Elon Musk, the CEO of Tesla, recently called the use of environmental, social, and governance (ESG) concerns by businesses a "scam," but one sustainable investment pioneer believes the electric carmaker still believes in the cause.

Despite being eliminated from the S&P 500 ESG Index last week, John Streur, head of Calvert Research and Management, applauded Tesla for disclosing employee diversity data earlier in May and stated Tesla remains in his company's ESG indexes.

Streur said, "I think they've fully embraced operational excellence, which is really what ESG is all about."

Streur's viewpoint comes at a time when ESG investment is under fire from conservatives who argue that matters like how to reduce carbon emissions should be decided by the government rather than investors.

Calvert, a Morgan Stanley subsidiary, has a "full weight" position in Tesla in its Calvert US Large Cap Core Responsible Index Fund, according to Streur.

ESG data, according to Streur, "could be a bit of a mess." He welcomed Tesla's new diversity details, which were released this month after a majority of the company's investors adopted a resolution Calvert filed in October.

Tesla will confront greater ESG risks as it grows, according to Streur, including issues like mining and facility location.

Source: Reuters