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BREAKING NEWS: Tesla is REMOVED from S&P 500 ESG Index after it was hit with claims of racial discrimination in factories and its handling of investigations into Autopilot crashes
- The electric carmaker was removed from an index measuring ‘sustainability’
- Dow Jones cited multiple issues that lowered its score, including concerns about its lack of low carbon strategy and codes of business conduct
- It also cited allegations of racial discrimination and deaths involving Autopilot
- The self-driving technology has been linked to at least 11 deaths since 2016
- Last year, a jury gave an ex-Tesla contractor $137M for alleged racial harassment
- Tesla remains on the regular S&P 500 measuring market capitalization
Tesla has been removed from a widely-followed sustainability index over concerns about its lack of low carbon strategy, claims of racial discrimination and deaths involving its Autopilot technology.
S&P Dow Jones Indices removed the electric carmaker from the S&P 500 ESG index on May 2, the company announced in a blog post Wednesday.
The index measures the ‘performance of securities meeting sustainability criteria.’
‘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 racial discrimination claims, poor working conditions and its handling of a government investigation after crashes linked to its self-driving cars
Autopilot technology has been linked to at least 11 deaths since 2016.
The company’s stock has fallen by nearly 29 percent in the past month, after founder and CEO Elon Musk announced plans to buy Twitter for $44 billion.
S&P Dow Jones Indices removed Tesla from the S&P 500 ESG index on May 2 after it failed to meet several sustainability and social responsibility criteria
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
The de-listing is another blow to Tesla as its stocks take a hit amid its mercurial founder’s bid to buy Twitter and undo its content moderation apparatus.
The move is ‘related to Tesla’s (lack of) low carbon strategy and codes of business conduct,’ the index said.
It describes the codes of business conduct as ‘a company’s implementation, transparent reporting on breaches and the occurrence of corruption and bribery cases and anti-competitive practices.’
S&P Dow Jones also says the company is at risk of controversy after an analysis considered it’s ‘involvement in a controversial incident, 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.
‘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.’
The National Highway Traffic Safety Administration has sent teams to 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.
S&P Dow Jones says Tesla could still re-join the sustainability index in the future if it meets the requirements again.