- Walmart has a gigantic presence in American life.
- Two of its stores were the sites of recent mass shootings.
- Walmart CEO Doug McMillon has declared that the company is curbing its guns and ammunition sales – and it’s part of a larger trend of social responsibility among American mega-firms.
- This article is part of Business Insider’s ongoing series on Better Capitalism.
Walmart is one of the most massive entities in American life.
It made $514.4 billion last year, more than the GDP of Thailand or Israel. Its global workforce of more than 2.2 million people would make it the fifth-largest city in the country, between Huston and Phoenix. And one in five bullets in America is purchased at a Walmart.
But not for long.
On Tuesday, the retail giant announced that it will stop selling ammunition for handguns and some rifles. This came after shootings at Walmart outlets in El Paso, Texas, and Southaven, Mississippi, claimed the lives of 24 people.
“We know these decisions will inconvenience some of our customers, and we hope they will understand,” CEO Doug McMillon said in a memo to employees. “As a company, we experienced two horrific events in one week, and we will never be the same.”
The company predicts that its market share in ammunition will drop to between 6% and 9% due to these changes – which come at a telling time. Not only because of the shootings, but because of Walmart’s recent public comments about how it, along with 180 other large firms, are starting to rethink its commitments.
In August, McMillon was one of 181 chief executives to add his name to a new proclamation from the Business Roundtable, an association of large companies that advocate for American business.
For decades, the Business Roundtable followed the conclusions of economist Milton Friedman, who famously emphasized that maximizing shareholder value – i.e., making money – was the one and only thing that businesses should feel responsible for.
The job of a business is “to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition, without deception or fraud,” Friedman wrote in 1962. In the 1980s, Friedman became an advisor to President Ronald Reagan, baking shareholder maximization into national policy.
But the Roundtable’s new mission statement widens that sense of responsibility. The group, which includes JPMorgan Chase CEO Jamie Dimon and Amazon head Jeff Bezos along with McMillon, pledged to work for the “benefit of all stakeholders,” including “customers, employees, suppliers, communities and shareholders.”
As Business Insider’s Richard Feloni has observed, this has the markers of being a response to a range of social pressures, like the outcry of inequality that followed the financial crisis and the coming of age of the millennials and now Gen Z – generations that emphasize transparency and purpose.
Walmart’s move to limit their firearm and ammunition sales can be see as the next step in this process. While large companies have at least started to talk about environmental responsibility, curbing weapon sales is a major sign of taking social responsibility seriously, including gun violence.
“We understand our heritage, our deeply rooted place in America and our influence as the world’s largest retailer. And we understand the possibility that comes with it,” McMillon said in a statement distributed over Twitter. “In a complex situation lacking a simple solution, we are trying to take constructive steps to reduce the risk that events like these will happen again. The status quo is unacceptable.”