Human Rights Policy. 1. Introduction. Rabobank Group

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1 Human Rights Policy Rabobank Group 1. Introduction... P Sustainability and human rights... P Objectives of this policy... P 1 2. Scope of application and basis of the Human Rights Policy... P Scope of application of the Human Rights Policy.... P Content of the Human Rights Policy... P Relationship with other Rabobank Group policies... P 3 3. The Rabobank Group Position on Human Rights... P General commitment... P Human rights due diligence... P Remediation... P Positive contributions... P Responsibilities concerning implementation of this policy... P Stakeholder engagement... P 5 4. Annex to the Human Rights Policy... P 5 Rabobank Group / Human Rights Policy / February 2012 / 1 of 5 1. Introduction 1.1 Sustainability and human rights Sustainability is one of the Rabobank Group s four core values. The Rabobank Group views sustainability as a necessary condition for future prosperity. With this in mind, the Rabobank Group is committed to contributing economically, socially and ecologically to the sustainable development of society. This commitment expressly includes meeting the responsibility to respect 1.2 Objectives of this policy The Rabobank Group respects It does not wish to be involved in matters that infringe upon human dignity. The Rabobank Group Code of Conduct This Human Rights Policy sets forth the commitments relating to human rights as stated in the Rabobank Group Code of Conduct and conveys the Rabobank Group s position on human rights to employees, managers, directors, supervisors, customers, business associates and other stakeholders. Through its commitment to sustainability, the Rabobank Group takes a forward-looking perspective. It does this by ensuring that the Rabobank Group lives up to its own values; carries out its activities with respect and dignity for people and planet; and approaches its relationships with customers and business associates in the same manner. The Rabobank Group is dedicated to minimising the risks and maximising the sustainability of its financial products and consequently also the long-term viability of the organisation and its business partners. The Rabobank Group s efforts in this field are based on its values (as expressed in the Mission Statement), and are guided by the Rabobank Group Code of Conduct, the Rabobank Group s commitment to respect human rights as outlined in this Human Rights Policy and other policies and guidelines.

2 2. Scope of application and basis of the Human Rights Policy 2.1 Scope of application of the Human Rights Policy This Human Rights Policy sets forth the Rabobank Group s position on human rights based on internationally recognised human rights and labour standards and principles. It incorporates the Guiding Principles on Business and Human Rights created by the Special Representative of the United Nations (UN) Secretary-General for Business and Human Rights, Professor John Ruggie, and endorsed by the UN Human Rights Council in June The Rabobank Group and its customers, business associates and companies in which it invests on behalf of its customers (investee companies) can all potentially impact human rights across numerous sectors. The Rabobank Group can impact human rights as an employer, as well as contribute to adverse impacts through the provision of its financial, advisory and other services and through its relationships with business partners such as suppliers. The Human Rights Policy outlines what the Rabobank Group expects from its employees and business partners with respect to The Rabobank Group seeks to have a positive impact on the overall sustainability of companies operations. This engagement approach enables the Rabobank Group to encourage customers and business associates to work towards fully respecting human rights within their business activities and ceasing undesired operational practices. Rabobank Group wishes to work in partnership with these parties and other stakeholders to attain solutions for identifying, preventing, mitigating and remedying adverse impacts on However, unwillingness on the part of a business associate to change undesired practices could ultimately lead to the decision that it is no longer acceptable for the Rabobank Group to continue the relationship. As part of the Rabobank Group s approach to sustainability, the Human Rights Policy provides guidance to the Rabobank Group s employees, managers, directors and supervisors in the area of This policy serves as a framework in relation to all commercial banking services, including credit facilities, project finance, advisory services, trade finance, leasing and asset management activities, that are provided by the Rabobank Group or one of its divisions. Within the context of this Human Rights Policy, guidance will also be formulated that will apply specifically to each individual group division. 