Banks, unions, NGOs and government working together on human rights

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Gerrit Zalm Sociaal Economische Raad

Dutch banks, unions, NGOs and government are joining forces by signing an agreement on international responsible business conduct regarding human rights in the banking sector.

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.

International leadership

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.

Joint research

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.

Second agreement

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.

Quotes:

Lilianne Ploumen, Minister for Foreign Trade and Development Cooperation:

‘Companies that are responsible for poor working conditions, pollution of the environment or unfair land confiscation all have a bank account or receive bank loans. This means banks occupy an important position: they can use their influence to tackle human rights violations by their clients. The banks signing this agreement today are showing a sense of responsibility and commitment. Working with NGOs, trade unions and the government, they want to help ensure fairer, more sustainable global supply chains. They are setting an example for the world to follow, and that is something to be proud of.’

Jeroen Dijsselbloem, Minister of Finance:

‘I am very pleased that the Dutch banks have made an agreement with civil organizations to prevent and deal with human rights violations. Banks can contribute to ascertaining that their clients respect human rights, and do not allow child- or forced labour within their production process. The agreement also deals with transparency. It must be clear to consumers in which area’s and industries banks invest and how they call on these industries about their human rights policy.’

Chris Buijink, chairman, NVB:

“This agreement unites the knowledge and expertise of NGOs, unions, government and banks to ensure the early detection and elimination of human rights violations. It puts us in the worldwide vanguard and we will do everything we can to make similar agreements at the international level.”

Coen van der Veer, executive committee, FNV trade union confederation

“It’s great that banks are becoming more interested in the importance of a living wage, trade union rights and the battle against child labour. We are delighted to use our international network to help them and to provide them with information on countries, businesses and projects.”

Maurice Limmen, chairman, CNV trade union federation

“It's a step forward for banks to actively track down violations of labour standards by their clients around the world. The CNV believes that fighting these violations and promoting Decent Work is a responsibility that we share with the banks, civil society organisations and government.”

Eduard Nazarski, director, Amnesty International Netherlands:

“Government has a duty to protect human rights, and banks have a responsibility to respect human rights. By signing this agreement, both have elected to take action. Only time will tell whether agreements of this kind will prove to be an effective means of fighting human rights violations.”

Jan Gruiters, general director, PAX:

“The purpose of this agreement is to help prevent human rights violations and compensate the victims of such violations. Such compensation is vital to fostering peace and reconciliation in conflict areas, for example in Colombia. Under the agreement, the parties will investigate whether banks should bear some of the responsibility in this respect. Our many years of experience working in conflict areas and advocating for victims can help banks understand such situations.”

Farah Karimi, general director, Oxfam Novib:

“It’s a positive development to have concluded a far-reaching agreement promoting greater transparency by banks about their loans and how they act on their human rights policy in the real world. But this is only the start. It is our expectation that the agreement will also encourage the banks’ clients to tackle human rights violations.”

Mariƫtte Hamer, president, SER:

“Like the Sustainable Garment and Textile Sector Agreement, cooperation is the key to the Dutch Banking Sector Agreement on International Responsible Business Conduct regarding Human Rights. I believe that cooperation between government, unions, NGOs and the banks themselves will lead to improvements in the lives and working conditions of people worldwide. The SER will do everything possible in the years ahead to join with all of the parties on making the agreement a success.”

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.


Photo by: Dirk Hol

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