles, translates well to this next stage of growth at BioFluff,” said Henning. “My network includes many of the parties that BioFluff is already connected to and some beyond.”

Henning succeeds CEO Martin Stübler, a BioFluff co-founder who left in August for an undisclosed startup.

“Luke Henning has gained the admiration of clients, investors and supply chain in his previous roles,” said Paul Foulkes-Arellano, founder of Circuthon Consulting in London and an original investor in BioFluff. “He knows exactly how to charm investors, build supply chain contracts and bring the world’s biggest brands on board.”

A plush market

BioFluff is among the early players seeking to scale sustainable “comfort materials,” which it sources and makes in Europe without toxic chemicals or genetic modifications.

The company’s Savian “fur” has appeared in a handbag by Ganni of Denmark and a fuzzy coat by Stella McCartney. The $543 billion market for non-animal fur will rise to $1,831 billion by 2032, according to Maximize Market Research.

BioFluff’s BioPlush material would enter a stuffed toys market set to expand from $11.8 billion in 2023 to $20 billion in 2030, according to Grand View Research. The company is also eyeing the home interiors market.

Dual master’s degrees

For eight years, Henning was a senior manager at KPMG Financial Risk Management in Cape Town.

While finishing an MBA at the University of Oxford, he helped to found a seed fund for student and alumni startups. Henning also holds a master’s in financial management from the University of Cape Town, after completing his undergraduate work at the University of Pretoria.

“While I never say never, my focus is closing the funding and seeking the best candidate for the role of full time CEO,” Henning said.

The post Circ’s Luke Henning to lead plush-material startup BioFluff appeared first on Trellis.

More companies that provide rayon, lyocell and modal to fashion brands are sourcing less from ancient and endangered forests, according to the nonprofit Canopy. Although the vast majority of cellulosic fibers are still spun from virgin materials, some of the biggest producers have been quickly adopting forest-friendly and circular materials.

Seventy percent of companies making semi-synthetic, cellulose-based fibers now exhibit green practices that reduce pressures on forests, according to the10th Hot Button report by Canopy, issued Oct. 16. Fifty four percent of fiber producers that the group tracked have reached the nonprofit’s favorable green rating, with 59 percent offering material traceability.

There has been notable progress over the past decade. Canopy has classified 21 companies as green, up from zero in 2016. And in that time, the number of apparel product lines made from next-gen, preferable sources of manmade cellulosic fibers rose to 16 from none.

Canopy uses this annual report in part to help brands make informed sourcing decisions, in line with its mission to save some of the hundreds of millions of trees felled for fashion each year. The Vancouver nonprofit works with 950 companies to protect forests and biodiversity in apparel, packaging and other industries.

A long way to go

And yet there’s a long way to go to advance circularity in rayon and other manmade cellulosic fibers (MMCFs). Although sourced from wood, plants or and waste, semisynthetics involve chemical and mechanical processing.

The use of recycled materials for such fibers is still rare, although it grew to 1.1 percent in 2024 from .7 percent a year earlier, according to the latest Materials Market Report by Textile Exchange.

Such textiles represent only 6 percent of the global fiber market, according to Textile Exchange. It found that fibers approved by Forest Stewardship Council (FSC) or other certification made up as much as 70 percent of cellulosic fiber market share.

“When we can pull these levers to build demand for those sorts of fibers, the world is better off,” said Forest Stewardship Council U.S. President Sarah Billig.

Who’s doing what

Tied for the top honors in the Hot Button report are Lenzing of Austria, responsible for nearly 13 percent of the worldwide production of manmade cellulosic fibers, and Tangshan Sanyou of China, which makes 9 percent. They are followed by Aditya Birla of India, which supplies almost 16 percent of global volumes.

Such early adopters are also working toward circularity goals, including using less wood and boosting next-generation production by 2030. For example:

  • Yibin Grace, which placed sixth in the report, in April announced it was opening China’s first dissolving pulp mill to turn old textiles into material for new fibers. 
  • Tangshan Sanyou in July started working with textile-to-textile recycler Circ on next-generation lyocell.
  • The fourth company on the list, Jilin Chemical Fiber, in May began producing Reboocel fiber made from FSC-certified bamboo and bamboo recycled from furniture.
  • Xinxiang Chemical (Bailu Group) in the spring launched pilot production for recycled viscose.

