Stakeholder identification and consultation

Please describe which stakeholders (or groups/ types of stakeholders) you have identified, consulted, engaged, collaborated or partnered with for the purpose of implementing the Principles and improving your bank’s impacts. This should include a high-level overview of how your bank has identified relevant stakeholders, what issues were addressed/results achieved and how they fed into the action planning process.

BMO maintains regular, open, and meaningful communication with its stakeholders. For an overview of its engagement on issues related to climate change and financial inclusion, please refer to page 21 of the 2023 Sustainability Report. BMO also collaborates with industry leaders, government officials, academic institutions, and investors to understand and tackle the challenges that impact both its business and society. Details about these groups can be found on page 17 of the 2023 Sustainability Report, as well as pages 28-30 of the 2023 Climate Report.

A key aspect of BMO’s Climate Ambition is convening stakeholders to promote climate action. In 2023, for instance, BMO chaired the Canadian Bankers Association’s Environmental Specialists Group and Climate Scenario Analysis Working Group to engage in advocacy regarding privacy regulations, environmental and social risk management, climate change, sustainable finance, and disclosure regulations. BMO Global Asset Management (GAM) actively engages with policymakers to advocate for climate change initiatives. In 2023, BMO GAM submitted comment letters relating to various environmental disclosure standards, including the TNFD draft guidance, the U.S. Environmental Protection Agency’s methane standards for the oil and gas sector, and the International Sustainability Standards Board Consultation on Agenda Priorities.

BMO U.S. also established a partnership with the National Association of Real Estate Brokers, the leading network of Black professionals which includes a down payment assistance program for graduates from historically Black colleges and universities as well as predominantly Black institutions. This initiative aligns with the bank’s commitment to invest US$7.5 billion to enhance access to homeownership, including the expansion of BMO’s Welcome Home Grants. Over half of this funding is anticipated to benefit individuals and communities of colour.

Additionally, BMO is a member of the PRB Core Group, which is dedicated to advancing the Principles for Responsible Banking (PRB). The Core Group, representing the PRB signatory community, is tasked with leading the development of the 2030 Vision for PRB, further refining the PRB framework to reflect the evolving landscape and expectations, and guiding members in fulfilling their commitments and targets during the 5-10 years of their PRB journey.

What actions were taken by BMO on its PRB targets, climate change and housing?

In its 2024 PRB Reporting and Self-Assessment Template BMO reports that it took the following actions on its PRB targets, climate change and housing:

• SMART Target 1: Climate change
• For each sector for which BMO has set decarbonization targets, the organization continues to disclose financed emissions in accordance with the PCAF Standard and other widely recognized metrics, such as emissions intensity, to effectively monitor progress. In 2023, BMO established the Climate Commercialization Working Group, a sub-committee of the ESG Executive Committee, to coordinate climate finance efforts related to its Climate Ambition. BMO’s Capital Markets group has created a foundation of energy transition and climate-related products and services, which are delivered through the Energy Transition Group, the Sustainable Finance team, and BMO Radicle to support the achievement of the set targets. Details regarding BMO’s climate-related product offerings and services, as well as their impact on priority topics, sectors, and targets, are outlined on pages 22-27 of the Climate Report.
• BMO also addresses its implementation strategy for products, services, policies, activities, and decision-making that contribute to achieving each of its financed emissions targets individually, along with its engagement strategy with stakeholders, in Appendix A of the Climate Report. Some of the notable actions discussed include:
• Developing sustainable finance products, such as transition bonds, where financing is contingent on decarbonization key performance indicators (KPIs)
  • Tracking energy transition financing
  • Pursuing opportunities for financing clean power generation
  • Collaborating with clients to provide advisory services and financing for both current and new clean energy generation and related technologies
• As part of its target monitoring initiatives, BMO has advanced its climate-related data and analytics program, focusing on creating technology solutions to enhance the acquisition, identification, and utilization of climate and sustainability data across the organization. This project included the formulation of a multi-year roadmap aimed at strengthening BMO’s data and analytics capabilities to facilitate risk reporting, inform decision-making, and track progress on internal climate commercialization goals and other climate-related metrics.

