Financial institutions can play an important role in promoting human rights, as well as respecting them by preventing or minimizing the social and environmental harm that may be caused by their transactions.

Too often, Banks are complicit in human rights by ignoring the human rights violations of clients while providing financial assistance for the client's activities. To avoid this situation banks should develop robust human rights policies, in the same spirit as they have collectively developed the Equator Principles to deal with social and environmental risks in project lending. The Equator Principles themselves fall far short as a tool to adequately manage human rights risks; better and more detailed policies are needed.

This is the message conveyed today by BankTrack to Mr John Ruggie, UN Special Representative for Business and Human Rights, at the “Consultation on human rights and the financial sector“ taking place in Geneva. The meeting is meant to inform Mr Ruggie on the distinct responsibilities of financial institutions as non-state actors to respect and promote human rights.

In Geneva, BankTrack also releases its new briefing paper “Human rights, Banking risk; incorporating human rights obligations in bank policies“. The paper details what BankTrack considers the human rights responsiblities of banks and what are the elements of a robust human rights policy for banks.

“In the last years, the focus of banks and NGOs alike has been on the social and environmental effects of bank lending“, said Johan Frijns, BankTrack coordinator, “yet there are too many people forced off their lands, too many workers exploited in sweatshops and on plantations, too many arms traded, too many authoritarian regimes kept afloat and too many trigger happy security forces protecting Bank financed projects all over the world to leave human rights issues outside the debate on what responsible banking is all about.“

“It is important that the end report of Mr John Ruggie to the UN Secretary General includes a specific section on the role of financial institutions. Given their role in financing many human rights sensitive sectors and activities and their associated leverage over clients, their potential positive impact can hardly be overstated“ said Andreas Missbach, who represents BankTrack at the meeting in Geneva.