Tesla booted from S&P ESG index

Elon Musk's Tesla has been removed from the ESG version of the S&P 500 index, leading the founder and entrepreneur to state "ESG is a scam". 

In a 17 May blog post on the S&P website posted by Margaret Dorn, head of ESG indices for North America, the company explained the index has undergone its fourth rebalance.

She stated Tesla was "ineligible for index inclusion" as its ESG score, as calculated by the group, had fallen to the bottom 25% of its peer group.

S&P noted the sector the company sits in, automobiles and components, had experienced an "overall increase" in its average ESG score, while Tesla had remained stable.

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Dorn flagged recent concerns relating to Tesla's working conditions, the handling of an investigation into deaths and injuries linked to its driver-assistance systems, a lack of low-carbon strategy and codes of business conduct.

The blog concluded the "beauty of the annual rebalance" means Tesla and others will be eligible for inclusion in the future.

Musk took to Twitter yesterday evening (18 May) stating that "ESG is a scam". He added that it "has been weaponised by phony social justice warriors".

The CEO highlighted that Exxon is rated in top ten of the S&P 500 ESG index by largest constituents. Others in that group include technology names such as Apple, Microsoft, Amazon and Alphabet.