On The Money: Yellen signals big shift on Treasury approach to climate | Amazon files preemptive lawsuit against New York AG | Senate Republicans urge SEC to block Nasdaq diversity rule

On The Money: Yellen signals big shift on Treasury approach to climate | Amazon files preemptive lawsuit against New York AG | Senate Republicans urge SEC to block Nasdaq diversity rule

Happy Friday and welcome back to On The Money, where we’re raising a glass of chocolate milk to the weekend. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

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THE BIG DEAL—Yellen: Treasury’s approach to climate will ‘change dramatically’ from Trump era: Treasury Secretary Janet YellenJanet Louise YellenOn The Money: Yellen signals big shift on Treasury approach to climate | Amazon files preemptive lawsuit against New York AG | Senate Republicans urge SEC to block Nasdaq diversity rule OVERNIGHT ENERGY: Court nixes Trump move to open 10 million acres to mining | Treasury will reportedly add climate czar | Manchin pushes natural gas in letter to Biden  Yellen: Treasury’s approach to climate will ‘change dramatically’ from Trump era MORE told key U.S. allies Thursday that the department’s approach to climate change will “change dramatically” under her watch.

During a virtual meeting of Group of Seven (G7) finance ministers and central bankers, Yellen said the U.S. would take a lead role in the global fight after years of environmental rollbacks under former President TrumpDonald TrumpBiden on Trump acquittal: ‘Substance of the charge is not in dispute’ North Carolina GOP condemns Burr for impeachment vote against Trump Toomey on Trump vote: ‘His betrayal of the Constitution’ required conviction MORE.

“She expressed strong support for G7 efforts to tackle climate change, highlighting that her colleagues should expect the Treasury Department’s engagement on this issue to change dramatically relative to the last four years,” the department said in a statement.

“The Secretary noted ‘we understand the crucial role that the United States must play in the global climate effort.’”

The background: Yellen’s pledge to global allies marks a notable turning point in the U.S. government’s approach to fighting climate change, a major priority for the Biden administration.

  • Under Trump, the U.S. pulled out of the Paris climate accords, which Biden has since rejoined, and weakened emissions and energy efficiency standards meant to slow the pace of global warming.
  • Yellen has also promised to make climate change a primary focus of her tenure as Treasury secretary. She called rising global temperatures an “existential threat” to both the planet and the economy during her confirmation hearing, and said the federal government needs to develop “regulations necessary to assess and mitigate this risk.”

I’ve got more here.

The finance-climate connection: Climate hawks and advocates for tougher financial rules have warned that the financial system can be upended by climate change through multiple means. The financial troubles facing the oil and gas industry could send tremors through the broader economy, banks could face losses from mortgages on coastal properties due to rising sea levels and countries that depend on fossil fuel exports could face serious challenges amid the rise of renewable energy.

Yellen’s role:

  • As Treasury secretary, Yellen is responsible for detecting risks to the financial system and can take action to mitigate them through the Financial Stability Oversight Council, an interagency panel of regulators she chairs. 
  • She is also expected to bring in Sarah Bloom Raskin, who served as deputy Treasury secretary during the Obama administration, to serve as the department’s climate czar, The Wall Street Journal reported Friday.
  • Yellen would also likely be involved in crafting any carbon pricing plans proposed by Biden.

LEADING THE DAY

Amazon files preemptive lawsuit against New York AG: Amazon is asking a court to block New York’s attorney general from bringing a case against it over workplace safety or the firing of employees who protested its coronavirus response.

In a filing in the Eastern District Court of New York, the e-commerce giant argued that the health and safety of its workers is out of Attorney General Letitia James’s purview.

“More fundamental than applying an inconsistent and incorrect standard, the OAG lacks the legal authority it purports to wield against Amazon,” the filing reads.

The context: James’s office has threatened legal action against Amazon for both its handling of the coronavirus pandemic and the firing of Chris Smalls, who led an employee protest at the company’s Staten Island facility after a co-worker tested positive.

  • Amazon argued in Friday’s lawsuit that its safety protocols have gone above and beyond requirements to protect its workers from COVID-19, touting a $800 million investment in safety measures during the first half of 2020.
  • It also pointed to internally collected data suggesting that Amazon and Whole Foods front-line workers in New York have tested positive for the disease at a rate 50 percent lower than the general population of the state.

The Hill’s Chris Mills Rodrgio has more here.

Senate Republicans urge SEC to block Nasdaq diversity rule: Republicans on the Senate Banking Committee are urging the U.S. Securities and Exchange Commission (SEC) to block Nasdaq’s proposed diversity requirements for listed companies.

The lawmakers—led by Sen. Pat ToomeyPatrick (Pat) Joseph ToomeyToomey on Trump vote: ‘His betrayal of the Constitution’ required conviction Romney on impeachment vote to convict: ‘Trump incited the insurrection’ GOP Sen. Cassidy: ‘I voted to convict Trump because he is guilty’ MORE (R-Pa.), ranking member of the committee—sent a letter to acting SEC Chair Allison Herren Lee on Friday urging her to not approve the rule.

“It is not the role of NASDAQ, as a self-regulatory organization, to act as an arbitrator of social policy or force a prescriptive one-size-fits-all solution upon markets and investors,” the letter reads.

  • Nasdaq laid out its proposal in December, which would require listed companies to have one director who identifies as female and one who identifies as an underrepresented minority or LGBTQ+. 
  • Foreign companies, or companies that are smaller, would have more flexibility, and would be able to meet these requirements by having two female directors.

The senators argue that the rules interfere with a board’s duty to its shareholders, violates principles that govern securities disclosures and imposes costs on public corporations and discourages private corporations from going public. The Hill’s Jordan Williams has the full letter here.

ON TAP NEXT WEEK

Tuesday:

  • Federal Reserve Governor Michelle Bowman gives a speech on community bank supervision and regulation at 11 a.m.

Wednesday:

  • The Federal Open Market Committee releases minutes from its January meeting at 2 p.m.
  • The Brookings Institution hosts a virtual discussion entitled “Economic impact payments: Uses, payment methods, and costs to recipients” at 3 p.m.

Thursday:

  • Federal Reserve Governor Lael Brainard gives a speech on climate change at 8 a.m.
  • The Senate Banking Committee holds a hearing entitled “The Coronavirus Crisis: Paving the Way to An Equitable Recovery” at 11 a.m.
  • The House Financial Services Committee holds a hearing entitled “Game Stopped? Who Wins and Loses When Short Sellers, Social Media, and Retail Investors Collide at 12 p.m.
  • A House Ways and Means subcommittee holds a hearing on free tax preparation services during the pandemic at 2 p.m.

NEXT WEEK’S NEWS, NOW: The House Financial Services Committee hearing on the GameStop frenzy Thursday is set to feature representatives from Robinhood, Melvin Capital, Reddit, and Citadel Securities—all of whom will face a barrage of tough questions, some of which may produce news. Expect a lot of posturing against big tech and Wall Street with a side of insight into what happened.

GOOD TO KNOW

Recap the week On The Money: