In the wake of recent prominent mass public shootings, the WSJ reported on a number of companies including risk factors in their recent SEC filings that address active shootings specifically, including Dave & Buster’s Entertainment (pages 22-23), Del Taco Restaurants (page 21), Stratus Properties (page 17), and The Cheesecake Factory (page 25). While the disclosures expectedly vary by company, common themes include potential reductions in customer traffic and consumer spending, staffing challenges, and store closures/event cancellations.
The article elaborates:
Deciding what to disclose, and which risks count as material, is more art than science. Figuring out whether a shooting is material may depend on whether a company operates spaces that are open to the public, among other factors, [Covington & Burling's] Mr. Martin said. Large companies often vet their risk factors through internal committees, enabling multiple senior executives to weigh in, before disclosing.
In many cases, though, companies decide whether they want to add a risk factor by looking at what competitors have included, lawyers said.
See Cooley's "Will the issue of firearms safety be reignited for the next proxy season?", and these prior reports: "Investor Coalition Launches Firearms Engagement Principles," "CalSTRS Prioritizes Engagements on Firearms Manufacture & Sale," "Investor Coalition Calls on All Companies to Mitigate Gun Violence-Related Risks," "Responding to Political & Social Issues: Board Considerations," and "Gun Control: Investor & Market Forces Trigger Corporate Response." This post first appeared in the weekly Society Alert!