If it belongs to the majority of the European Parliament, the financial sector in the EU should be covered by the European duty of care. The sector is currently exempt from this. “The loans should not be used for the manufacture of chemical weapons or other prohibited things,” explains EU correspondent Mathijs Schiffers of the FD.
Last year, European member states decided that the financial sector would not be covered by the EU-wide duty of care. It tasks companies and institutions to detect abuses when it comes to human rights and climate violations in supply chains. “In the end, member states wanted to leave it up to the countries themselves,” says Schiffers. But the European Parliament now thinks differently.
“An institution can cause, contribute to, or be affiliated with abuses”
The European Parliament decided this week that banks are indeed responsible for what happens to the money they lend. “There are three degrees,” says Schiffer. ‘An institution can cause abuse, contribute to it or be affiliated with it. The latter is the milder form, but then you still have some responsibility. The member states will have to return to the negotiating table with the parliament.’
Ultimately, the decision in this matter does not belong to the European Parliament, but to the European Commission. Furthermore, the proposal must also pass through the Legal Affairs Committee of the European Parliament and must survive the plenary session.
Finally, negotiations with the Council, the decision-making body of the member states, have yet to take place. “They won’t take place until after the summer, so it’s going to take some time.”
Source: BNR
Fernando Dowling is an author and political journalist who writes for 24 News Globe. He has a deep understanding of the political landscape and a passion for analyzing the latest political trends and news.
