Expert Group on Business and Human Rights

The issue of accountability of banks, both as direct actors and as indirect financing agents in respect of human rights violations has come under the spotlight and deserves renewed attention as the risk of involvement of banks and other financial institutions’ is notably increasing.

This is especially pronounced following the adoption by the UN Human Rights Council of the report of Prof. J. Ruggie, establishing the “Protect, Respect and Remedy” framework. Consequently, several private banks are developing and adopting human rights standards and codes of conduct within their policies.

Under the current regime, banks can be directly held liable for human right violations of employees, ; but in some cases, they can also be held indirectly liable for human rights violations resulting from the business activities of their clients through the concept of complicity and the communities within which they operate.

Thus, because a bank often performs a facilitative role to the business activities of its clients, its conduct will also be evaluated on a broader basis to assess whether it contributes, facilitates or supports human rights violations committed by other actors.

This research project seeks to explore such new trends whereby banks’ impugned conduct is perceived to fall beyond direct human rights violations, to also include indirect conduct by way of complicity, if violations are committed by enterprises financed by those banks. The conclusions of the research are especially interesting regarding:

• The extent of Banks’ responsibility through the concept of complicity;
• Judicial versus non-judicial remedies;
• Extraterritorial competence of national courts; and

The increasing supervisory role of CSOs and NGOs as human rights watchdogs.