Smith & Wesson loses fight with nuns and other shareholders on gun safety proposal
- The Interfaith Center on Corporate Responsibility won a resolution on gun safety at American Outdoor Brand's annual shareholder meeting, the same resolution it successfully passed at Sturm Ruger earlier this year.
- The group wants Smith & Wesson's parent company to make a report on whether it is adequately addressing the risks that its products are associated with gun violence and to show evidence it is exploring ways to make safer guns.
The maker of Smith & Wesson firearms lost a prolonged fight with religious groups and other shareholders who have been pushing it to consider a plan to help reduce the harmful effects of its products.
The investors, led by The Interfaith Center on Corporate Responsibility, presented a resolution on gun safety at American Outdoor Brand's annual shareholder meeting Tuesday, the same resolution it successfully passed at Sturm Ruger earlier this year. And the preliminary voting showed the shareholders also won this fight.
The proposal calls on American Outdoor Brands, Smith & Wesson's parent company, to put together a report on whether the gun maker is adequately addressing the risks that its products are associated with gun violence and to show evidence it is exploring ways to make safer guns and products to reduce this violence.
Speaking at the meeting after the results of the vote were revealed, American Outdoor Brands CEO James Debney said the vote was "politically motivated" and that he was "disappointed" the shareholders had taken their fight to the annual meeting rather than work through legislatures.
Sister Judy Byron, who presented the proposal on behalf of the 11 shareholder groups that backed it, said the move could be key to the company's survival. Recent mass shootings in the U.S. have involved American Outdoor Brands products, she said, exposing the company and shareholders to boycotts, protests and negative publicity. American Outdoor Brands, she said, "is obligated to help find these solutions."
The company refused to respond to other shareholder questions about the proposal after the vote.
In a statement after the meeting, Byron said, "Not only can these solutions help save many lives, they may help AOBC's long-term business prospects in the process and we are gratified that so many of our fellow shareholders supported our resolution today."
The religious groups got a boost of momentum this year from big fund companies like BlackRock, which sided with them in the Sturm Ruger vote and cast its 2.8 million shares in favor of the proposal. BlackRock and Vanguard are Sturm Ruger's and American Outdoor's biggest shareholders by virtue of their large index fund businesses.
Major shareholder voting advisory firms Institutional Shareholder Services and Glass Lewis also supported the proposal's passage.
"Just one year ago, it was unthinkable that shareholders would demand that gun manufacturers examine their own role in America's gun violence epidemic," said Avery Gardiner, the co-president of the Brady Campaign, in a statement on Tuesday. "Now, it's becoming the norm."
The gun safety debate grabbed national headlines once again earlier this year after a mass shooting at a high school in Florida left 17 people dead. American Outdoor said before the vote that a report like the one described in the proposal isn't necessary because it already discloses its reputational and financial risks.
American Federation of Teachers, the union representing 1.7 million educators and others, has also been pushing for measures to protect schools from gun violence and prevent teacher pensions from investing in assault weapon makers. It also backed the Interfaith Center's proposal. In a statement on Tuesday, AFT President Randi Weingarten said, "We continue to work with our pension funds and other institutional investors and take political action at the state and national levels to push for permanent change."