• SMART Target 2: Housing
• In the U.S., federally insured depository institutions are obligated to support the credit needs of the communities they serve, including low-to-moderate income communities. BMO has held listening sessions with community partners who have indicated a need for affordable housing in their areas. The process for setting targets was based on the combined legacy of BMO and Bank of the West’s residential home purchase and home improvement mortgage units to low-to-moderate income (LMI) and minority borrowers, as well as in LMI and majority-minority census tracts. This approach represents a 25% increase over baseline performance from 2019 to 2021.
• Goals and key performance indicators (KPIs) are tracked and monitored through monthly dashboard reports and a quarterly oversight committee that includes members from all contributing lines of business to review results and evaluate strategy. Measures contributing to this progress are detailed in BMO’s 2023 Sustainability Report.
• BMO has also implemented an internal data collection process to measure and monitor progress toward its $12 billion commitment to finance affordable housing in Canada, supporting the Canada Mortgage and Housing Corporation (CMHC) aspiration that all Canadians have access to homes that are affordable and meet their needs by 2030. As of the end of the 2023 fiscal year, BMO had allocated $7.2 billion in capital to affordable and accessible housing through authorized lending to clients with commercial real estate developments that met the CMHC’s definition of “affordable housing,” authorized lending for BMO’s On-Reserve Housing Loan Program which provides financing for eligible individuals wishing to build or purchase a personal residence located on reserve, and securitizing affordable mortgage pools under the Canada Mortgage Bond program.

 

UN Principles for Responsible Banking: Accelerating a positive global transition for people and the planet

With over 300 signatory banks representing almost half of the global banking industry, the Principles for Responsible Banking are the world’s foremost sustainable banking framework. Through these Principles, the banking community takes action to align core strategies, decision-making, lending and investment with the UN Sustainable Development Goals and international agreements such as the Paris Climate Agreement.

FBRH Principles for Responsible Banking (PRB) Assurance:

First class PRB assurance services: The result of solid, hands-on ESG/ Sustainability experience

• FBRH is a GRI Certified Training Partner (Global), ISEP Training Centre and a member of CPD.
• FBRH builds trust. Over 200 reviews from top professionals from around the world demonstrate our ability to build strong, trusting business relationships.
• FBRH possesses a unique skill set that combines ESG/sustainability certified training, experience in advisory services and report preparation, and ESG/sustainability report assurance.

The combination of all the above empowers FBRH to provide first class Principles for Responsible Banking (PRB) assurance services.

 

References:

This case study is based on published information by BMO, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original please revert to the following link:

https://our-impact.bmo.com/wp-content/uploads/2024/07/2024-PRB_EN.pdf

Note to BMO: With each case study we send out an email requesting a comment on this case study. If you have not received such an email please contact us.

What are the material issues the company has identified?

In its 2021 Sustainability Report BMO identified a range of material issues, such as sustainable finance, climate change, diversity, equity and inclusion, data security, customer experience. Among these, creating economic value for its stakeholders stands out as a key material issue for BMO.

Stakeholder engagement in accordance with the GRI Standards

The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:

“The reporting organization shall identify its stakeholders, and explain how it has responded to their reasonable expectations and interests.”

Stakeholders must be consulted in the process s of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.

Key stakeholder groups BMO engages with:

To identify and prioritise material topics BMO engages with its stakeholders through the following channels:

Stakeholder Group	Method of engagement
Customers	·      Newsletters and email ·      Events and conferences ·      Research surveys and co-creation/usability testing ·      Media, social media and podcasts
Employees	·      Email, quarterly calls, internal blogs and videos ·      Town halls, team meetings, listening sessions and employee resource groups ·      Events and conferences ·      Learning programmes ·      Surveys
Communities	·      Indigenous Advisory Council and Black and Latino Advisory Council meetings ·      Community partnerships and donations, volunteering, sponsorships
Shareholders and investors	·      Email, conference calls and video conference calls
Government, NGOs and industry	·      Virtual panel events ·      Industry events
Suppliers	·      Meetings and virtual conferences

What actions were taken by BMO to create economic value for its stakeholders?

In its 2021 Sustainability Report BMO reports that it took the following actions for creating economic value for its stakeholders:

• Creating economic value for employees
• In 2021, BMO paid $8,322 million in employee salaries, benefits and other compensation.

