American Outdoor Brands (NASDAQ:AOBC) shareholders rejected a proposal from activist investors to require the gunmaker to take on the “human rights impacts” of its business while also rejecting an increase to CEO James Debney’s pay. It seems shareholders want the company focusing on what it does best: making firearms that are popular with gun owners and enthusiasts. But with the gunmaker stuck in a steep, multi-year decline, investors aren’t willing to pay execs more until those leaders prove they can get the job done. It was only a year ago that shareholders made the Smith & Wesson firearms owner issue a report on the risks the gunmaker faced, financial and otherwise, due to crimes involving its products. While management objected to the exercise, it eventually issued a detailed report outlining the greater risk it would confront if it strayed from its mission. That obviously factored into the rejection shareholders handed the activist investors, who covered a lot of the same ground in their new proposal but wanted American Outdoor to frame it in terms of “human rights” — an amorphous, undefined phrase. Management argued it would open up the company to unlimited legal liability, and a Reuters report said a transcript of the shareholder meeting showed the proposal was not approved, though by what margin was not indicated. The proxy question failure suggests investors are satisfied the gunmaker knows its business best and wants management to stay focused on it, but they’re not willing to pay up for management until said business gets back on track. They also rejected American Outdoor’s compensation plan for the CEO and other executives. [full article]
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Bob Rogers is the Editor and Publisher of GunPro Plus, America’s premier daily digital gun news portal. After a successful 20-year career as the Editor for a major magazine in the gun industry, Bob launched GunPro Plus to bring his industry expertise on gun news into the digital realm.
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