MSCI has given SpaceX the lowest possible ESG score, reflecting a rather pessimistic view of the company’s sustainability performance.
Following the assessment, the company’s shares fell 4% after its recent high-profile IPO, despite soaring 65% above the offering price on their first trading day.
⚡️According to MSCI’s report, SpaceX demonstrated inadequate management of ESG-related risks. The company received just 1 out of 10 in the “Controversies” category and 3.2 out of 10 for Corporate Governance.
Musk responded in his characteristic style: “Unfortunately, electric rockets are impossible.”
In reality, much of the ESG criticism comes down to the technical limitations of the aerospace industry, where emissions remain unavoidable with current technology. It’s difficult to argue with that. At this stage, the regulatory approach appears to be an attempt to apply standards designed for one industry to another, where they do not necessarily fit.
However, Musk’s conflict with ESG ratings is nothing new. Back in 2022, Tesla was removed from the S&P 500 ESG Index. At the time, Musk described ESG as “a scam” and “a weapon of phony social justice warriors.” Ironically, Exxon Mobil remained in the index, while the all-electric Tesla was excluded.
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