Other progress includes the rise of textile-to-textile material Circulose, which rose from startup Renewcell’s ashes in Sweden. More brands, such as Reformation, are working its pulp into their collections.

In addition, in February recycling startup Circ launched Fiber Club, a collaboration with Fashion for Good and Canopy. Birla Cellulose, Arvind Limited and Foshan Chicley have joined the effort to push circular manmade cellulosics, along with brands Bestseller, Eileen Fisher, Everlane and Zalando.

Canopy rates companies according to sourcing, conservation, innovation, traceability and other factors. The new report added chemical management to reflect participation in the Zero Discharge of Hazardous Chemicals program.

What needs work

Canopy calls on companies to scale up next-gen materials from crop and textile waste to reduce pressure on forests for virgin pulp.

That said, some smaller fiber companies that employ more advanced circularity practices are struggling. Kelheim Fibres of Germany entered bankruptcy last year. Formosa Chemicals & Fibre of Taiwan is set to fold, and American rayon maker Enka appears to be on the brink of closing.

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The opinions expressed here by Trellis expert contributors are their own, not those of Trellis.​

AI’s energy use and carbon emissions are a red-hot topic in the climate space these days. The collision between AI and climate goals will be one of the defining corporate challenges of the next decade. And Salesforce — one of tech’s most visible sustainability champions — sits squarely at the center of that tension. 

Salesforce has been outspoken about its ESG commitments for years. But as the business capitalizes on the AI revolution, its sustainability program will continue to contend with the environmental side effects of AI. The evolving strategy, highlighted recently in the Chasing Net Zero series, captures a broader question facing every company today: Can climate progress keep pace with technological disruption? 

Just three years ago, Salesforce made headlines for entering the carbon credit business, with Christiana Figueres, former UN climate chief, leading the crowd in chants of “Climate neutral now!” at the launch event. In those days, corporate climate goals were borne out of the enthusiasm that companies’ actions and investments could contribute significantly toward reaching the Paris Agreement goal to reduce global emissions by half by 2030 and reach net zero by 2050.

Today, corporate targets and reality are diverging from those goals, not converging. The cracks in the model show up in every sector, from industrials to cosmetics. But the massive impact of energy demand from AI on the tech sectors’ emissions may be the most visible stress test of Paris-aligned reduction frameworks.

Moving the goalposts

As companies reengineer their net zero commitments, a fundamental question emerges: should advocates demand that business adapt to the targets, or accept targets that adapt to the business?

At issue in the case of Salesforce is what might be called the “intensity loophole.” For years, standard-setters have grappled with how to create a framework that leaves room for fast-growing companies whose emissions keep rising in absolute terms. Small, disruptive businesses should be afforded room to grow their emissions, the logic goes, so they have the chance to improve on the status quo — and to unseat high-emitting legacy companies?

In the early days of target-setting, most companies set absolute reduction goals, because intensity targets were seen as lower ambition. But as companies miss their targets, Salesforce and many others have moved the goalposts — either by dropping net zero altogether or by reshaping their targets to fit the business.

Just look at Salesforce’s annual impact synopses. Like most sustainability reports, they offer a blend of high level principles, long range targets and numeric ESG disclosures. The narrative describes a range of activities, but offers concrete numbers on the amount of investment and expected GHG benefits of their initiatives in only a few cases.

This makes it hard to tell if today’s actions will deliver on tomorrow’s promises. Broad concepts such as “business resilience” would carry more weight if paired with concrete data showing how specific mitigation projects are expected to yield emission reductions.

Standard setters have enabled this imprecision. Businesses undertake significant changes such as mergers and product launches much faster than the standards can adapt. Growth and governance operate on different clocks.

Intensity data isn’t a climate metric

To stabilize the climate, total global emissions must decrease. Only by reducing overall emissions can Salesforce and other companies contribute meaningfully to net zero progress. And intensity metrics make it hard to tell whether this is happening.

