Tesla cut from S&P 500 ESG Index; Musk tweets his fury
Reuters
An S&P Dow Jones Indices executive told Reuters on Wednesday it has removed electric carmaker Tesla Inc from the widely followed S&P 500 ESG Index because of issues including claims of racial discrimination and crashes linked to its autopilot vehicles, and Tesla CEO Elon Musk responded with harsh tweets including that “ESG is a scam”.
In it changes, effective May 2, the sustainability index also added soon-to-be-Musk-controlled Twitter Inc and oil refiner Phillips 66 while dropping Delta Air Lines and Chevron Corp, according to an announcement.
The back-and-forth over the index changes reflects a wider debate about the metrics used to judge corporate performance on environmental, social and governance (ESG) issues, a growing area of investing.
Tesla has become the most valuable auto industry company by pioneering EVs and expanding into battery storage for electric grids and solar-power systems.
Factors contributing to its departure from the index included Tesla’s lack of published details related to its low carbon strategy or business conduct codes, said Margaret Dorn, S&P Dow Jones Indices’ head of ESG indices for North America.
Even though Tesla’s products help cut planet-warming emissions, Dorn said, its other issues and lack of disclosures relative to industry peers should raise concerns for investors looking to judge the company across environmental, social and governance criteria.
“You can’t just take a company’s mission statement at face value, you have to look at their practices across all those key dimensions,” she said.
Tesla representatives did not immediately respond to questions. The company has previously called ESG methodologies “fundamentally flawed.”
Musk tweeted that “Exxon is rated top ten best in world for environment, social & governance (ESG) by S&P 500, while Tesla didn’t make the list! ESG is a scam. It has been weaponized by phony social justice warriors.”
BUSINESS
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2022-05-19T07:00:00.0000000Z
2022-05-19T07:00:00.0000000Z
https://daily.denvergazette.com/article/282020445901913
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