Documenting respect for human rights in the financial sector

This report provides an initial benchmark of the human rights policies and self-reported human rights due diligence practices of 20 of the largest private Danish financial institutions, along with 2 state affiliated financial institutions. The financial institutions represent four different financial sector categories: pension funds, banks, insurance companies, and investment management firms. The report examines how they communicate to the public about their commitments and approaches to avoiding and addressing negative human rights impacts in relation to their financial activities.

The financial institutions are benchmarked on 8 indicators derived from UNGPs and existing human rights benchmark initiatives such as the Corporate Human Rights Benchmark. The key findings in the benchmark are:
 

• Lack of documented alignment with the UNGPs: The overall score is 38% equalling an average score of 5,3 out of 14 possible points across the eight indicators. Given the UNGPs are a minimum standard of expected corporate conduct on human rights, this average indicates significant room for improvement.
   
• Best and worst indicators: The financial institutions perform best on demonstrating that they identify human rights risk (76% overall alignment score), and poorest on engaging with affected people to inform their approaches (6%).
   
• Pension funds perform best: Pension funds on average have the highest overall alignment score (50%) followed by investment management companies (37%), insurance companies (31%) and banks (26%).