By adopting an intensity-based approach, Salesforce is using gross profit to normalize its emissions data. Other companies that track GHG intensity use metrics such as revenues, employees, units sold or the number of SKUs. Changes in non-climate metrics can easily create noise in the data. An intensity metric based on gross profit, for example, can improve if a company raises its prices – an action that has no bearing on global greenhouse gas emissions.

The real value of intensity metrics is as a management tool to push teams to deliver more output with less carbon. They can drive efficiency and creativity, but they fall short as a measure of global climate progress.

Risks in the ‘spheres of influence’ era

As the Salesforce profile notes, the company intends to tackle its AI emissions growth by achieving efficiencies in data center contracting and by setting standards and targets for suppliers. This is part of a broader trend across large, complex multinationals. Five years ago, companies were laying out targets to reduce Scope 3 emissions. But today’s supply chains are optimized for costs, not carbon — making Scope 3 emissions a wicked problem. Now, companies are replacing hard targets with intentions to influence their suppliers.

The rise of the “influence era” is evident in Oxford’s new Spheres of Influence framework, which seeks to systematically credit companies for their sway over others. It credits the effects of companies’ products, investments and policy advocacy, which are overlooked by traditional GHG accounting frameworks. The Spheres model is not meant to replace action, but to acknowledge that companies shape climate outcomes well beyond their Scopes 1, 2 and 3.

This shift broadens the definition of corporate climate leadership, but it also tempts companies such as Salesforce to highlight influence over impact — and to narrate progress without funding it. And in the worst cases, when companies exert influence rather than investment, the emissions reductions can be pushed down the supply chain, where the costs land on the world’s most vulnerable workers, who are least able to absorb them.

An unsteady bargain

Pressure from investors, employees and advocates has made companies aware that they are expected to pick up some of the responsibility for achieving net zero by mid-century. The groundswell of target-setting suggested that companies had accepted this responsibility.

The case of Salesforce shows that the bargain with companies is an unsteady one. And the lesson for advocates is clear: Climate targets offer a false sense of security. Far from being firm commitments on the path to net zero, more and more targets seem quaint aspirations. And if they are replaced by intensity-based alternatives, it could mask the uncomfortable truth that absolute emissions are still rising — and net zero is still far away.

The post The problem with Salesforce’s new climate math appeared first on Trellis.

New research about how people engage emotionally with environmental, climate and nature-related issues show a large regional difference.

Trellis data partner GlobeScan’s research around what motivates people to act when it comes to climate change shows in Africa and the Middle East, people tend to feel hopeful and empowered, whereas in Europe and North America, reactions are often marked by fear, anxiety and a sense of helplessness. These contrasting emotional landscapes reveal that climate communication cannot take a one-size-fits-all approach. To truly resonate, messaging must be culturally attuned and reflect local emotional realities and values to inspire meaningful action. 

What this means

GlobeScan’s project, called Societal Shift, shows that emotional responses to climate issues are varied, nuanced and full of potential — if harnessed effectively. In the Global South, where feelings of hope and empowerment are more common, there’s an opportunity to build on this optimism and resilience. These emotional foundations can support locally-driven solutions and leadership that reflect community values and aspirations. In the Global North, where fear, anxiety and helplessness are more frequently expressed, communication strategies can evolve to offer a more constructive path forward. This might include amplifying stories of action and not just intent or doom and gloom, to inspire confidence and a sense of agency. This might also include channeling frustration and anger toward calls for greater justice in the climate fight. Emotional engagement is not a distraction from climate action; it plays a central role in enabling people to move from awareness to meaningful participation.

Based on a survey of more than 31,000 people conducted in July and August 2025.

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The global effort to decarbonize maritime shipping and reduce value-chain emissions stalled this week after intense lobbying from the U.S. forced negotiators to delay a decision on a net-zero plan for the industry.

Proponents of the plan had gone into a meeting of the U.N.’s International Maritime Organization (IMO) with cautious optimism. Earlier this year, nations agreed to set steadily increasing emissions-intensity limits on vessels under the IMO’s Net Zero Framework. Owners of large vessels would have been required to cut emissions by as much as 43 percent by 2035, compared to a 2008 baseline. The framework was hailed as the first time an industry would be so regulated at a global level.