• Creating economic value for the state
• In 2021, BMO paid $3,324 million in taxes and levies.

• Creating economic value for shareholders
• In 2021, BMO paid $4.24 in dividends per share.

• Creating economic value for suppliers
• In 2021, BMO paid $5,257 million in goods and services purchased.

Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?

The GRI Standard addressed in this case is: Disclosure 201-1 Direct economic value generated and distributed

Disclosure 201-1 Direct economic value generated and distributed corresponds to:

• Sustainable Development Goal (SDG) 8: Decent Work and Economic Growth
• Targets: 8.1, 8.2
• Sustainable Development Goal (SDG) 9: Industry, Innovation and Infrastructure
• Targets: 9.1, 9.4, 9.5

 

78% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

Research by well-recognised institutions is clearly proving that responsible companies can look to the future with optimism.

7 GRI sustainability disclosures get you started

Any size business can start taking sustainability action

GRI, ISEP, CPD Certified Sustainability courses (2-5 days): Live Online or Classroom  (venue: London School of Economics)

• Exclusive FBRH template to begin reporting from day one
• Identify your most important impacts on the Environment, Economy and People
• Formulate in group exercises your plan for action. Begin taking solid, focused, all-round sustainability action ASAP. 
• Benchmarking methodology to set you on a path of continuous improvement

See upcoming training dates.
References:

This case study is based on published information by BMO, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original please revert to the following link:

https://our-impact.bmo.com/wp-content/uploads/2022/03/BMO_2021_Sustainability-Report-and-PAS_EN_FINAL_aoda.pdf

Note to BMO: With each case study we send out an email requesting a comment on this case study. If you have not received such an email please contact us.

What are the material issues the company has identified?

In its 2018 Environmental, Social and Governance Report BMO identified a range of material issues, such as business conduct, corporate governance, diversity and inclusion, employee engagement, talent attraction and retention. Among these, promoting customer data security and privacy stands out as a key material issue for BMO.

Stakeholder engagement in accordance with the GRI Standards             

The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:

“The reporting organization shall identify its stakeholders, and explain how it has responded to their reasonable expectations and interests.”

Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.

Key stakeholder groups BMO engages with:

Stakeholder Group	Method of engagement
Customers	·       Advisory panels ·       Complaints management process (e.g., BMO’s Ombudsman Office) ·       Customer experience surveys ·       Dedicated mailboxes ·       Focus groups ·       Meetings, phone calls and email correspondence ·       Social media ·       Stakeholder ESG surveys
Employees	·       Dedicated mailboxes ·       Enterprise Resource Groups ·       Internal grievance mechanisms ·       Senior leader internal blogs ·       Stakeholder ESG surveys ·       Surveys (ad hoc surveys, annual employee survey) ·       Team meetings ·       Town halls
Shareholder and Investor Community	·       Annual meeting ·       Disclosure of interim and annual financial results ·       Investor conferences ·       Investor Relations website ·       Management proxy circular ·       Meetings, phone calls and email correspondence ·       Quarterly conference calls ·       Stakeholder ESG surveys ·       Shareholder and Investor dialogue
Government and Regulators	·       Meetings, phone calls and email correspondence ·       Regulatory submissions
Civil Society	·       Interviews ·       Meetings, phone calls and email correspondence ·       Questionnaires ·       Research papers (on key issues for BMO’s industry) ·       Stakeholder ESG surveys ·       Surveys (on key issues for BMO’s organisation)

How stakeholder engagement was made to identify material issues

To identify and prioritise material topics BMO surveyed over 3,300 individuals – a representative sampling of employees, customers, investors, communities/civil society organisations (CSO) and BMO leaders in North America, Europe and Asia – to find out how they rated potential material topics on a four-point scale.

What actions were taken by BMO to promote customer data security and privacy?

In its 2018 Environmental, Social and Governance Report BMO reports that it took the following actions for promoting customer data security and privacy:

• Evaluating the effectiveness of key controls
• To maintain its resilience in the face of cyber-attacks, BMO routinely evaluates the effectiveness of key controls through testing, reviewing best practices and benchmarking. In these evaluations, BMO refers to the ISO 27001 information security management standard and the U.S. National Institute of Standards and Technology cyber security framework. BMO also works with cyber security experts and suppliers to improve controls, strengthen internal resources and enhance its technological capabilities. BMO’s enterprise-wide information security programme sets out requirements for carrying out mandatory annual information security and privacy training for employees, complying with relevant regulations and reporting information security issues to management and the Board.

