Thun Group of Banks releases new Paper on implications of UN Guiding Principles for corporate & investment banking

The Thun Group of Banks' Discussion Paper published in January 2017 explores how the UN Guiding Principles on Business and Human Rights should be applied in the banking sector. At the Thun Group of Banks' annual meeting in June 2017, the Thun Group agreed to clarify some of the statements in the January 2017 version of its Discussion Paper in response to questions raised by civil society, including related to interpretation of UNGP 13a and 13b. The January and December 2017 version of the Discussion Paper and comments from civil society on the January 2017 Discussion paper are available below.

Please send any comments to Christian Leitz, christian.leitz[at]

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18 December 2017

Thun Group paper on the implications of UN Guiding Principle 13b & 17 in a corporate and investment banking context

Author: Thun Group of Banks

This paper builds on the requirements for sound due diligence as explained in the Thun Group of Banks' 2013 Discussion Paper (...) focuses on situations where banks may be directly linked to negative human rights impacts under UNGP 13b of the UNGPs (...) introduces the concepts of proximity to an impact (ranging from a low to high level of proximity) , which may , based on operational criteria , indicate the “degree of directness” of linkage between the impact and the product and service offered by the bank . Proximity thus describes a bank’s connection to an impact depending on the characteristics of the financial product and service provided. It is therefore an operational criter ion and must not be confused with leverage . It is also not a description of a spatial or geographic relationship between a bank and potential or actual adverse impacts. Unit of analysis, as a means to inform the focus of a bank ’ s due diligence (for example , by reference to the client (company or subsidiary) to which the financial product and service is offered, or asset in the case of specific asset finance)...

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19 October 2017

UN Independent Expert asks Thun Group of Banks to discuss the Guiding Principles on Foreign Debt and Human Rights & practice of lending to states with widespread human rights violations

Author: Juan Pablo Bohoslavsky, UN Independent Expert on the effects of foreign debt and other related international financial obligations of States

“Mandate of the Independent Expert on the effects of foreign debt and other related international financial obligations of States on the full enjoyment of all human rights, particularly economic, social and cultural rights” - 19 October 2017

Dear Members of the Thun Group of Banks,

… With this… letter I would like to express my gratitude for the open exchange I had with colleagues from UBS and Crédit Suisse on the occasion of my recent official visit to Switzerland… In my meetings, I expressed concern that the Thun Group’s second discussion paper may be interpreted as unduly limiting the responsibilities of banks in the context of their client relationships…

… I would like to encourage the Thun Group of Banks to discuss… the relevance of the Guiding Principles on Foreign Debt and Human Rights… [and] regret that the Guiding Principles… have largely been absent in discussions about human rights due diligence of financial institutions, including its commercial banking sector…

… Furthermore, I would like to propose to the Thun Group to reflect on lending to States and State-linked corporations operating in contexts marked by widespread and systematic violations of human rights… Unless lending decisions are subjected to human rights impact assessments, appropriately targeted or mitigated by contractual measures, financial lending can have a persistent impact on criminal regimes, making it possible for them to consolidate autocratic rule, perpetuate political exclusion and human rights violations, and reduce the need for political concessions. 

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Author: Andreas Missbach, Public Eye

"Banken und Menschenrechte: Showdown in Thun", 15 Juni 2017

2010 hat Public Eye – noch als Erklärung von Bern – die Debatte über die menschenrechtliche Verantwortung von Banken lanciert. Anfang dieses Jahres nun hat eine Gruppe von Grossbanken ein Positionspapier veröffentlicht, welches die UNO-Leitprinzipien für Wirtschaft und Menschenrechte völlig verdreht. In einer Stellungnahme vom 12. Juni stellt sich das Office of the United Nations High Commissioner for Human Rights (OHCHR) klar gegen diese Interpretation der Banken... Die schlimmste Behauptung im Papier der Thun Group ist die, Banken könnten allenfalls mit Menschenrechtsverletzungen «direkt verbunden» sein, nie und nimmer diese aber «verursachen» oder «dazu beitragen». Warum sie so argumentieren, liegt auch auf der Hand: Gemäss UNO-Leitprinzipien muss ein Unternehmen keine Wiedergutmachung für Menschenrechtsverletzungen leisten, wenn es mit diesen nur «direkt verbunden» ist. Auf Anfrage von BankTrack betonte das OHCHR in einem Bericht vom 12. Juni, dass die Verantwortung zur Wahrung der Menschenrechte auch den Bankensektor betrifft. Es ist das erste Mal, dass der UNHCHR detaillierte Vorschläge zur Umsetzung der Leitprinzipien im Bankensektor formuliert.

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1 August 2017

Report of the Thun Group of Banks' annual meeting

Author: Gabriela Schwarz, University of Zurich, Centre for Human Rights Studies

More than 80 representatives of banks, civil society, governments, international governmental organizations, academia, law and consulting firms plus other business enterprises gathered in Thun on 19 June 2017 for the Thun Group of Banks Annual Meeting. The aim of the meeting was i) to share knowledge on crucial developments around business and human rights with a focus on the banking sector and ii) to discuss the Thun Group's January 2017 publication titled "Discussion Paper on the Implications of UN Guiding Principles 13 and 17 in a Corporate and Investment Banking Context"... The most intensely debated issue concerned the three categories of potential business involvement in human rights harm (cause, contribute, directly linked) and... whether banks can, in principle, cause or contribute to human rights harm outside the realm of employee-related (or purely internal) matters... The bank representatives acknowledged the possibility of contribution to human rights harm through own activities... though they considered these as rare when providing financial products & services... Based on the outcomes of the panel discussions, the Thun Group agreed to clarify some of the statements in the 2017 Discussion Paper that had led to misunderstandings... [and] further recognized the need to make appropriate reference to the requirement of the UNGPs to review risks to rights-holders when providing financial services to corporate clients.

