Elon Musk loses US$12.3 billion in 24 hours amid tweeting politics and calling ESG a “scam”

Elon Musk loses US$12.3 billion in 24 hours amid tweeting politics and calling ESG a “scam”
FILE PHOTO: Elon Musk looks at his mobile phone in Cape Canaveral, Florida, U.S. January 19, 2020. REUTERS/Joe Skipper

Wednesday was probably the typical mid-week “hump day for most people.” But Elon Musk, the world’s richest man and Tesla CEO, was busy tweeting away US$12.3 billion of his wealth.

That day, Tesla lost its spot on the widely-known S&P 500 ESG Index, in which companies are assessed based on environmental, social and governance standards. Musk then responded by calling the index “a scam” on Twitter. He talked about his political shift from Democrat to Republican in a separate tweet.

While this was happening, Tesla shares dropped to a record low, shaving off a chunk of Musk’s riches. According to business heads, though, the car company has unresolved issues with racial discrimination, poor working conditions and autopilot-related crashes, just to name a few, which led to it losing its spot on the S&P.

Key comments:

“Exxon is rated top ten best in world for environment, social & governance (ESG) by S&P 500, while Tesla didn’t make the list!,” tweeted Musk on Wednesday. “ESG is a scam. It has been weaponized by phony social justice warriors.”

“In the past I voted Democrat, because they were (mostly) the kindness party,” said Musk in a separate tweet on Wednesday. “But they have become the party of division & hate, so I can no longer support them and will vote Republican.”

According to Margaret Dorn, Senior Director and Head of ESG Indices at S&P Dow Jones Indices, Tesla’s products did help alleviate planet-warming emissions by expanding solar-power systems. But, unresolved issues need to be addressed. “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,” Dorn said in an interview.