Tesla has fallen out of the S&P 500 ESG index, and Elon Musk is spitting feathers. Some of Musk’s supporters are not too happy either — but there is a deeper issue. 

And so it begins- S&P ditches Tesla from ESG index, and it becomes polarising

“What little old me?” Elon Musk is not happy with ESG. In a recent tweet, reacting to the news that Tesla is no longer in the S&P 500 ESG index, Musk exclaimed that the company is ”doing more for the environment than any company ever!” 

He accompanied the tweet with an image of Dwayne Johnson in a car with actor AnnaSophia Robb, asking, “What’s an ESG score?” To which comes the reply: “It determines how compliant your business is with the leftist agenda.” 

Musk is not a happy bunny. In a series of Tweets, he seemed decidedly vexed!

And while Tesla is out, Exxon is in. The oil company famous for being especially unpopular with the climate change lobbyists is on the list. (If someone spends 95 per cent of their time doing good and the rest of their time strangling kittens, does the good make-up for the bad? I don’t think so.) 

Musk wasn’t too happy about Exxon’s ESG score, either.

Tesla ESG ratings were too low for the index because of concerns over racial discrimination claims within Tesla and doubts over the safety record of Tesla cars in autopilot.

And Musk and a good percentage of his fans reacted with fury, seeing it all as a left-wing plot, with ESG nothing less than a socialist scam designed to suck us into a kind of socialist utopia in which the new Bible is called: “The Book of Woke.”

Whether Tesla deserves its poor ESG score has been covered here before. 

But the issue of ESG being labelled as left-wing is important. Supporting ESG is not inconsistent with holding views to the right of the political spectrum, but there is a perception that it is. And perception might not be everything, but it is almost everything.

Wokeness, ESG and the left

To be clear, there are many erstwhile Musk fans out there — people who bought Tesla cars, Tesla shares and bigged up Musk at every opportunity — who feel differently. To many, he is “the entrepreneur’s entrepreneur”. 

And yet many of those people are finding that their own mouth is full of feathers they need to expectorate — not because they are furious with S&P, but because their hero has gone bad on them. Or so is the perception.

For many Musk fans, these events represent the most disappointing character change from someone they once admired since Daenerys Targaryen took to her dragon and burned King’s Landing from the air. 

And so, like with everything else, we see a great polarisation. This time, it is within a demographic I characterise as erstwhile and current Musk fans.

The reality of ESG

Despite Musk’s claims, ESG isn’t a left-wing concept. Instead, it is an investment strategy and has become a marketing approach. 

It is an investment strategy because of the view that companies which abide by certain principles will make higher profits in the long term.

Over and over again, you hear ESG advocates say, “I am a card-carrying capitalist.” (Well, maybe not over and over again, but I have heard two ESG folks say that.)

Maybe these ESG fans who promote their capitalist ethos are like Shakespeare’s Queen Gertrude — protesting too much. But I don’t think so; there is no contradiction between ESG and capitalism.

But maybe there is a contradiction between Gordon Gekko’s “greed is good” form of capitalism and ESG. I have long had my doubts about the compatibility of ESG with the ideology of Ayn Rand — an ideology that is not famous in Europe but is enormously popular in the US.

Perhaps ESG is “enlightened capitalism”. The “S” part seems to hinge on the idea that there is profit in being nice. Well, maybe there is: there are plenty of reasons to believe evolution created altruistic traits in nature because altruism is self-serving. But it is the “S” where Tesla seems to fail — or at least antagonise the ESG rating agencies.


The view that ESG is a left-wing concept and just a way of commercialising “wokeness” is dangerous.

One rationale behind ESG is that customers want to believe the companies they buy products from are doing the right thing. The rationale suggests that this purchasing motive is especially prevalent amongst Millennials and Generation Z and will become more dominant as they age. 

But we live in a divided world. And what ESG must avoid is getting caught up in that divide.

Customers vote with their purses and wallets. Some might be drawn to certain brands because they like their ethos. But others might turn from brands because they think their ethos is too woke, too left, or just too “ESG”. 

ESG has a tricky path to tread — and must avoid becoming part of the polarisation or taking sides. 

Digital Trust Europe London - ESG World Forum

ESG World Forum
7-8 June 2022, Park Plaza Westminster Bridge, London

Part of the Digital Trust Europe Series

ESG World Forum is a two-day, in-person event taking place as part of the Digital Trust Europe series. 2021 was widely considered “the year of ESG investing.” Given the importance society has placed on ESG issues following COP26, we are likely to see this growth trend continue throughout 2022.

ESG World Forum will bring together a range of leading ESG experts and executive speakers from a range of industries as every major company is considering ESG strategies. 


ESG world forum