Supporting Statement: An estimated 2% of Canadians are “unbanked”,1 while 15-25% are “underbanked”. Unbanking and underbanking have a disproportionate effect on Indigenous peoples.2 The Financial Consumer Agency of Canada found that racialized or Indigenous bank customers are subjected to discriminatory practices,3 were more likely than other customers to be recommended inappropriate products, were not presented information in a clear and simple manner and were offered optional products such as overdraft protection and balance protection insurance.

Financial institutions play a key role in society, allowing businesses and individuals to access essential economic opportunities through a range of financial products and services, including credit and loan services, savings accounts, and investment management. Financial institutions have the responsibility to ensure that their business activities do not discriminate against communities of colour and Indigenous people. As the eighth largest bank in North America, BMO’s racial equity commitment and actions can impact its twelve million customers4 and influence the industry’s approach in addressing the racial wealth gap.
BMO announced its Zero Barriers to Inclusion 20255, a multi-year strategy aiming at supporting equity, equality and inclusion by providing access to opportunities and enabling growth for its employees, customers and communities where it operates. Although well intentioned, the initiatives and investments made in application of this strategy do not constitute a viable alternative to racial equity audits as it fails to identify, prevent and address existing or potential racial inequities stemming from its products and services.

An independent examination of BMO’s business activities would help shareholders, employees, and customers understand whether BMO’s initiatives are effective and aligned with its stated racial equity commitments while ensuring that the bank’s business activities falling outside its Zero Barriers to Inclusion 2025 do not discriminate against people of colour and Indigenous people. A racial equity audit would inform and facilitate any course correction necessary to promote racial equity and protect the company – and by extension its shareholders – from the risks associated with the failure to address systemic racism.6
Racial equity audits have proven to be effective risk mitigation tools as they help manage material legal, financial, regulatory, and reputational business risks by identifying, prioritizing, remedying, and avoiding adverse impacts on communities of colour and Indigenous people beyond the workplace.
At BMO’s 2023 annual meeting of shareholders, 37% of votes were cast in favour of a resolution requesting a third-party racial equity audit. However, in contrast with a number of its US and Canadian peers, BMO has not confirmed its intention to conduct this assessment.
We urge BMO to assess its business activities through a racial equity lens in order to obtain a complete picture of how it contributes to and could help dismantle systemic racism.