Sturm Ruger, one of the country's largest firearms makers, urged shareholders for weeks to reject a proposal from a group of Roman Catholic nuns demanding more transparency from the company on whether it planned to develop safer products and monitor the ones already in circulation.
But when the votes were counted at the company's annual meeting on Wednesday, a majority of investors sided with the nuns.
Ruger must now produce a report by February on how it tracks violence associated with its firearms, what kind of research it is conducting related to so-called smart gun technology and its assessment of the risks that gun-related crimes pose to the company's reputation and finances.
The vote was a rebuke to the company's leaders and victory for gun-control activists who had prepared the resolution. But the chief executive, Christopher J. Killoy, played down the impact of the measure's passage.
"This proposal requires Ruger to prepare a report," Killoy told shareholders after the vote was announced. "That's it, a report. It cannot force us to change our business, which is lawful and constitutionally protected."
The Ruger meeting was the first chance for activist shareholders to confront a publicly held American gun-maker since 17 people died in Parkland, Fla., in a school shooting in February.
Shareholder approval of the proposal faced long odds, but activists had prepared for months to challenge Ruger. They plan to raise similar issues at other shareholder meetings this year.
Ruger did not support the proposal, which was submitted by 11 members of the Interfaith Center on Corporate Responsibility, a shareholder advocacy organization that included health care networks and several groups of nuns. The company said in a public filing that "the intentional criminal misuse of firearms is beyond our control."
But Institutional Shareholder Services, an advisory firm, backed the proposal, describing it as a push for "concrete evidence that the board is properly assessing risks to the company's long-term viability."
On a separate front, Amalgamated Bank, an institutional investor and retail bank that promotes social justice issues, had worked with other groups that have tried to convince major Ruger shareholders like BlackRock and Vanguard that the company's close ties to the National Rifle Association had exposed it to risk.
Amalgamated said Tuesday that it would withhold its vote to reappoint Sandra Froman, the only woman on the Ruger board, to the seat she has held since 2015.
Froman won re-election on Wednesday. She did not respond to requests for comment.
Ruger is based in Southport, Conn., but held its shareholder meeting at a hotel a short drive from one of its factories in Arizona.
Also Wednesday, gun-maker O.F. Mossberg & Sons, Inc. said in a statement that it would discontinue selling products to Dick's Sporting Goods, and its subsidiary, Field & Stream, in response to their hiring of gun control lobbyists last month.
"It has come to our attention that Dick's Sporting Goods recently hired lobbyists on Capitol Hill to promote additional gun control," said Mossberg Chief Executive Officer Iver Mossberg. "Make no mistake, Mossberg is a staunch supporter of the U.S. Constitution and our Second Amendment rights, and we fully disagree with Dick's Sporting Goods' recent anti-Second Amendment actions."
Business on 05/10/2018