In line with our guiding sustainability principles, we deem the respect of human rights as important to our corporate responsibility. Addressing this robustly in our client transactions, as well as with our employees and vendors, demands that we look to international frameworks and principles of best practice.
Our Human Rights Statement and our ES Policy Framework, endorsed by a sub-committee of the Management Board, explain how we translate these voluntary guidelines into day-to-day practice.
Targets and Measures
We have set the following targets in 2017, which we will continue to follow in 2018:
- Improving our approach to combat modern slavery and human trafficking (aligning to the UK Modern Slavery Act)
- Respecting human rights across our client transactions and in interactions with our employees and vendors
- Periodically reviewing our internal policies and processes to deliver on our commitment to human rights.
Modern Slavery and Human Trafficking
In 2016, we set up a working group to analyze the implications of the UK Modern Slavery Act and review the bank’s approach to combating this issue.
In 2017 based on the work of the group, we published a Slavery and Human Trafficking Statement, aligned to the UK Modern Slavery Act and signed by the representatives of the Management Board.
Furthermore, in dialogue with internal and external stakeholders, we agreed the following measures:
- Include modern slavery and human trafficking messaging in our:
- whistleblowing policy,
- handbooks for new employees, and
- Master Services Agreements with vendors.
- Update our complaints management standards with information on human rights
- Integrate specific ES criteria including modern slavery and human trafficking into a new vendor certification process that will be implemented in 2018
- Update of our sustainability principles and Code of Business Conduct and Ethics
The working group will continue its work in 2018.
To prevent serious negative human rights impacts through our business activities, we continued to review client transactions in critical sectors through our ES risk management approach. In a single transaction, a combination of factors may lead to human rights risks, and a combination of issues, including environmental risks, can lead to a referral to our sustainability team. Therefore, we do not separately disclose the number of transactions reviewed from the perspective of a human rights risk. Those referrals are part of our wider ES risk due diligence and, in 2017, we examined 595 clients and transactions on this basis.
Our aim is to ensure that the vendors we use are not involved in human rights infringements, and that they have procedures in place to respect human rights. We are currently implementing a new vendor certification process that will include specific human rights aspects.
For both new and existing vendors, we aim to conduct an in-depth analysis around the extent to which they may have a negative impact on human rights. In 2017, we analyzed 123 existing vendors, applying the same criteria as those that we will roll out with the new certification process in 2018. For vendors that were in scope (their business purpose or the countries they operate in were considered critical for human rights issues), we found that all had good policies and processes in place. The review process will continue in 2018, with approximately 300 existing vendors in scope yet to be analyzed.
Human rights is a highly complex subject and requires us to continually broaden our knowledge and review our due diligence processes. We aim to increase awareness across the bank, and, in 2017, we trained 900 employees on human rights issues as part of our ES risk training. In 2018, we plan to develop a general human rights course for all employees, as well as a bespoke training for employees in procurement teams.
Remaining abreast of the latest insights and developments demands that we proactively and regularly scrutinize our policies and procedures, with input from our stakeholders.
In 2017, we invited non-governmental organizations (NGOs) to comment on our ES Policy Framework, including our approach to human rights. These insights will inform the 2018 update of the framework.
We remain actively involved in the discussions on the formal interpretation of the UN Guiding Principles on Business and Human Rights (UNGP) for the financial sector. We do this primarily via our interaction in the Thun Group, which dedicated its 2017 annual meeting to an open and constructive dialogue on human rights. Participants ranged from representatives of the UN working group on Business and Human Rights, the Office of the United Nations High Commissioner for Human Rights (OHCHR), and the Organization for Economic Co-operation and Development (OECD); to banks, government representatives, civil society, law and consulting firms. A key topic was the Thun Group’s 2017 discussion paper on the implications of UNGP 13 and 17 in a corporate and investment banking context.
Navigating existing conceptual and legal issues around implementation of the UNGPs, as well as the different approaches, remains an ongoing challenge. The debates revealed the need for clarification on definitions and implications of the principles “cause, contribute and direct linkage” and what this means in an investment and corporate banking context and beyond. We will continue to contribute to this debate.