AP Photo/Sue Ogrocki
While anti-gun investment groups have routinely sought to disrupt the firearms industry from within, pro-gun groups have mostly remained silent. For the most part, such activist investors have accomplished little more than requiring companies to waste money on studies, but if they continue to be able to tout “wins,” their numbers–and, by extension, their ability to govern the firearm industry–will only grow.
Luckily, one right-leaning non-profit is looking to provide a counter to that.
Americans for Tax Reform announced a new project designed to counter activist investors who have passed resolutions potentially damaging to gun companies and other corporations as a means of achieving a political goal.
“ATR feels there is a need to protect the long-term interests of small investors and pension fund beneficiaries from activist shareholders, proxy advisory firms and Washington proposals that use financial institutions as the venue to enact the social and political agenda of few, that cannot be accomplished through the legislative process,” James Setterlund, executive director of the newly formed Shareholder Advocacy Forum, told the Washington Free Beacon. “The Shareholder Advocacy Forum will provide a voice for these shareholders and hold executives and directors accountable when they prioritize activist proposals ahead of their fiduciary responsibility.”
The group wants to counter activist investor groups who seek to force “social justice” change onto companies. Perhaps most famously, such a group pressured Smith & Wesson to conduct a study to look at the viability of smart gun technology.
Of course, the company found it wasn’t viable, but it didn’t need a study for that. We all know it’s not feasible. Neither are a lot of technologies anti-gunners want to see implemented.
However, ATR’s efforts won’t end there, either.
ATR wants to counter groups like Byron’s and said it intends to protect the long-term interests of shareholders. The new Shareholder Advocacy Forum said it will take a number of different steps to effectively negate the efforts of these activists, including opposing legislation the group believes will be used by them. They sent their first letter opposing legislation to members of the House Financial Services Committee last week to voice their concerns with H.R. 2364.
H.R. 2364, the Investor Choice Against Gun Proliferation Act, would require financial institutions to file disclosures that indicate if they have “substantial financial relationship with manufacturer or dealer of firearms or ammunition.” Setterlund said the legislation would not protect investors but lead to further demonization of the firearms industry.
“The project launched with a letter of opposition to H.R. 2364 because we feel that private businesses should not be forced to disclose who they do business with and the Securities and Exchange Commission would be politicized by forcing the regulator to monitor which companies do business with businesses in the firearms industry,” he told the Free Beacon.
Frankly, I couldn’t agree more, and I wish the new Shareholder Advocacy Forum good luck.
Unfortunately, I’m not sure how effective this strategy will be. I tend to favor a more direct approach to countering such groups, namely by creating our own to not just invest defensively but also to go after anti-gun companies.
That said, I’m not an expert, and the folks at ATR are, so when in doubt, listen to them.
Then again, I see no reason we shouldn’t do both.