Tesla Kicked Out from S&P 500 ESG Index

Standard & Poor's 500 Environmental, Social and Governance list was created in 2019. Environmental, social, and governance (ESG) criteria are used to monitor investments and push firms to perform ethically based on company policy. The S&P 500 ESG Index ranks and effectively recommends firms to investors based on environmental, social, and governance data. Hundreds of data points per organization are used to determine how businesses influence the environment and treat stakeholders other than shareholders, such as customers, employees, vendors, partners, and neighbors.

When corporations that participate in risky or unethical practices are held accountable, ESG standards can assist investors avoid investment losses.

The S&P 500 ESG Index is a market-cap-weighted index that measures the performance of securities that meet sustainability standards while keeping overall industry group weights identical to the S&P 500.

Tesla is no longer eligible to be included in the S&P 500 ESG Index. Investors are likely to be surprised by the decision, which could have a minor influence on the stock price. Tesla has failed to offer adequate specifics about its low-carbon plan and norms of business conduct, according to S&P Dow Jones Indices. S&P Dow Jones' recent judgement may have been influenced by a succession of issues and legal fights surrounding Tesla. Following a spate of crashes attributed to Tesla's autopilot, the National Highway Traffic Safety Administration (NHTSA) started an investigation into the business last year. Tesla was also the subject of a recent lawsuit filed by a California state agency, alleging job discrimination.

Citing racial discrimination charges and crashes tied to its autonomous vehicles, a decision that caused Tesla CEO Elon Musk to send a series of critical tweets.

Tesla (CEO) Elon Musk responded on Twitter by calling ESG a "scam" after the company was dropped from an S&P Global index.

What do you think about Tesla’s removal from the Index? Is it fair?

Thank you.

Regards,

Virender Udherani,

Kautilya,

IBS Mumbai.