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Warren asks Fidelity, other companies to demand change in gun industry

Senator Elizabeth WarrenAndrew Harrer/Bloomberg

WASHINGTON — As Congress steps into a familiar snarl over gun restrictions, US Senator Elizabeth Warren is calling on deep-pocketed investors in gun companies, including Boston-based Fidelity Investment Management, to use their leverage to demand change from the weapons industry.

The Massachusetts Democrat sent letters Monday to investment funds with the biggest stakes in three publicly traded gun makers, urging them to pressure the manufacturers to self-regulate.

‘‘Now it’s time to put your money where your mouth is,’’ Warren wrote in one such note to BlackRock chief Larry Fink, who declared in his annual letter to CEOs last month that companies need to contribute a social good to keep the $6 trillion investment firm’s support.


Warren wants pressure put on Springfield, Mass.-based American Outdoor Brands (formerly Smith & Wesson), Southport, Conn.-based Sturm, Ruger & Co., and Farmington, Utah-based Vista Outdoor.

BlackRock is the largest shareholder in both American Outdoor Brands Corporation and Sturm, Ruger, and is the second-largest shareholder in Vista Outdoor. Last week, the company announced that it would be ‘‘engaging’’ with weapons makers to ‘‘understand their response to recent events.’’

But Warren wants specifics. She’s asking firms to pressure gun companies to impose their own age restrictions and waiting periods on buyers and invest in developing safer guns. In addition to BlackRock and Fidelity, she sent missives to Vanguard, Invesco, and five other firms with major positions in gun companies and asked for reports on their plans by March 9.

The push comes as Wall Street giants seek to get ahead of a new wave of consumer activism demanding that corporations of all stripes cut ties to gun interests. Bank of America, for example, pledged over the weekend to work with its gunmaking clients ‘‘to understand what they can contribute to this shared responsibility;’’ MetLife ended its discount program for NRA members; and the Blackstone Group asked its fund managers to detail their ownership of gun companies.


Precisely how much leverage the investment managers can claim over the companies is arguable. Fink in his annual letter wrote that as policymakers fail to address pressing problems, ‘‘society increasingly is turning to the private sector and asking that companies respond to broader societal challenges.’’ But BlackRock invests through index funds, limiting its ability to sell its stakes in individual companies that run afoul of its standards.

‘‘Given our inability to sell shares of a company in an index, even if we disagree with management, we focus on engaging with the company and understanding how they are responding to society’s expectations of them,’’ BlackRock spokesman Brian Beades said in a statement. He added the firm is working with clients who want to exclude from their portfolios weapons manufacturers or other companies ‘‘that don’t align with their values,’’ and currently manages $200 billion in assets in such funds.

Other firms on the receiving end of Warren’s letters indicated that whatever actions they take with gun companies will unfold behind closed doors. A Vanguard spokesman said the fund characterizes its approach as ‘‘quiet diplomacy focused on results.’’

Likewise, a Fidelity spokeswoman said that ‘‘while it is our general practice not to comment publicly on individual companies or investment decisions, we meet regularly with companies we invest in and will engage and debate them on a number of topics including social responsibility when appropriate.’’


A Warren aide said the senator’s effort isn’t meant as a substitute for legislative action — rather it’s an attempt to use ‘‘every tool available to push for change.’’

On Monday, one legendary investor who’s proven a frequent ally of Democratic causes dismissed the notion of mixing political judgments with investing decisions. ‘‘I don’t believe in imposing my views on 370,000 employees and a million shareholders,’’ Berkshire Hathaway CEO Warren Buffett said in a CNBC interview. ‘‘I'm not their nanny on that.’’