Our approach to materiality

Our approach to materiality is guided by our commitment to Responsible Growth and doing so in a sustainable manner, which helps us deliver returns to our clients and shareholders and help address society’s biggest challenges. We use these principles to evaluate the environmental, social and governance (ESG) issues that are most material to our company.

We listen to and engage with a diverse set of stakeholders who are interested in or directly affected by our company’s business. As part of this stakeholder engagement process, we take the feedback of our constituents, including shareholders, to help inform our decisions and our approach to disclosure. We do this through a variety of ongoing engagement and activity, including our National Community Advisory Council (NCAC), a forum made up of senior leaders from civil rights, consumer advocacy, community development, environmental, research, and other organizations who provide external perspectives, guidance and feedback on our business policies and products.

We also utilize ESG frameworks and ratings to guide our disclosures. ESG frameworks include: Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB), the Task Force on Climate-Related Financial Disclosures (TCFD), CDP, and the World Economic Forum's International Business Council stakeholder capitalism metrics. ESG ratings include MSCi and Sustainalytics. As regulators and investors are increasingly focused on ESG, we are incorporating those recommendations into our materiality approach.

We then apply an internal lens through our risk management principles; an ESG Committee which oversees ESG priorities and strategy for the bank; and a particular focus on climate change and racial equality. The result is a dynamic, ongoing process to weigh this information and produce a view on how various priorities are ranked in terms of importance to core business success and importance to external stakeholders. After collecting these inputs, issues were weighted, prioritized and plotted on the following ESG Materiality Assessment Map according to their relative degree of importance. The Materiality Map was then reviewed and approved by senior leaders at the company and various ESG groups and committees. It is important to note that all issues on the Map — regardless of where they fall —are relevant to the company. These issues were drawn from a broader set of potential areas, many of which were deemed not to be pertinent to the bank.

We use the results of our ESG Materiality Assessment as well as our ongoing approach to materiality to guide our ESG reporting and disclosures and to ensure transparency into ESG issues of greatest importance.

materiality chart

ESG MATERIALITY MAP - Top Right Quadrant Detail

Chart shows the top right quadrant of the ESG Materiality Map - Overview, which is also a quadrant chart with an x axis representing the increasing importance to business success and a y axis representing the increasing importance to stakeholders.

The bottom left, with a relatively lower priority to both business success and stakeholders, contains two items, "Land rights/use" and "Technology & innovation"

The bottom right, important to business success, contains two items "Financial literacy & education" and “sustainable finance” 

The top left, important to stakeholders, contains seven items "Access to banking”, “Biodiversity”, “Community development & impact”, “Environmental operations/supply chain”, “Lobbying & public policy engagement”, “Social advocacy” and “Transparency, accountability, & reporting”

The top right, with significance to both business success and stakeholders, contains five items “Business ethics, corporate governance & risk management”, “Client satisfaction & financial protection”, “Climate risk & Net Zero strategy”, “Cybersecurity & data privacy” and “Human rights & human capital – Diversity & inclusion, Employee health & well-being, Racial equality & economic opportunity, Responsible supply chain, Talen acquisition & retention”

Notes:

  • Topics in bold denote inclusion under broader Human Rights topic 

  • Topics are listed in alphabetical order; not in order of importance

  • Material matrix was developed using BofA commitments and documentation (X-axis), and the BSR (Business for Social Responsibility) stakeholder report (Y-axis).

Topic Definitions

Upper Right Quadrant

  • Business ethics, corporate governance & risk management: includes our commitment to upholding the highest standards of corporate governance and ethical conduct. Additionally, this includes our overall approach to assessing and managing risk across the business and within individual business units, product and services, and transactions, across all geographic locations. Business ethics includes organizational standards, principles and values that set a high standard of ethics and govern the actions of individuals to prevent corruption, extortion and bribery in all markets in which the Bank operates or does business. 

