This post marks International Human Rights Day, which occurred earlier this week on the 10 December. This is the day that the Universal Declaration of Human Rights was signed, which has its 75th anniversary this year.
The Universal Declaration of Human Rights (UDHR), adopted by the United Nations General Assembly in 1948, has been a cornerstone in the development of human rights globally. While its impact is broadly recognised in various sectors, its influence on the financial sector remains an under-explored area, particularly in the United Kingdom. This post examines the intersection of the UDHR and the financial sector, shedding light on how this formative document has shaped legal frameworks, corporate responsibilities, and individual rights within economic activities in the UK.
The UDHR and Financial Regulations
The UDHR, although not legally binding, casts a significant shadow over financial regulations within the UK. This influence, while not always direct, is evident in the ways that the principles of the Declaration have become intertwined with national laws and regulations governing economic activity. Articles 23 and 25 of the UDHR are particularly relevant to financial regulation: in particular, Article 23 upholds the right to work, including the right to just and favourable conditions of work and protection against unemployment, while Article 25 advocates for the right to an adequate standard of living, including the necessities of food, clothing, housing, and medical care.
These obligations have particular resonance in the context of certain UK legislation, including the Equality Act 2010 and Financial Services Act 2021. Employment laws in the UK, influenced by the UDHR, protect workers from discrimination and ensure fair wages and safe working conditions, reflecting the Declaration’s commitment to human dignity and social justice. The right to work also necessitates supporting an environment where businesses can thrive, create jobs, and contribute to the economy. This, in turn, depends on a stable and robust financial system. As such, regulatory bodies in the UK are tasked with creating frameworks that not only ensure the stability of the financial sector but also foster an environment conducive to economic growth and employment, in the interest of societal wellbeing more broadly.
Similarly, the right to an adequate standard of living underpins the need for consumer protection in financial matters, like the Financial Services Act 2021. This aspect of the UDHR encourages the development of regulations that protect individuals from financial fraud and exploitation, ensuring that their basic needs can be met without undue financial risk or hardship. The UK’s Financial Conduct Authority places consumer protection at the heart of its agenda, aligning with the UDHR’s principles of fairness and equality.
Furthermore, the indirect influence of the UDHR on UK financial regulations can be seen in the emphasis on inclusive economic policies. This includes initiatives to increase financial literacy and access to financial services, particularly for marginalised and disadvantaged groups. Such measures are aligned with the spirit of the UDHR, which advocates for equality and non-discrimination.
Corporate Responsibility and the UDHR
Companies are increasingly aware of their role in upholding human rights, a concept that finds its roots in the UDHR. The UK’s adoption of the Modern Slavery Act 2015, for example, reflects the UDHR’s principles, compelling companies to ensure their supply chains are free from human rights abuses. However, the path to realising these ideals is fraught with complexities. The concept of corporate responsibility often grapples with the inadequacies of current economic models, such as the fallacy of trickle-down economics. These challenges underscore the need for a robust human rights approach within corporate governance. Such an approach should encompass not only legal compliance but also ethical considerations, aligning corporate strategies with human rights obligations. This alignment requires continuous scrutiny and advocacy from human rights advocates. The journey towards fully realising the UDHR’s ideals in the corporate sphere remains an ongoing endeavour.
The UDHR’s Broader Influence
The UDHR has created a culture of rights awareness in finance, encouraging ethical discussions and promoting human dignity and social welfare. This has led to a rise in social impact investing and ethical banking in the UK since 2011. Ethical banking, which centres the ethical implications of investments and operations, has also gained traction, with banks evaluating their impact on society and the environment in their decision-making processes. The influence of the UDHR thus extends beyond mere compliance with regulations, encouraging a comprehensive ethical framework that underpins the operational ethos of financial entities in the UK.
The enduring relevance and transformative power of the UDHR remains evident in its influence on the UK financial sector. In navigating the complexities of global finance, the principles enshrined in the UDHR serve as a guiding force, recognising the need for economic progress while also protecting and promoting human rights. Embracing these principles is both a legal obligation and a moral imperative to ensure that social prosperity operates to the benefit of all, and not just the privileged few. Ultimately, the UDHR continues to play a critical role in securing socio-economic rights and promoting the mandate of equality in the contemporary UK context.