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29 June 2017

Thun Group of Banks discusses second Discussion Paper at annual meeting

Author: Christian Leitz, Head, Corporate Responsibility Management, UBS

"Message sent by Thun Group of Banks to all attendees of the Thun Group's annual meeting (19-20 June 2017, Seepark Thun, Thun, Switzerland)", 29 June 2017

The Thun Group of Banks' [annual meeting in June 2017]...focus[ed] on our Group's second Discussion Paper...[as well as] on a range of other pertinent topics. We are now working on bringing together those many comments into a meeting report, which we will publish in July. At the same time, the Group is working on concrete steps that arise from the comments made at the meeting pertaining to our second Discussion Paper. In the first instance, this includes updating the Thun Group's Second Discussion Paper to clarify that this analysis is not intended to categorically exclude banks from 13a, which than can be used as the basis for further discussions and exploration.

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15 March 2017

Commentary: "Artful Dodgers: Banks and their Human Rights Responsibilities"

Author: David Kinley, Univ. of Sydney Law School

The Thun Group’s recent and second contribution to the banks and human rights debate raises more questions than it answers...Though it might be said that [this paper] is more reflective than its predecessor, it appears to have taken the banks’ thinking backwards rather than forwards. At the root of this thinking lie the intertwined notions of ‘proximity’ and ‘directness’. That is specifically, the proximity of a bank to a human rights impact will be determined by the directness of its actions in effecting that impact. It is, according to the Thun Group, only when the bank’s actions are sufficiently direct that any responsibility or liability will be borne by the bank...It does seem odd, for example, for the banking sector to seek to restrict the reach of its power and responsibilities in respect of human rights outcomes, at the very time when other sectors - notably retail - are yielding to pressure to delve deeper into their supply chains to identify and address abusive practices.

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14 March 2017

Thun Group response BankTrack

Author: BankTrack

...Firstly, as mentioned in our open letter, the Thun Group made a commitment following its last open meeting in June 2014 to define a stakeholder engagement strategy. However, this commitment has not yet been met. For constructive dialogue to take place it is vital that commitments made at such meetings are upheld. In addition, the absence of a meaningful and inclusive stakeholder engagement strategy is at the heart of the concerns we set out in our open letter. The UN Working Group made the point in its response to the Thun Group paper that initiatives like this paper, which seek to interpret the meaning of the UNGPs in a sector-specific context, “should be subject to a process of consultation and review by other stakeholders to ensure accuracy, robustness and legitimacy”. In line with this, we ask the Thun Group to meet its commitment to establish a stakeholder engagement strategy, and do so in a way which takes on board this recommendation from the UN Working Group, in time for its forthcoming meeting. Secondly, we have asked the Thun Group to withdraw and reconsider its recent paper...

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28 February 2017

John Ruggie raises concerns about discussion paper on financial sector's human rights responsibilities

Author: John G. Ruggie, Harvard Univ, former UN Special Representative on business & human rights

"Comments on Thun Group of Banks Discussion Paper on the Implications of UN Guiding Principles 13 & 17 in a Corporate and Investment Banking Context", Feb 2017

I welcomed the Thun Group of Banks' initiative to elaborate on the application of the UN Guiding Principles on Business and Human Rights (UNGPs) to banking when it first started up some five years ago...I am also keenly aware that, beyond their own walls, corporate and investment banking may face greater challenges resulting from diverse and complex business relationships than, say, a mining company. But banks are not alone in this respect...Having said that, I am deeply troubled by the discussion paper the Thun Group has just recently published. It misconstrues the central Guiding Principle regarding the corporate responsibility to respect human rights (UNGP 13)...I divide my comments into two parts, the first focusing on the analytical discussion in the paper, and the second on the illustrative cases.

Rejoinder following Thun Group response (28 Feb 2017)

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28 February 2017

Thun Group responds to concerns raised about its discussion paper on clarifying human rights responsibilities of finance sector

Author: UBS on behalf of Thun Group of Banks

The Thun Group of Banks welcomes the feedback received so far on our Discussion Paper and would like to thank the organisations and individuals for sharing their views on it. We are looking to generate a constructive discussion among banks and other stakeholders and therefore we see each of these comments as a very valuable component of this dialogue. We look forward to continuing the discussion with interested parties in forthcoming multi-stakeholders forums.

Response to UN Working Group

Response to John Ruggie

Response to BankTrack

23 February 2017

UN Working Group on business & human rights raises concerns about discussion paper on financial sector's human rights responsibilities

Author: UN Working Group on the issue of human rights and transnational corporations and other business enterprises

The Working Group finds that the Discussion Paper provides some useful practical considerations for banks in certain situations where they may be directly linked to human rights impacts through the financial products or services they provide to third parties which themselves may be contributing to or causing a human rights abuse. However, the Working Group would like to express our concern about some elements of the Discussion Paper that do not accurately reflect some key elements of the UNGPs. The Working Group believes that if left unaddressed, this can cause unnecessary confusion about the UNGPs, which may undermine attempts by banks and others to implement their responsibility to respect human rights...The Working Group has two specific concerns about aspects covered in the Discussion Paper: a) The question whether banks can contribute to adverse human rights impacts beyond its own employment practices. b) The extent to which the third pillar of the UNGPs – the need to ensure access to remedy for those affected by human rights abuse – is relevant for banks. Additionally, the Working Group would also like to make some observations about the process of developing these kinds of tools that seek to unpack key concepts of the UNGPs in a sector-specific context.

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