Corporate America is starting to take a stand on gun control, and now it’s time for more Boston money managers to say something, do something.
Many of our marquee investment firms own shares in gun companies, including Springfield’s American Outdoor Brands, which made the AR-15 assault rifle used in last month’s killing of 17 high school students and teachers in Parkland, Fla.
The list is long, the names illustrious: Fidelity Investments, State Street, Putnam Investments, John Hancock. Even the state pension fund, which invests $72 billion for government workers, holds gun stocks.
No need to prod State Street. The financial behemoth, which ranks among the biggest holders of publicly traded gun stocks, stepped up on its own last week, with a pledge to engage weapons manufacturers and distributors “on ways that they will support the safe and responsible use of their products.”
Advertisement
The Boston money manager went on to say it would closely watch how gun companies weigh in on potential legislation and regulations. Let’s hope State Street doesn’t stop there and will take more-drastic steps, such as forcing changes on boards if gun makers don’t clean up their acts.
By now, I would have expected Fidelity CEO Abby Johnson to have given State Street some cover on this. The Boston mutual fund giant also ranks among the biggest holders of gun stocks, and so far its public statements on the topic have been mealy-mouthed.
“We do meet regularly with companies we invest in and will engage and debate them on a number of topics including social responsibility when appropriate,” Fidelity said in an e-mailed statement.
Ditto John Hancock, whose statement said it is “completing a comprehensive review of any holdings of and/or associations with gun manufacturers across our organization.”
Putnam Investments was at least honest about its priorities.
“Our job is to maximize value for shareholders,” it said. “We seek superior performance at a reasonable risk level. We’re a fiduciary for our clients, and we take that role very seriously.”
Advertisement
Meanwhile, state Treasurer Deb Goldberg isn’t mincing words on what Massachusetts should do. Through its pension fund, the state holds about $5 million in investments in companies that make or sell firearms, or accessories like ammunitions. It’s a tiny fraction of the fund, but that’s still too much for Goldberg.
She’s ready to divest, and her office is drafting legislation to get it done. The state has done this before and currently has investment restrictions on companies that derive much of their revenue from tobacco, and companies that do business in Sudan or Iran.
Goldberg thought about engaging gun companies, but she can’t see that making a difference. But if a wave of states start to pull pension money out of gun companies, that could force change.
For the treasurer, this mass shooting struck a nerve. “Watching those children and watching the Florida Legislature spoke to me,” she said, referring to how lawmakers voted down a bill to ban assault weapons. “Traditional approaches are not going to work.”
Mass shooting after mass shooting, we’ve been waiting for Congress to act. Nothing happens because the NRA owns the Republicans and intimidates the Democrats. Even as President Trump vows to support gun reform, nobody is holding their breath.
Turns out the gun industry and the companies that support it can do a lot without lawmakers. Gun companies can ask for background checks on all gun sales. They can stop selling military-style assault weapons to civilians. They can agree to common-sense consumer safety protections.
Advertisement
“It’s not a zero sum game,” activist John Rosenthal said. “The gun industry can be part of the solution.”
Of course, gun makers won’t do anything on their own. They need a little push — OK, a lot — and that’s where Boston institutions can flex some of their financial muscle.
John Streur, CEO of Calvert Research and Management, a subsidiary of the Boston money manager Eaton Vance, was on the phone this week with the management of supermarket operator Kroger Co., which sells guns at some of its stores.
Calvert, a socially responsible investor, does not hold US gun stocks but is an investor in Kroger and decided to raise concerns. On Thursday, the company announced it would join Walmart and Dick’s Sporting Goods and raise the minimum age for buying guns to 21.
“We’re getting things done that were unimaginable even a couple of years ago,” Streur said. “This is companies and investors taking responsibility for the power they have and using it well.” He said investors have been effective in getting companies to address climate change and the opioid crisis.
“It is a system change we are witnessing,” he added. “We know as investors it is very difficult for a single company to break from the pack. We know how important it is to get an entire industry to move.”
Advertisement
There is strength in numbers. If every one of them stepped up to force gun industry changes, this country could make mass shootings obsolete.
What Washington can’t do, corporate America can.
Shirley Leung is a Globe columnist. She can be reached at shirley.leung@globe.com.