1 For the text of the resolution, see UN document: A/HRC/RES/17/4. Rabobank Group / Human Rights Policy / February 2012 / 2 of Content of the Human Rights Policy The Rabobank Group recognises the relevant standards and principles as formulated in the International Bill of Human Rights that comprises: Universal Declaration of Human Rights International Covenant on Civil and Political Rights International Covenant on Economic, Social and Cultural Rights It furthermore recognises the principles concerning fundamental rights contained in the eight Core Conventions of the International Labour Organisation (ILO) as set forth in its Declaration on Fundamental Principles and Rights at Work. Depending on the circumstances, the Rabobank Group may need to consider additional standards, including but not limited to the: Convention on the Rights of the Child Convention on the Elimination of All Forms of Discrimination against Women UN Declaration on the Rights of Indigenous Peoples The Rabobank Group is furthermore compelled to comply with the national laws of the countries in which it operates, including countries in which the laws are not or only weakly enforced, and its own policies and procedures. It is furthermore a signatory to the United Nations Global Compact. In instances where the Rabobank Group is faced with conflicting requirements, it seeks practical ways to respect the principles of internationally recognised When it is necessary to prioritise actions in order to address actual and potential adverse human rights impacts, the Rabobank Group first seeks to prevent and mitigate the ones that are most severe or whereby a delayed response would render them irremediable. The Rabobank Group acknowledges that companies can potentially have an impact on all It consequently does not reject out of hand any of the rights outlined in the above stated international instruments. The Rabobank Group does, however, periodically assess its human rights risks by analysing its banking and financial activities, relationships and portfolios; by conducting thorough research; and by engaging in dialogue with stakeholders in order to provide specific guidance to its employees, managers, directors and supervisors. This process has resulted in a list of human rights (please refer to the Annex) for which specific guidance has been developed. This list is updated annually based on input from employees, managers, directors and supervisors and in consultation with external experts and stakeholders.

3 2.3 Relationship with other Rabobank Group policies The Human Rights Policy has been aligned with the Rabobank Group s view of sustainability set out in the Code of Conduct and policies derived from it, including the Food & Agri Business Principles (Principle 5: Promoting Social Welfare), the Rabobank Group s supply chain policies with regard to highly sensitive supply chains, including aquaculture, biofuels, cocoa, coffee, cotton, forestry, fishery, mining, oil & gas, palm oil, soy and sugarcane, and the Armaments Industry Policy. These policies outline the Rabobank Group s preconditions for conducting business in these fields. 3. The Rabobank Group Position on Human Rights 3.1 General commitment The Rabobank Group s general commitment in the field of human rights has been aligned with the Protect, Respect and Remedy Framework as endorsed by the Human Rights Council of the United Nations. The basic premises of this framework are as follows: 1. States have a duty to protect human rights against adverse business impacts 2. Companies have a responsibility to respect human rights 3. There is a need for greater effective access to remedy for victims The Rabobank Group recognises this framework and the Guiding Principles that implement it and the ensuing responsibility to respect human rights. In order to meet its responsibility, the Rabobank Group develops policies and processes that enable it to identify, prevent, mitigate, account for and remedy any adverse human rights impacts the Rabobank Group may cause or contribute to through its own activities, with adverse human rights impacts being defined as infringements of the internationally recognised human rights of individuals and communities. The Rabobank Group furthermore seeks to prevent or mitigate adverse human rights impacts that are directly linked to its operations, products and services through its business relationships, including customers, business associates and society. 3.2 Human rights due diligence Human rights due diligence is a process that has been outlined in the Guiding Principles on Business and Human Rights as endorsed by the UN Human Rights Council. In combination with this policy, it enables the Rabobank Group to meet its responsibility to respect Rabobank Group / Human Rights Policy / February 2012 / 3 of 5 The core features of human rights due diligence are as follows: The process is aimed at knowing and showing that human rights are not infringed upon in the course of doing business. It consists of: i) Identifying and assessing actual and potential human rights impacts ii) Integrating and acting upon the findings iii) Tracking the effectiveness of the response iv) Communicating how human rights impacts are addressed The process will vary in complexity according to the size of the business enterprise, the risk of severe human rights impacts and the nature and context of the operations. It is different from other due diligence activities in that it focuses on adverse impacts on individuals and communities and on their