Colgan opened by reminding his audience that Europe exists not in isolation but at the intersection of three vast global systems: the environmental web that sustains all life, the industrial networks that generate the greenhouse emissions driving climate change, and the financial architectures that allocate the capital for both economic growth and decarbonization. Europe, he argued, views these systems through a unique lens. Its robust embrace of ESG and green finance stands in stark contrast to the more cautious attitude of other regions.
Building on this foundation, Colgan described the shocks reverberating through climate politics today. He observed that the Trump administration’s return has once again disrupted U.S. climate diplomacy and science funding, emboldening right-wing parties abroad. Meanwhile, rising interest rates are making capital-intensive clean-energy technologies more expensive relative to traditional fossil-fuel assets. Across Washington and Westminster, a new strain of “climate realism” has taken hold—one that doubts the feasibility of Paris targets and advocates a more pragmatic, if pessimistic, approach. Colgan cautioned that such realism risks abandoning decades of hard-won progress.It was at this juncture that political science, Colgan insisted, offers indispensable perspective. He reminded his audience that climate solutions are profoundly political, hinging on shifting coalitions and contested interests as much as on carbon budgets and technological fixes. He stressed the significance of what he termed the “two-level game,” in which international agreements like the COP meetings interact with far more consequential domestic politics. Distributional struggles, he continued, play out at every scale—from global negotiations to local siting fights—raising the question of who bears costs and who reaps benefits. Moreover, ideas and identities—culture wars, partisan alignments, national narratives—shape how societies confront climate risks. Finally, the stakes and uncertainties have never been higher, whether in terms of sea-level rise or the security implications of forced migration and resource conflict.
Over the past year in Oxford, Colgan has pursued three intertwined research projects. The first probes whether the 2015 Paris Agreement truly moved the needle for major automakers. His preliminary conclusion is sobering: most firms have responded far more to U.S. regulations than to Paris itself. The second project investigates the growing appeal of “climate realism,” asking whether calls to lower mitigation ambitions and embrace geoengineering represent a pragmatic pivot or a dangerous capitulation. The third, and perhaps most novel, project examines how climate considerations are beginning to reshape global financial governance—a realm that until recently paid scant attention to environmental risks.
It was in this context that Colgan introduced the concept of “asset differentiation.” He explained that, increasingly, financial terms—interest rates, insurance premiums, portfolio allocations—are being adjusted to reflect an asset’s environmental footprint. He illustrated this trend with a flurry of data: the steady rise in green finance policies adopted by national governments; the exponential growth in signatories to the United Nations Principles for Responsible Investment; the surge of European fund inflows into sustainable strategies compared with more modest U.S. figures; and the alarming retreat of insurers from high-risk U.S. states, foreshadowing a future in which swathes of America may become uninsurable.
To make sense of these developments, Colgan proposed two conceptual models of governance. The “vertical” model follows the classic policy-to-market pathway, in which states and intergovernmental organizations with strong climate preferences enact regulations or subsidies and market actors then adjust. In contrast, the “horizontal” model describes a networked form of governance: states, firms, NGOs, individuals, and subnational bodies all engage one another through carbon accounting standards, net-zero alliances, and divestment campaigns, creating a web of incentives that does not depend solely on top-down directives. In practice, Colgan found evidence for both forms, with many initiatives lying at their intersection.
Colgan concluded by emphasizing that today’s climate politics operate at multiple speeds. Even if the Paris engine falters, a diverse array of actors—from development banks and central banks to city councils and corporate boards—continues to search for new levers to pull. In this multi-speed world, Europe’s blend of idealism and strategic realism offers a compelling model for how a region can exert influence without antagonism. Ultimately, Colgan urged, political scientists must do more than chart pathways to climate solutions; they must illuminate how the struggle over climate change will be waged, showing where finance, ideas, and power converge in shaping our collective future.
by Yangyang Zhao (ESC Research Assistant)
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