The CFCS studies issues at the intersection of finance and security, including the way in which finance and financial institutions can contribute to the disruption of priority threats. These threats include human trafficking and modern slavery, on which CFCS published a paper in March 2017.
The 2017 research identified several ways in which a financial institution can contribute to the identification,
disruption and prevention of human trafficking and modern slavery including:
- Using its branch presence to act as ‘eyes on the street’ by training staff to spot signs of modern slavery and human trafficking;
- Using its considerable transaction monitoring and client screening capabilities to identify suspicious activity that might be indicative of human trafficking or modern slavery, including use of typologies to identify high risk client profiles;
- Ensuring that its own supply chain (for example contractors used for cleaning or catering services) is free of modern slavery;
- Using its leverage over its clients to drive up anti modern-slavery standards and to avoid contributing to potential modern slavery and human trafficking by making responsible lending and financing decisions. For example, undertaking due diligence on, and monitoring of, clients with business models that rely on labour exploitation or outsourcing to countries with a high migrant workforce or known exploitative practices.
Whilst the first three points are uncontroversial, the fourth point appears to be less universally agreed.
Indeed, last year there was considerable public debate between the Thun Group of banks and Professor John Ruggie, author of the UN Guiding Principles on Business and Human Rights, on precisely this point.
Thus, the purpose of this paper is to:
- Gain insight into current financial sector thinking relating to the role of financial institutions in contributing to a human rights agenda
- Contrast this identified position with the clear status when considering finance and environmental risks and identify where and why there are gaps
- Determine recommendations as to how financial institutions can align their approach to human rights (specifically modern slavery and human trafficking) with their clear and stated commitment to the environmental agenda.
We have now reached the stage where we are conducting interviews with experts.
As part of this publication we are looking to gain insights from senior thought leaders on this topic to
contribute to this paper and are now scheduling interviews with experts.