New BankTrack analysis finds banks fail to transparently address human rights impacts
"Banks failing to address severe human rights impacts transparently, finds BankTrack research", 14 December 2021
New analysis by BankTrack finds that bank responses to allegations of human rights abuses linked to their finance typically avoid addressing the specific issue raised, and only very rarely set out any specific action taken towards resolving the problem.
The report, “Actions speak louder: Assessing bank responses to human rights violations'', investigates bank responses in nine cases in which severe human rights impacts are felt by local communities and affected people, ranging from forced displacement and failure to provide compensation to ties with oppressive regimes and paramilitary violence. [...]
From an analysis of 90 instances in which BankTrack or other civil society groups contacted banks regarding specific allegations of human rights abuse, the report finds that banks responded in most instances (69 responses, or 77%), but that in over half of these responses (36 out of 69, or 52%), the response neither addresses the substance of the issue raised nor acknowledges the bank’s finance for the company or project in question. The analysis found only six cases in which banks set out any specific action taken to address their link to the impact or resolve it. No instances were found in which banks provided details on whether or how they monitored the effectiveness of any action to prevent, mitigate or address impacts.
The results show clear differences by country, with French banks setting a relatively good example, responding in 11 instances out of the 14 enquiries made and receiving an average response score of 0.75 out of 3. Banks in the US and UK also responded often - 14 responses out of 17 in the UK and 14 responses out of 15 in the US), but these responses scored much lower for their quality, only receiving 0.29 out of 3 in both countries. Japanese banks also responded frequently - 8 instances out of 10 - but only one of these responses received a score above 0.
BankTrack is calling for progress towards mandatory human rights and environmental due diligence from regulators, with an emphasis on ensuring grievance mechanisms and other channels are available through which people whose rights are affected by bank-financed projects can seek effective remedy. In the meantime, banks must respond to communities and civil society organisations that raise genuine human rights concerns[...].
Full report is available here.