The S&P published a blog post on Wednesday explaining why Tesla was removed from its ESG indexes earlier in the month. It stated the score was influenced by Tesla’s absence of a low-carbon approach and norms of corporate behavior. Elon Musk has dubbed ESG metrics the “Satan Unleashed.” Tesla was removed from the S&P 500’s ESG Index as part of a comprehensive adjustment to the list. Google, Facebook, Amazon, and even the oil and gas conglomerate Exxonmobil were still on the list.
S&P 500 Index
The S&P 500 ESG Index measures and successfully recommends firms to investors based on environmental, social, and governance data. Hundreds of pieces of data per organization are used to determine how companies influence the environment and behave interests other than shareholders, such as consumers.
Low-Carbon Approach by Tesla
Adjustments to the index went into effect on May 2, and an index representative explained why in a post shared Tuesday. It stated the score was influenced by Tesla’s absence of a low-carbon approach. It also complain about norms of corporate behavior and bad working conditions at the company’s Fremont, California manufacturing. Tesla’s management of a Federal Highway Transport Safety Agency inquiry also hurt its grade.
Unfair work practices at Tesla
Tesla was also accused of unfair work practices by the U.S. Department Of Labor last year. While Tesla is helping to phase out gasoline-powered vehicles, it has slipped behind its counterparts. According to the S&P representative. Elon Musk, complained about the index on Twitter on Wednesday morning, stating S&P Global Ratings had lost its credibility. Musk has over 90 million subscribers.