The IMO meeting was expected to adopt the plan then move to implementation, but support drained away after the U.S. threatened to impose tariffs, visa restrictions and port levies on countries that backed the plan. On Friday, the nations voted to postpone a decision for a year.

‘Unprecedented effort’

“During the past three days, an unprecedented U.S.-led effort to block a global agreement has culminated in multiple spontaneous proposals, and intense pressure both on and out of the floor,” said Alison Shaw, IMO manager at Transport & Environment, a nonprofit with offices in multiple European countries. “It is a clear effort to enact climate denialism, undo years of constructive negotiation and abandon the very targets the IMO has set for itself.” 

The decision will slow efforts by companies to reduce shipping emissions, which form a significant part of Scope 3 inventories, particularly for retailers and consumer packaged goods businesses. Maritime shipping accounted for around 2.5 percent of IKEA’s value-chain emissions in 2024, for instance. The company is aiming to purchase only zero-emissions ocean transport services by 2040.

“This is a loss of momentum for the shipping industry’s efforts to decarbonize,” said a spokesperson for Maersk, which operates more than 700 container vessels on routes between 130 countries.

Currently, companies intent on tackling these emissions rely on a patchwork of initiatives including Katalist, a “book and claim” platform that allows them to support and take credit for purchases of low-carbon maritime fuels, such as ammonia and methanol. Members include Amazon, IKEA, Levi Strauss, Mondelez International and Patagonia.

That project and others continue, but spread of the new technologies will be far slower in the absence of the rules the framework would have imposed. 

“We are in a very early part of a transition, and more than 99% of maritime transport is still powered by fossil fuels,” said Jesse Fahnestock, director of decarbonization at the Global Maritime Forum, a non-profit that partners with shipping companies. “So to get alternative fuels and the vessels that can use them out there, the regulatory framework is a hugely important lever.”

Talks continue

Despite the pressure from the U.S. and others, nations agreed to delay rather than scrap the framework altogether. Fahnestock noted that because the proposal is still live, discussions about the details of implementation scheduled over the next 12 months may continue as planned.

“Our impression is that the how of the framework is going to continue,” he said. Talks will focus on which fuels qualify as lower-carbon, rules for life-cycle analysis of the fuels and how proceeds credits, which vessel owners can use to meet missed targets, will be distributed.

Still, standing in the way of an agreement is the world’s largest economy. In a joint statement issued last week, U.S. secretaries for state, energy and transportation said they were considering sanctions against officials from countries that support the IMO framework and blocking vessels registered in those countries from U.S. ports.

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JPMorgan Chase, the largest U.S. bank, has backed away from its pledge to cut the carbon footprint of its corporate offices, bank branches and data centers 40 percent by 2030.

JPMorgan said the transition away from “time- and percent-bound targets,” disclosed Oct. 15 in its 2024 Sustainability Report, will allow it to prioritize measures to reduce, avoid or replace greenhouse gas emissions by analyzing which projects have the largest potential impact relative to cost rather than making decisions based on whether an initiative will deliver specific cuts by a short-term timeframe.

“This evolution in our strategy reflects the insights we have gained over the years and enables us to adapt to a changing landscape, including increased power demand, the pace of technological advancement and the overall economics of sustainable solutions,” the company said in the report.

The original goal was set in 2021, along with pledges related to how JPMorgan makes financing decisions to support the development of low-carbon technologies. Its biggest competitors also have emissions reductions targets focused on their operations (Scope 1) and electricity consumption (Scope 2). For example, Citi aims to become net zero for those categories by 2030, and Wells Fargo is working toward a 70 percent reduction.  

As of Dec. 31, 2024, JPMorgan cut emissions related to its operations and overall electricity consumption by 14 percent compared with its 2017 baseline, so it was running behind its original 2030 goal, according to a Trellis analysis of data from its 2023 and 2024 sustainability reports. 

JPMorgan declined to comment officially on this year’s sustainability report, nor did it issue a press release about its publication.

