Photo: Tesla
Before Tesla was included in the S&P 500 index, people doubted that the company would make it, but it did. That does not mean that the index is comfortable with Tesla’s history of environmental violations, racism, and sexual harassment cases in its factories, and also with how it handles safety issues with its cars.
When the S&P 500 ESG Index was published, Margaret Dorn felt it was necessary to explain why Tesla did not make the cut. This is what she wrote in her article about that on Indexology Blog:
“A few of the factors contributing to its 2021 S&P DJI ESG Score were a decline in criteria level scores related to Tesla’s (lack of) low carbon strategy and codes of business conduct. In addition, a Media and Stakeholder Analysis, a process that seeks to identify a company’s current and potential future exposure to risks stemming from its 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.”
Summing this up, Autopilot’s deaths and the NHTSA investigation about it also excluded Tesla from the index. Regarding the “claims of racial discrimination and poor working conditions at Tesla’s Fremont factory,” there are multiple cases of racism reported at the Californian plant.
Melvin Berry won $1 million in August 2021 after being offended with racial slurs by his supervisors in Tesla. The compensation came in an arbitration process because Berry was a Tesla employee. The company forces all employees to solve any issues in these courts, which is why Cristina Balan is still fighting to clear her name after Tesla publicly accused her of embezzlement. The engineer is also fighting to end compulsory arbitrations.
Owen Diaz was a contractor, which allowed him to file his racism lawsuit against Tesla in a federal court in San Francisco. He won $6.9 million in compensatory damages for emotional distress and $130 million in punitive damages. Tesla managed to reduce that respectively to $1.5 million and $13.5 million. Diaz appealed the decision.
If that was not enough, the California DFEH (Department of Fair Employment and Housing) filed a lawsuit against Tesla for “systematic racial discrimination and harassment.” It also accused the company of moving to Texas to avoid accountability.
Elon Musk did not like that and started a rant on Twitter that was not left without a response.
ESG Hound, a Twitter profile dedicated to studying Environmental, Social, and Governance issues, made a list to dispute Musk’s allegations that Exxon being included proved that “ESG is a scam” that “has been weaponized by phony social justice warriors.”
The response to Musk’s virtual temper tantrum has eleven points. The most important ones are related to racism and the multiple air quality violations (at least 30) from Fremont. Tesla had to pay a $1-million fine. According to ESG Hound, they were caused because Tesla turned down a control device at the paint shop during the Model 3 production ramp-up.
ESG Hound also brings up stuff related to SpaceX, which is involved in multiple environmental concerns in Texas. However, it refers more to Elon Musk greenwashing his businesses than to Tesla itself. There is still enough related to the EV maker, such as the showroom in Xinjiang, where China is accused of genocide against the Uygurs, Musk’s issues with the SEC, lying about FSD’s capabilities (autonowashing), et cetera. Only die-hard fans of the billionaire or Tesla investors would side with him on this one.
“A few of the factors contributing to its 2021 S&P DJI ESG Score were a decline in criteria level scores related to Tesla’s (lack of) low carbon strategy and codes of business conduct. In addition, a Media and Stakeholder Analysis, a process that seeks to identify a company’s current and potential future exposure to risks stemming from its 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.”
Summing this up, Autopilot’s deaths and the NHTSA investigation about it also excluded Tesla from the index. Regarding the “claims of racial discrimination and poor working conditions at Tesla’s Fremont factory,” there are multiple cases of racism reported at the Californian plant.
Melvin Berry won $1 million in August 2021 after being offended with racial slurs by his supervisors in Tesla. The compensation came in an arbitration process because Berry was a Tesla employee. The company forces all employees to solve any issues in these courts, which is why Cristina Balan is still fighting to clear her name after Tesla publicly accused her of embezzlement. The engineer is also fighting to end compulsory arbitrations.
Owen Diaz was a contractor, which allowed him to file his racism lawsuit against Tesla in a federal court in San Francisco. He won $6.9 million in compensatory damages for emotional distress and $130 million in punitive damages. Tesla managed to reduce that respectively to $1.5 million and $13.5 million. Diaz appealed the decision.
If that was not enough, the California DFEH (Department of Fair Employment and Housing) filed a lawsuit against Tesla for “systematic racial discrimination and harassment.” It also accused the company of moving to Texas to avoid accountability.
Elon Musk did not like that and started a rant on Twitter that was not left without a response.
ESG Hound, a Twitter profile dedicated to studying Environmental, Social, and Governance issues, made a list to dispute Musk’s allegations that Exxon being included proved that “ESG is a scam” that “has been weaponized by phony social justice warriors.”
The response to Musk’s virtual temper tantrum has eleven points. The most important ones are related to racism and the multiple air quality violations (at least 30) from Fremont. Tesla had to pay a $1-million fine. According to ESG Hound, they were caused because Tesla turned down a control device at the paint shop during the Model 3 production ramp-up.
ESG Hound also brings up stuff related to SpaceX, which is involved in multiple environmental concerns in Texas. However, it refers more to Elon Musk greenwashing his businesses than to Tesla itself. There is still enough related to the EV maker, such as the showroom in Xinjiang, where China is accused of genocide against the Uygurs, Musk’s issues with the SEC, lying about FSD’s capabilities (autonowashing), et cetera. Only die-hard fans of the billionaire or Tesla investors would side with him on this one.
5. Tesla deliberately turned off a Paint Shop control device during the initial Model 3 ramp up to meet production goals, resulting in large quantities of highly hazardous pollutants
— ESG Hound (@ESGhound) May 18, 2022
6. You were charged with fraud by the SEC
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