More Americans are seeking to ensure that the companies they invest in match their values and beliefs, without having to forsake growth. Today, Bank of America’s investment businesses announced the launch of a new program that supports clients’ needs to align investments with the environmental, social and governance (ESG) issues they care about.
"One of the most pronounced trends we’ve seen in recent years is the call for wealth to have a productive impact on our environment, our communities, and our society broadly, in addition to earning an investment return," said Andrew Sieg, managing director and head of Global Wealth and Retirement Solutions for Bank of America Merrill Lynch. "This program offers opportunities for a wide range of investors with diverse interests and beliefs to help meet this need."
New offerings for investors on a mission
Merrill Lynch Wealth Management
now offer more than 180 ESG-themed investments to individual and institutional investors, including mutual funds, exchange traded funds, separately managed accounts, and alternative investments. These offerings are organized around three key themes:
- Environmental Stewardship – examining use of water, alternative energy, climate change and clean tech.
- Human Capital Practices – including “gender lens” investing (investments focused on improving the lives of women and girls) and faith-based investing.
- Corporate Governance – focusing on corporate transparency, disclosure, reporting and incentives.
Chris Wolfe, chief investment officer of Merrill Lynch Wealth Management’s Private Banking and Investment Group, notes that investors are rapidly adopting the values-based approach. He notes that values-based investing accounted for $3.74 trillion, or roughly one in every eight to nine dollars under professional management, citing a study from the Forum for Sustainable and Responsible Investment (US SIF) done in 2012. That is 22 percent higher than the $3.1 trillion noted in SIF’s 2010 report. Moreover, values and financial interests are no longer mutually exclusive, Wolfe says. “There is compelling evidence that investing according to one's principles can generate competitive returns,” he notes.