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Given what you know of the Trump Administration, you may not be shocked to learn thathidden away behind a wall of acronyms, and obscured in the recesses of the federal rule-making processit is doing its best to stall the trend toward ethical investing. The Department of Labor, in June, proposed changes to the Employee Retirement Income Security Act (ERISA) that would make it hard for pension funds to steer money toward so-called E.S.G. fundsthose that put a priority on environmental, social, and governance factors, such as whether a company is switching to renewable energy or putting women on its board or treating its workers fairly.

A couple of caveats first: E.S.G. investing is no panacea. (A Blackrock E.S.G. fund, for instance, had ExxonMobil as its twentieth-largest holding at one point, which is roughly akin to the Vatican setting aside a corner of the Sistine Chapel for satanic rituals.) And, at this late date, the idea that green capitalism is going to single-handedly save the day seems absurd. Still, people have pensions, and theyre going to be invested somewhere. E.S.G. funds saw record growth in 2019, and that rise steepened as the pandemic hit. The rebound in civil society has been impressive, with an increase in volunteering, social cohesion, community support and focus on public good vs. private freedoms, JPMorgan said in a recent note to clients. We see the Covid-19 crisis accelerating the trend to ESG investment. Oh, and theres another reason: a Financial Times analysis in June found that, in the past decade, you made more money investing responsibly.

Who wouldnt like all this? Well, diehard libertarians clinging to the Milton Friedman theory that a corporation has no social responsibility beyond making money, and people who run unethical enterprises. This (often overlapping) set of players orbits in a loose constellation around the businessman in the Oval Office, who himself has never been accused of behaving ethically. Now Trumps Secretary of Labor, Eugene Scalia (the son of the late Supreme Court Justice), has proposed the rule changes, which would force pension funds seeking to invest ethically to jump through any number of hoops proving that theres no pecuniary difference with more cavalier holdings.

Happily, New York Statewhich is home to, among other things, a great many fundshas decided to fight back. Linda Lacewell, the states superintendent of financial services, wrote Scalia last week to say, In our view, the rise of ESG investing in recent years is a welcome development that reflects both a more sophisticated approach to investment and risk analysis and one more in line with the challenges facing investors today. As Ali Zaidi, who handles climate policy for Governor Andrew Cuomo, explained to me in an interview, the proposed rule is essentially an effort to take information away from the market. Whats really stunning, Zaidi added, is that it comes as the economic feedback to this incredible challenge we face in the form of the COVID crisis has actually reminded us how important E.S.G. and climate-risk analysis really are. In financial regulatory parlance, we talk about stress testing. In some ways, the stress testing is happening right now, and showing that a lot of these industries sit on a house of sand, not a firm foundation. That is to say, you better hope that you werent long on oil going into the pandemic, because you not only helped to wreck the planetyou also lost your shirt.

As Zaidi pointed out, like all else in our public life, the result of the Administrations efforts rests on the outcome of the November elections. The Department of Labors rule changes will probably come late enough in the Trump term that, if hes defeated, it will be relatively easy for Congress to overturn them. And Elizabeth Warren, who seems likely to wield some power on financial questions in a Biden Administration, has made it clear that shell have no patience for this kind of irresponsibility. As she wrote in a letter to the Wall Street Journal last month, Mr. Scalia seems to think that burying our heads in the sand and pretending that there is no risk to manage is risk management itself. If Mr. Scalia truly wanted to protect retirees, hed remove roadblocks to ESG investing, call on his colleagues to create strong ESG standards and support my Climate Risk Disclosure Act. The bottom line, as she points out, is that climate change threatens the stability of our economy. Indeed, as a new study published last Thursday makes clear, by 2100, as much as twenty per cent of global G.D.P. could be threatened by coastal flooding, in a worst-case scenario. Add in desertification, heat waves, agricultural collapsepretty soon, there isnt much of an economy left to worry about.

The situation seems obvious by this pointbut clearly not, at least in the Azkaban where American policy is currently formulated. Others, however, are catching on. Mark Fawcett, the chief investment officer for the National Employment Savings Trust, the United Kingdoms largest public pension fund by number of members, announced last week that it will begin to divest its massive portfolio from fossil fuels. Why? Just like coronavirus, climate change poses serious risks to both our savers and their investments, Fawcett said. It has the potential to cause catastrophic damage and completely disrupt our way of life. No one wants to save throughout their life to retire into a world devastated by climate change.

According to the World Bank, fashion is responsible for ten per cent of the planets greenhouse-gas emissions, more than all international flights and maritime shipping combined. Which is why its good that the fashion writer Shonagh Marshall has launched Denier, a Web site that features her conversations about the industrys relation to people, the planet, and profit. (And also a pretty good pun.) The sites early content includes a particularly fine colloquy with Liz Ricketts, of the Or Foundation, about what happens to the clothes that Americans give away to charities. I interviewed Marshall, whos based in New York, last week; our conversation has been edited for length and clarity.

Fashion, broadly defined, seems to be a large part of the climate equation. Is it possible to reimagine it as an industry? If so, is that reimagining under way, or is it mostly greenwashing so far?

It is possible to reimagine it, and I think the regenerative nature at the very core of the fashion industry makes it ripe for dreaming up new systems. There are a number of fashion designers that have built their businesses with concerns for the climate crisis at the center. They act as interesting case studies in that all the decisions they make have the well-being of people and the planet as a focus, even if this means forgoing profit. But there is a lot of greenwashing, and fast fashion and luxury design houses have done little to change all elements of their business. Often, they focus on one thing, such as carbon emissions, which is fantastichowever, as we know, this is just not enough! A brilliant resource to find out how well a fashion brand is doing across people, planet, and animals is Good on You. Fashion companies are rated from 1 (We Avoid) to 5 (Great), and it includes lengthy descriptions about why they are rated this way.

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Trump Tries to Make It Hard for Anyone Else to Behave Ethically, Either - The New Yorker