The Telegraph reports that Facebook has been removed from Standard & Poor’s Environmental, Social, and Governance (ESG) Index after the company received a score of 22 for social responsibility and only 6 for governance, out of a possible 100, scoring extremely poorly.
Reid Steadman, S&P’s social and governance chief, stated that the growing number of privacy concerns around the company including “a lack of transparency as to why Facebook collects and shares certain user information,” resulted in low scores for the firm. S&P cited the Cambridge Analytica scandal as one of the reasons for the tech giant’s poor performance.
“These events have created uncertainty about Facebook’s diligence regarding privacy protection, and the effectiveness of the company risk management processes and how the company enforces them,” Steadman said. “These issues caused the company to lag behind its peers in terms of ESG performance.”
On April 30, Oracle and IBM were also removed from the index but Facebook was the largest tech firm removed from the list.Facebook is the fourth-largest company in the S&P 500, with Microsoft, Apple, and Amazon taking the top three places. Google’s parent company, Alphabet, comes in sixth on the list.
Facebook does not need any further bad press as the company plans to reveal its new Libra digital cryptocurrency next week with backing from over a dozen other companies. Visa and Mastercard are reportedly quite invested in the currency while other Silicon Valley firms such as PayPal, Uber, Stripe, and Booking.com are fully supporting the currency.
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