Tesla Removed From ESG Index

Tesla (TSLA) has been removed from the S&P 500 ESG Index, which scores companies on environmental, social, and governance (ESG) standards. Investopedia

Margaret Dorn, who is the senior director of ESG indices for North America at S&P Dow Jones Indices, had said the electric vehicle maker was dropped in the index’s fourth annual rebalancing because it doesn’t have a low-carbon strategy and has questionable records about its business conduct and policy enforcement.

Dorn indicated Tesla’s score this year was impacted by claims of racial discrimination and poor working conditions at its Fremont, Calif. factory, and the company’s handling of the investigation by federal regulators over accidents linked to its vehicles’ autopilot feature. She added that while Tesla is helping take fossil fuel-powered cars off the road, it’s fallen behind its peers “when examined through a wider ESG lens.”

A series of controversies and legal battles involving Tesla may have factored into S&P Dow Jones’ recent decision. Last year, the National Highway Traffic Safety Administration (NHTSA) opened a probe against Tesla following a series of crashes attributed to the company’s autopilot. Tesla was likewise faced with a recent lawsuit compiled by a California state agency, alleging discrimination within the workplace.Tesla Removed From ESG Index

Tesla (TSLA) has been removed from the S&P 500 ESG Index, which scores companies on environmental, social, and governance (ESG) standards.

Margaret Dorn, senior director and head of ESG indices for North America at S&P Dow Jones Indices, said the electric vehicle maker was dropped in the index’s fourth annual rebalancing because it doesn’t have a low-carbon strategy and questions have been raised about its business conduct.

Dorn noted that Tesla’s score this year was impacted by claims of racial discrimination and poor working conditions at its Fremont Calif factory, and the manner the company handled of the investigation by federal regulators over cases of accidents linked to its vehicles’ autopilot feature. She also added that while Tesla is helping take fossil fuel-powered cars off the road, but is fallen behind its peers “when examined through a wider ESG lens on policies and compliance.”

This news has also has an impact on TSLA stock as it joins other Tech companies declining in price as the US Federal reserve continue tighten and fighting inflation, which has been in 40 years high.