We have two covers this week. In most of the world we argue that ESG is deeply flawed. Environmental, social and governance investing is one of the hottest trends in finance. Companies are eager to tout their ESG credentials; investors who want to save the world buy ESG funds; asset managers charge higher fees for them. Yet the measure is incoherent, lumping together a dizzying array of objectives and offering no guide to trade-offs. Elon Musk is a corporate-governance nightmare, yet by popularising electric cars he helps fight climate change. Closing a coal mine is good for the environment, but awful for workers who are laid off. The measure needs to be simplified. Drop the S and the G, we argue, and shift the E from “environment” to “emissions”. If the measurement of firms’ carbon footprints were standardised, they would be easier to shrink. 
 
In Britain we argue that the next prime minister, whether it is Rishi Sunak or Liz Truss, should learn from the country’s life-sciences industry. There is no better example of Britain’s strengths, which include scientific excellence, fine universities and a healthy startup culture. British life-sciences work in an ecosystem including the National Health Service, which among other things is a cradle-to-grave source of data for drug trials. The industry’s innovations include the covid-19 vaccine that saved more lives than any other. But there is not enough growth capital, Brexit threatens scientific collaboration and the government’s aversion to investing in already-wealthy regions, or spoiling the view from any voter’s front window, makes it hard to build the right infrastructure. The candidates who claim Margaret Thatcher’s mantle today should remember the steel she displayed to drag Britain out of a previous economic rut. 

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Mario Draghi tendered his resignation as prime minister of Italy, after three of the four main parties in his governing coalition refused to support him in a motion of confidence. Unless a fresh government can be formed, which looks unlikely, the probable outcome is an early election. Polls predict that will bring a hard-right alliance to power. The upheaval imperils the reform package Mr Draghi drew up, which has allowed Italy to access €200bn ($204bn) from the EU’s covid-recovery fund.

The European Central Bank raised its benchmark interest rate for the first time in a decade, taking it from a negative rate of -0.5% to zero. The ECB has been slower than its counterparts in America, Britain and elsewhere to lift rates in the face of stubbornly high inflation. The euro gained against the dollar ahead of the ECB’s announcement, having fallen to a 20-year low.