27 February 2020

ANZ has agreed to compensate more than 1000 Cambodian families that were forcibly displaced by a sugar company it loaned money to in 2011. Advocates are calling the step a watershed for human rights in the global banking sector.

The decision to pay the families with interest earned by the loan as well as offering an admission that the bank failed to conduct proper due diligence on the project ends one of the ugliest chapters of ANZ's 13-year expansion into Cambodia.

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In February, ANZ met with the Cambodian families and acknowledged that its initial due diligence before making the loan had been inadequate and its efforts to pressure the sugar company to make up for its human rights breaches unsuccessful. ANZ recognised the continuing hardships faced by the affected communities and committed to reviewing its human rights policies, including its customer social and environmental screening processes.

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"Both organisations look forward to working with ANZ to continue to align its human rights approach with the OECD Guidelines and Multinational Enterprises and the UN Guiding Principles on business and human rights," the ANCP statement said.

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"ANZ agreeing to contribute the gross profit it earned from the loan to the affected families has created an important precedent for the banking sector and we congratulate ANZ on becoming a global leader regarding an agreement of this kind," Oxfam chief executive Lyn Morgain said.

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