Most large banks still failing to implement UN human rights principles, new BankTrack benchmark finds
Ryan Brightwell, Human Rights Campaign Lead, BankTrack: +31 634 643 116; ryan@banktrack.org
Ryan Brightwell, Human Rights Campaign Lead, BankTrack: +31 634 643 116; ryan@banktrack.org
A new benchmark from BankTrack shows that banks are still not yet fully implementing their responsibilities to respect human rights. BankTrack’s fifth Global Human Rights Benchmark report assessed 50 of the world’s largest banks on their fulfilment of responsibilities outlined in the UN Guiding Principles on Business and Human Rights. Thirteen years on from the unanimous endorsement of these Principles by the UN Human Rights Council in 2011, no bank was found to fully comply with the Principles, with 70% of the banks assessed scoring less than half marks and ranking as “laggards” or “followers”.
Only two banks, the Netherlands’ ABN AMRO and Japan’s Mizuho, were ranked as “leaders”, scoring 11 out of 15 available points. However, even these highest performing banks are falling short of fully meeting their responsibilities. Almost all banks are failing to show how they are providing or supporting remedy for people impacted by their financial decisions: only four banks garnered half-scores on this new criterion for setting out one example of remedy.(1)
On a more positive note, banks are making some progress towards improving their policies and processes for managing human rights. Only seven banks were ranked as “laggards”, the lowest category, compared with 10 in the previous report two years ago. The average score achieved shows a modest improvement, to 5.9 points out of 15 in 2024, up from 5.1 out of 14 in 2022. This increase is observable despite the addition of the extra core criterion.
The benchmark also shows some bright spots. For example, six banks have now developed or participated in an accountability or grievance mechanism for people affected by the bank’s finance, and which meets minimum standards of being supported by a clear complaint handling process. This is an increase from only two banks in 2022.(2)
BankTrack human rights campaigner and policy researcher, Giulia Barbos commented: “It’s clear that banks are still falling short in their human rights performance and are not putting people at the centre of their due diligence process. The near-total lack of policies to protect vulnerable groups such as human rights defenders, combined with growing silence from banks when human rights concerns are raised on behalf of affected communities, is worrying. Banks must urgently shift focus to address these glaring gaps.”
Other key findings of the report include:
- Most banks have human rights policy statements in place. 42 out of 50 banks in scope have developed a commitment to respect human rights in a statement of policy. Of these, 30 banks show that their commitments to respect human rights extend to their provision of finance.
- Banks fall short in demonstrating meaningful consultation with potentially affected people. Half of banks benchmarked (25 out of 50) still provide no indication that they meaningfully consult with those potentially affected by their lending or investment decisions.
- Human rights reporting has made limited progress. Only 13 banks out of 50 disclose their salient human rights risks and the steps taken to address them; up from eight in 2022. Only 17 banks report on actions taken to address specific human rights violations with at least one concrete example. Reporting remains one of the lowest-performing areas for banks.
- Bank responses to human rights enquiries are getting worse instead of better. Data from BankTrack’s Response Tracking database show 21 banks either ignored all enquiries or issued non-committal replies when human rights issues were raised in letters to the bank. Only 15% of communications sent to banks elicited a response describing any kind of action being taken by the bank to prevent, mitigate or address the impact raised.
- Banks lack safeguards to protect human rights defenders and Indigenous Peoples. Most banks (33 out of 50) mention the right of Indigenous Peoples to Free, Prior, and Informed Consent (FPIC). However, none has established a process to ensure that clients or investees provide evidence of having obtained FPIC where required. 82% of banks fail to mention human rights defenders and their specific rights in their disclosures.
- A healthy environment is now a human right, but banks didn’t get the memo. A historic UN resolution passed in July 2022 confirmed the human right to a clean, healthy and sustainable environment. However, all but three banks failed to acknowledge this, or to integrate considerations of how environmental impacts might affect human rights into their due diligence processes.
- The highest ranking banks are mostly based in Europe, Australia, or Japan. Of the 14 banks in the "leaders" or "moderate achievers" categories, seven are headquartered in Europe (UK, Netherlands, Spain, and Finland), three in Japan, three in Australia, and only one in the United States. There has been a notable improvement in Japanese banks’ scores since 2019, when Japan's “big three” were all ranked as “followers” or “laggards”.
Chiara Macchi of Wageningen University Law Group, a member of the report’s Independent Academic Advisory Panel, said: “This year’s report highlights some progress in the banks’ awareness of their human rights responsibilities and in their human rights policies. However, the picture emerging from the report also clearly shows that such progress remains insufficient, especially if we consider the availability of resources that these key market players might mobilize to become true leaders in corporate human rights and environmental due diligence. In the light of the recent Corporate Sustainability Due Diligence Directive, which also binds, albeit with some limitations, the financial sector, it is fair to expect much more from banks, which can use their unique leverage to effect positive change in society”.
The full report can be downloaded here .
View the benchmark webinar on YouTube
Notes for editors
(1) These were ANZ, ABN AMRO, ING and Citi. See section 4.2, “evidence of remedy”, for details.
(2) These are National Australia Bank and ANZ, the only two banks meeting this requirement in 2022, and ABN AMRO, Deutsche Bank, Mizuho and Mitsubishi UFJ, which developed or participated in grievance mechanisms since the previous report.
For links to the human rights policies, processes and reports cited in this document, and more details about the rationale for each scoring decision, see each banks’ full scoresheet, linked in the results table above.