CAB - 7 Oct 2020 - 10 Oct 2020 - Advice

SIC takes a stand against gun manufacturers

SHETLAND Islands Council is to write to stock market investor Black Rock supporting its offer to let clients opt out of investing in gun manufacturers in the wake of the latest fatal high school shooting in the US.

Black Rock invests over a third of the council’s reserves, worth £134 million, on the equity markets.

Last week the firm said the recent attack in Parkland, Florida, which saw a gunman kill 17 people, the majority of whom were school pupils, had “driven home the terrible toll form gun violence in America”.

The Valentine’s Day shooting took place at Marjory Stoneman Douglas High School.

During Tuesday’s policy and resources committee meeting, councillor George Smith received backing for his suggestion of writing to Black Rock “noting the stance they are taking, and offering our support”.

“Clearly guns, wherever they are, are a dangerous thing,” he said. “If we can do anything in our own small way to reduce the availability of guns – particularly in the United States – that would be a good thing.”

In its statement Black Rock said the latest in a long line of high school tragedies in a country rife with guns “requires response and action from a wide range of entities across both the public and private sectors”.

“It has put a spotlight on the role of companies that manufacture and distribute civilian firearms,” the statement continued.

However, the company has stopped short of an outright ban on investing in gun manufacturers at this stage.

Smith said after the meeting that he felt Black Rock was “taking a very responsible stand”, and if those investing through the company pledged their support he hoped they might go as far as withdrawing their holdings in the companies making guns.

“This is their direct response trying to put some pressure on the NRA [National Rifle Association] and others on the appalling situations we see almost on a weekly basis in America where there are innocent folk being shot,” he said.

Smith said that, as SIC education and families committee chairman, it was very difficult continually “seeing young people being shot merely for attending school”.

Previous efforts by councillors including Jonathan Wills to get the council and Shetland Charitable Trust to consider a broader policy of ethical investment – which would have involved divesting from tobacco and arms manufacturers, amongst others – have been dismissed.

Among the most vocal objectors during previous debates was South Mainland councillor Allison Duncan, but in this instance he backed ward colleague Smith’s suggestion.

Council leader Cecil Smith agreed that “we can do that”, while councillors Alastair Cooper and Steven Coutts also voiced their support, and no one around the table objected.

Smith said he was open-minded about other forms of ethical investment, though “we don’t have the buying power to dictate, and we do have to accept we’ll end up with mixed portfolios”.

But in this instance “when the investment company themselves are making a statement, I think it’s an ideal opportunity for us to be supporting that”.

Meanwhile, head of finance Jonathan Belford told councillors the value of its investments had swelled by £14 million in the third quarter of 2017/18 to an overall value of £358 million – while there was a further increase to £365 million in January, ahead of a more recent “period of volatility in global markets”.

Black Rock’s investment matched the target they were set, while other investors Baillie Gifford and Insight outperformed their benchmarks.

Overall the reserves’ value has increased by a tenth since April when they were worth £334 million.

Councillor Cooper, however, sought to emphasise that a large portion of that money is set aside for specific purposes and there was “a degree of ignorance” both within and outwith the SIC about how much money is actually at its disposal.

“Externally we have so many people saying this council is awash with money,” he said, “but the truth is a lot of that money is ring-fenced.”