Banks must do more to meet their obligations under UN guidelines to disclose how they respond to specific human rights impacts linked to their finance. This is the main conclusion of a the first in a new series of Human Rights Impact Briefings released by BankTrack today, which assesses the responses of fifteen large commercial banks to evidence of serious labour standards violations by a company they financed, the Malaysian palm oil grower IOI Corporation. The series of briefings intends to shed light on the extent to which banks are living up to their responsibilities under the UN Guiding Principles, by examining specific instances of human rights violations linked to bank finance, and asking banks to explain how they have responded. For this first briefing, BankTrack presented banks with existing research by Finnwatch...which documented how IOI Corporation had blocked foreign workers on their plantations from joining trade unions, withheld their passports - a recognised indicator of forced labour, and failed to pay some workers the minimum wage. Banks were asked to detail how they had met their responsibilities to seek to prevent or mitigate these impacts. Under the UN Guiding Principles on Business and Human Rights, adopted in 2011, all businesses are required to seek to prevent or mitigate adverse human rights impacts that are directly linked to their operations, products or services by their business relationships. Further, they have a responsibility to account for how they address such human rights impacts by communicating this externally. While all banks but one responded, half of these did not acknowledge their links to IOI Corporation or discuss the specific impacts raised in the briefing. This is despite the evidence of these financial links being available either publicly or on industry databases to which banks themselves provide information. Four banks cited concerns around customer confidentiality as reasons for not providing further disclosure.

How banks responded

1. No response: Bank of China

2. Response with no comment on specific case: Credit Suisse; HSBC; Mitsubishi UFJ Financial; Mizuho Financial; Morgan Stanley; Sumitomo Mitsui Financial; UBS

3. Confirmation of link with IOI Corporation, but no response to issues raised: Citigroup; Intesa Sanpaolo; Société Générale; Standard Chartered

4. Response outlining some action taken in response to the issues raised: Crédit Agricole; Deutsche Bank; JPMorgan Chase