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Tesla is Kicked Off an Index For Socially Responsible Companies While Exxon Remains

• https://observer.com By Sissi Cao

The S&P Global kicked Tesla out of its S&P 500 ESG Index after an annual re-balancing. Elon Musk questions why Exxon Mobil, the nation's largest oil and gas producer, managed to stay in the index.

Investors care about the ESG (environmental, social and governance) profiles of large corporations more than ever. In 2019, S&P Global, the ratings firm behind the S&P 500 Index, introduced a new benchmark called the S&P 500 ESG Index, a weighted selection of about 300 public companies the firm believes have achieved a good balance between financial return and sustainability performance.

One would think Tesla, the world's largest electric vehicle maker, would easily make the list and it did for several years. But not any more. In April, S&P decided to exclude the company from its ESG Index after an annual re-balancing. Meanwhile, the firm assigned a higher ESG score to Exxon Mobil, the largest oil and gas producer in the U.S., and included it in this year's index.

S&P isn't the only third-party organization with this view. In environmental index compiled by the University of Massachusetts last year, Tesla was ranked as a bigger air polluter than Exxon Mobil and Marathon Petroleum.


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