• Implementing a Privacy Code
• In Canada, BMO’s Privacy Code outlines its commitment to its customers and the 10 key privacy principles BMO embraces. The Code also outlines the channels through which BMO’s customers can make and escalate privacy complaints. In other jurisdictions, BMO complies with all local requirements for providing mechanisms to raise privacy concerns. Additionally, BMO’s Privacy Office oversees a privacy risk governance programme, which sets out BMO’s policies and procedures for identifying, measuring, managing, mitigating and reporting privacy risk. All incidents involving suspected or actual breaches of privacy must be reported to the Privacy Office, which then manages BMO’s response to these incidents.

• Assessing and monitoring privacy risks
• Privacy risk is assessed and monitored in BMO’s supplier management and enterprise compliance programme The Privacy Office has a data-driven reporting system that tracks key metrics. The Office reports quarterly to the Audit and Conduct Review Committee of the Board of the Bank, and to the Audit Committee of BFC. It also provides reports on privacy issues to all BMO’s operating groups and corporate support areas, to help them understand their state of readiness for protecting privacy and to identify opportunities for improvement. In addition, to provide another layer of security for online banking customers, BMO invited them to download third–party software from its website that helps protect information against malware and fraudulent activity. When prompted through an online marketing campaign, 61,755 customers downloaded the software and in March 2018, during Fraud Awareness Month, BMO also posted a video about phishing on the Security Centre page of its website that attracted nearly 163,500 views, with 6,891 visitors viewing the complete video.

Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?

The GRI Standard addressed in this case is: Disclosure 418-1 Substantiated complaints concerning breaches of customer privacy and losses of customer data

Disclosure 418-1 Substantiated complaints concerning breaches of customer privacy and losses of customer data corresponds to:

• Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
• Targets: 16.3, 16.10

 

78% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

Research by well-recognised institutions is clearly proving that responsible companies can look to the future with optimism.

7 GRI sustainability disclosures get you started

Any size business can start taking sustainability action

GRI, ISEP, CPD Certified Sustainability courses (2-5 days): Live Online or Classroom  (venue: London School of Economics)

• Exclusive FBRH template to begin reporting from day one
• Identify your most important impacts on the Environment, Economy and People
• Formulate in group exercises your plan for action. Begin taking solid, focused, all-round sustainability action ASAP. 
• Benchmarking methodology to set you on a path of continuous improvement

See upcoming training dates.
References:

1) This case study is based on published information by BMO, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:

http://database.globalreporting.org/

2) https://www.globalreporting.org/standards/gri-standards-download-center/

Note to BMO: With each case study we send out an email requesting a comment on this case study. If you have not received such an email please contact us.

What are the material issues the company has identified?

In its 2016 Environmental, Social and Governance Report and Public Accountability Statement BMO identified a range of material issues, such as privacy and data security, consumer protection and transparency, corporate governance, learning and development. Among these, promoting ethical business behaviour stands out as a key material issue for BMO.

Stakeholder engagement in accordance with the GRI Standards

The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:

“The organization should identify its stakeholders, and explain how it has responded to their reasonable expectations.”

Stakeholders must be consulted in the process s of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.

Key stakeholder groups BMO engages with:   

Stakeholder Group	Method of engagement
Customers	·         Advisory panels ·         Complaints management process (including BMO’s Ombudsman Office) ·         Correspondence (by letter and email) ·         Dedicated mailboxes ·         Focus groups ·         Meetings (in person and by phone) ·         Net Promoter Score surveys (by phone and online) ·         Social media ·         Stakeholder impact surveys
Employees	·         Dedicated mailboxes ·         Employee affinity groups ·         Senior leader internal blogs ·         Stakeholder impact surveys ·         Surveys (annual employee survey) ·         Town halls
Shareholder & Investor Community	·         Annual general meeting ·         Correspondence (by letter and email) ·         Disclosure of interim and annual financial results ·         Investor conferences ·         Investor days ·         Meetings (in person and by phone) ·         News releases, corporate website and industry con­ferences ·         Stakeholder impact surveys
Government & Regulators	·         Correspondence (by letter and email) ·         Meetings (in person and by phone)
Civil Society	·         Correspondence (by letter and email) ·         Interviews ·         Meetings (in person and by phone) ·         Questionnaires ·         Research papers (on key issues for the industry) ·         Stakeholder impact surveys ·         Surveys

