Proponents seek investor support for their proposal requesting a human rights impact assessment scheduled for a vote at Sturm Ruger’s annual meeting of stockholders on Wednesday, June 1st.
NEW YORK, NY, WEDNESDAY, MAY 25TH, 2022 - As our nation once again tries to process the unimaginable - a massacre at an elementary school where 21 people including 19 children, many under the age of 10, were gunned down by an 18-year old man – shareholders in Sturm Ruger ($RGR) are reiterating their call for their fellow investors to support item #4 on the proxy, calling for a third-party human rights impact assessment (HRIA).
While by no means a solution to the complex issue of gun violence, given the lethality of RGR’s firearms business, investors see due diligence around potential human rights harms as a critical first step toward preventing them. The proposal has the support of proxy advisories ISS and Glass Lewis.
Third-party HRIAs are used by companies to assess existing and potential adverse human rights impacts which can pose significant reputational, financial, and legal risks.[i] This type of assessment, particularly when conducted by a third-party auditor, can often identify issues that a company may be unaware of in its day-to-day operations--issues that a company can remediate, address or prevent once the risks are identified. While the HRIA is a non-binding document, most companies that undergo these third-party audits find them a valuable tool in a company’s risk management structure.
“Whenever someone is injured or killed by gun violence - a daily occurrence in our country - we all ask what could have been done to prevent it,” said Laura Krausa of CommonSpirit Health who filed the proposal along with fellow members of the Interfaith Center on Corporate Responsibility. “And while we all know that there are multiple factors contributing to these events, not taking every possible step to prevent them from recurring within our respective spheres of influence is an abdication of responsibility that almost ensures they will recur. This is precisely what the HRIA is meant to do.”
According to the Gun Violence Archive,[ii] there have already been over 200 mass shootings in the U.S. this year and gun violence has taken the lives of 17,201 people, including 648 children and teens. In fact, gun violence is now the leading cause of death for children and teens in our country[iii].
Said Sr. Judy Byron of the Northwest Coalition for Responsible Investment who co-filed the proposal at RGR, “That the mass shooting in Buffalo was a hate crime perpetrated by a young white supremacist with an AR he likely modified to kill as many Black people as possible is beyond chilling, and the trauma of it, the fear it has instilled in the Black community, cannot be underestimated. There is a significant opportunity for manufacturers to engage in discussions about what proactive contributions they could make to more effectively prevent harms caused by the products they sell to the public. In order to do this, they must first understand where the gaps are and where the risks are most salient.”
In its statement of opposition[iv] to the proposal, RGR claims that it is unable to track customer misuse and/or criminal use of its weapons because it sells to distributors rather than directly to consumers. Proponents argue that its indirect sales model does not shield the company from accountability for its potential human rights risks. The pharmaceutical industry, for example, does not sell its products directly to patients, yet it is accountable for any detrimental human rights impacts throughout its value chain, as Pfizer acknowledges in its human rights policy: “In line with the UN Guiding Principles on Business and Human Rights, Pfizer’s human rights policy focuses on addressing risks that could have the most severe impact on people: our patients, our colleagues, the workers of our business partners, and the communities in which we operate. Our responsibility to respect human rights extends throughout our operations, from lab to patient, including our diverse global supply chain of numerous local, third-party vendors.”[v]
Continued Krausa, “A third-party human rights impact assessment will not destroy RGR as management has argued as it isn’t legally binding, but it will reveal potential human rights threats to the business and it could save lives. Importantly, an HRIA will show the world that RGR takes seriously the human rights/civil rights risks inherent in its business and demonstrates a genuine willingness to contribute to mitigation and prevention strategies. It will demonstrate that RGR is doing what it can to prevent the next shooting and show that RGR places the lives of its customers and communities above its profits.”
About the Interfaith Center on Corporate Responsibility (ICCR)
Celebrating its 51st year, ICCR is the pioneer coalition of shareholder advocates who view the management of their investments as a catalyst for social change. Its 300-member organizations comprise faith communities, socially responsible asset managers, unions, pensions, NGOs, and other socially responsible investors with combined assets of over $4 trillion. ICCR members engage hundreds of corporations annually in an effort to foster greater corporate accountability. Visit our website www.iccr.org and follow us on Twitter, LinkedIn, and Facebook.