A group of nuns and other faith-based investors won a shareholder vote at Sturm Ruger & Co. requiring one of the nation’s largest gun-makers to prepare a report about the risks of its business.
Ruger’s CEO, Christopher Killoy, said at the company’s annual meeting on Wednesday that the company will comply and prepare the report. “Shareholders have spoken,” he said.
But, he added, the winning proposal “cannot force us to change our business,” and “cannot change what Ruger is about and what we stand for.”
It was the first major test this year for faith-based shareholder groups, which have been urging the nation’s gun industry to act after recent extreme examples of gun violence.
Specifically, the proposal, backed by Catholic Health Initiatives and the Northwest Coalition for Responsible Investment, asks gun makers like Sturm Ruger to prepare a report about the financial and reputational risks associated with their business. The shareholders plan to introduce a similar proposal on the proxy of American Outdoor Brands, another gun-maker that typically holds its meetings in the fall.
Two major shareholder voting advisory firms, Institutional Shareholder Services and Glass Lewis, threw their support behind the coalition’s proposal, while Sturm Ruger’s board had advised against it.
Since a February shooting at a Florida high school that left 17 people dead, there has been a surge of activism to stop further gun violence, involving a range of constituents, from the high school students who survived that shooting to major banks, retailers and investment firms.
“A new momentum has emerged over these last few months,” said Colleen Scanlon, the chief advocacy officer of Catholic Health Initiatives, who was present at the meeting to introduce the proposal. “It’s so significant that a majority of shareholders are asking their company to consider gun safety.”
BlackRock, the world’s biggest asset manager and Sturm Ruger’s biggest shareholder, said in a note to clients in March that it would reach out to gun-makers to try to get them to talk about their business, and it added it could use its position as a major shareholder to vote against directors and in favor of shareholder proposals.
It wasn’t known Wednesday how BlackRock voted its 2.8 million Sturm Ruger shares. A spokesman wasn’t immediately available. It holds those shares largely because of its giant index fund operation.
Sturm Ruger’s Killoy said during the meeting, which was webcast from Prescott, Arizona, that the company, as a policy, does not meet individually with shareholders.
The proposal got majority support, but the exact percentage of votes for and against isn’t immediately known. Shareholders also approved all director nominees, a vote on the independent auditor and an advisory vote on executive compensation.
In a statement, the Interfaith Center on Corporate Responsibility said Wednesday the vote sends “a strong message to Sturm Ruger’s board that business as usual is insufficient given the current climate, and that new safety standards responding to the risks guns pose for society are needed.”