Slow progress on renewable energy 

The new approach applies to projects JPMorgan is considering across more than 6,500 global sites, such as on-site solar projects, power purchase agreements for renewable energy, lighting and energy efficiency measures and heating and cooling retrofits.

For example, JPMorgan in 2024 installed solar panels at 64 retail branches and three commercial offices; it also paired some of those new installations with energy storage, as part of a pilot project. Its goal in 2023 was to deploy 16 megawatt-hours of energy storage in Arizona and Delaware by the end of 2025. The company’s new headquarters in New York is the city’s largest all-electric tower, powered by a hydroelectric project upstate. 

JPMorgan sourced 57,420 megawatt-hours of electricity from its on-site solar panels as of Dec. 31, 2024, up from 47,443 megawatt-hours in 2023. The bank didn’t disclose progress toward its 2030 renewable energy commitment in the latest report; in its 2023 report, the bank said it had reached 23 percent.    

JPMorgan will use the cost of renewable energy and the price for high-quality carbon credits when assessing future investments. For example, the company signed a 13-year contract in May that will purchase credits for carbon captured at pulp and paper mills along the U.S. Gulf Coast. The bank paid less than $200 per metric ton of removal, one of the lowest prices reported for a deal of this nature.  

$309 billion in green finance

JPMorgan is holding firm on its commitment to invest $1 trillion to support renewable energy, electric vehicles, climate adaptation and other initiatives in pursuit of a clean economy transition by 2030. The bank has so far deployed $309 billion toward that goal, including $68 billion in 2024. Much of that financing came in the form of green bonds or funds deployed for renewables and low-carbon energy projects.

JPMorgan deployed $1 billion in financing to climate adaptation and resilience projects in 2024, its first commitments to that category. 

Funding the low-carbon transition

The bank is also sticking to commitments to reduce the emissions intensity of its investments in energy projects and in companies representing eight key economic sectors ranging from aluminum to shipping. Wells Fargo has backed off a similar pledge. 

This activity falls into the category of “financed emissions,” and it typically represents the largest portion of any financial institution’s carbon footprint. It’s an area that members of the now-defunct Net Zero Banking Alliance had sought to address collaboratively. JPMorgan pulled out of the group in January.

Despite that defection, the bank still calculates and reports on its energy financing activities. It scrutinizes the amount of money it commits to high-carbon supply compared with its investments toward projects or technologies that support the transition to low-carbon energy. The overall ratio for 2024 was 1.13, meaning that for every $1 committed to high-carbon energy, JPMorgan put $1.13 toward low-carbon projects.

Aside from how it reviews energy financing, JPMorgan also uses 2030 intensity goals to assess investments related to auto manufacturing, aviation, shipping, iron and steel, cement and aluminum. “Our targets are designed to help us track our clients’ decarbonization progress and inform how we can best support our clients’ low-carbon transition objectives,” the bank said in its 2024 report.

For example, the carbon intensity of JPMorgan’s aviation investments has decreased about 20 percent since 2021, primarily because many of its clients in that sector have prioritized fleet modernization initiatives and other projects that have reduced their emissions.

Conversely, the carbon intensity for JPMorgan’s aluminum clients has increased 10.4 percent compared with the 2021 baseline, largely because of its support for companies in emerging markets, where production emissions tend to be higher.  

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Of the 917 bills that reached California Gov. Gavin Newsom’s desk over the past month, 794 were signed into law.

His decisions related to energy and environmental impacts reflect contrasts. For instance, he continued the state’s cap-and-trade program while green-lighting new oil drilling and rejecting virtual power plant advancement.

As for supply chains, the passage of a requirement for companies to disclose heavy metals in prenatal vitamins contrasts with rejected proposals to ban forever chemicals in cookware and plastic glitter in personal care products. 

Here are the key new laws, as well as legislation that perished by Newsom’s pen.

Signed into law

Heavy metals disclosure: In 2027, prenatal vitamin purveyors will have to detail how much lead, cadmium, mercury or arsenic appear in their supplements under Senate Bill 646, which passed without opposition. A similar metals disclosure law for baby food went into effect in January.

