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Human Rights and Finance – highlights from the event at the European Parliament

Human Rights and Finance – highlights from the event at the European Parliament

Angel Pes Guixa, Deputy Director of CaixaBank

​​​​BRUSSELS, 27 February 2018 – On Thursday, 22 February 2018 representatives of the European Savings and Retail Banking Group (ESBG) attended a conference “Human Rights and Finance: Next Steps for EU Policy" which took place at the European Parliament and was hosted by its member Bas Eickhout (Group of the Greens/European Free Alliance).

The purpose of the conference was to launch a discussion on how human rights can be more effectively embedded into the current reflection of the High Level Expert Group on Sustainable Finance, so that this results into concrete policy measures in the future. The outset is that the European Commission has supported the development of the United Nations Guiding Principles on Business and Human Rights in different policy areas, such as in the development of National Action Plans on Business and Human Rights, but has not integrated them into the policy discussions on sustainable finance.


CaixaBank, providing the views of a retail bank

The conference attracted members of the European Parliament, representatives of trade unions, non-governmental organisations, banking associations, research institutions and other stakeholders. Angel Pes Guixa, Deputy Director of CaixaBank with responsibility for sustainability and President of the Spanish Network of the Global Compact, as well as member of the WSBI-ESBG Corporate Social Responsibility and Sustainable Development Committee, participated in one of the panels dedicated to the stakeholder perspective on the future of human rights and financial regulation in the EU (more extensive interview with Angel Pes Guixa can be found here).

As pointed out by non-governmental organisations, one of the main issues acting as a deterrent to effectively embed human rights in policy is the lack of judiciary ground that would keep financial institutions and organisations accountable, transparent and responsible. It was argued that a comprehensive, legally binding but to a certain extent flexible framework could bring significant changes in the financial industry.


Non-financial risks are extremely important for retail and savings banks

Difficulties of measuring human rights, defining human rights and translating it into the interest for business were also among the topics discussed during the conference. According to some speakers, the struggle to convince business to comply with human rights is often related to the fact, that this brings mostly non-financial return.  However, Pes Guixa provided the example of retail and savings banks, emphasizing that very often, and due to their business models, non-financial risks are even more important than financial risks, as the loss of trust from the customers can significantly damage the business.

Pes Guixa also reminded that financial inclusion plays an important role in enhancing positive outcomes related to many aspects of human rights and Sustainable Development Goals (SDGs). In this respect, the example of the social bank MicroBank, leading microcredit institution in Europe set up by CaixaBank in 2007, was highlighted. Pes Guixa also added that the SDGs are the way forward, as they provide the framework and the opportunity to boost human rights and sustainable development.  


Event conclusions: concrete steps to move forward

A variety of concrete recommendations for EU policy making were suggested during the event. A classification system to establish market clarity on what is 'sustainable', price signals reflecting positive and negative externalities, greater transparency on the sustainability impact and processes of retail funds and an adequate design and application of regulation in respect of banks depending on their business models and size could certainly contribute to enhancement of a sustainable system and create a framework to address inequalities and trigger positive impact.

Panellists of the conference concluded that financial sector, non-governmental organisations and most importantly policymakers should continue working together in order to bring positive changes. Amongst other conclusions, the UN Guiding Principles on Business and Human Rights should constitute the authoritative source of how human rights considerations should be mitigated by actors in the financial sector.

Overall, human rights should be integrated in the core of future policy and not be treated as an add-on. In this respect it was claimed that they should be regarded as a cross-cutting matter and they should be explicitly included in any future potential taxonomy to be designed by policy makers. According to some participants, a crucial step ensuring that financially material human right risks are captured in financial regulation could be an omnibus legislative proposal, which would incorporate financially material environmental, social and governance issues into the duties of asset managers and asset owners.

 

Related story: Human rights & finance: CaixaBank's case

Conference speakers and panellists:

  • Bas Eickhout, MEP, Greens/EFA
  • Heidi Hautala, MEP, Greens/EFA
  • Paul Tang, MEP, S&D
  • Sirpa Pietikäinen, MEP, EPP
  • Margaret Wachenfeld, Managing Director, Themis Research, and Advisory Council, Corporate Human Rights Benchmark
  • Sabina Timco Iacazzi, Lead, Social Issues and Human Rights, UN Environment Programme Finance Initiative
  • Eleni Choidas, European Policy Officer, ShareAction
  • Filip Gregor, Head of the Responsible Companies Section, Frank Bold
  • Isabel Ebert, EU Representative & Researcher, Business & Human Rights Resource Centre
  • Angel Pes Guixa, General Manager, Institutional Representation, Global Compact and Sustainability, CaixaBank, and President of the Spanish Network of the Global Compact
  • Anne van Schaik, Accountable Finance Campaigner, Friends of the Earth Europe
  • Morten Clausen, Director, Finance Sector/Financial Regulation, UNI Europa


Sustainability; Sustainable development; Financial inclusion; Responsible Business; Social business