Banking with Labour Rights: Exploring the Challenges of Mainstreaming Extra-Financial Information into Financing Relationships

Abstract: The thesis presents the challenges involved in attempting to mainstream international labour rights standards into commercial financing relationships. In order to do so, it draws upon the financing relationships provided by the three most prolific banks in the coal-mining industry: BNP Paribas (France and England), Citi (United States of America) and Royal Bank of Scotland (Scotland). It undertakes an assessment of the social responsibilities of financial actors through an analysis of the responsibilities of States and companies, under the United Nations “Protect, Respect and Remedy” Framework. In doing so, the particular nature of the financial sector and bank–client relationships are taken into account. The discussion on State duty raises questions on the extra-territorial obligations of States and the role of regulation within the sector. The analysis of corporate responsibilities demonstrates that the scope and character of the relationships and products give rise to differing constructions of social responsibility. Furthermore the consideration of extra-financial issues is shown as complementary to the fiduciary duty that firms owe their clients. The analysis of the products provided by the three banks demonstrates that the crucial challenge to mainstreaming labour rights into their financing relationships is the establishment of a clear and effective stimulus, that is a “business case” for mainstreaming. On this basis, the thesis presents a “business case” model and framework which is then applied to the current efforts and initiatives of the banks selected.