The Heart of the Matter - Gun Stocks and Divestment
The Socially Responsible Investing tenet of "knowing-what-you-own" is adding another layer of reflection to those affected by the recent gun violence in Parkland, Florida. Educators in Florida may be surprised to learn they’ve been helping fund the firearms industry—including the company that made the gun used during the February 14th shooting.
The Florida Retirement System teachers held 41,129 shares in American Outdoor Brands Co, formerly Smith & Wesson, who manufactured the semiautomatic AR-15 assault rifle that was used in the Feb. 14 attack.
“I am sure that most of Florida’s public school employees are as sickened as I am to learn that the state has invested some of our pension fund holdings in the maker of the AR-15,” said Florida Education Association president Joanne McCall.
Bloomberg put out a brief TV excerpt on this issue. See video here.
Teachers and other educators in Florida are now pushing their Pension Fund administrators to divest from gun stocks. The FRS is guided by state political officials like Governor Rick Scott and his cabinet. Read more here.
Teachers have moved to divest from firearms in the past. Following the Sandy Hook Elementary School shooting in Connecticut in 2012, where 20 children and 6 adults were gunned down, California’s teachers’ union, CalSTRS and the California Public Employees’ Retirement System sold off their stakes in Sturm Ruger and Smith & Wesson.
A spokesman for BlackRock, the $6 trillion dollar asset manager who has large positions in American Outdoor Brands Co, said that in response to the recent events it will "focus on engaging with the companies and understanding how they are responding to society’s expectations of them,” the spokesman said.
Quite frankly, we're a bit ruffled about the issue of gun violence, and we've listened to many of our clients who feel similarly. When the safety of our nation's citizenry is at stake, it is no small issue. As we've always believed, the impact of divestment is two-fold - there is some direct financial attrition to the companies themselves, but often the main impact is the resounding message it sends to that industry. As we've seen most recently with the Fossil Fuel Divestment movement, when the public speaks with their dollars, companies listen.
We'd like to remind you that all BSWM Model Portfolios are 100% Gun Manufacturer free! Still, we are actively working to get more involved with this issue in our industry. The tide is changing on gun violence, and we're proud to be part of the movement.
Blue Summit Wealth Management Team