February 23, 2018 / 11:06 PM / 7 months ago

Breakingviews - Cox: Gun lobby meets match with economic protests

NEW YORK (Reuters Breakingviews) - The day before Martin Luther King Jr. was assassinated in Memphis, he delivered a speech widely remembered for its closing passage, when the reverend said he was unafraid to die because he had “been to the mountaintop.” Few seem to recall an earlier part of his oration where King exhorted African-Americans to use their purchasing power, and specifically boycott Coca-Cola, Wonder Bread and Sealtest milk.

A protester is framed by signs calling for more gun control three days after the shooting at Marjory Stoneman Douglas High School, at a rally in Fort Lauderdale, Florida, U.S., February 17, 2018. REUTERS/Jonathan Drake

Many successful civil-rights movements have adopted some type of economic protest. Consider Gandhi’s 24-day march from an ashram near Ahmedabad to the coastal town of Dandi to harvest sea salt in an act of nonviolent resistance against the salt monopoly imposed by India’s British colonizers. Striking female garment workers – and the wealthy women who refused in solidarity to purchase the clothing of their overlords - furthered the suffragette movement.

Abolitionist Quakers refused to trade in products made with slave labor. A global divestment drive helped topple South Africa’s apartheid regime in 1991 after companies including International Business Machines and General Motors pulled out from the region.

And so it is with America’s idiosyncratic epidemic of gun violence. The nation’s assault-weapons complex is facing a blowback following the horrific massacre of 17 students and their teachers at a Florida high school. As politicians fail to enact gun-safety laws, the acute target of consumers is the gun industry’s powerful lobbying organization, the National Rifle Association, and the providers of products and services that do business with the group led by Wayne LaPierre.

Companies with national household brands severed ties with the NRA: rental-car outfits Hertz Global and Enterprise Holdings, parent of the Alamo and National brands; and Best Western and Wyndham Worldwide stopped offering discounts to NRA members. The software firm Symantec will no longer give NRA members a bargain on its LifeLock identity theft protection services.

Insurers also backed away from the NRA, including MetLife and Chubb. The First National Bank of Omaha, which had issued a co-branded NRA credit card, tweeted, “Customer feedback has caused us to review our relationship with the NRA.” Though the furor has lasted just a few days, the speed with which it has taken flight is astounding. The #BoycottNRA hashtag led Twitter throughout Friday.

And there is more to come. As I wrote last week, financial backers of companies that produce the preferred weapons of mass murderers in schools, the AR-15 and its variants, may be next. As Americans are increasingly frustrated by the failure of Congress and state legislators to regulate weapons developed for military deployment, they may resort to using their pocketbooks and investment portfolios to force change. 

Chief executives could be next, and any corporate boss not assessing his or her company’s ties to guns, especially semi-automatic assault-style rifles, is putting shareholders at risk. BlackRock, the Vanguard Group and Fidelity are among the biggest investors in publicly traded AR-15 producers Vista Outdoor, American Outdoor Brands and Sturm Ruger.

Though BlackRock owns the shares as part of its so-called index funds business, the $6 trillion fund manager led by Larry Fink, in a statement to Reuters, said that it “will be engaging with weapons manufacturers and distributors to understand their response to recent events.”

Some institutional investors have already taken matters into their own hands. The Interfaith Center on Corporate Responsibility, a group of faith-based investor groups, on Friday said its members filed two shareholder resolutions at Sturm and American Outdoor asking them to report on activities related to gun safety measures and the mitigation of harm associated with guns.

Judy Byron, of the Sisters of the Holy Names, the lead filer of the resolution at American Outdoor, said it chose to hold shares in the two firms so that “we could engage them in dialogue on the critical role they can play in addressing the epidemic of gun violence in our country, and sadly in our schools. We are eager to hear what these companies are doing to ensure the safety of children and communities whose lives may be at risk as a result of their products.”

For a nun, those are fighting words – they too have dug in their proverbial heels during times of protest, like at the civil rights marches in Selma, Alabama. The tens of millions of American consumers and investors seeking change that their elected officials and President Donald Trump seem incapable of delivering won’t be so kind.

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