Tesla was delisted from the S&P 500 ESG Index on Wednesday due to “falling behind its peers when examined through a wider ESG lens,” the report says. S&P Dow Jones Indices also removed Berkshire Hathaway, Johnson & Johnson and Meta from the list.
Tesla’s CEO quickly reacted on Twitter saying “ESG is an outrageous scam! Shame on S&P”followed by other tweet comparing Tesla’s results with Exxon which is rated a top ten on the list.
“But, how can a company whose self-declared mission is to “accelerate the world’s transition to sustainable energy” not make the cut in an ESG index? There are many reasons. First and foremost, the GICS industry group in which Tesla is assessed (Automobiles & Components) experienced an overall increase in its average S&P DJI ESG Score”, the report says.
“So, while Tesla’s S&P DJI ESG Score has remained fairly stable year-over-year, it was pushed further down the ranks relative to its global industry group peers. A few of the factors contributing to its 2021 S&P DJI ESG Score were a decline in criteria level scores related to Tesla’s (lack of) low carbon strategy and codes of business conduct”, Margaret Dorn stated.
The Senior Director and Head of ESG Indices also added that the Media and Stakeholder 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”.
“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”, she concluded.
ESG Report concluded saying that “while Tesla and others may not have been included in the index this year, the beauty of the annual rebalance is that they will once again have an opportunity to be reviewed for inclusion in years to come”.
According to the State Administration for Market Regulation, Tesla China is releasing an over-the-air (OTA) update on 107,293 Model 3/Y produced from October 2021 to April 2022, due to to the non-fully cooled-down CPU on fast charging.