  • Client satisfaction & financial protection: Includes ensuring the marketing and communications of products and services is honest, transparent and fair and managing customer risks to ensure the safety of financial products offered by the Bank. This also includes efforts to engage with customers to understand their level of satisfaction with Bank products and services, overdraft fee policies, and efforts to ensure that products meet or exceed customer expectations. 

  • Climate risk & Net Zero strategy: includes the coordinated management, governance and processes to identify, monitor and control climate-related physical and transition risks. This also includes the Bank's management of financed emissions and work to achieve Net Zero before 2050. 

  • Cybersecurity & data privacy: includes our approach to identify and address vulnerabilities and threats to customer and employee data security, safeguards for preventing fraudulent transactions and breach of privacy or data security, and responsible use of big data. 

  • Diversity & inclusion: includes taking meaningful steps to drive diverse representation at all levels of the company (i.e. attraction, hiring, development and retention) and building a culture where our employees feel comfortable being who they are and bringing their whole selves to work with equal access to opportunities regardless of their differences. 

  • Employee health & well-being: includes efforts to provide a fair wage and pay equity and a healthy and safe work environment to our employees, including supporting their physical, financial and emotional well-being through programs such as paid medical and parental leave, flexible work arrangements, wellness programs and wellness incentives. 

  • Racial equality & economic opportunity: includes investing resources and delivering products and services to address issues critical to our stakeholders and meet the diverse needs of our clients and communities. 

  • Responsible supply chain: includes supplier diversity and our commitment to respect human rights in all aspects of our supply chain, including efforts to meet or exceed international standards related to fair wages and benefits, forced labor, child labor, discrimination and harassment, and safe workplace conditions. 

  • Talent acquisition & retention: Our ability to attract and retain top talent, efforts to promote professional growth, and actions to measure and improve employee satisfaction 

Lower Right Quadrant

  • Financial literacy & education: includes offering education (e.g. Better Money Habits), advice, and personalized support to empower people to make confident financial decisions to build their preferred future. 

  • Sustainable finance: our commitment to mobilize and scale capital deployment to help drive social and environmental change, including inclusive development and the transition to a low-carbon economy. This also includes efforts to reduce investment in products and services with financial exposure to high GHG emitting sectors. 

Lower Left Quadrant 

  • Land rights/use: includes business impacts of the Bank's activities or business relationships on land rights and the range of human rights linked to land, such as economic livelihood, property, adequate standard of living, housing, equality, food security, cultural rights, freedom from violence, self-determination and life. 

  • Technology & innovation: includes the responsible use of digitalization and technology, such as artificial intelligence (AI) and cryptocurrency, to optimize efficiencies in business practices, improve and diversify our product and service offerings for customers, and promote public interest. Reflects our focus on Operational Excellence and increasing efficiency. 

Upper Left Quadrant

  • Access to banking: includes the development of and access to financial products, services, and technology solutions to help to meet the individualized needs of underbanked communities and different customer demographics. 

  • Biodiversity: emerging issue that includes business impacts on local ecosystems through deforestation, consumption of raw materials, and land/water use, especially where operations are sited in biologically sensitive areas. Impacts on local ecosystems may include associated adverse impacts on the human rights of local communities, including the rights to food, health, as well as Indigenous Peoples' rights.  

  • Community development & impact: includes strategic lending, investing and philanthropy to support community economic development. Focus on this also considered environmental justice. 

  • Environmental operations/supply chain: includes the responsible management of energy, water, and waste in our operations and supply chain. Focus on this also considered environmental justice. 

  • Lobbying & public policy engagement: includes the lobbying efforts and political contributions made by Bank of America to governments and institutions of political influence, our relationships with public authorities, and our public policy and market influence. 

  • Social advocacy: includes promoting equality and inclusion in our communities by investing in programs and initiatives to advance societal issues and engaging with public policy makers to empower diverse groups. 

  • Transparency, accountability & reporting: includes the business approach to provide clear, accountable and comparable business and sustainability information to the public in an accessible manner.

Explore more

woman holding phone while drinking coffee

Better Money Habits® Millennial Report – Winter 2020
office

The environment and our global economy
two people on a background of mountains

ESG reports - Bank of America