Tesla was excluded from the ESG index, which Musk called a scam. Executives of the Standard & Poor's Dow Jones Index issued a document saying that the company had removed Tesla from the Standard & Poor's 500 ESG Index. Musk angered him for creating a "scam." The ESG index excludes Tesla, which Musk calls a scam.

Tesla was excluded from the ESG index, which Musk called a scam 1. On Wednesday (May 18) local time, Standard & Poor's Dow Jones Index Company announced its annual routine index adjustment in official website. Among the 308 stocks in the Standard & Poor's 500 ESG Index, Apple, Microsoft, Google, Amazon, NVIDIA, unitedhealth group, Procter & Gamble, ExxonMobil and JPMorgan Chase were re-selected.

However, companies such as Tesla, Berkshire Hathaway, Johnson & Johnson and Meta were excluded. Margaret Dorn, Senior Director of North America of Standard & Poor's Dow Jones Index Company and Head of ESG Index, published a blog post in official website on June 5438+07, explaining that Tesla's score in environmental, social and governance standards remained "quite stable" in the past year, but its ranking declined compared with that of its constantly improving global peers.

Dorn wrote that the harsh working environment and racial discrimination exposed by Tesla's factory in fremont, the handling of the investigation of casualties related to autonomous driving, and the lack of low-carbon strategy and business code of conduct are all unfavorable to Tesla.

Although Tesla played a role in eliminating fuel vehicles, Dorn pointed out that from a broader ESG perspective, it has fallen behind its peers. Finally, Donne also "encouraged" unsuccessful companies. "Although Tesla and other companies may not be included in the index this year, they will have the opportunity to be included in the review again in the next few years."

Musk tweeted back: ESG is a scam.

After the news was announced, Tesla's intraday decline has expanded to 5.4%. Musk, founder and CEO of Tesla, naturally launched a "storm" about the Standard & Poor's Dow Jones index on Twitter.

Musk wrote, "ESG is a heinous scam! Shame on S&P Dow Jones Index Company. " Musk added, "(American energy giant) ExxonMobil was rated as the top ten ESG (environment, society and corporate governance) by Standard & Poor's 500, but Tesla was not on the list!"

Musk stressed that although Tesla has done more for the environment than any company, in fact, ESG scores value some other political factors. Musk said, "The political attacks against me will escalate sharply in the coming months."

During the sensitive period of Musk's acquisition of Twitter, Tesla was kicked out of the Standard & Poor's 500 ESG index. Earlier, Musk made it clear that after the transaction was completed, he would revoke Twitter's ban on former US President Donald Trump.

Tesla was excluded from the ESG index, which Musk called Scam 2. On Wednesday, local time in the United States, executives of Standard & Poor's Dow Jones Index Company issued a document saying that Tesla had been removed from the Standard & Poor's 500 ESG Index due to alleged racial discrimination and frequent crashes related to driver-assisted driving systems. In response, Elon Musk, CEO of Tesla, angrily denounced Tesla for creating a "scam".

The Standard & Poor's 500 ESG Index uses environmental, social and governance data to rank companies and effectively recommend companies to investors. Its measurement standard includes hundreds of data points of each company, which are related to the way the company affects the world and the way it treats stakeholders other than shareholders, including customers, employees, suppliers and partners.

Standard & Poor's Dow Jones Index Company made a decision last month to remove Tesla from the index. At the same time, Apple, Microsoft, Amazon and even ExxonMobil, an oil and gas multinational company, are still on the list. In this regard, Margaret Dorn, head of the Standard & Poor's 500 ESG Index in North America, issued a document on Wednesday to explain this.

Standard & Poor's Dow Jones Index Company claims that Tesla's factory in fremont, California, USA has racial discrimination and poor working conditions. These allegations prompted an institution in California to file a lawsuit, which Tesla is questioning. Standard & Poor's also said that its decision was also influenced by the investigation of Tesla by the National Highway Traffic Safety Administration (NHTSA), after many people were injured or even killed because of their driver-assisted driving system Autopilot.

Dorn said: "Although Tesla may have played an active role in replacing fuel vehicles, from a broader ESG perspective, it has fallen behind other peers." Tesla shares were included in the Standard & Poor's 500 ESG index in May, 20021.Before it was removed, the stock ranked fourth in the index, second only to Apple, Microsoft and Amazon.

Exxon Mobil is the ninth stock in the index, which triggered a fierce attack from Musk. He wrote on Twitter: "ExxonMobil was rated as the top ten best companies in the world by the Standard & Poor's 500 Index in terms of environment, society and governance (ESG), but Tesla was not on the list! ESG index is a scam, which has been weaponized by false social justice fighters! I increasingly believe that enterprise ESG is the incarnation of the devil. "

Tesla previously wrote in the company impact report: "The current environmental, social and governance (ESG) report does not measure the scope of positive impact on the world. Instead, it focuses on measuring the dollar value of risk/return. Individual investors who entrust funds to ESG funds under large investment institutions may not realize that their money can be used to buy stocks of companies that make climate change worse, not better. "

In that report, Tesla also argued that other automakers can get higher ESG ratings, even if they have hardly reduced greenhouse gas emissions and continue to produce internal combustion engines. Standard & Poor's did not immediately respond to requests for comment on why ExxonMobil was on the list and why Tesla was removed from the list.

