Anti-gun violence organizations are targeting publicly traded gun companies such as Smith & Wesson with backing from Snoop Dogg and other celebrity supporters. Here’s how you can join the divestment effort

San Bernardino. Savannah. Colorado Springs. Sacramento. The horrific run of mass shootings this year seems unstoppable. Tragically, there’s a significant statistical risk that between the time I write this column and send it to my editor and the day it runs, there will have been another.

It’s a situation that leaves many of us wondering: what can we do? With politics at an impasse, it may seem hopeless, but there are historic examples where normal, everyday people have used their money to change situations that seemed unchangeable.

So, if politicians can’t, or won’t, act, what can the power of money and the markets do? Potentially, at least, quite a lot. After all, a business needs investors; without them it is difficult for a company to remain in business. And when investors want change, they can get it.



Forcing change isn’t easy. Just ask anyone involved in the most successful social responsibility/divestment campaign to date: the push to sell stocks of companies doing business in apartheid-era South Africa.

Looking back, the campaign – which culminated in the 1980s when colleges did finally divest their endowments and when those initiatives were supported by wider consumer boycotts and broader measures – was a big success. But the process took decades to accomplish and was much more complicated than we remember today.

But the aim was worthwhile. And a group of anti-gun violence organizations – States United to Prevent Gun Violence, the anti-violence movement No Guns Allowed, and Campaign to Unload – are hoping a similar movement can urge Americans to fuse their collective cash to force change in the gun industry.

Look inside your 401(k) retirement plan, they urge, to see whether you might – without even being aware of it – be supporting one of the three publicly traded gun companies (Smith & Wesson, Olin Corp or Sturm, Ruger) with your retirement savings, the place where most people own shares.

Institutional investors – pension funds and some college endowments – have already begun to act. City pension funds in Philadelphia and Chicago adopted resolutions vowing to sell off their firearms investments altogether or to do so if the latter didn’t publicly accept stringent new rules and regulations. The trustees of one of the largest pension funds in the nation, the California State Teachers Retirement System (aka Calstrs), voted unanimously to forge ahead with divestment in the wake of the Sandy Hook elementary school murders, in which 20 children and six adults died at the hands of a gunman.

Rhode Island’s former treasurer and its new governor, Gina Raimondo, oversaw the decision to sell off the state pension fund’s $20m stake in a firearms distributor.

Most recently, New York mayor Bill de Blasio went public with a plea for all “government pension funds in New York City and across the country to divest immediately from funds that include assault weapon manufacturers” if they don’t receive pledges that those weapons won’t “be sold to civilians”. And de Blasio is lining up behind the likes of celebrity supporters of the Campaign to Unload, including Snoop Dogg and Los Angeles Clipper Matt Barnes, urging the rest of us to “Pledge to Unload”.

Facebook Twitter Pinterest Snoop Dogg: a supporter of the Campaign to Unload. Photograph: Paul A. Hebert/Invision/AP

Making that pledge is one of those moral choices that just feels easy. And you won’t be missing out on much: there are only three such companies out there, and they make up a tiny part of the stock market.

The folks who have designed the site have done an excellent job of putting it together. A drop-down menu enables you to select your 401(k) provider – Fidelity, say – and after you click, you’ll be alerted to any specific funds that might be particularly likely to contain gun stocks.

“You can make sure you’re not supporting these companies; it’s a step an individual can take,” says Cathie Whittenburg, communications director of States United to Prevent Gun Violence, one of the partners behind the campaign.

Alas, as with so many other seemingly easy decisions, following through is trickier than it first appears.

Firstly, the nature of 401(k) plans makes the process circuitous and complex. We never get timely and complete information on what’s in our mutual fund portfolios, so it’s entirely possible that we’d end up selling a fund in the belief that it has gun stocks when in fact the manager sold them two months ago.

Conversely, we may think we’re OK, when in fact the manager has bought all three gun stocks on a big dip in their value, and the data that is available to us just doesn’t reflect those transactions yet. If a fund is otherwise a top performer in our portfolios, selling it because of information that might not be up to date risks throwing the baby out with the bathwater, says Daniel Wiener, CEO of Adviser Investments.

