Smith & Wesson doesn’t invest in smart gun technology because consumers don’t want them — making a shareholder proposal to report on the gun maker’s “efforts to produce safer firearms” useless, top executives said.
Parent company American Outdoor Brands reiterated its stance on the development of user-authorized “smart gun” technology in regulatory filings this week, noting current efforts pose liability risks for the entire industry.
“Smart gun technology is not commercially available today or reliable, and, in fact, could potentially cause more injuries, not less,” the gun maker said in its Sept. 10 filing with the Securities and Exchange Commission. “If the opposite were true, it would be used extensively by law enforcement agencies since it was originally designed for that purpose. Not one law enforcement agency uses such technology.”
The gun maker argues the technology provides no recourse should a battery die or the user authorization functions otherwise fail. It could also provide a false sense of security, leading to unsafe storage practices and other “unintended consequences.”
“A person relying on a firearm to protect his or her life, or the life of a loved one, does not have the liberty of rebooting the device, recharging the battery, removing a glove, or drying his or her hands,” the company said.
It’s the same position Smith & Wesson first detailed in a letter to BlackRock — an investment firm with major holdings in AOBC and other publicly traded gun makers — after the financial industry caved to public pressure over gun laws and demanded manufacturers answer to their role in preventing mass shootings.
“We are a manufacturing company, not a technology company, and we are poorly situated to hire those with the knowledge and expertise to develop such technology and to otherwise compete with technology companies who are far more knowledgeable in this area,” Chief Executive Officer James Debney said in the letter, dated March 6. “In fact, to divert significant resources to these initiatives would be irresponsible when the most recent market research shows there is very little interest or desire among firearm consumers for “smart gun” products, even if they were available.”
Still, the response provided little comfort to some investors. Last month, the Sisters of the Holy Names of Jesus and Mary backed a resolution for a gun violence risk report, drawing the support of at least two proxy advising firms ahead of the gun maker’s annual meeting Sept. 25.
Institutional Shareholder Services (ISS) argued the proposal deserves shareholder support, even if the gun maker fears the backlash of creating the first smart gun, saying “there is reason to believe that smart gun technology could be employed to make guns safer in the U.S. and that any engineering problems could be overcome if there was a market for the product.”
“Nothing could be further from the truth,” Smith & Wesson said in its filing. “It is remarkable that ISS is substituting its judgment for ours on what firearms we should develop, market, and sell to our customers.”