“Cap and invest”: Newsom refreshed California’s existing cap-and-trade program through 2045. Funds enabled by Assembly Bill 1207 and Senate Bill 840 are meant to help efforts that include high-speed rail and wildfire prevention.

Drill, baby drill? Many environmentalists decried Senate Bill 237, which eases the approval of up to 2,000 oil wells in Kern County in the south of the state, purportedly to stabilize gasoline supplies.

Carbon capture win: Senate Bill 614 creates a regulatory structure for developing underground storage and pipelines for captured carbon dioxide, ending a moratorium. It’s seen as a boost for the growing carbon capture and storage industry.

Regional power: As the federal government decimates previous support for renewable energy projects, California is expanding its role within a regional power market. Assembly Bill 825 enables the state to trade more clean energy with other Western states.

Small solar boon: Under Assembly Bill 1104, small and midsize solar developers will no longer be considered “public works” organizations, sparing them red tape around labor rules. 

Electrification plans: Assembly Bill 39 requires towns above 75,000 people to detail how they will electrify buildings and EV charging systems, especially in underserved communities. 

Breakthrough for in-state glass: In a challenged market for recycled glass, Assembly Bill 899 updates California’s Beverage Container Recycling law to let CalRecycle pay higher incentives to in-state manufacturers that use recycled glass. 

Vetoed

Forever chemicals stay: Senate Bill 682 sought to restrict harmful perfluoroalkyl and polyfluoroalkyl substances (PFAS) in pots and pans as well as dental floss and food packaging. Newsom said the bill would harm low-income shoppers. Concerns about toxic cookware became a flashpoint last year after a scare over fireproofing chemicals in black plastic spatulas.

No-go on glitter ban: Assembly Bill 823 would have expanded the 2015 Plastic Microbeads Nuisance Law to block the sale of personal care and cleaning products containing glitter, which pollute waterways. Newsom nixed it, stating that “it may incidentally result in a prohibition on biodegradable or natural alternatives.”

RIP to VPPs: Three separate bills would have advanced virtual power plants (VPPs)— which combine distributed sources of energy, such as electric car batteries and solar panels — to shore up the state’s electrical grid. Newsom said no to all of them, citing complications with existing state rules and programs.

Thirsty data centers spared: Assembly Bill 93 would have required California to check water consumption by fast-growing data centers. But Newsom said he was “reluctant to impose rigid reporting requirements about operational details on this sector without understanding the full impact on business and the consumers of their technology.”

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The opinions expressed here by Trellis expert contributors are their own, not those of Trellis.​

The closure of the Net Zero Banking Alliance in early October wasn’t a surprise to anyone paying attention.

What started four years ago as a bold alliance of nearly 150 banks — together managing over $75 trillion in assets and pledging to align their lending with net-zero carbon emissions by 2050 — ended with an almost embarrassing dissolution as final members voted to cease operations after months of high-profile defections, political pressure and a steady erosion of commitments that had been watered down to the point of meaninglessness.

This failure demands our attention because it forces us to confront uncomfortable truths about the nature of voluntary cooperation, the power of political backlash and the gap between stated intentions and measurable outcomes. If we’re serious about addressing climate change through financial systems, we need to understand why the alliance failed — and we need to be honest about what actually works.

The illusion of voluntary commitment

Let’s begin with first principles. The alliance rested on a foundational assumption that major financial institutions, facing the physical and transition risks of climate change, would voluntarily constrain their most profitable activities in service of a collective good.

Consider the incentive structure. A bank’s fiduciary duty runs to its shareholders, not to the atmosphere. Oil and gas financing remains extraordinarily lucrative. Between 2016 and 2024, the world’s largest banks channeled $7.9 trillion to fossil fuel companies — despite the banks touting their own climate commitments. The banking alliance did nothing to change this fundamental calculus. It provided cover, not constraint.

From an impact investing perspective, this represents a category error that should have been obvious from the outset. Real capital allocation decisions — the kind that move markets and reshape industries — are driven by three forces: regulatory requirements, fiduciary obligations and demonstrable financial returns. Voluntary pledges might influence behavior at the margins, but they cannot override core economic incentives. The alliance tried to substitute moral persuasion for structural change and the result was entirely predictable.

