'It Needs To End:' Elon Musk Rages Again Against 'Corrupted Lie' Of ESG Scores After Tesla's Low Rating Puzzles Cathie Wood

view original post

Loading…
Loading…

S&P Global’s most recent environmental, social, and governance (ESG) score for Tesla, Inc. TSLA did not sit well with CEO Elon Musk and the EV company’s bullish analysts.

What Happened: The annual update, typically conducted in late May, gave Tesla an ESG score of 40. Cathie Wood-led Ark Investment Management‘s Chief Futurist, Brett Winton, shared a screenshot on social media platform X, comparing Tesla’s ESG score to that of tobacco giant Philip Morris International Inc. PM, which received an 85. S&P Global’s ESG scores range from 0 to 100, with higher scores indicating better ESG performance.

Winton also reshared a post highlighting that Forbes named Philip Morris the number one company in its 2024 “Net Zero Leaders” list – companies that aim to slow global warming by eliminating or offsetting their pollution.

In a critical response, Winton stated, “Makes sense. Killing your customers is a very cost-efficient way to reduce emissions.”

Musk responded to Winton’s post, saying, “ESG is a corrupted lie. It needs to end.”

Ark Invest CEO Wood also expressed her disapproval, stating, “Ridiculous, and more ridiculous. Tesla’s ESG score is 40 but Phillip Morris’s score is 85, with higher better. What?”

See Also: Everything You Need to Know About Tesla Stock

Not A New Grouse: Musk’s criticism echoes his views from last year. Responding to a social media user’s observation about tobacco companies ranking high on ESG lists, Musk stated, “ESG is used as a moral cloak to hide bad behavior.”

In 2022, Tesla was excluded from the S&P Global ESG Index due to concerns regarding its “low-carbon strategy,” “code of business conduct,” and alleged issues with racism and poor working conditions at its Fremont factory.

A Complex Issue: S&P Global considers various factors when evaluating companies, including their environmental impact, treatment of stakeholders (customers, employees, vendors, partners, and neighbors), and governance practices.

ESG scores are used by investors who prioritize companies with environmental and social consciousness, alongside good governance. Investment funds focused solely on ESG-compliant companies have also emerged.

While Tesla emphasizes the emissions-reducing capabilities of its EVs, critics argue that battery manufacturing has its own environmental drawbacks.

The iShares ESG Advanced MSCI USA ETF USXF ended Wednesday’s session up 2.01% at $46.19, according to Benzinga Pro data.

Check out more of Benzinga’s Future Of Mobility coverage by following this link.

Read Next: Cult Of Tesla Crumbling: Early ‘Die-Hard’ Backers Bail As Musk’s EV Empire Faces Reality Check Amid Stock Slump

Image generated via AI on MidJourney

Market News and Data brought to you by Benzinga APIs