Then, too, there’s the fact that removing a relatively small amount of capital from mutual funds is a fairly indirect approach. If the mutual fund manager doesn’t change his investment strategy, he’ll continue to invest in the company, albeit with slightly fewer dollars.

The problem with divesting via mutual funds and 401(k) plans is that, unlike a pension fund trustee, you don’t get to tell your company’s HR department and the investment manager that you want them to yank only the money in gun stocks. You’re simply offered a menu of mutual fund choices, not stock choices, and that’s it.

The Campaign to Unload does provide a useful list of ways to begin a discussion about divestment with your HR team at work, and it’s a good idea to think of this really as being a starting point. Because if your goal really is to either starve gun companies of investment capital or sway their behavior because you and your fellow investors have become such significant activist investors, you’ll need to think on a much more ambitious scale than simply selling funds that own gun stocks or buying a few high-cost, socially responsible funds.

Your goal needs to be, firstly, to convince a mutual fund manager and his or her employer –firms like Fidelity and T Rowe Price – that it’s going to be far, far more trouble than it’s worth to ever add another gun stock to a fund portfolio ever again.

Sure, tying Fidelity up in red tape as company after company tries to find gun-free investment alternatives for their employees’ 401(k) plans is a start. But it would be much better if the investment company itself decided that it wanted to become a gun-free zone. What strategies, either passive or active, could lead to that?

New York’s mayor, while heading the Lockyer Wall Street for Change movement, urged identifying and contacting, via phone, the investment companies that are the largest shareholders of these gun companies. (You could identify which banks are their principle bankers, and add them to the list.)

These aren’t giant businesses, by Wall Street’s standards, and if it becomes a major headache for a Blackrock or a Fidelity to own shares in three small companies from a public relations point of view (or simply because their phone lines are tied with calls from protesters), they may simply decide the game’s not worth the candle.

But if you’re trying to make changes to a 401(k) plan or a pension plan, do so with lots of support from fellow employees. It’s even better if your company’s HR department and that of another company make the same request at the same time: numbers talk.

Secondly, be prepared with counterarguments. Managers of investment firms are wary of the whole topic of divestment and view arguments in favor of dumping gun stocks as the thin end of the wedge. The next thing, they grouse, we’ll all be asking them to dump fossil fuel stocks, and pharmaceutical stocks, and on and on. And maybe that’s true for some of us; or perhaps that segment of the population will be fine confining our investing to socially responsible funds that do that screening for us.

But guns kill people, no matter what the NRA says. There is a very direct link between gun manufacturers and the dead bodies in Newton, Connecticut or San Bernardino, California. We benefit from the commercial exploitation of fossil fuels in a way that we don’t from civilian gun ownership; the harm done by those who use tobacco is primarily confined to themselves and not inflicted on others or described as violent murder.

Gun violence is an epidemic that needs a public health response | Georges Benjamin Read more

When the state of affairs has reached the point where some companies, nauseatingly, would have us believe that the solution is buying bulletproof blankets for our children at school, as the body count rises, something must change.

Decades of protests and marches don’t seem to outweigh the financial stranglehold of the National Rifle Association on the willpower of politicians, so it’s time for individuals to bring their own financial power – of all kinds – to the table. The Unload campaign is a start, but it will work more effectively if campaigners also target the investment management firms directly.

Those who “unload” could also pledge to boycott, however – shunning any store that sells guns or ammunition. Are you an alumnus of Boston University? Its trustees voted against divesting from gun stocks earlier this year, and other universities have stalled on considering the topic.

If the issue is important enough to you, and you’re a donor – or receive begging letters from your college’s fundraising department – you could organize a letter-writing campaign telling them they won’t see another penny in gifts until the stocks are gone and the investment mandate rewritten to exclude gun stocks.

Do you bank where Smith & Wesson does? That, too, is a relationship that you could unload. If we’re going to unleash the power of money on gun companies, let’s not stop with our 401(k) plans.