A unique approach to Gun Violence Prevention.

[AndyS]

Activist shareholders for Smith & Wesson embrace the long view in struggle to curb gun violence
For some of the company’s stockholders, the use of its products to commit murder demands change at the highest level of corporate governance. They are calling on the company to adopt a human rights policy consistent with the United Nations Guiding Principles on Human Rights. The company’s management rejects the idea as one that would harm its business.

SEC rules enable shareholders to submit resolutions for consideration at the company’s Annual Meeting of Stockholders, where elections are based on the one-share one-vote principle.
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With gun violence on the rise several years ago, (Judy) Byron (a member of the Adrian Dominican Sisters and director of the Northwest Coalition for Responsible Investment) made what might be a counter-intuitive proposal: Her order should buy stock in gun-makers and gun-dealers. They had experience with shareholder activism going back to the anti-apartheid movement in the 1970s. It was time, she suggested, to apply what they had learned to the epidemic of gun violence. Soon, the Adrian Sisters had ownership shares in Smith & Wesson, Strum Ruger and Dick’s Sports. Then, along with other ICCR members, they started introducing shareholder resolutions. This year’s was their fifth resolution put before Smith & Wesson shareholders.

Link to article.

The UN resolution being promoted says simply that Companies should try to reduce human rights violations and mitigate the damage done with their products. S&W management flatly refused because "it would damage their business". So they admit that their product is responsible for human rights violations?

It's a unique approach that has proven to work in the past. This group or religious organizations helped dissemble Apartheid and was responsible for Dick's Sporting Goods taking military style weapons off their shelves. Basically they buy enough stock to get a seat at the table. They then write resolutions to company policy which the SEC requires management to address in public. At worst the company will negotiate some smaller change to get the resolution off the agenda at the annual meeting.

In the case of the UN resolution S&W refused to negotiate and it went to a vote; it lost by just 8% of shares but S&W had to make a public statement that they know their product violates human rights and they don't care. So, if you want to help and have a stock account just buy one share of S&W (currently ~$11.) and you get to cast a proxy vote on corporate resolutions. One share isn't enough to sway stock price unless everybody bought at the same time ala GameStop. If a few thousand people spend the $11 over a year these nuns just might change S&W's business practices. They've already changed Dick's Sporting goods!

[Pantagruel]

1. Clever approach

Got a link to S&W admission of human rights violation?

[CaliforniaPeggy]

2. Those are some damned smart stockholders. Kudos to them and their tactics.

Thanks for the post, Andy.

K&R