rights, rather than only on risks to the company. The fact that human rights risks may change over time means this is an ongoing process instead of a one-off transactional analysis. It covers adverse human rights impacts that Rabobank Group may cause or contribute to through its own activities or which may be directly linked to its operations, products or services by its business relationships. It applies to the Rabobank Group s own activities and to its relationships with business partners, suppliers and other non-state and state entities and is consequently also aimed at avoiding legal and non-legal complicity. The Rabobank Group intends to carry out specific activities with respect to its various stakeholders, including the following: Internal relationships (employees) The Rabobank Group is committed to respecting all the human rights of its employees: - It fully respects the rights of workers, including but not limited to freedom of association and the effective recognition of the right to collective bargaining; elimination of all forms of forced or compulsory labour; effective abolition of child labour; and the elimination of discrimination with respect to employment and occupation. - The Rabobank Group takes measures to assert these rights by means of dissemination of information and training. - It promotes a corporate culture of awareness of and respect for - Employees have access to grievance mechanisms, which are in line with human rights principles, through which complaints and disputes can be resolved effectively (please refer to section 3.3 below).

4 3.2.2 Customers and business associates (including suppliers) The Rabobank Group aims to carry out reasonable and appropriate human rights due diligence regarding material human rights risks within its commercial relationships: - Possible aspects of the Rabobank Group s activities that are subject to human rights due diligence requirements include client acceptance, provision of loans and leasing products, project financing 2 and investments (including those made on behalf of its customers). - In order to help identify the material human rights issues, the Rabobank Group has developed sector specific policies (as listed under 2.3) and has a database containing country-specific information. - Human rights principles will also be included in the process of establishing joint ventures and making acquisitions. - Rabobank Group expects its customers, suppliers and other business partners to uphold the human rights commitment set out in this policy. A contractual clause to this effect may be inserted into relevant contracts or letters for prospects. - The Rabobank Group insists that its suppliers respect human rights and take reasonable steps to satisfy it that this precondition is being met. The Rabobank Group monitors this by screening and engaging with suppliers to ensure that they follow the same principles as the Rabobank Group does. - While the Rabobank Group sees engagement as an important part of its responsibility to respect human rights, if ongoing engagement does not lead to improvements over time, the Rabobank Group may terminate a relationship on the basis of predetermined criteria Society (neighbours, communities and society at large) The Rabobank Group aims to make a positive contribution to society in the countries in which it operates: The Rabobank Group aims to make a positive contribution to society in the countries in which it operates: - The Rabobank Group respects sanctions imposed by the United Nations, the European Union or any other legislated sanctions that apply to the countries in which the bank operates. Rabobank Group will not undertake any transactions that may conflict with these sanctions. It will conduct increased human rights due diligence in such cases 3. - The Rabobank Group will not operate in countries in which it cannot comply with its human rights commitments towards its employees and/or where circumstances impede the free choice of business partners. 2 The Rabobank Group has committed to adhere to the Equator Principles for project finance. 3 Government authorities, companies and individuals must comply with sanctions. Engaging in international business with parties that do not comply with sanctions would put the Rabobank Group at risk of becoming involved in transactions that contravene the sanction legislation that applies to the countries in which the bank operates. The Rabobank Group has decided that all entities must comply with the legislation of the European Union and the United States (OFAC) and must also comply with local legislation whenever appropriate. The Rabobank Group s sanctions are divided into four areas: personnel risk, customer risk, services risk and payment risk. In order to support the two latter risks, the Rabobank Group s Sanction Desk is developing a Countries Catalogue comprising financial sanctions, economic sanctions and internal guidelines for countries that have been sanctioned. This catalogue can be found on RaboWeb. Rabobank Group / Human Rights Policy / February 2012 / 4 of Remediation Even with the best policies and practices in place, the Rabobank Group or one of its divisions may cause or contribute to an adverse impact that was not