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Merrill Lynch and U.S. Trust Sign the United Nations Principles for Responsible Investment

Response to Growing Client Demand for Social Impact Investments

Tuesday, November 25, 2014 8:00 am EST

Dateline:

NEW YORK

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BAC
"We are seeing increasing demand from our clients to ensure that their investments express their personal values and have a positive impact on society"

Bank of America’s Global Wealth and Investment Management (GWIM) division today announced that it has signed the United Nations-supported Principles for Responsible Investment (PRI) on behalf of its discretionary asset management businesses. The unit (GWIM) is comprised primarily of Merrill Lynch Wealth Management and U.S. Trust.

The PRI initiative is recognized as the leading global network for investors and financial industry participants who are committed to integrating environmental, social and governance (ESG) considerations into their investment practices and ownership policies.

"We are seeing increasing demand from our clients to ensure that their investments express their personal values and have a positive impact on society,” said Andy Sieg, head of Global Wealth and Retirement Solutions for Bank of America Merrill Lynch. “To meet that demand, we are committed to offering broad access to innovative financial solutions related to responsible investment. The PRI initiative represents another important step in this direction and in the evolution of our ESG and impact investment platform.”

The PRI’s network of international signatories work together to implement a set of voluntary and aspirational principles that provide a framework for integrating ESG factors into investment analysis and ownership practices. These factors are aligned with investors’ goals and values and tailored to each organization’s investment strategy, approach and resources.

“We are delighted to welcome Bank of America’s Global Wealth and Investment Management division to the PRI,” said Fiona Reynolds, managing director of the PRI. “Their commitment to using the PRI’s framework is welcome news and clearly demonstrates how ESG has moved into the minds of mainstream investors. More investors are seeing the benefits of embracing responsible investment strategies, and we believe that acceptance of the PRI is helping to underpin this trend.”

Recent research by U.S. Trust found that one-half of high net worth investors consider social and environmental impact an important part of investment decision-making (up from 45 percent in 2013).1 Six in 10 of these investors feel that the way they invest can have a strong influence on society.2 Two-thirds believe that private capital from socially motivated investors is a way to help hold public companies and governments accountable for their actions and results.3

A component of the growing demand for social impact investing is being driven by the interests of women and millennials, or Generation Y. Specifically:

  • Seventy-five percent of millennials and 63 percent of women surveyed feel that their investment decisions are a way to express their social, political and/or environmental values.4
  • Values-based investing was one of the top three criteria wealthy 20- and 30-year-olds use when selecting an advisor.5
  • Twenty-nine percent of millennials surveyed say they feel that changing the world by finding solutions to major problems is the most important use of their wealth.6

GWIM’s ESG program includes a broad array of investment opportunities, including innovative social impact partnerships designed to help drive social change, as well as substantial thought leadership. As of September 2014, Bank of America Corporation’s investment businesses had more than $8.6 billion in assets with a clearly defined ESG approach. The GWIM platform is part of a broader commitment from Bank of America totaling $70 billion in environmental lending, financing and other business, as well as $100 million in grants over the next 10 years.

GWIM formed an ESG Council in 2012. Today, the council acts as a collaborative team to bring the best of Bank of America’s ESG capabilities to clients at all asset levels. The council reports into the bank’s Global Corporate Social Responsibility Committee, which, in turn, reports to the company’s chief executive officer and makes recommendations regarding corporate social responsibility and ESG issues.

Bank of America Merrill Lynch has been extremely active in both developing and offering investment opportunities with social purpose. In late October 2014, BofA Merrill Lynch Global Research launched the BofAML Green Bond Index to track the performance of debt issued by quasi-governments and corporations where the proceeds of the issue are to be used solely for projects and activities that promote climate or other environmental sustainability purposes. The index was created because of the growing interest in this market segment.

In August 2014, Merrill Lynch clients were offered fixed rate bonds issued by the World Bank, an offering spurred by interest in social purpose investments. Additionally, Bank of America Merrill Lynch completed the offering of interests in an innovative social impact partnership with New York State and Social Finance Inc. in December 2013. The proceeds are being used to fund a 5½-year program focused on comprehensive reentry employment services to 2,000 formerly incarcerated individuals in New York City and Rochester, N.Y.

1 U.S. Trust 2014 Insights on Wealth & Worth, June 2014

2 U.S. Trust 2013 Insights on Wealth & Worth, May 2013

3 U.S. Trust 2014 Insights on Wealth & Worth, June 2014

4 U.S. Trust 2014 Insights on Wealth & Worth, June 2014

5 Young High Net Worth Survey, Merrill Lynch Private Banking and Investment Group, April 2013

6 U.S. Trust 2014 Insights on Wealth & Worth, June 2014

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About the Principles for Responsible Investment (PRI)
The United Nations-supported Principles for Responsible Investment (PRI) Initiative is an international network of investors working together to put the six principles for responsible investment into practice. Its goal is to understand the implications of Environmental, Social and Governance issues (ESG) for investors and support signatories to incorporate these issues into their investment decision making and ownership practices. In implementing the principles, signatories contribute to the development of a more sustainable global financial system. Visit www.unpri.org.

Merrill Lynch is the marketing name for Merrill Lynch Wealth Management, and Merrill Edge™, both of which are made available through Merrill Lynch, Pierce, Fenner & Smith Incorporated (“MLPF&S”). Merrill Lynch makes available products and services offered by MLPF&S and other subsidiaries of Bank of America Corporation (“BofA Corp.”). Banking products are provided by Bank of America, N.A., and affiliated banks, members FDIC and wholly owned subsidiaries of BofA Corp.

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U.S. Trust operates through Bank of America, N.A., member FDIC, and other subsidiaries of BofA Corp.

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Contact:

Reporters May Contact:
Susan Atran, Bank of America, 1.646.743.0791
susan.atran@bankofamerica.com
Joy Frascinella, PRI, 44 (0) 203.714.3143
joy.frascinella@unpri.org