Brief analysis of Tesla's mission statement and practice consistency

In today's business society, a company's mission statement and purpose statement not
only guide its development direction, but also reflect the core values of the company.
Taking Tesla as an example, this paper analyzes the connotation of its mission
statement, and evaluates the degree of consistency between the company's actual
behavior and the statement from the perspectives of stakeholder theory and Friedman
theory.
"Tesla's mission is to accelerate the world's transition to sustainable energy," the
company says in its mission statement. (Tesla, 2023) Sustainable development and
environmental protection are the core values reflected in Tesla's statement.
Stakeholder theory holds that a company's decision-making and behavior should
consider the interests of all stakeholders in a balanced manner, rather than only
pursuing the maximization of shareholders' interests (Freeman et al., 2020). Since
going public, Tesla has delivered impressive returns to shareholders. The stock is up
nearly 50 per cent in 2022 from the start of the year (Tesla, 2023). However, there are
also reports that Tesla factory has high risk of work-related injury, overtime culture
and other problems, and some employees are dissatisfied with the working
environment and salary treatment (Worksafe, 2022). This is inconsistent with the
company's commitment to sustainable development in its statement. Tesla products
have been well received in the market with excellent performance and intelligent
functions. However, some car owners reported safety hazards and battery problems,
and quality problems occasionally occurred (Cao et al., 2022). Tesla's electric vehicle
products do help reduce carbon emissions in the use stage, but the impact on the
environment in the production process, such as electricity and raw material mining,
deserves attention (Harper et al., 2019). From the perspective of stakeholder theory,
there is a certain degree of deviation and contradiction between Tesla's behavior and
its mission statement. On the one hand, Tesla has contributed to environmental
protection by promoting electric vehicles and renewable energy products, which is in
line with the concept of sustainable development in the company's statement. At the
same time, Tesla's good financial performance and continuous growth of the stock
price have also achieved the goal of maximizing shareholders' interests. But on the
other hand, in the process of pursuing performance growth, Tesla also ignores the
rights and interests of other stakeholders to a certain extent. For example, employees
face high risks of work-related injury and overtime culture, and some rights and
interests are damaged; There are quality and safety risks in individual products, which
affect the interests of consumers; The environmental impact of production and supply
chain links also needs to be improved (Worksafe, 2022; Cao et al., 2022; Harper et al.,
2019). These behaviors are contradictory to the purpose of sustainable development
and environmental friendliness of enterprises.
According to Friedman's theory, the only social responsibility of enterprises is to
create profits for shareholders on the premise of abiding by laws and ethics
(Friedman, 1970). This theory emphasizes that instead of diverting limited resources
to pursue other social responsibilities, firms should focus on maximizing shareholder
wealth. From the perspective of financial data, Tesla has made remarkable
achievements in maximizing shareholders' interests. In 2022, Tesla set a record $1.19
trillion in revenue, and its stock price rose nearly 50% from the start of the year,
delivering a handsome return to shareholders (Tesla, 2023). However, if the company
pursues profit maximization excessively, its performance in other areas may be
affected. For example, some studies have pointed out that in order to control costs and
improve efficiency, Tesla factories have high risks of work-related injuries, overtime
culture and other problems.(Worksafe, 2022; Hansen, 2021). There is a certain
contradiction with the concept of sustainable development advocated in the
company's statement. Moreover, due to the excessive focus on vehicle sales and
profits, Tesla also has some shortcomings in product quality control. In 2022, Tesla
recalled more than 3.5 million vehicles worldwide for safety hazards, software
glitches and other issues (Boudette, 2022). This not only affects the company's brand
image, but also damages consumer rights and interests to a certain extent. Therefore,
from the perspective of Friedman's theory, although Tesla has achieved the goal of
maximizing shareholders' interests, it also sacrifices other aspects such as employee
rights and interests, product quality and sustainable development concept to a certain
extent while pursuing profit maximization. This is somewhat different from the
company's original mission statement, and has also aroused doubts and dissatisfaction
from stakeholders.
In general, Tesla has achieved good performance in pursuing the maximization of
shareholders' interests, and its electric vehicle products have also fulfilled the promise
of environmental protection to a certain extent. However, Tesla still has room for
improvement in balancing the interests of various stakeholders and practicing the
concept of comprehensive sustainable development. In the future, how to better
balance different interest appeals while adhering to core values will be a major
challenge for the company.

Reference List
•Tesla (2023). Tesla Q4 2022 Vehicle Production & Deliveries.
•Freeman, R.E., Harrison, J.S., Wicks, A.C., Parmar, B.L., & de Colle, S., 2020.
Stakeholder Theory: The State of the Art. Cambridge University Press.
•Worksafe, 2022. Safety in the Age of Silicon Valley Manufacturing: A Case Study on
Tesla Inc.
•Cao, Y., Wang, Q., & Li, X., 2022. Assessment of Electric Vehicle Battery Safety
Issues. Journal of Automotive Safety and Energy, 13(2), pp. 145-153.
•Harper, G., Sommerville, R., Kendrick, E., Driscoll, L., Slater, P., Stolkin, R.,
Walton, A., Christensen, P., Heidrich, O., Lambert, S., Abbott, A., Ryder, K., Gaines,
L., & Anderson, P., 2019. Recycling lithium-ion batteries from electric vehicles.
Nature, 575(7781), pp. 75-86.
•Friedman, M., 1970. The Social Responsibility of Business is to Increase its
Profits.*New York Times Magazine, 13 September, pp. 32-33, 122, 124, 126.
•Hansen, A., 2021. Labor Practices in the Green Economy: The Case of Tesla
Motors.Labor Studies Journal, 46(1), pp. 8-22.
•Boudette, N.E., 2022. Tesla recalls more than 3 million vehicles over safety and
software issues.