{"id":50889,"date":"2014-12-15T12:00:31","date_gmt":"2014-12-15T12:00:31","guid":{"rendered":"https:\/\/www.transcend.org\/tms\/?p=50889"},"modified":"2015-05-05T21:27:11","modified_gmt":"2015-05-05T20:27:11","slug":"only-half-of-global-banks-have-policy-to-respect-human-rights","status":"publish","type":"post","link":"https:\/\/www.transcend.org\/tms\/2014\/12\/only-half-of-global-banks-have-policy-to-respect-human-rights\/","title":{"rendered":"Only Half of Global Banks Have Policy to Respect Human Rights"},"content":{"rendered":"
\"Children<\/a>

Children from one of the communities in Ocean Division, southern Cameroon, who lost much of their forestland after the government leased it to a logging company. Credit: Monde Kingsley Nfor\/IPS<\/p><\/div>\n

Just half of major global banks have in place a public policy to respect human rights, according to new research, despite this being a foundational mandate of an international convention on multinational business practice.<\/p>\n

Further, of the 32 global banks examined, researchers found that none has publicly put in place a process to deal with human rights abuses, if identified. None has even created grievance mechanisms by which those impacted by potential abuses can complain to the banks.<\/p>\n

The findings<\/a>, published by BankTrack, an international network of watchdog groups, come three and a half years after the adoption of the United Nations Guiding Principles on Business and Human Rights. These principles, unanimously endorsed by the U.N. Human Rights Council in 2011, specify a range of actions and obligations for all businesses, including the financial sector.<\/p>\n

Yet banks have a unique role in underwriting nearly all of the business activity around the globe, even as they are typically shielded from the impacts of those investments.<\/p>\n

\u201cBanks covered in this report have been found to finance companies and projects involving forced removals of communities, child labour, military backed land grabs, and abuses of indigenous peoples\u2019 right to self-determination,\u201d the report, released last week, states.<\/p>\n

\u201cPolicies and processes, open to public scrutiny and backed by adequate reporting, are important tools for banks to ensure that these kinds of abuses do not happen, and that where they do, those whose rights have been impacted have the right to effective remedy \u2026 If these policies and procedures are to be meaningful, the finance for such \u2018dodgy deals\u2019 must eventually dry up.\u201d<\/p>\n

One of the banks studied in the new report, JPMorgan Chase, is one of the leading U.S. financiers of palm oil, through loans and equity investments. While the bank does have a human rights policy, BankTrack\u2019s researchers find this policy applies only to loans, not investments.<\/p>\n

\u201cWhen it comes to reporting on implementation, the bank falls flat, making the policy little more than window-dressing,\u201d Jeff Conant, an international forests campaigner with Friends of the Earth U.S., a watchdog group that is working<\/a> on palm-oil financing, told IPS.<\/p>\n

\u201cWe\u2019ve spoken with JPMorgan Chase about the need to give impacted people an opportunity to file complaints about the human rights impacts of its financing, with the belief that this is a first step towards accountability. Frankly, from the bank\u2019s response, I don\u2019t see them stepping up anytime soon.\u201d<\/p>\n

While private finance today facilitates almost the full range of corporate activity, Conant notes, \u201cthe finance institutions themselves are wholly unaccountable.\u201d<\/p>\n

Sobering results<\/strong><\/p>\n

According to the new study, a few banks appear to be well on their way to conformity with the Guiding Principles. The top-ranked institution, the Dutch Rabobank, received a score of eight out of 12, with Credit Suisse and UBS close behind.<\/p>\n

These are the exceptions, however. Against a set of 12 criteria, the average score was only a three.<\/p>\n

Many scored at or near zero. While those ranked at the very bottom include several Chinese institutions, they also include banks in the European Union and the United States.<\/p>\n

Indeed, Bank of America, one of the largest financial institutions in the world, scored just 0.5 out of 12, receiving a minor bump for having expressed some commitment to carrying out human rights-related due diligence. (The bank failed to respond to request for comment for this story by deadline.)<\/p>\n

