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Publicly traded companies have a problem. As part of being publicly traded, there are things they have to do. These things generally make sense when you consider the history of how some companies operated before these laws were enacted.
Unfortunately, some of these things are now benefiting anti-gun activists looking to try and undermine the Second Amendment in other ways.
Sturm, Ruger has been targetted in the past by these activists, and it looks like they will be again.
America’s largest gunmaker, Sturm, Ruger (NYSE:RGR) is once again the target of activist investors who want to express dissatisfaction with management’s response to last year’s shareholder ballot initiative that required Ruger to report on the risks facing its business.
A second bite at the apple
Activists won a shareholder proposal demanding that Ruger monitor violent crimes using its firearms, examine so-called smart gun technology, and assess the risks gun violence may be causing to both Ruger’s reputation and its finances.
Because the shareholders’ meeting occurred shortly after the February 2018 Parkland school shooting in Florida and emotions were still raw, the activists were able to secure almost 70% of the votes cast in favor of the resolution. A similar initiative was also successful later in the year at Ruger peer American Outdoor Brands (NASDAQ:AOBC), the owner of Smith & Wesson firearms.
Ruger’s report was issued in February and detailed the problems inherent in monitoring criminal events, the severe limitations smart gun technology possesses, and the nominal risks facing it above and beyond what Ruger is already required to assess.
American Outdoor’s report reached similar conclusions, though it hired an independent third-party organization to scour news reports, which found that stories about gun violence were “largely an unbranded conversation,” and don’t tend to center around a single manufacturer.
A targeted response
The activists did not like Ruger’s response, leading Majority Action — a group that bills itself as a platform that “empowers individuals and groups to organize for progressive causes,” along with the Interfaith Center on Corporate Responsibility (ICCR), one of the groups behind last year’s proxy fight — to attempt to penalize Ruger chairman Michael Jacobi and director Sandra Froman. Froman also serves as a director of the National Rifle Association (NRA), where she has held several executive positions, including president between 2005 and 2007.
The activist organizations are calling for shareholders to withhold their votes from the nominees at the May 8 annual meeting, a gesture that would be mostly symbolic.
Their efforts are simple to understand. They think they can dictate to gun companies how to operate and, in the process, negating the “need” for gun control legislation to some degree.
The idea is sound in many ways. If the gun companies were to stop making standard capacity magazines or modern sporting rifles, there would be no need to pass a law banning them. There’s no need to ban something that no one is making, right?
Unfortunately for them, that’s not going to happen. Even if Ruger and Smith & Wesson stopped making products like this, someone else would. Private companies aren’t beholden to stockholder regulations, and the beauty of the free market is that someone else would step up to offer these products.
In other words, it’s a losing cause for these nimrods.
But it’s also important to remember that we can fight fire with fire on this. To start with, if you’re investing, look at companies like Ruger and Smith & Wesson for your investment dollars. They’re sound companies for one thing, but for another, it’ll help counter this nonsense. If you own stock in these companies, those are shares these lunatics can’t get their paws on.
Then we turn the tables on them. Then we go after companies like Dick’s Sporting Goods and Levi Strauss. We hammer those companies, as well as any others that opt to drink the gun control Kool-Aid.
While we can’t do this and undermine the anti-Second Amendment crowd as a whole, we can cut off their corporate sponsorship, and that’s the next best thing.
Two can play this game, so let’s.