In her role at the OCC, which is charged with supervising and regulating “all national banks and federal savings associations,” Chen will lead climate risk efforts related to “supervision, policy, and external engagement,” according to a press release from the Treasury Department. The official formerly served as climate czar at the New York State Department of Financial Services.
“We are fortunate to have someone with her background and experience in both finance and climate-related financial risk to lead the agency’s risk management work in this area,” acting Comptroller Michael Hsu remarked. “She is an asset to an already strong and dedicated team of OCC staff focused on the safety and soundness of our banks and the financial system.”
Diana Furchtgott-Roth, who directs the Heritage Foundation’s Center for Energy, Climate, and Environment, said in an interview with The Daily Wire that Chen would deter the financial sector from pursuing oil and gas projects in favor of green energy initiatives.
“She will be able to tell banks that certain investments will be discouraged because they might pose a climate risk,” Furchtgott-Roth explained. “Say, for example, a bank wanted to lend money for a coal mine — she has the ability to advise OCC to downgrade that bank and say, ‘This is a risky investment.’ The OCC does have power over risky investments, but in the past climate change has not been looked on as a risk.”
President Joe Biden and other top White House officials have worked to emphasize renewable energy solutions in the private sector. The Inflation Reduction Act, for example, allocated $369 billion to climate measures such as electric car tax credits of $7,500 per vehicle. Beyond nixing expansions to the Keystone XL pipeline and slowing federal oil leases to a crawl, Biden returned the United States to the Paris Climate Agreement — an international treaty signed in 2015 that calls for slashing worldwide emissions in half by 2030.
“They are going to be able to come down on banks using a combination of hard and soft power,” Furchtgott-Roth explained. “But I think banks will quickly learn, so as not to run afoul of their regulators, that they should be avoiding certain types of projects.”
Furchtgott-Roth added that the appointment of a new federal climate czar would further embed the environmental, social, and governance (ESG) movement into corporate America. Companies that adopt ESG goals may hire with respect to racial identity while deprioritizing merit, push green energy standards, or otherwise blend profits with left-wing politics.
Despite efforts from many Western governments and corporations to decrease emissions, China has rapidly increased its use of fossil fuels — increasing emissions by 11% from the signing of the Paris Agreement to last year while the United States cut emissions by 6%.
“All this ESG benefits China and hurts the United States,” Furchtgott-Roth remarked. “This is not in the best interest of the United States. It is not in the best interest of global emissions either.”
In the public sector, officials are nevertheless pursuing a “whole-of-government approach to put climate change at the center of our domestic, national security, and foreign policy,” according to a speech delivered by Biden days after his inauguration.