The Connecticut treasurer, which oversees $ 37 billion in public pension funds, on Tuesday announced plans to sell $ 30 million in shares in civilian gunmakers while banning similar future investments and creating incentives for banks and financial institutions to adopt firearms policies when lending to businesses.
If approved by an advisory board, it will be the first time Connecticut has taken the initiative to divest shares in gun-related companies since the 2012 Sandy Hook Elementary School shooting in Newtown that has killed 20 children and six educators.
State Treasurer Shawn Wooden’s predecessor had attempted to influence the practices of these manufacturers, an approach noted by Wood that did not end gun violence.
“I believe divestment should be a tool of last resort, and I support engagement and committed ownership as a shareholder. The sad truth is that, even working with other institutional investors across the country, the engagement on this issue has not worked, ”Wooden said. “The cost, the economic cost, the social cost of gun violence is very, very important. And the time is right because we don’t have more action in Washington on this issue.”
Connecticut pension funds are currently invested in five of the 17 companies identified by an independent index as producers of arms and ammunition.
The state has roots in the gun industry dating back to the early 1800s. Factories in Middletown, Connecticut supplied pistols to the US government during the War of 1812. Horace Smith and Daniel B. Wesson de Smith and Wesson designed the first repeating rifle in Norwich, Connecticut, and the pistol went into mass production in New Haven.
The proposal comes as the U.S. Supreme Court is considering gun rights for the first time in nearly a decade, hearing arguments on Monday related to a dispute over New Town’s now-defunct restrictions. York regarding the taking of licensed, locked and unloaded weapons outside the city limits. The High Court could get around the problem or possibly extend gun rights.
Wood maintains that the intention of his plan is not to bankrupt gunmakers. Wood has said he supports the “responsible” manufacture and use of firearms, but argued that it is his job to reduce risks to state pension funds and that “guns fire was an incredibly risky proposition. “
The Connecticut State Supreme Court last month said that a survivor and relatives of the victims of the Sandy Hook shooting could continue their lawsuit against Remington Arms, the maker of the rifle used by the shooter. The company argued that it should be protected by a 2005 federal law preventing most prosecution of gun manufacturers when their products are used in crimes.
Wood also hopes to influence the financial services and the arms industries. His plan would continue to allow state pension funds to invest in companies involved in “smart weapons” technology that limit access to weapons. It would also require banks and investment firms to outline their firearms policies in all responses to requests for proposals from the Connecticut treasurer’s office. These policies will be taken into account, among other factors, when the government investment dollars are awarded.
Wood announced Tuesday that Citigroup will be the primary underwriter in Connecticut’s upcoming $ 890 million general bond issue.
Under a 2018 policy, Citigroup requires its customers and business customers not to sell firearms to anyone who has not passed a background check or to anyone under the age of 21. capacity stores.
US Senator John Kennedy, a Republican from Louisiana, criticized Citigroup for the move at the time, accusing the bank of “threatening law-abiding business owners for exercising their Second Amendment rights.”
The National Rifle Association has also accused “America’s financial elite” of wanting to “create a world in which American public policy decisions emanate from corporate boards in Manhattan rather than citizens and their elected officials.”