The exhortation to focus on the governing law requires an understanding of the applicable law, including identifying the sources of that applicable law. Such an inquiry also requires making important distinctions between binding law and soft law, between treaties and voluntary initiatives, and between obligations on the one hand and responsibilities on the other. Notwithstanding the importance of the distinctions, these two bodies are connected and potentially mutually reinforcing (see state-business nexus in the UN Guiding Principles on Business and Human Rights, especially Principles 4–6).
Within hard law, either domestic or international law may be sources of applicable human rights norms.
(1) Domestic laws of relevance may be those of host states or states of incorporation and include national laws governing labor, non-discrimination, and occupational health and safety, such as the 2015 French bill. Also relevant may be national and international regulations related to social and environmental reporting
(2) Applicable international law includes the range of universal human rights treaties adopted under the aegis of the United Nations. These include treaties on economic and social rights (International Covenant on Economic, Social and Cultural Rights, 1966), civil and political rights (International Covenant on Civil and Political Rights, 1966)), and on the rights of women (Convention on the Elimination of all Forms of Discrimination Against Women, 1979), children (Convention on the Rights of the Child, 1990), and persons with disabilities (Convention on the Rights of Persons with Disabilities, 2006), among others. In addition to such universal instruments, a number of regional human rights instruments exist such as the European Convention on Human Rights (1950), the Inter-American Convention on Human Rights (1969), the African Charter of Human and Peoples Rights (1981), and the Charter of Fundamental Rights of the EU (2000). Such international human rights treaties establish, for states parties, the legally binding obligations to respect, protect, and fulfill human rights. A unique feature of the obligations flowing from international human rights law treaties is their operation and applicability both horizontally and vertically. In addition to treaty law, customary international law constitutes another potential source of binding human rights norms, including peremptory norms1 of jus cogens and obligations erga omnes, from which no derogation is permitted.
Having argued for a greater focus on human rights law obligations, it is worth exploring in greater depth what those might be, particularly in the context of arguments in favor of integrating human rights into finance. That is, there is a need to be very specific and granular about the particular obligations to be integrated and to what specific element and stage of finance. Hortatory general calls for the integration of human rights into development frequently fall foul of critiques for the lack of concrete specificity. At the same time, the legal typology of human rights law naturally lends itself to that clarity and specificity, even if it is underused. In particular, human rights law establishes obligations to respect, protect, and fulfill, clarifying the particular expectation of conduct on the part of the duty bearer, usually the state.
This article argues that the most compelling argument for the integration of human rights into finance and the basis for the value added of human rights to finance emerges in respect of hard law. In this, the primary, though not exclusive, focus should remain on human rights as legally binding norms since this accountability is the distinguishing element of human rights and the essence of the value added of human rights. Thus, the key to effectively connecting human rights norms with financial regulation is to anchor the operational and practical analysis in the universally applicable human rights obligations and to go a step further, and identify the particular type of obligation (to respect, protect, or fulfill) and explain the concrete implications of the integration of that precise obligation.
This element of the approach calls for a focus on identifying a particular right and extrapolating its nature and application to a particular stage or decision of financing—such as the right to due process, the right to an adequate standard of living, the right to equality or non-discrimination, access to information, the right to privacy, and effective remedy (a substantive mapping is needed). Relatedly there is a need to identify the specific nature of the applicable obligation derived from human rights law (respect, protect, fulfill). In the context of private commercial bank and financiers, the relevant binding human rights law obligation will more often than not be the state obligation to protect, which is the state obligation to protect groups and individuals from human rights violations occurring as a result of the acts or omissions of third parties.