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Bank of America Global Wealth and Investment Management

PRI reporting framework 2020

You are in Organisational Overview » Asset class implementation gateway indicators

Asset class implementation gateway indicators

OO 10. Active ownership practices for listed assets

10.1. Select the active ownership activities your organisation implemented in the reporting year.

Listed equity – engagement

10.2. Indicate why you do not engage and do not require external managers to engage.

We do not require these external managers to engage companies in order to be on-boarded to our platform.  However, for ESG-classified managers/strategies we do inquire into their engagement practices as part of the due diligence process in order to understand if and how engagement is a part of the investment decision-making process.

Listed equity – voting

10.3. Indicate why you do not cast your votes

While we do have conversations with ESG managers on our platform about their engagement processes and outcomes, we are not an asset owner. We are an intermediary helping clients select investment managers and do not vote the proxies.

IP/MAA:  We have a licensing agreement with a third party provider and our clients can leverage any of the negative screens.  We can accommodate restrictions of up to 30% of an account and prorate cash proceeds of these restrictions across the rest of the model.  We currently don't disclose criteria used in our screens nor are clients informed when the screen is changed. 

CIO:  The Social Innovation screen seeks to find companies that are best-in-class across the three focus areas within the screening process: Environmental Stewardship, Human Capital Engagement, and Corporate Citizenship. We also employ a Performance Review which is designed to measure how effectively corporations implement the policies and procedures described and evaluated in the previous step, and whether the company capitalizes on external incentives for good corporate behavior. We believe the the data points used in the screening process identify companies that are having positive social impact while simulataneously creating economic advantages for their businesses. The scoring process takes place after each quarter-end and the portfolios are adjusted accordingly. Given CIO’s discretionary approach, changes are implemented and clients may speak with their portfolio managers to be made aware of any changes in a client's portfolio

Fixed income SSA – engagement

Please explain why you do not engage directly and do not require external managers to engage with companies on ESG factors.

          We do not require these external managers to engage companies in order to be on-boarded to our platform.  However, for ESG-classified managers/strategies we do inquire into their engagement practices as part of the due diligence process in order to understand if and how engagement is a part of the investment decision-making process.
        

Fixed income Corporate (financial) – engagement

Please explain why you do not engage directly and do not require external managers to engage with companies on ESG factors.

          We do not require these external managers to engage companies in order to be on-boarded to our platform.  However, for ESG-classified managers/strategies we do inquire into their engagement practices as part of the due diligence process in order to understand if and how engagement is a part of the investment decision-making process.
        

Fixed income Corporate (non-financial) – engagement

Please explain why you do not engage directly and do not require external managers to engage with companies on ESG factors.

          We do not require these external managers to engage companies in order to be on-boarded to our platform.  However, for ESG-classified managers/strategies we do inquire into their engagement practices as part of the due diligence process in order to understand if and how engagement is a part of the investment decision-making process.
        

Fixed income Corporate (securitised) – engagement

Please explain why you do not engage directly and do not require external managers to engage with companies on ESG factors.

          We do not require these external managers to engage companies in order to be on-boarded to our platform.  However, for ESG-classified managers/strategies we do inquire into their engagement practices as part of the due diligence process in order to understand if and how engagement is a part of the investment decision-making process.
        

OO 11. ESG incorporation practices for all assets

11.1. Select the internally managed asset classes in which you addressed ESG incorporation into your investment decisions and/or your active ownership practices (during the reporting year).

Listed equity

Fixed income - SSA

Fixed income - corporate (financial)

Fixed income - corporate (non-financial)

Fixed income - securitised

Cash

Other (1)

`Other (1)` [as defined in OO 05]

          Other
        
Select the externally managed assets classes in which you and/or your investment consultants address ESG incorporation in your external manager selection, appointment and/or monitoring processes.
Asset class
ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes
Listed equity

Listed equity - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Fixed income - SSA

Fixed income - SSA - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Fixed income - corporate (financial)

Fixed income - corporate (financial) - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Fixed income - corporate (non-financial)

Fixed income - corporate (non-financial) - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Fixed income - securitised

Fixed income - securitised - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Cash

Cash - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Other (1)

Other (1) - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

11.3b. If your organisation does not integrate ESG factors into investment decisions on your externally managed assets, explain why not.

Currently, we practice the steps highlighted below for any ESG-classified managers/strategies our due diligence analysts cover, but this process has not been integrated across non-ESG classified managers/strategies on the platform.

1)     Our approach to selecting ESG-classified investment managers is based on the manager’s ability to effectively integrate both Environmental, Social, and Governance (ESG) factors and traditional risk-return criteria into their investment selection and risk management approach.

2)     Impact Criteria: The strategy integrates environmental, social and governance factors into their process of investment decision making, portfolio construction and/or risk management. We use many data points and discussions with strategy providers to conduct this analysis, including third party ESG Ratings. Exclusionary screens can be used as part of the process, but are not considered a driving factor in selecting a strategy.

3)         Risk and Return Criteria: The strategy has the potential to meet or exceed the risk and return profiles of “traditional” (non-impact focused) strategies in its peer group. The risk and return profile of the strategies are in line with the expected risk and return of the underlying assets.

11.4. Provide a brief description of how your organisation includes responsible investment considerations in your investment manager selection, appointment and monitoring processes.

Currently, we practice the steps highlighted below for any ESG-classified managers/strategies our due diligence analysts cover, but this process has not been integrated across non-ESG classified managers/strategies on the platform.

1)     Our approach to selecting ESG-classified investment managers is based on the manager’s ability to effectively integrate both Environmental, Social, and Governance (ESG) factors and traditional risk-return criteria into their investment selection and risk management approach.

2)     Impact Criteria: The strategy integrates environmental, social and governance factors into their process of investment decision making, portfolio construction and/or risk management. We use many data points and discussions with strategy providers to conduct this analysis, including third party ESG Ratings. Exclusionary screens can be used as part of the process, but are not considered a driving factor in selecting a strategy.

3)         Risk and Return Criteria: The strategy has the potential to meet or exceed the risk and return profiles of “traditional” (non-impact focused) strategies in its peer group. The risk and return profile of the strategies are in line with the expected risk and return of the underlying assets.


OO 12. Modules and sections required to complete

12.1. Below are all applicable modules or sections you may report on. Those which are mandatory to report (asset classes representing 10% or more of your AUM) are already ticked and read-only. Those which are voluntary to report on can be opted into by ticking the box.

Core modules

RI implementation directly or via service providers

Direct - Listed Equity incorporation

Direct - Fixed Income

RI implementation via external managers

Indirect - Selection, Appointment and Monitoring of External Managers

Closing module

12.2. Additional information. [Optional]


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