New Jersey’s public-worker pension fund continues to own a small stake in a company that manufacturers firearms, several years after Gov. Phil Murphy and lawmakers first raised concerns about public investments in the gun industry.
As of earlier this month, the pension fund owned shares worth an estimated $28 million in a company that, among other products, specializes in making custom sporting shotguns and rifles, according to the latest information provided by the Department of Treasury.
However, the overall $85 billion worker-pension fund has cut ties in recent years with a manufacturer of firearms ammunition, which had been its only other direct link to the firearms industry, Treasury officials confirmed.
The updated information about the pension fund’s ties to the firearms industry was provided to NJ Spotlight News in response to the latest in a series of periodic inquiries about the status of the fund’s investments in the firearms industry, including manufacturers of guns and ammunition.
Dumping shares in firearms company
Those inquiries began after Murphy, a first-term Democrat, touted the pension fund’s shedding of a stake in a company that manufactures semiautomatic rifles in the wake of the 2018 slaughter of 17 people at Marjory Stoneman Douglas High School in Florida. The shootings were allegedly carried out by a former student armed with a powerful semiautomatic rifle.
Around the same time, lawmakers in New Jersey proposed legislation that called for the divestiture of any stakes that the public-worker pension fund owned in companies that manufacture firearms or ammunition. But at the time, it was unclear exactly what, if any, such investments were owned by the pension fund.
Recent mass shootings in Colorado, Georgia, Indiana, South Carolina, Texas and Wisconsin have rekindled interest in issues related to gun safety and the firearms industry. While none of those events occurred in New Jersey, the state is among those where gun violence is a common occurrence in major urban areas, despite having some of the toughest gun laws in the country.
Earlier this month, President Joe Biden announced several executive actions aimed at reducing gun violence. They included placing new restrictions on the manufacturing of homemade firearms known as “ghost guns.” Biden also called on the Congress to take more aggressive legislative action, including by passing bans on assault weapons and high-capacity magazines.
Murphy’s latest on gun reform
Murphy has also put forward a new anti-gun-violence agenda that is intended to build on prior gun-reform efforts that have been launched since he took office in early 2018.
His latest proposals include a push to increase the minimum age for purchasing firearms in New Jersey and a call to hold gun manufacturers themselves liable through a proposed amending of public-nuisance laws for “the public harm they cause.”
“We cannot sit back when we know there is more to do to address the danger of gun violence in our communities,” Murphy said earlier this month during a public event in Newark.
In a 2018 speech highlighting his first 100 days in office, Murphy praised the pension fund’s shedding at the time of an investment in Vista Outdoor, a manufacturer of semiautomatic rifles, that was valued at $1.9 million.
The latest information detailing the pension fund’s firearms industry investments provided by Treasury indicates state fund managers have also shed a prior investment in Olin Corp., the parent company of the Winchester Ammunition Co. In 2019, that investment was valued at $2.3 million. Winchester manufactures and sells ammunition to military, law enforcement and commercial customers.
One last link to firearms
But the pension fund continues to own shares in Richemont, a holding company for Purdey & Sons, which manufacturers high-end shotguns and rifles, according to Treasury. And the value of those shares has increased since the last time NJ Spotlight News sought information about the pension fund’s firearms-industry investments, when it was reported to be worth $22.3 million.
“The only exposure the Pension Fund currently has to the manufacture of civilian guns or ammunitions is a small fraction of a $28 million investment in shares of the luxury brand holding company Richemont,” Treasury spokeswoman Jennifer Sciortino said.
“There are no other civilian firearms or ammunition manufacturer investments in the Pension Fund,” she said.
In 2018, several lawmakers introduced the legislation that called for banning the New Jersey pension fund from holding any investments in companies with direct ties to the manufacturing of guns or ammunition. At the time, they raised concerns about using public funds to help companies make profits from the production of weapons and ammunition.
But that bill stalled in the Legislature after Murphy conditionally vetoed another measure that sought to force the pension fund to divest stakes in companies that were shirking their responsibility to clean up severely polluted Superfund sites.
Instead of mandating outright divestment, Murphy at the time encouraged lawmakers to back an effort to establish a formal state investment-evaluation policy known as ESG (environmental, social and governance), which takes into account factors beyond the bottom line for retirees.
Murphy, a former executive at Goldman Sachs, said in his 2018 conditional veto that the adoption of ESG policies in states like California and New York had “positively changed business practices and allowed for more robust engagement between the state and the investment community.”
Unloading shares at a steep price
He also cited the “illiquid” nature of some pension-fund investments and raised concerns that they could not be sold immediately without incurring major losses.
“I do not believe that (divestiture) should be the only available response when companies in which the State has invested pension funds behave poorly,” Murphy wrote in the conditional veto.
Later that year, a formal ESG policy was enacted by the New Jersey State Investment Council and a subcommittee was tasked with cataloguing “investments in firearm and ammunition manufacturing and retail companies.”