Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to Axios Closer for insights into the day’s business news and trends and why they matter

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Nashville news?

Get a daily digest of the most important stories affecting your hometown with the Axios Nashville newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Columbus news?

Get a daily digest of the most important stories affecting your hometown with the Axios Columbus newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Dallas news?

Get a daily digest of the most important stories affecting your hometown with the Axios Dallas newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios NW Arkansas

Stay up-to-date on the most important and interesting stories affecting NW Arkansas, authored by local reporters

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Illustration: Sarah Grillo/Axios

A new report shows the skyrocketing importance of "ESG" issues — environmental, social and governance concerns — among institutional investors, who place big financial bets on companies.

Why it matters: Long considered a money-losing nicety, ESG is rapidly going mainstream. The Edelman poll of big investors found that 52% said they'd put more trust in a company that linked executive compensation to ESG goals — like data privacy and cybersecurity, diversity and inclusion, and fighting global warming.

  • "This is a wake-up-call" for corporate leaders, Lex Suvanto, global managing director of financial communications and capital markets at Edelman, told Axios.

By the numbers: Edelman's latest Trust Barometer — a subset of the larger survey that the giant P.R. company puts out each January — polled 600 institutional investors in six countries, who collectively manage more than $9 trillion.

  • 84% said that "maximizing shareholder returns can no longer be the primary goal of the corporation."
  • More than half said "ESG initiatives lead to a favorable impact on company growth."
  • 55% said board diversity "has a significantly positive impact on trust."
  • 61% have "increased their investment allocation to companies that excel when it comes to ESG factors."
  • According to Edelman, virtually all investors surveyed "expect the board of directors to oversee at least one ESG topic."

The lesson, Suvanto said, is that ESG priorities are "no longer optional" for companies as they seek to attract investors and employees — and to deflect protests.

  • "Investors are starting to draw straight lines" between corporate investments and societal values, he said.
  • As little as 18-24 months ago, the survey results around ESG would have looked quite different, according to Edelman.

The big picture: "ESG" is a bit of a squishy category, referring to anything from funds that shun tobacco or firearms firms to corporations that try to apply various political yardsticks.

  • Investors who put ever-increasing amounts of money into so-called ESG investments can't always be certain they're getting what they bargained for.
  • The United Nations adopted a broad set of "principles for responsible investing" over a decade ago, but there still aren't any specific definitions or standards for "ESG."
  • Marketing pitches for these supposedly halo-wearing investments often go overboard.

On the plus side, evidence is mounting that ESG investments can equal the returns — or even outperform — investments without socially conscious screens. And momentum seems to be building in favor of ESG:

  • The Business Roundtable said in August that companies must embrace social purpose even as they pursue profits.
  • MSCI, the huge research and index firm, just published ESG ratings for thousands of companies "in a push to improve transparency in the rapidly growing ESG industry," as the WSJ put it.
  • An Edelman report from 2018 found that "more and more people in the U.S. and worldwide believe brands should take a stand on societal issues."

Reality check: No, millennials aren't driving this. According to Suvanto of Edelman, concerns about ESG were "consistent across age cohorts."

Go deeper: CEOs are America's new politicians

CEOs under more pressure to save society

New research encourages CEOs to act on guns

Go deeper

1 hour ago - World

Pentagon warns of ISIS-K capabilities outside Afghanistan

The site of an airstrike conducted by the U.S. against a planner for ISIS-K in Nangarhar province, Afghanistan in August. Photo: Xinhua via Getty Images

U.S. intelligence believes ISIS-K has the "intent" to eventually launch attacks outside of Afghanistan and could be capable of doing so "somewhere between six or 12 months," a top Pentagon official told senators Tuesday.

Why it matters: The U.S. withdrawal and subsequent Taliban takeover of Afghanistan has raised fears that terrorist groups will reconstitute and potentially pose a renewed threat to the U.S. homeland.

Exclusive: Billionaires back new media firm to combat disinformation

Illustration: Aïda Amer/Axios

A new public benefit corporation backed by billionaires Reid Hoffman, George Soros, and others is launching Tuesday to fund new media companies and efforts that tackle disinformation.

Why it matters: Good Information Inc. aims to fund and scale businesses that cut through echo chambers with fact-based information. As part of its mission, it plans to invest in local news companies.

Dan Primack, author of Pro Rata
2 hours ago - Economy & Business

Scoop: Sequoia Capital just blew up the VC fund model

Illustration: Aïda Amer/Axios

Sequoia Capital, one of the world's oldest and most successful venture capital firms, is forming a single fund to hold all of its U.S. and European investments, including stakes in publicly-traded companies, Axios has learned.

Why it matters: Venture capital is the money of innovation, but the industry itself rarely innovates. This is a radical exception.