(CNN) New Jersey is offering gun manufacturers and retailers two options: Either follow state standards for preventing guns from falling into the wrong hands or lose the state's business.

New Jersey Gov. Phil Murphy signed an executive order Tuesday that allows state agencies to review the practices and policies of both gun manufacturers and government-contracted gun retailers to ensure they meet state standards for gun safety. State agencies may request disclosure of retailers' policies for preventing sales to firearm traffickers and other prohibited individuals, and for protecting against the theft of firearms.

"Public entities should know which banks are taking meaningful action to reduce gun violence, and which ones are not," Murphy said at a news conference in Morristown, New Jersey. "We will not waste any time in ensuring that the people we do business with and who do business with the state of New Jersey share our concerns and share or state's values."

Murphy noted that many New Jersey dealers are already in compliance, but the executive order will now open doors to retailers who are doing the right things, but aren't able to compete for state contracts yet.

There are more than 2,000 shootings each year in New Jersey, according to Murphy. Nearly 40,000 people in the United States died by guns in 2017 , marking the highest number of gun deaths in decades, according to the latest analysis from the Centers for Disease Control and Prevention.

Read More