Tesla had previously been criticized by investors, who said that Tesla had released little information about the impact of its manufacturing or labor behavior.

Kristin Hull, founder and CEO of Nia Impact Capital, said: "In terms of the importance of environmental sustainability, Musk has vigorously promoted himself and Tesla. However, Tesla has always avoided providing information about the use of water and how to obtain all the materials of the battery. At the same time, you can't be sued for racial discrimination while being considered a big coffee in the ESG field. "

According to the S&P report, by the end of 65,438+02 in 2020, 65 billion US dollars of assets had been invested in funds linked to the Standard & Poor's 500 ESG index, far less than the 65,438+03 trillion US dollars linked to the Standard & Poor's 500 index, and Tesla is still a part of the latter. Compared with Tesla's total market value of nearly $750 billion, this $65 billion is also very small. Moreover, among these ESG funds, Tesla shares only account for a small part of their portfolio.

In addition, of the $65 billion linked to ESG index, only 1 65,438+0 billion is invested in passive index funds. After Tesla's delisting, these funds also need to sell their Tesla shares. Obviously, being included or excluded from the index may affect the company's share price. The rest are invested in funds based on the Standard & Poor's 500 ESG index, many of which are managed by portfolio managers. These funds do not need to sell their Tesla shares.

Jon Hale, director of sustainability research at Morningstar, a fund tracking company, said: "From the perspective of ESG, Tesla is not a very transparent company. Although the company's products are obviously beneficial to the environment, Tesla is now a big company, which has an impact on employees and customers. These problems worry ESG investors.

Even if delisting from the Standard & Poor's 500 ESG index will not affect a company's stock value, it may affect its actions. But Hale said: "Musk and Tesla may be an exception. However, on the other hand, in the current environment, few companies are willing to become laggards in the ESG field. "

Since the end of March, Tesla's share price has fallen by more than 30%, but this may have little to do with being delisted. More likely, because people are worried about Musk's acquisition of Twitter, investors' views on technology stocks have changed more widely.

Tesla was excluded from the ESG index, which Musk called a scam. The Standard & Poor's Dow Jones Index excluded Tesla from the Standard & Poor's 500 ESG Index. The reason is that Tesla is currently accused of racial discrimination and is being investigated by regulators for its auto-driving-related car accident.

In this regard, Tesla CEO elon musk responded with a number of tweets, calling ESG a scam and calling Standard & Poor's global rating unprofessional.

In the tweet, Musk quoted a sarcastic remark that ESG catered to the left, and said, "Tesla has contributed far more to the environment than other companies."

In another tweet, he wrote, "Exxon (the global oil and gas giant) ranks among the top ten in the world in terms of environment, society and governance (ESG), but Tesla is not on the list at all! ESG is a scam. It has become a weapon for fake social justice fighters. "

Later, Musk added, "Standard & Poor's global rating has lost its professional ethics."

Musk also tweeted that "the political attacks against me will escalate sharply in the coming months." Or suggest that Tesla's removal from the Standard & Poor's 500 ESG index is a political attack on Musk.

According to the official website, the Standard & Poor's 500 ESG index takes into account the S&P Dow Jones Index ESG score and market value. The goal of the Standard & Poor's 500 ESG Index is to cover a wide range of companies in the Standard & Poor's 500 Index, maintain a similar level of return, and provide better ESG characteristics.

Among the 308 constituent stocks selected by the Standard & Poor's 500 ESG Index, companies such as Apple, Microsoft, Amazon and Alphabet were selected again. Companies eliminated with Tesla include Berkshire Hathaway, Johnson & Johnson, Meta and so on.

With regard to Tesla's dismissal, Margaret Dorn5, Senior Director of North America and ESG Index Director of S&P Dow Jones Index Company, wrote in official website on May 17, explaining that the harsh working environment and racial discrimination exposed by Tesla's fremont factory, the handling of auto-driving-related casualties investigation, the lack of low-carbon strategy and business code of conduct are all unfavorable to Tesla.

Although Tesla has played a role in eliminating fuel vehicles, Dorn believes that from a broader ESG perspective, it has fallen behind its peers.

Tesla is being investigated for a car accident related to autonomous driving. According to Reuters, an American security agency said that it had begun to investigate a car accident involving an autopilot system in Tesla on May 12. At the time of the accident, the vehicle crashed into construction equipment, causing three people to die and three construction workers to be injured.

The survey is just one of 35 surveys on Tesla. Since 20 16, the National Highway Traffic Safety Administration (NHTSA) has investigated 35 accidents related to Tesla's autopilot system. As of May 18, when US stocks closed, Tesla fell 6.8% to 709,438+0 USD/share.