Where there’s smoke… Tesla ESG rating changes reflect latest challenges

Blog September 10, 2018

Tesla ESG rating changes

In August, a fire broke out in piles of cardboard on Tesla’s property, dominating a news cycle.

This month, Elon Musk smoked a blunt while recording a podcast interview, and Tesla stock dropped 6 percent in a day.

For many investors, analysts, and reporters, a string of controversies related to Tesla’s business are more of a concern than the oddball literal fire here and there.

Here’s a look at the ongoing series of fires leadership is trying to put out, through the lens of intangible risk and environmental, social, and governance, or ESG factors.

Executive turnover is a major problem for Tesla, and possibly a symptom of others, according to coverage this month by the Bloomberg, the Automotive News, and the Los Angeles Times, that was captured in real-time on Truvalue Labs’ platform (see above).

So how does the ESG data look?  

Throughout 2018, Tesla stock movements have moved in tandem with real-time ESG scores at many key moments–see the chart below.

Truvalue Labs’ data can reveal the timely effect of ESG and intangible factors long before traditional ratings firms update their scores.  Timeliness also means more consistent and regular updates of intangible factor scoring every day of the year.

With timely data, meaningful comparisons can be made between Tesla and competitors like GM–see this blog from July on that very topic.

That analysis includes a look at the ESG Momentum for each company.   

Momentum is a metric that research shows has potentially greater value than outright ESG scores–but it can’t be calculated with data that lags changes in fundamental circumstances by a quarter or a year.

For more examples of timely analysis that research analysts and portfolio managers can perform with the Truvalue Labs dataset, see the blog.