To Incentivize Companies to Address Climate Change, Measure Their Broader Impact
September 6, 2024
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Summary.
In June, 2023, Elon Musk took to Twitter (now X.com) to complain that his electric car company did not have a higher ESG rating. At the time, Tesla had a lower ESG score than fossil fuel companies such as Shell and Exxon. In fairness to the ESG ratings, Tesla had not made enough efforts to clean up its manufacturing emissions. But it also highlighted how the current carbon compliance regime fails to reward systemic efforts by entrepreneurial companies — whether they be producers of electric cars, wind turbines, plant-based food, or firms that use their social influence to change policy or advise clients cutting emissions
