ARK founder Cathie Wood says Tesla removal from S&P ESG is ‘ridiculous’

ARK Invest found Cathie Wood called Tesla’s removal from the S&P’s Environment, Social & Governance Index “ridiculous” after the automaker was not included on the list due to “a decline in criteria-level scores” in low-carbon strategies and its “codes of business conduct.”

On Wednesday, Tesla was removed from the S&P’s ESG Index after a standard rebalancing. While Tesla, which has accelerated the world’s transition to sustainable energy, especially through transportation, was removed from the index, companies like Exxon, a global giant in oil production, remained.

The S&P noted that its low-carbon solutions and recent string of lawsuits accusing the automaker of a toxic work environment at the Fremont Factory contributed to the decision.

“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,” the S&P 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.”

Tesla’s CEO Elon Musk dubbed the ESG index as an “outrageous scam,” stating that it “has been weaponized by phony social justice warriors.”

Cathie Wood, the founder of ARK Invest, a prominent Tesla bull, called the ESG’s removal of Tesla “Ridiculous. Not worthy of any other response.”

Ridiculous. Not worthy of any other response. https://t.co/zwISYknbKB

— Cathie Wood (@CathieDWood) May 19, 2022

Wood, who has covered and invested in Tesla for years through several of ARK’s ETFs, has broken apart the company and analyzed nearly every detail. ARK has high expectations for Tesla in the next few years, including a bullish take on its Robotaxi fleet, which the fund believes will be a major revenue stream for the automaker moving forward.

Along with the company’s obvious technological prowess, Tesla has contributed immensely to the world’s needs environmentally, especially with its overwhelming influence that has caused a major disruption in the global automotive market. The S&P’s removal of Tesla from the ESG Index is not permanent, and perhaps the automaker will be reconsidered in the future.

Tesla stock has fallen over 40 percent so far in 2022, but is up over 26.5 percent in the past year. ARK’s Innovation ETF also is down, losing 55 percent of its value so far this year.

Disclosure: Joey Klender is a TSLA Shareholder. He does not invest in ARK’s ETFs.

I’d love to hear from you! If you have any comments, concerns, or questions, please email me at joey@teslarati.com. You can also reach me on Twitter @KlenderJoey, or if you have news tips, you can email us at tips@teslarati.com.

The post ARK founder Cathie Wood says Tesla removal from S&P ESG is ‘ridiculous’ appeared first on TESLARATI.

Source: TESLARATI

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