Reference no: EM133119011

More than 180-that is the number of school shootings since 2009, and more than 356 people have died as a result. The tragedy at Stoneman Douglas High School in Parkland, Florida, motivated Ed Stack to act. Mr. Stack is the CEO of Dick's Sporting Goods (it also owns Field & Stream and Golf Galaxy), a business founded by his father from whom he bought it in 1984. Since then, Stack took the company public in 2002, and over the years he's cultivated Dick's into a thriving business and the largest sporting goods company in America. Like the students of Stoneman, Stack also felt "enough is enough," and two weeks later the company stopped selling guns to people under 21, along with removing assault rifles and high-capacity magazines from its stores, but not all guns and ammo. This, however, is just part of the history. The company briefly stopped selling assault rifles back in 2012, reacting to the Sandy Hook shooting, but customer complaints caused the company to relent and eventually sell them again.

The Proverbial Straw

This time was indeed different. After pulling guns from the shelves, Dick's destroyed them, over $5 million worth, stating the company did not want their inventory to end up being sold by someone else. Dick's did not immediately remove all guns from all stores, but instead they rolled the initiative out over time as an ongoing strategic initiative.

When asked to explain his actions, Mr. Stack said, "If you see a problem and you have expertise on the problem, and you have a sense of the solution, you should stand up and say something and that's what we did.

Costs and Resistance

These actions have had costs. After one year with the limits in place, store sales declined 3.1 percent ($250 million), approximately the amount of lost gun sales in 2018-2019. After Mr. Stack aligned himself with gun-control activists, others lashed back, such as other gun sellers, gun buyers, and employees of gun manufacturers. Some of Dick's employees objected too-sixty-two resigned explicitly for this reason (it employs nearly 45,000). And Mr. Stack received personal threats. Not surprisingly, the National Rifle Association (NRA) objected, along with some (non) customers based on perceived infringements on the Second Amendment right to bear arms. This was expected by Stack, and others, and the impact is difficult to assess.

Responsibility Is Contagious

Numerous other companies changed practices and took actions, similar to those of Dick's. Delta Airlines and Met-life stopped providing discounts to NRA members, and Citigroup and Bank of America implemented new compliance policies for their clients in the gun industry. Several pension funds also requested greater transparency and safety measures from the gun companies in which they invest. Walmart was and is the largest seller of guns in America. Its initial response to Parkland was similar to that of Dick's; they stopped selling to people under 21. Employees took up the issue again when twenty-two people were killed in a shooting at an El Paso, Texas, store. They publicly protested and threatened to walk off the job, all in the effort to influence executives to change company policies and to stop selling guns and participate in buy-back programs (cash for guns). Walmart leaders did not yield, and the company continues to sell guns as it did before. However, it stopped selling handguns long ago, and discontinued selling some sporting rifles in 2015

Skeptics

Some say Dick's is really just following industry trends and market realities, rather than rallying for social change. For instance, interest in hunting and thus sales of guns and related products have been on the decline for many years.51 Stack, however, is undaunted. In March 2020, he announced plans to accelerate the removal of guns from over 400 additional stores. The company's stock surged 13 percent on the news.

For Discussion: (Note: Although this case happens within the context of a much larger gun control debate in America, our focus here is on business ethics and thus the behaviors, policies, and practices of people engaged in business. Put differently, this is not intended to spur discussion on the Second Amendment, but instead on the concepts presented in this chapter as they relate to the decisions by the CEO of Dick's Sporting Goods, and the resulting impact and reactions of various stakeholders.)

1. What ethical decision-making perspective did Ed Stack seem to use?

2. Describe the level of social responsibility demonstrated by Ed Stack.

3. Which stakeholders were primary in this case? Which were secondary?

4. Which of the common decision-making perspectives is illustrated by Ed Stack in this case? Explain.

5. Describe the implications of Stack's actions on employees of Dick's.

6. Assume you are the CEO of Dick's, how would your actions differ from those of Ed Stack? Describe and justify.
7. Again, assume you are the CEO, what type of stakeholder activism could influence you to change policies and begin selling guns again? Explain and justify.