Elon Musk lashed out on Twitter after Tesla was removed from a widely-followed sustainability index on Wednesday over concerns ab...
Elon Musk lashed out on Twitter after Tesla was removed from a widely-followed sustainability index on Wednesday over concerns about the company's lack of low carbon strategy, allegations of workplace racism and Autopilot deaths.
Tweeting into the wee hours of Thursday, Musk responded to well-known tech investor Cathie Wood, who called Tesla's removal from the S&P 500 ESG Index 'ridiculous', adding: 'Not worthy of any other response.'
'Yup,' responded Musk, 'A clear case of wacktivism.'
'What I love most about wacktivists is their incredible sense of humor,' he added in another tweet.
Tesla has become the most valuable auto industry company by pioneering electric vehicles, but was removed from the ESG Index, which measures the 'performance of securities meeting sustainability criteria.'
Elon Musk lashed out on Twitter after Tesla was removed from a widely-followed sustainability index on Wednesday
An executive with S&P Dow Jones Indices, which maintains the index, said that Tesla had been removed because of issues including claims of racial discrimination and crashes linked to its autopilot vehicles.
The move was effective on May 2 but was only announced on Wednesday in a blog post from SPDJI.
In other changes, the sustainability index also added soon-to-be-Musk-controlled Twitter and oil refiner Phillips 66 while dropping Delta Air Lines and Chevron, according to an announcement.
'ESG' stands for environmental, social and governance. The criteria is used by 'socially conscious' investors when deciding where to put their money, according to Investopedia.
Tesla remains on the regular S&P 500 index, which measures the largest companies in the US by market capitalization.
The index provider cited various issues at Tesla that significantly lowered its ESG score, including Autopilot technology that has been linked to at least 11 deaths since 2016.
Allegations of racism also contributed to the company's removal. Last October, a jury awarded $137 million to a former contractor who called Tesla's Fremont plant a 'hotbed of racist behavior.'
Earlier, Musk slammed the decision on Twitter, claiming that the index 'has been weaponized by phony social justice warriors.'
S&P Dow Jones Indices removed Tesla from the S&P 500 ESG index after it failed to meet sustainability and social responsibility criteria. Above, the company's HQ in Beijing, China
Musk slammed the index on Twitter, which ironically was added to the index at the same time that Tesla was taken off
Tesla's stock has fallen by nearly 29 percent in the past month, after founder Elon Musk filed a bid to buy Twitter for $44 billion
On Twitter, Musk added: 'Exxon is rated top ten best in world for environment, social & governance (ESG) by S&P 500, while Tesla didn't make the list! ESG is a scam.'
The de-listing is the latest blow to Tesla. The company's stock has fallen by nearly 29 percent in the past month, after Musk announced plans to buy Twitter for $44 billion.
The move is 'related to Tesla's (lack of) low carbon strategy.'
Even though Tesla is contributing to reducing emissions with its electric cars, its issues and lack of disclosures relative to industry peers should raise concerns for investors looking to judge the company across ESG criteria, said Margaret Dorn, the organization's head of ESG indices for North America,
'You can't just take a company's mission statement at face value, you have to look at their practices across all those key dimensions,' she said.
S&P Dow Jones also blamed the company's codes of business conduct, which it describes as 'a company's implementation, transparent reporting on breaches and the occurrence of corruption and bribery cases and anti-competitive practices.'
Tesla is at risk of controversy after an analysis 'identified two separate events centered around claims of racial discrimination and poor working conditions at Tesla's Fremont factory, as well as its handling of the NHTSA investigation after multiple deaths and injuries were linked to its autopilot vehicles,' the index provider said.
'Both of these events had a negative impact on the company's S&P DJI ESG Score at the criteria level, and subsequently its overall score.
'While Tesla may be playing its part in taking fuel-powered cars off the road, it has fallen behind its peers when examined through a wider ESG lens,' it added.
Last October, a California jury awarded former Tesla contractor Owen Diaz (pictured) $137 million verdict after he sued alleging racial harassment at the Fremont factory
Black workers at Tesla's Fremont factory (pictured) were regularly subjected to deeply offensive racial slurs and jokes by co-workers and managers, according to a complaint
Elon Musk and Tesla haven't commented on the company being de-listed from a sustainability index used by 'socially conscious' investors. Above, Musk at the Met Gala on May 2
The National Highway Traffic Safety Administration has sent teams to at least 27 crashes involving Autopilot since 2016. The technology has been linked to at least 11 deaths.
The agency doesn't publicize names of victims, though some have been revealed by local law enforcement and reported in media outlets.
Last October, a California jury awarded former Tesla contractor Owen Diaz a staggering $137 million verdict after he sued alleging racial harassment at the Fremont factory.
Diaz's lawsuit described the Fremont, California, plant, as a 'hotbed of racist behavior' where he was subjected to daily racist abuse including the N-word over a course of 11 months from 2015 to 2016.
The 52-year-old contracted elevator operator claimed fellow employees drew swastikas and left racist graffiti around the plant, while he said one of his supervisors drew a person with a black face and a bone in his hair and wrote 'booo,' short for 'jigaboo.'
The supervisor then allegedly told him 'he couldn't take a joke' when Diaz confronted him. Diaz contended that none of his supervisors stepped in to stop the abuse.
Kevin Kish, the director of the California Department of Fair Employment and Housing (DFEH), said the agency had received hundreds of complaints from workers at the plant.
The agency filed a complaint against the company in February after it found evidence of 'segregation and hostile work environment' at the carmaker's Fremont plant.
The DFEH 'found evidence that Tesla's Fremont factory is a racially segregated workplace where Black workers are subjected to racial slurs and discriminated against in job assignments, discipline, pay, and promotion', Kish said in a statement reported by the Wall Street Journal and Bloomberg.
'The facts on this case speak for themselves,' Kish added.
Ahead of the filing, Tesla released a statement saying it 'opposes all forms of discrimination and harassment' and that it is committed to providing 'a workplace that is safe, respectful, fair and inclusive.'
The family of 15-year-old Jovani Maldonado (pictured) has sued Tesla after he died in an Autopilot-involved accident
But according to the DFEH, workers at the factory would be 'taunted by racial slurs and then baited into verbal and physical confrontations' by non-black workers and would subsequently face disciplinary action.
The company's Autopilot technology is also part of the reason it was removed from the ESG index.
Last October, the NHTSA demanded to know why Tesla hasn't recalled cars with a suspected autopilot flaw that caused several crashes.
The agency's investigation covered 765,000 vehicles and included almost everything that Tesla has sold in the US since the start of the 2014 model year up to that point.
In 2019, 15-year-old Jovani Maldonado was killed after a Tesla on Autopilot hit a Ford Explorer pick-up truck on a California highway, sending the truck rolling.
His family sued the electric car giant.
Last month, video emerged of a Tesla crashing into a $2m private yet while being 'summoned' across a Washington airfield by its owner.
The rogue Model Y kept on going after slamming into the Cirrus Vision at the airfield, believed to be in Spokane.
In January, California prosecutors filed charges against a man who allegedly ran a red light and killed two people in 2019 while driving a Tesla on Autopilot.
Kevin George Aziz Riad, 27, pled not guilty to two counts of vehicular manslaughter.
HisTesla Model S was moving at a high speed when it left a freeway and ran a red light before striking a Honda Civic on December 29, 2019, police said. The two people in the Civic died at the scene.
Experts calling it the first set of serious charges against someone using a widely available driver-assist system.
S&P Dow Jones says Tesla could still re-join the sustainability index in the future if it meets the requirements again.
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