How an Asset Manager Pressured a Grocery Chain on Gun Sales — and Won
At a panel discussion in New York, socially responsible asset manager Calvert explained how it played a role in persuading Kroger to stop selling guns.
Calvert Research and Management, which has focused on socially responsible investments since its founding in 1976, is turning up the heat on businesses that sell firearms.
Calvert has never owned the stocks of gun manufacturers or retailers where guns represent a material part of earnings because these companies don’t meet its investment principles. But it does own two retailers — grocery store chain Kroger Company and Dick’s Sporting Goods — that sold firearms at some of their locations, and it successfully lobbied for Kroger to make changes following the February 14th mass shooting at Marjory Stoneman Douglas High School in Parkland, Florida.
“After Parkland we engaged with Kroger and asked why a grocer sold firearms, including assault rifles,” said John Streur, president and CEO of Calvert, which was acquired by Eaton Vance in 2017, during a panel discussion in New York on Thursday.
He emphasized that Calvert has always made its position on gun sales known to both companies, but it used the heightened awareness of gun policies’ connection to mass shootings to raise the issues again. “We took advantage of the nationwide attention,” he said.
Other asset managers that don’t specifically incorporate environmental, social and governance criteria into their investment process, including BlackRock, are joining Calvert in taking vocal stands against gun manufacturers and companies that deal in firearms since the shooting as well.
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Calvert pushed Kroger to raise the legal age to purchase a gun at its stores to 21 and to eliminate the sale of assault rifles. (Kroger only sells guns through some of its Fred Meyer stores, a chain of super stores with locations in Alaska, Idaho, Oregon, and Washington.)
Shortly after pressure from Calvert, Kroger announced it would raise the age to buy a gun in its Fred Meyer stores to 21. It later said the stores would phase out the sales of all firearms.
Streur says Calvert pointed out a number of issues to Kroger, including the business inconsistency of selling both food and guns and the risks to its brand.
“You can pick up bread and butter, and an assault rifle if you want,” he said. “From an investor’s perspective the risks were greater than the benefits they could achieve through gun sales.”
Calvert also told the company that it would file a shareholder resolution on the issue if the company didn’t make the changes.
Streur said what was particularly interesting was another announcement from Kroger, saying it would even stop selling magazines that advertised or depicted gun activities, something Calvert was not involved in.
Separately, Dick’s Sporting Goods has said it would eliminate the sale of assault rifles and high capacity magazines and raise the age to buy a gun in its store to 21. Streur said it’s positive that companies like BlackRock are taking more active stances on issues like guns.
“It gives us all more power,” he said.