Assessing the Human Rights Impact of Sustainable Finance Instruments

PI: Stephen Park

The global capital markets—and, by extension, private issuers, investors, and other financial market participants—are expected to play a growing role in supporting the fulfillment of economic and social rights. A key challenge for the incorporation of human rights is determining how to measure, assess, and report on the human rights performance of a given financial instrument by a given issuer. This project addresses this challenge in the context of green bonds, social bonds, sustainability bonds, and similar fixed-income debt instruments that are used to finance projects with a specific social benefit (such as education, employment, housing, or healthcare). The use of proceeds of these financial products, as well as the process by which they are created, sold, traded, marketed, and applied, can be defined by reference to specific human rights. This project examines the use of metrics and indicators, reporting standards, due diligence, and third-party assessment for the purpose of evaluating regulatory approaches to innovation in finance and human rights.