The neuroscience of belief offers insight here. When we commit to an abstract principle such as “net zero by 2050,” our brains encode this as a virtuous intention — we receive a small dopaminergic reward for identifying with the moral position. But this reward is disconnected from the behavioral mechanisms that would actually produce the outcome. The banks experienced the psychological benefits of membership while continuing to finance fossil fuels at scale.

This isn’t hypocrisy in the traditional sense; it’s the predictable result of misaligned incentives meeting human cognitive architecture. To take a more cynical view, it may reflect less on human weakness and more on a deliberate calculation by bank decision makers concerned with the optics of commitment and participation.

The collapse: Political reality meets corporate resolve

The exodus began in December 2024 when Goldman Sachs withdrew, followed rapidly by other Wall Street giants including JPMorgan, Citi, Bank of America, Morgan Stanley and Wells Fargo. By summer, major international institutions HSBC, UBS and Barclays had also departed. The alliance’s assets under management plummeted from $75.5 trillion in November 2024 to $42.2 trillion by August.

While many alliance watchers would say the proximate cause was political, I’d argue that political pressure only accelerated failures that were already inevitable. The banks didn’t leave because they were forced to; they left because the costs of staying had begun to outweigh the benefits, and those benefits had always been largely reputational.

This reveals something crucial about the architecture of collective action on climate. When the political winds shift — and they will shift, repeatedly, across the decades required for the energy transition — voluntary commitments evaporate. This isn’t a moral failing; it’s a structural feature of systems governed by quarterly earnings reports and electoral cycles.

What actually works: Moving beyond performance

If voluntary alliances are insufficient, what will drive meaningful capital reallocation toward climate solutions? The evidence points to three mechanisms, none of which the alliance meaningfully advanced:

    • Regulatory requirements with enforcement mechanisms. The European Union’s sustainable finance regulations, however imperfect, create legal obligations that cannot be abandoned when political winds shift. They embed climate considerations into the operational fabric of financial institutions rather than relying on discretionary commitments. This isn’t ideological preference — it’s recognition that durable change requires changing the rules of the game, not asking players to voluntarily play differently.

    • Demonstrable financial returns in climate solutions. The renewable energy sector regularly delivers competitive returns with decreasing technological risk. Battery storage, green hydrogen and electric vehicles represent genuine investment opportunities. Capital flows toward these sectors not because of moral commitments but because the risk-adjusted returns increasingly justify the allocation. Impact investors and enterprises should lead with the “magnitude of the opportunity” rather than appeals to altruism, or even measurable impacts. Drop those in the appendix.

    • Transparency and accountability mechanisms that create reputational and legal consequences for material misrepresentation. This is distinct from voluntary pledges. When banks must disclose financed emissions with the same rigor they disclose credit risk, when greenwashing carries genuine legal liability, behavior changes. Not because hearts change, but because the cost-benefit analysis shifts. (The Eighth Circuit Court of Appeals paused the U.S. Securities and Exchange Commission’s litigation about its climate-risk disclosure rule last month.)

Honest assessment and action steps

The demise of the net zero banking alliance should prompt uncomfortable but necessary questions. How many other climate initiatives in the financial sector rest on similarly fragile foundations? How much of what passes for climate action is actually performance designed to forestall regulation? And most importantly: what would genuinely effective climate finance look like?

For business leaders, those committed to climate action through finance can:

    • Engage banks on specific projects by focusing on concrete, low-carbon transactions (clean power, green steel, renewable fuel) rather than abstract commitments.

      • Work with values-based banks, which you can find via the Global Alliance for Banking on Values, with more than 70 values-based banks with $265 billion in assets. There’s also Equator Principles Banks composed of 128 financial institutions using environmental/social risk frameworks for project finance and B Corp Certified Banks including Amalgamated Bank, Beneficial State Bank and Sunrise Banks.

The demise of the banking alliance is clarifying rather than demoralizing because it forces attention toward interventions that might actually work. And it reveals which institutions are genuinely committed to transition (largely smaller, mission-driven banks and credit unions) and which are mostly engaged in reputation management.

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