foreseen or prevented. If it is identified that the Rabobank Group or one of its divisions is responsible for such an impact, the Rabobank Group will endeavour to remedy or co-operate in the remediation of the situation through legitimate processes. The Rabobank Group therefore: Seeks to have grievance mechanisms in place both for all employees in all countries and divisions and for other relevant stakeholders. Fully co-operates in legitimate external processes aimed at addressing and resolving grievances directly and early. Asks or, where appropriate, demands that the companies with which it engages adopt grievance mechanisms to address possible human rights infringements. Assures that the collaborative and multi-stakeholder initiatives in which the Rabobank Group participates provide for effective grievance mechanisms and/or other measures of adequate accountability. Ensures that before investing in projects with severe potential human rights impacts, the operation will encompass effective stakeholder engagement, including an operational-level grievance mechanism. 3.4 Positive contributions Respect for human rights is a baseline standard that applies to all activities and interactions. The human rights due diligence processes of the Rabobank Group are aimed at preventing and mitigating adverse impacts on human rights from its activities and associated relationships. In addition, the Rabobank Group strives to contribute positively to human rights wherever it can. It does this, for example, by improving access to banking by supporting the development of local banks in poor countries, offering particular investment opportunities that contribute to development (e.g. microcredit) and supporting sport events and community development projects. Such contributions are, however, never intended to offset any adverse impacts that the Rabobank Group or one of its divisions may have caused or contributed to. Respect for human rights remains the baseline standard. 3.5 Responsibilities concerning implementation of this policy The Executive Board is responsible for the ongoing development of this policy and the Rabobank Group s overall commitment to respect It is supported in this effort by other divisions of the Rabobank Group, including Co-operative & Sustainable Business, Legal, Human Resource Management and Procurement. The management of the various Rabobank Group divisions are responsible for appraising the human rights situation in their own markets and for taking appropriate steps to ensure respect for human rights, including engagement with those whose human rights may be affected. This responsibility includes developing more specific actions based on the general guidelines set out in this policy.

5 The Ethics Office of the Rabobank Group provides guidance on the interpretation and implementation of this Human Rights Policy. It will closely monitor the human rights process within the organisation. Human rights issues are reviewed in annual reporting and in compliance procedures and are reported publicly in the annual report. Human rights-related complaints can also be channelled through the appropriate grievance mechanisms that Rabobank Group has in place at various levels, such as persons of trust, the divisions whistle-blower system (where available) and other local procedures. 3.6 Stakeholder engagement The Rabobank Group recognises that human rights require meaningful engagement with internal and external stakeholders. Human rights principles are included as part of the dialogue and decision-making processes in works councils, the group-wide Ethics Committee, ongoing dialogues with NGOs and unions and other partnerships. Stakeholder engagement is particularly important in relation to identifying, assessing and remedying grievances among any of the Rabobank Group s stakeholders stated in this policy, also with respect to ensuring ongoing learning and improvement. Any person or party who believes that the Rabobank Group or any of its divisions has not acted in accordance with this policy or has general enquiries relating to the policy is requested to contact the Ethics Office: ethics.office@rn.rabobank.nl. Rabobank Group / Human Rights Policy / February 2012 / 5 of 5 4. Annex to the Human Rights Policy The Rabobank Group recognises all internationally recognised As part of meeting its commitment to respect human rights, the Rabobank Group has developed guidance on particular rights for its employees, managers, directors and supervisors. This internal guidance is updated annually based on input from and consultation with both them and external experts and stakeholders. The following rights have been included in this guidance to date: Labour rights Right to non-discrimination Right to be free from all forms of forced or compulsory labour Children s right to be free from child labour Rights to freedom of association and collective bargaining Right to enjoy just and favourable conditions of work Non-Labour rights Rights to life, liberty and security of the person Right to an adequate standard of living Rights of minorities Rights to take part in cultural life, to benefit from scientific progress and from the material and moral rights of authors and inventors Right to privacy