This piece was originally published in our 2022 Q2 Impact Update.
The U.S. has once more found itself asking the question: What can be done to assure that “never again,” means never again? As the country repeatedly and collectively mourns the loss of lives due to gun violence, responsible investing reminds us that even in the wake of this devastation, our investments can have a role in the solution.
In Buffalo, New York at a grocery store, we saw a racially motivated attack, and in the midst of grieving those who were lost, we witnessed the devastating elementary school shooting unfold just ten days later in Uvalde, Texas, followed by a shooting at a 4th of July parade in Highland Park, Illinois. Public opinion polling reports that 53% of the country is in favor of more gun control measures—yet the United States leads high-income nations in gun ownership and gun violence. While additional polls show that self-defense and hunting are top reasons why individuals own firearms, violence still persists throughout the nation. Due to the reality that the business of gun manufacturing is profitable, investors can proactively assess their portfolios and divest from entities that are contributing to the cycle of gun violence.
How does the private sector participate in the cycle of gun violence?
Finding a legislative solution takes time, and that solution may not be sufficient for every stakeholder, which we have seen before. Both chambers of U.S. Congress passed legislation at a compromise, which President Biden signed into law, that focuses on mental health, school safety, and red-flag laws. Other countries that have enacted gun control measures have shown that when these mandates are applied accordingly, gun violence and gun deaths decrease considerably. But beyond law-making, investors can change their investment strategies to make sure they are not profiting from the manufacturing or distribution of guns.
Corporations play a large role in this conversation because they profit from the sale of guns, the manufacturing of guns, and the laws in place that allow access to guns. After the most recent shootings and decision from the U.S. Supreme Court to roll back gun safety measures, stocks of gun manufacturers rose—a seemingly regular occurrence throughout history. Companies respond to quarterly pressure to sell and distribute guns and related products, and as investors we have the power to divest from those entities in our portfolios. Alongside impact investors, some corporations have already responded to the ongoing crisis and changed their policies as they recognize their role; for example, Dick’s Sporting Goods updated policies by raising the age to buy guns, limiting which guns they sell, and stopping the sale of guns throughout physical locations.
Domini’s approach and Commitment
For 25 years, Domini has always excluded corporations across our portfolio that are significantly involved in the production of weapons and civilian firearms. Through our investment standards, we do not waiver from our goal of universal human dignity or our standard to not invest in products or services that have the potential to cause incalculable harm. Some of the greatest dangers we face both at home and abroad are tied to weapons of mass destruction, which is why Domini also excludes investments in United States Treasury securities due to the country’s leadership position in the global nuclear weapons arsenal. This quarter, we reaffirmed our commitment by signing an investor letter in support of the Treaty on the Prohibition of Nuclear Weapons, which outlaws nuclear weapons as well as any form of assistance with their manufacture or production. Additionally, we engage with companies on peripheral aspects, like through our engagement with Amazon.com, where we worked with shareholders on topics such as removing products from their store that serve as accessories for guns and ammunition.
At the core of our work is our belief that investments we make today will shape the world we live in tomorrow, and that includes supporting the on-going effort to assure that “never again” actually means never again. In these trying times, knowing where your dollars are invested is essential. As we continue to harness the power of finance to create a better world, we are reminded that when we unite under the same mission, hope and change is possible.