National Bank of Canada | Fighting against forced labour and child labour in loan and investment portfolios at National Bank of Canada

Status
Filed
AGM date
Previous AGM date
Proposal number
5
Resolution details
Company ticker
NA:CN
Lead filer
Mouvement d'éducation et de défense des actionnaires (MÉDAC)
Resolution ask
Report on or disclose
ESG theme
  • Social
ESG sub-theme
  • Human rights
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Financials
Company HQ country
Canada
Resolved clause
It is proposed that, from 2027 onwards, the Bank report to its shareholders and interested parties on the measures taken during the previous financial year to prevent and reduce the risk of loans being granted to companies using forced labour and child labour in the production of goods produced, purchased or distributed by its customers using the Bank’s financing for their activities.
Supporting statement
The Fighting Against Forced Labour and Child Labour in Supply Chains Act (1) came into force on May 11, 2023. The Act requires certain companies to file reports on their efforts to fight forced labour and child labour, with the first of these reports to be filed by May 31, 2024. While this Act aims to protect children from exploitation and human rights abuses in supply chains, we propose that the Bank take a proactive stance on this issue by making a commitment, as a good corporate citizen, to prevent and reduce the risk that its loan portfolio includes any form of support for companies that use forced labour or child labour in their business operations. It is important for us that the Bank be more proactive for the following key reasons: 1. Financing companies involved in forced child labour, even indirectly, is incompatible with the core values of Canadians, the public human rights commitments of banks and stakeholders’ expectations. Scandals related to forced labour could: • Provoke media campaigns and boycotts; • Cause lasting damage to the brand image and public trust; • Affect relationships with responsible institutional investors. Major institutional investors, particularly those committed to the Principles for Responsible Investment (PRI) and other ESG initiatives, require rigorous management of human rights risks. Banks that are slow to act are exposed to opposing votes in annual meetings and divestment. On the international stage, Quebec and Canada are known to stand for ethics and children’s rights. Canadian banks, as key players in the economy, are responsible for applying these principles in their financial practices, reinforcing the country’s credibility and influence. Taking a proactive approach to reducing financing related to forced child labour is not only a moral requirement, but also a strategy for managing risks, protecting the organization’s reputation and ensuring alignment with the expectations of investors and other stakeholders. This would enable Canadian banks to assume their role as responsible leaders in the global economy. (1) https://www.parl.ca/legisinfo/en/bill/44-1/s-211

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