Topline
Index provider MSCI awarded SpaceX the lowest possible environmental, social and governance (ESG) rating, ranking Elon Musk’s rocket maker at the same score as Russia while flagging concerns the firm has failed to manage “significant” risks following its record-setting debut earlier this month.
Elon Musk has claimed the ratings are “weaponized by phony social justice warriors.”
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Key Facts
MSCI, one of the world’s largest stock market index providers, awarded SpaceX a CCC rating a day before its June 11 initial public offering, the lowest on MSCI’s seven-tier sustainability scale, saying the company was “lagging its industry” because of its exposure to and management of “significant” environmental, social and governance risks, the Financial Times reported.
A CCC rating is awarded to companies that have “very poor management measures” that may be in or were recently involved in “significant” ESG controversies, according to MSCI.
SpaceX scored a one out of 10 on MSCI’s “controversies” scale and was awarded an “orange flag,” a designation for companies MSCI deems to be directly or indirectly involved in one or more “severe” controversies,” whereas a score of zero and a “red flag” are reserved for firms facing one or more “very severe” ongoing controversies.
MSCI awarded SpaceX a 3.2 out of 10 on governance, a metric on which companies start at a perfect 10 and lose points for what MSCI describes as “corporate governance flags.”
SpaceX did not immediately respond to Forbes’ request for comment, but Musk responded to the ESG score on X, writing, “Unfortunately, electric rockets are impossible.”
Shares of SpaceX plunged by more than 10% as of Monday morning, potentially extending a losing streak to three days following a post-IPO surge.
surprising fact
The S&P 500 removed Musk’s Tesla from its ESG Index in May 2022, citing a “lack of low-carbon industry” and “codes of business conduct” following claims of racial discrimination and poor working conditions at Tesla’s Fremont, California, factory. Tesla’s handling of an investigation by the National Highway Transportation Safety Administration also weighed on its ESG score, according to the S&P 500. Musk denounced the rating, claiming ESG “is a scam” that has been “weaponized by phony social justice warriors,” and called ESG the “Devil Incarnate.”
key background
SpaceX has faced scrutiny in recent years over workplace safety, labor disputes and allegations of employee discrimination and retaliation. The National Labor Relations Board dismissed a case in February accusing SpaceX of illegally firing eight employees who criticized Musk and requested that the company distance itself from Musk’s social media comments, including one in which he made light of allegations of sexual harassment against him. In August 2023, the Justice Department sued SpaceX for allegedly discouraging asylum seekers and refugees from applying and refusing to hire or consider them because of their citizenship status. The DOJ dropped its case in February 2025. Musk’s xAI, which was acquired by SpaceX earlier this year, has faced litigation and investigations into allegations that AI chatbot Grok enabled the creation of non-consensual sexualized images, including claims involving minors. Musk’s AI firm also faces an environmental lawsuit over gas-burning turbines in Mississippi, though the DOJ has requested that the case be dropped.
forbes valuation
Musk is by far the world’s wealthiest person with a net worth of $1.2 trillion as of Monday, according to Forbes’ estimates. The Tesla and SpaceX CEO became the world’s first trillionaire earlier this month after SpaceX’s IPO, with his fortune swelling to above $1.4 trillion amid record-setting investor demand.
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