US state of Rhode Island pushing for weapons divestment

The general treasurer of Rhode Island is pushing the US state’s pension fund to divest from equity funds that own stakes in gun distributors. 

Gina Raimondo, chair of the investment commission, is to recommend selling Rhode Island’s $20m (£12m) investment in Wellspring Capital Partners IV and Summit Partners, private equity funds that hold stakes in United Sporting Companies. 

Kenneth J Block, a candidate in the 2014 gubernatorial elections, immediately criticised the announcement, saying that Raimondo was being “irresponsible and misguided” and “politicising” the issue.

She responded by saying that selling the investments was “the right thing to do.”

“As a [mother] and public official, I am deeply troubled by gun violence”, she added.

Since the Sandy Hook tragedy last year, in which gunman Adam Lanza murdered 20 children and six adults at Sandy Hook Elementary School, several other US pension funds have taken similar steps. 

California State’s teachers’ pension fund began divesting from assault weapons producers in January, while the city council of Oakland has voted to divest from all gun and ammunition manufactures.

In December, Bill de Blasio, a trustee for the New York City’s $43.3 billion (£26.7 billion) retirement fund argued that divestment from such companies could also make financial sense. 

“The increased liability from such exposure, and gun companies’ links to the horrific Newtown tragedy, make such exposure a poor investment decision”, he said.

In September, the Church of England was criticised for owning £10m of shares in General Electric, which produces parts used in a number of weapon systems including combat aircraft and drones.

Further reading:

Church of England under fire for £10m arms investment

Campaign groups urge world leaders to fix arms trade loopholes

Will only unspeakable tragedy make investors see the necessity of responsible investment?