Illustration: Sarah Grillo/Axios

The case for sustainable investing — or ESG, for environmental, social, and governance — is a pretty simple one: Long-term investors have a clear financial incentive to back companies that will thrive over the long term. Such companies need to be well governed, have good relations with their stakeholders, and be well positioned to help humanity minimize our onrushing environmental catastrophe.

Why it matters: While the Obama administration was well disposed towards such investing, the Trump administration isn't. To sum up the thesis in three letters: ESG, for environmental, social, and governance.

  • A proposed new rule from the Labor Department would effectively ban pension-plan administrators from making any kind of ESG offering part of the default option in a 401(k) plan, and would discourage them from having any ESG options at all.

What they're saying: "When investments are made to further a particular environmental or social cause, returns unsurprisingly suffer," wrote Labor Secretary Eugene Scalia in an 0p-ed announcing the new rule.

  • The rule itself claims that it will have a positive economic effect, saying that "investments' returns will generally tend to be higher over the long run" as a result of ignoring ESG factors.
  • But, but, but: ESG funds outperform their peers.

Between the lines: Scalia doesn't have a lot of support. The asset management industry is naturally wary of this rule, because it creates more work and potential liability for pension fund managers. And even his natural bedfellows are wary.

  • The U.S. Chamber of Commerce initially reacted positively to the rule, but when I asked them for comment, I was put in touch with Chantel Sheaks, the executive director for retirement policy, who praised only the fact that the Department of Labor was implementing a 30-day comment period.
  • The American Petroleum Institute represents the companies most excluded by ESG policies. But the API's Aaron Padilla, who covers ESG policy there, told Axios that he wants the government to "encourage the consideration of ESG as it is linked to companies' financial performance."

My thought bubble: This rule looks like lame-duck hippie-punching from a beleaguered administration wanting to throw a bone to climate-change deniers.

The bottom line: As the Environmental Defense Fund's Gabe Malek told Axios: "ESG is a key part of fiduciary duty in the EU. The U.S. is just lagging behind other countries."

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Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 12:30 a.m. ET: 18,288,573 — Total deaths: 693,805 — Total recoveries — 10,916,907Map.
  2. U.S.: Total confirmed cases as of 12:30 a.m. ET: 4,713,562 — Total deaths: 155,469 — Total recoveries: 1,513,446 — Total tests: 57,543,852Map.
  3. Education — Fauci: Schools can reopen with safeguards, but those in virus hot spots should remain closed
  4. Politics: White House will require staff to undergo randomized coronavirus testing — Pelosi says Birx "enabled" Trump on misinformation.
  5. Sports: 13 members of St. Louis Cardinals test positive, prompting MLB to cancel Tigers series — Former FDA chief says MLB outbreaks should be warning sign for schools.
  6. 1 🎥 thing: "Tenet" may be the first major film to get a global pandemic release.
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Hurricane Isaias lashes the Carolinas

People walk through floodwaters on Ocean Blvd. in Myrtle Beach, South Carolina, on Monday. Photo: Sean Rayford/Getty Images

Hurricane Isaias made landfall as a Category 1 storm near Ocean Isle Beach in southern North Carolina at 11:10 p.m. ET Monday, packing maximum sustained winds of 85 mph, per the National Hurricane Center (NHC).

What's happening: Hurricane conditions were spreading onto the coast of eastern South Carolina and southeastern N.C., the NHC said in an 11 p.m. update. Ocean Isle Beach Mayor Debbie Smith told WECT News the eye of the storm triggered "a series of fires at homes" and "a lot of flooding." Fire authorities said they were responding to "multiple structure fires in the area."

Exclusive: Trump declines to praise John Lewis, citing inauguration snub

President Trump dismissed the legacy of the late Rep. John Lewis in an interview with “Axios on HBO,” saying only that Lewis made a “big mistake” by not coming to his inauguration.

The big picture: Trump's comments were a glaring contrast with the praise Republicans and Democrats showered upon Lewis this week, and a default to personal grudges during a week of mourning for a civil rights hero.