Office Hours: Tesla’s ESG Rating, the Closed IPO Market, and Advancing Your Career

ESG Practices

Scott Galloway critiques the inconsistencies in ESG ratings, highlighting the removal of Tesla from S&P's top ten while retaining Exxon. He argues that ESG has become a marketing cliché, losing its original purpose and becoming a tool for cultural elites to dictate behavior. Galloway emphasizes that fossil fuels, despite their environmental impact, have been crucial for economic growth and prosperity, making the ESG criteria questionable.

ESG has been weaponized. It's become meaningless. It's become an easy target for conservatives.

--- Scott Galloway

The discussion underscores the need for clear metrics to genuinely assess companies' environmental impact, rather than relying on subjective judgments 1 2.

   

Musk's Response

Elon Musk's reaction to Tesla's ESG rating removal was notably outspoken, labeling the ESG system as a scam. Scott Galloway acknowledges Musk's point, noting that the decision seems arbitrary given Tesla's role in promoting electric vehicles. He suggests that the ESG framework is flawed, as it allows companies like Exxon to maintain high ratings despite their environmental impact.

ESG is Vaseline smeared over a very dirty lens.

--- Scott Galloway

This controversy highlights the broader implications of ESG ratings and their impact on corporate reputations and stock values 1.