 How stakeholder engagement was made to identify material issues

To identify and prioritize material issues BMO carried out, in 2016, targeted online surveys and organized ESG-specific panels with region­al stakeholders from North America, Europe and Asia. Stakeholders engaged by BMO were asked to rank material issues and propose new ones. They included thought leaders, research an­alysts, investors, employees, industry peers, academics, community part­ners and civil society organizations.

What actions were taken by BMO to promote ethical business behaviour?

In its 2016 Environmental, Social and Governance Report and Public Accountability Statement BMO reports that it took the following actions for promoting ethical business behaviour:

• Implementing a Code of Conduct
• BMO’s expectations and guidelines for employees’ ethical behaviour are outlined in its Code of Conduct. Moreover, in 2016 BMO:
  • refreshed the Code of Conduct, to make it easier to understand
  • launched a new Supplier Code of Conduct, outlining principles BMO’s suppliers are expected to comply with
  • updated its Statement on Hu­man Rights to ensure it aligns with the refreshed Code of Conduct and the new Supplier Code of Conduct
  • updated its Anti-Corruption pol­icy, to incorporate principles and updates relating to hiring practices, gifts and sponsorships

• Providing ethics training
• To promote awareness of the Code of Conduct, BMO provides employees with formal and informal training. Every year, all BMO employees (including contract and temporary em­ployees) have to complete BMO’s Ethics, Legal & Compliance Training program. Through the training employees are, among others, offered guidance on effective risk management.

• Enabling employees to report ethical concerns
• BMO provides various channels for employees to raise, confidentially and without fear of retaliation, concerns regarding ac­counting, internal controls over finan­cial reporting and auditing matters, or the Code of Conduct. These channels include a third-party whistleblower reporting service, for BMO employees and other stakeholders to report such concerns to BMO’s Om­budsman.

Which GRI indicators/Standards have been addressed?

The GRI indicators/Standards addressed in this case are:

1) G4-56: Describe the organization’s values, principles, standards and norms of behavior such as codes of conduct and codes of ethics – the updated GRI Standard is: Disclosure 102-16 Values, principles, standards, and norms of behavior

2) G4-57: Report the internal and external mechanisms for seeking advice on ethical and lawful behavior, and matters related to organizational integrity, such as helplines or advice lines – the updated GRI Standard is: Disclosure 102-17 Mechanisms for advice and concerns about ethics

3) G4-58: Report the internal and external mechanisms for reporting concerns about unethical or unlawful behavior, and matters related to organizational integrity, such as escalation through line management, whistleblowing mechanisms or hotlines – the updated GRI Standard is: Disclosure 102-17 Mechanisms for advice and concerns about ethics

4) G4-SO4: Communication and training on anti-corruption policies and procedures – the updated GRI Standard is: Disclosure 205-2 Communication and training about anti-corruption policies and procedures

 

78% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

Research by well-recognised institutions is clearly proving that responsible companies can look to the future with optimism.

7 GRI sustainability disclosures get you started

Any size business can start taking sustainability action

GRI, ISEP, CPD Certified Sustainability courses (2-5 days): Live Online or Classroom  (venue: London School of Economics)

• Exclusive FBRH template to begin reporting from day one
• Identify your most important impacts on the Environment, Economy and People
• Formulate in group exercises your plan for action. Begin taking solid, focused, all-round sustainability action ASAP. 
• Benchmarking methodology to set you on a path of continuous improvement

See upcoming training dates.

 

References:

1) This case study is based on published information by BMO, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:

http://database.globalreporting.org/

2) http://www.fbrh.co.uk/en/global-reporting-initiative-gri-g4-guidelines-download-page

3) https://g4.globalreporting.org/Pages/default.aspx

4) https://www.globalreporting.org/standards/gri-standards-download-center/

 

Note to BMO: With each case study we send out an email requesting a comment on this case study. If you have not received such an email please contact us.