BofAML becomes first major US brokerage to sign on to UN PRI

Bank of America Merrill Lynch (BofAML) has signed the UN-sponsored Principles for Responsible Investment (PRI), becoming the first major US brokerage to do so, to meet increasing demand from clients for investments that abide by ESG philosophies and increase its share of the responsible investment market.

By signing up to the principles, BofAML agrees to incorporate ESG criteria into its analysis and decision making, seek ESG disclosures from institutions in which it invests, report on activities on progress toward implementing the principles, and more.

‘We are seeing increasing demand from our clients to ensure their investments express their personal values and have a positive impact on society,’ says Andy Sieg, head of global wealth and retirement solutions for BofAML, in a press release. ‘To meet that demand, we are committed to offering broad access to innovative financial solutions related to responsible investment.’

In a separate press release, the PRI says BofAML’s adherence to the principles marks a major step toward fulfilling its goal of promoting responsible investment worldwide, particularly in the US, where BofAML joins major entities such as the $300 bn CalPERS pension fund and the $36.4 bn Harvard University endowment in signing up to the UN PRI.

‘While responsible investment has grown around the world, particularly in Europe and some other markets, it has been a little bit slower to gain traction in the US market. People have seen [responsible investing] more as an ethical issue than a mainstream investment issue,’ says Fiona Reynolds, managing director of the PRI. ‘We see responsible and longer-term investment going hand in hand.’

As evidence of the growing popularity of responsible investing, the PRI and BofAML both cite a recent study by US Trust that finds half of all high-net-worth investors consider social and environmental impact an important part of their decision-making process, an increase from 45 percent in 2013.