Best shareholder engagement Bank of America
Ross Jeffries, Bank of America
Bank of America takes shareholder engagement seriously, not just in the run-up to proxy season and not just in terms of talking to institutional investors. It wins the award for best shareholder engagement for the second consecutive year because it puts in the work year-round, involves the board, reaches out to a wide array of investors large and small – and makes governance changes based on the feedback it receives.
The work starts at the top. Both Bank of America’s lead independent director and the board chair play a key role in the company’s shareholder engagement program. The lead independent director regularly takes part in meetings with shareholders and the other board members review input received from investors. In the 12 months leading up to Bank of America’s 2021 AGM, its lead independent director took part in 46 meetings with large shareholders and other key stakeholders.
The engagement program is also a team effort. Others who take part include the company’s global general counsel, head of investor relations, vice chair, chief human resources officer, global ESG executive and corporate secretary. ‘Our CEO has made [engagement] a priority and that’s been communicated to management,’ says Ross Jeffries, deputy general counsel and corporate secretary.
Bank of America uses email to regularly contact its largest 250 shareholders to make sure they are quickly aware of important news at the company, such as director appointments. The bank contacts its large investors and key stakeholders, representing more than 61 percent of shares outstanding, multiple times during the year via email, letters, phone calls and – more commonly before the Covid-19 pandemic – in-person meetings.
Our CEO has made [engagement] a priority and that’s been communicated to management
Reaching retail investors Many companies’ engagement programs center almost entirely on large institutional shareholders. But the number of engaged retail investors has exploded over the last couple of years. Bank of America has been ahead of the game having expanded its outreach beyond the institutional audience to engage with retail shareholders, including employee shareholders.
In 2021, for example, the bank enhanced its dedicated web page for retail shareholders around the AGM by providing interactive information such as a link to the voting website, videos from the board, the company’s 2020 human capital management report and additional soliciting materials. ‘As we think about our AGM, we think creatively about how we can engage [retail shareholders],’ Jeffries says.
In addition, Bank of America continued to refine its 2021 proxy statement and other proxy-related communications to target retail shareholders. It encourages retail shareholders to vote at its AGMs and in 2021 donated more than $1 mn in equal parts to the National Urban League and UnidosUS on behalf of each shareholder account that voted. Bank of America also has a communication plan focused on employees through email, an internal communications website and company town halls.
Engagement should lead to action where necessary if it is to be part of an effective relationship with investors. Bank of America evaluates and reviews feedback from shareholders when the board considers management oversight and long-term strategy. According to the company, its dialogue with investors has led it to make improvements in corporate governance, environmental, social and executive compensation practices.
For example, after considering input from shareholders and other stakeholders, the company has updated its human capital management report, enhanced its ESG disclosures, become involved with SASB and the TCFD, updated corporate governance disclosures and expanded disclosures on political activities and public policy engagements.
Overall, the bank’s shareholder engagement program has been helpful, Jeffries says: ‘Over time, we’ve built up candid and cordial relationships with investors, so there are no surprises.'