\u201cThe findings of\u00a0this report are quite sobering about what can be expected from self-regulatory principles,\u201d Aldo Caliari, the director of the Rethinking Bretton Woods Project at the Center of Concern, a Washington think tank, told IPS.<\/p>\n

\u201cThe Guiding Principles are the bare minimum of any human rights framework in the corporate sector, a framework that has the companies\u2019 consent. So the fact that there is so little [adherence to] such a relatively weak tool, where every effort to court corporations\u2019 support has been made,\u00a0is, indeed, very telling.\u201d<\/p>\n

Despite the spectrum of findings on implementation, the financial services industry as a whole has taken note of the Guiding Principles.<\/p>\n

In 2011, four European banks met to discuss the principles\u2019 potential implications for the sector. Three more banks eventually joined what is now called the Thun Group, and in October 2013 the grouping released an initial paper<\/a> on the results of these discussions, including recommendations for compliance.<\/p>\n

A previously existing set of voluntary guidelines for the banking sector, known as the Equator Principles<\/a>, were also updated in 2013 to reflect the new existence of the Guiding Principles. So far, the Equator Principles have been signed by 80 financial institutions in 34 countries.<\/p>\n

\u201cTo date, banks\u2019 efforts to implement the UN Guiding Principles have mainly revolved around producing discussion papers on the best way forward,\u201d Ryan Brightwell, the new report\u2019s author, said in a statement.<\/p>\n

\u201cBankTrack has welcomed these discussions, but some three and a half years on from the launch of these Principles, it is time to move onto implementation.\u201d<\/p>\n

Strengthening accountability<\/strong><\/p>\n

The new findings on lagging implementation will strengthen arguments from those who want to tweak or supplant the Guiding Principles. Some suggest, for instance, that the framework be changed to treat financial institutions differently from other sectors.<\/p>\n

\u201c[T]he financial sector requires an exceptional treatment when it comes to the application of the Guiding Principles,\u201d the Center of Concern\u2019s Caliari wrote last year in comments for the Working Group on Business and Human Rights.<\/p>\n

\u201cFinancial companies, more than other companies, have the potential, with their change of behaviour, to influence the behaviour of other actors. That means they also should be upheld to a greater level of responsibility when they fail to do so.\u201d<\/p>\n

Caliari and others are also part of a movement to move beyond voluntary frameworks such as the Guiding Principles (at least in their current form), and instead to see through the creation of a binding mechanism.<\/p>\n

This decades-long effort received a significant boost in June, when the U.N. Human Rights Council voted to allow negotiations to begin toward a binding treaty around transnational companies and their human rights obligations. (This same session also approved a popular second resolution, aimed instead at strengthening implementation of the Guiding Principles process.)<\/p>\n

The new data on banks\u2019 relative lack of compliance with the Guiding Principles, Caliari says, is one of the reasons the call for a legally binding treaty \u201chas been gaining ground.\u201d<\/p>\n

He continues: \u201cIt\u00a0is increasingly clear that mechanisms that rely on the consent of\u00a0the companies cannot be the total of available accountability mechanisms. More is needed.\u201d<\/p>\n

__________________________________<\/p>\n

Edited by Kitty Stapp. The writer can be reached at cbiron@ips.org<\/em><\/p>\n

Go to Original \u2013 ipsnews.net<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Public policy to respect human rights is a foundational mandate of the international convention on multinational business practice. Of the global banks examined, none has a process to deal with human rights abuses. None has even created grievance mechanisms by which those impacted can complain to the banks.<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[55],"tags":[],"class_list":["post-50889","post","type-post","status-publish","format-standard","hentry","category-capitalism"],"_links":{"self":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/50889","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/comments?post=50889"}],"version-history":[{"count":0,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/50889\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/media?parent=50889"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/categories?post=50889"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/tags?post=50889"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}