Banks, unions, NGOs and government working together on human rights
Dutch banks, unions, NGOs and the Dutch government concluded an exceptional agreement in The Hague today. The agreement makes it possible for banks to do more to ensure respect for human rights in investment and financing matters, for example with regard to working conditions, freedom of association in trade unions, child labour and land use rights. The agreement has been signed by 13 Dutch banks and covers their worldwide financing activities.
The Social and Economic Council of the Netherlands (SER) facilitated the banking sector agreement, with the relevant committee being chaired by Prof. Jacqueline Cramer. The key point is that banks, unions, NGOs and government have agreed to pool and share their individual expertise and experience in the field of human rights risks. Their aim is to help banks identify human rights risks and take the appropriate action in their operations.
The agreement reached in the Banking Sector Agreement is the first of their kind worldwide between NGOs, government and a national banking sector concerning the actual implementation of the UN Guiding Principles for Business and Human Rights and the OECD Guidelines for Multinational Enterprises. To increase their impact, the parties have agreed to work together to reach similar agreements internationally. They intend to approach the European banking sector, the EU and the OECD with that aim in mind.
The parties intend to learn from one another by undertaking a joint programme of research and by sharing best practices, i.e. successful methods of influencing businesses in high-risk sectors. The research will be concluded by late 2017. The parties have also agreed to conduct analyses of specific high-risk sectors, starting with the palm oil, cocoa and gold sectors. A Steering Committee will be established to support implementation of the agreement.
Expertise, experience and transparency
Up-to-date, detailed information is needed about human rights situations and any factors that might have a positive or negative impact on them, as well as a willingness to share that information. This will require close cooperation between the parties, with each having access to this information. That is why the parties plan to develop a joint database for collecting reliable information about human rights risks across countries and sectors. Banks can use this information when taking decisions about project and business financing.
Banks will themselves be more transparent about the way in which they fulfil the responsibility to respect human rights, about their investment portfolios, about their client screening programmes, and about their dialogue with clients in the event that they become involved in human rights violations. Banks will also insist that clients receiving project finance set up a complaints mechanism for actual or potential victims of human rights violations, as stipulated in the OECD Guidelines for Multinational Enterprises and the UN Guiding Principles for Business and Human Rights. In addition, when financing businesses where there is a high risk of human rights violations, banks will encourage their clients to give those exposed to such risks an opportunity to voice their complaints. Using examples, the parties will explore where the banks’ shared responsibility for their business partners’ policy reasonably begins and ends.
The Banking Sector Agreement on International Responsible Business Conduct regarding Human Rights is the second such agreement to be concluded in the Netherlands in a short space of time. On 4 July, a broad coalition of parties signed the Sustainable Garment and Textile Sector Agreement. In the months and years ahead, similar agreements are expected in a number of other sectors. The agreements are a response to the SER’s 2014 advisory report, in which it argues that sectors and businesses should take the initiative to conclude such agreements with government, unions and civil society organisations.
List of signatories:
Ministry of Foreign Affairs, Ministry of Finance, Dutch Banking Association, FNV, CNV, Oxfam Novib, Amnesty International, Pax, ABN AMRO, ASN Bank, ASR Bank N.V., BNG Bank, F. van Lanschot Bankiers N.V., FGH BANK N.V., ING Groep N.V., Intesa Sanpaolo Bank Luxembourg S.A., Amsterdam Branch, Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V., NWB Bank, Rabobank, SNS Bank N.V., Triodos Bank N.V.