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‘ESG is the devil’: Elon Musk sounds off on mind-boggling report finding big tobacco more ethical than Tesla

June 15, 2023 | | Print Article

Tesla has a lower ESG score than the world’s top cigarette manufacturers, and critics, including Tesla boss Elon Musk, say this is proof that ESG scores are bad.

According to the Corporate Finance Institute, an ESG score is a “measurement or evaluation of a given company, fund, or security’s performance with respect to Environmental, Social, and Governance (ESG) issues.”

It’s basically a measurement of how “woke” an investment or company is. This measurement tool is relevant because last month the S&P 500 kicked Tesla off its ESG Index because of its own low score.


Yet a bunch of far more arguably harmful companies still made the index, including Philip Morris International, the maker of Marlboro cigarettes.

This raises the question, as asked by the Washington Free Beacon, as to “[h]ow could cigarettes, which kill over eight million people each year, be deemed a more ethical investment than electric cars?”

It doesn’t make much sense, does it?

Here are Musk’s personal thoughts about ESG:

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Evil is one way to put it. Another is “progressive.” Companies like Altria, one of the largest tobacco producers in the world, are very “progressive” in how they act.

“Companies like Altria have gone out of their way to emphasize the diversity of their corporate boards and the breadth of their social justice initiatives, from funding minority businesses to promoting transgender women in sports,” according to the Washington Free Beacon.

Now contrast this with Tesla, which is neither “woke” nor “progressive.”

“Tesla, whose executives are overwhelmingly white men, has resisted that bandwagon, going so far as to fire its top LGBT diversity officer last year,” the Beacon notes.

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Suffice it to say, Musk doesn’t run Tesla with the purpose of appeasing “woke” zealots. He runs it with the purpose of … running a successful business.

“Any cause that makes makes it’s virtue unquestionable will immediately be adopted by the unvirtuous,” he recently tweeted about “wokeness” and ESG in general:

He had a point.

The thing about ESG is that it didn’t start out all too bad.

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“Early ESG efforts were laser-focused on ‘sin stocks’—companies whose core business was deemed immoral—including tobacco,” the Beacon notes.

But then it went completely “woke.”

“[A]s ESG investing has ballooned, so has the number of variables used in ESG ratings, which now encompass everything from labor practices and carbon pledges to diversity trainings and human rights. That has created countless opportunities to game the system, experts say, and lets even the most sordid companies score points—and investors—by toeing the progressive line,” according to the Beacon.

Exactly. They’re pretending to be virtuous when in reality some of the companies with the highest ESG scores are peddling pure poison to people.

“Cigarettes are the leading cause of preventable death in the United States, killing more people than alcohol, illegal drugs, and car accidents combined. And their supply chain involves a litany of environmental sins: The industry’s carbon footprint is substantial, and even e-cigarettes, marketed as a less harmful alternative to tobacco, can result in serious pollution because they don’t biodegrade,” the Beacon notes.

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“Tobacco farming, which mostly takes place in developing countries, causes deforestation and soil erosion. Tobacco workers are exposed to toxic chemicals, including high doses of nicotine, which can lead to hospitalization.”

Boyden Gray & Associates managing partner Jonathan Berry, who reportedly sued NASDAQ last year over its corporate boardroom diversity requirements, isn’t surprised by any of this.

“ESG company ratings often measure abstract woke goals that have no rational connection to companies’ actual businesses. Companies score ‘points’ mainly by demonstrating their compliance with the latest dogmas issued by the DEI complex,” he said to the Beacon.

And in doing so, ESG scores help companies like Altria and Philip Morris purport to be doing good for the world when they’re clearly selling poison.

“An unusually green tobacco giant could score better than an electric carmaker with an all-male board, and corporations can earn points merely by setting water reduction targets or using ‘diverse’ suppliers,” the Beacon notes.

Which may be why, according to the Beacon, Philip Morris is bragging about “empowering” female tobacco farmers in its 2022 report. This sort of virtuous rhetoric is now standard fare among tobacco companies.

“Imperial Brands touts its trainings on ‘microaggressions’ and a board that is 40 percent women. Philip Morris International and British American Tobacco promote their scores on Bloomberg’s Gender Equality Index. … Altria advertises a granular list of diversity targets, including for ‘AAPI women,'” according to the Beacon.

“And in 2020, the company’s ‘Corporate Responsibility’ report addressed the ‘pandemic within the pandemic’ caused by ‘systemic racism.’ It did not mention that smoking, like COVID-19, disproportionately kills black Americans.”

Vivek Saxena
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