Thursday 19 May 2022 07:10 AM Elon Musk lashes out at S&P 500 ESG Index after Tesla was removed trends now
Elon Musk lashed out on Twitter after Tesla was removed from a widely-followed sustainability index on Wednesday over concerns about the company's lack of low carbon strategy, allegations of workplace racism and Autopilot deaths.
Tweeting into the wee hours of Thursday, Musk responded to well-known tech investor Cathie Wood, who called Tesla's removal from the S&P 500 ESG Index 'ridiculous', adding: 'Not worthy of any other response.'
'Yup,' responded Musk, 'A clear case of wacktivism.'
'What I love most about wacktivists is their incredible sense of humor,' he added in another tweet.
Tesla has become the most valuable auto industry company by pioneering electric vehicles, but was removed from the ESG Index, which measures the 'performance of securities meeting sustainability criteria.'
Elon Musk lashed out on Twitter after Tesla was removed from a widely-followed sustainability index on Wednesday
An executive with S&P Dow Jones Indices, which maintains the index, said that Tesla had been removed because of issues including claims of racial discrimination and crashes linked to its autopilot vehicles.
The move was effective on May 2 but was only announced on Wednesday in a blog post from SPDJI.
In other changes, the sustainability index also added soon-to-be-Musk-controlled Twitter and oil refiner Phillips 66 while dropping Delta Air Lines and Chevron, according to an announcement.
'ESG' stands for environmental, social and governance. The criteria is used by 'socially conscious' investors when deciding where to put their money, according to Investopedia.
Tesla remains on the regular S&P 500 index, which measures the largest companies in the US by market capitalization.
The index provider cited various issues at Tesla that significantly lowered its ESG score, including Autopilot technology that has been linked to at least 11 deaths since 2016.
Allegations of racism also contributed to the company's removal. Last October, a jury awarded $137 million to a former contractor who called Tesla's Fremont plant a 'hotbed of racist behavior.'
Earlier, Musk slammed the decision on Twitter, claiming that the index 'has been weaponized by phony social justice warriors.'
S&P Dow Jones Indices removed Tesla from the S&P 500 ESG index after it failed to meet sustainability and social responsibility criteria. Above, the company's HQ in Beijing, China
Musk slammed the index on Twitter, which ironically was added to the index at the same time that Tesla was taken off
Tesla's stock has fallen by nearly 29 percent in the past month, after founder Elon Musk filed a bid to buy Twitter for $44 billion
On Twitter, Musk added: '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.'
The de-listing is the latest blow to Tesla. The company's stock has fallen by nearly 29 percent in the past month, after Musk announced plans to buy Twitter for $44 billion.
The move is 'related to Tesla's (lack of) low carbon strategy.'
Even though Tesla is contributing to reducing emissions with its electric cars, its issues and lack of disclosures relative to industry peers should raise concerns for investors looking to judge the company across ESG criteria, said Margaret Dorn, the organization's head of ESG indices for North America,
'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.
S&P Dow Jones also blamed the company's codes of business conduct, which it describes as 'a company's implementation, transparent reporting on breaches and the occurrence of corruption and bribery cases and anti-competitive practices.'
Tesla is at risk of controversy after an analysis 'identified two separate events centered around claims of racial discrimination and poor working conditions at Tesla's Fremont factory, as well as its handling of the NHTSA investigation after multiple deaths and injuries were linked to its autopilot vehicles,' the index provider said.
'Both of these events had a negative impact on the company’s S&P DJI ESG Score at the criteria level, and subsequently its overall score.
'While Tesla may be playing its part in taking fuel-powered cars off the road, it has fallen behind its peers when examined through a wider ESG lens,' it added.
Last October, a California jury awarded former Tesla contractor Owen Diaz (pictured) $137 million verdict after he sued alleging racial harassment at the Fremont factory
Black workers at Tesla's Fremont factory (pictured) were regularly subjected to deeply offensive racial slurs and jokes by co-workers and managers, according to a complaint
Elon Musk and Tesla haven't commented on the company being de-listed from a sustainability index used by 'socially conscious' investors. Above, Musk at the Met Gala on May 2
The National Highway Traffic Safety Administration has sent teams to at least 27 crashes involving Autopilot since 2016. The technology has been linked to at least 11 deaths.
The agency doesn't publicize names of victims, though some have been revealed by local law enforcement and reported in media outlets.
Last October, a California jury awarded former Tesla contractor Owen Diaz a staggering $137 million verdict after he sued
