The S&P 500 ESG Index uses environmental, social, and governance data to effectively rank and recommend companies to investors. Its criteria include hundreds of data points per company that relate to how companies affect the planet and treat stakeholders beyond shareholders, including customers, employees, suppliers, partners, and neighbors.
As a justification for the expulsion, it was said that Tesla’s “lack of a low carbon strategy” and “codes of business conduct”, along with the racism and poor working conditions reported at the Tesla factory in Fremont, California, affected the score. Tesla’s handling of an investigation by the National Highway Transportation Safety Administration also weighed on its score.
While Tesla’s stated mission is to accelerate the world’s transition to sustainable energy, it reached a settlement with the Environmental Protection Agency in February of this year after years of Clean Air Act violations and failure to track their own emissions. Tesla was ranked 22nd in last year’s Toxic 100 Air Polluters index, compiled annually by the Political Economy Research Institute at U-Mass Amherst, worse than Exxon Mobil, which was ranked 26th. (The index uses data from 2019, the most recent available.)
In Tesla’s first quarter filing, the company also revealed that it is being investigated for its waste management in the state of California, and that it had to pay a fine in Germany for failing to meet “take back” obligations in the country. due to exhausted batteries. .
In the meantime, The California Department of Fair Employment and Housing sued Tesla for harassment and discrimination against black people at its Fremont auto plant. The agency says it found evidence that Tesla routinely kept black workers in low-level positions at the company, assigned them more physically demanding and dangerous tasks, and retaliated against them when they complained of racist slurs.
Last year, the National Labor Relations Board said that Tesla had also engaged in unfair labor practices. “While Tesla may be playing his part in phasing out fuel-powered cars, he has fallen behind his peers when examined through a broader ESG lens,” the S spokesperson wrote. & P.
In a company impact report that followed, Tesla sought to defend itself: “Current environmental, social and governance (ESG) reporting does not measure the extent of positive impact on the world. Instead, it focuses on measuring the dollar value of risk/return. Individual investors, entrusting their money to ESG funds from large investment institutions, may not be aware that their money can be used to buy shares of companies that make climate change worse, not better.”
In that report, Tesla claimed that other automakers could achieve higher ESG ratings even if they barely reduce their greenhouse gas emissions and continue to make internal combustion engine vehicles.
Source: Ambito
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