Trade unions call on Belgian Development Bank to ensure due diligence for sustainable development

In light of recent public criticism against the Belgian Development Bank (BIO) for its investments, including allegations of tax avoidance and involvement in human and labour rights violations, trade unions have addressed proposals for the Belgian Government to address this situation.

Established in 2001 by the government of Belgium to promote the development of the private sector, BIOhas the particularity of having the Belgian state as the sole shareholder. The bank is active with investments in entrepreneurship and the private sector, agriculture, health and education, run in 52 countries in Asia, Latin America, the Middle East, North Africa and Sub-Saharan countries. 56% of the investment goes to financial inclusion. 36% of all investments are not direct investments but are placed through private equity funds (PEFs).

A 2012 report showed evidence of the bank placing a substantial part of its investments via PEFs lodged in tax havens, in an effort to avoid taxes in the countries where the investments were conducted. In 2019, another report demonstrated that BIO was involved in human rights and labour rights violations in the framework of their investment in the activities of the Canadian company Feroni in the sector of palm oil in the Democratic Republic of Congo.

Among the violations, the report mentioned ”killings of nearby residents, intimidation, arbitrary arrest and detention without trial, late and below minimum wage payments, as well as violations of the right to food, right to a healthy environment, right to land, and the right to Free, Prior and Informed Consent”. Ultimately, this investment programme ended up in economic failure and bankruptcy of Feronia, leaving a trail of violence, environmental destruction and barely any local development.

In light of this situation and in the context of the upcoming EU legislation on due diligence, the Belgian trade unions have addressed the Government of Belgium with a series of key recommendations to address the repeated failures of BIO to contribute efficiently to truly sustainable development. Involving the private sector in development policies must translate into sustainable development and decent work, underpinned by a real commitment of the business community to ensure the respect of labour rights, human rights and environmental standards throughout their activities.


  1. A holistic approach to development: BIO must prioritise social and environmental standards alongside economic governance when making investment decisions. This includes focusing on sustainable employment, capacity building, and participation of local workers, as well as incorporating safeguards for ecological development.
  2. Clear exclusion criteria: Bio must avoid investments and projects with potential negative impacts on social, environmental, and human rights aspects. The bank should exclude projects that commercialise public health and education services, hindering affordable access for all.
  3. Preference for socially responsible investments: BIO must prioritise investments in private equity funds (PEFs) that align with social investment objectives and promote human rights, labour rights, and environmental sustainability. Investments should focus on small and medium enterprises and strategies to transition from informal to formal economies.
  4. Strengthen internal expertise: The bank must enhance its internal expertise in human and labour rights, and environmental standards to reduce reliance on external consultants. Collaboration with development actors, such as the ILO and local social partners, can further reinforce expertise.
  5. Enhanced due diligence management: BIO must establish continuous due diligence processes that involve planning, monitoring, evaluation, reporting, and engagement with rights holders. The process should include the public availability of a due diligence plan and systematic consultation with stakeholders.
  6. Transparency and access to information: BIO must ensure greater transparency regarding value chains and PEFs used for investments, including tax payment practices. More information on due diligence processes and impact studies is also necessary.
  7. Effective complaint mechanism: The bank’s current complaints mechanism needs to be more independent, efficient, and accessible to victims. In addition, BIO must put in place clear procedures for mediation, access to justice, class actions, and whistleblower protection.
  8. External control and reporting: The Belgian Federal Parliament should be involved to ensure transparency and external control. Annual reporting on BIO’s interventions with potential negative human rights impacts should be mandated.

Trade unions recognise the importance of sustainable development and call on BIO to adopt a rights-based approach. By implementing due diligence as a core process, the bank will ensure its activities contribute positively to human and labour rights and environmental standards. Trade unions emphasise the need for BIO’s accountability and involvement in achieving sustainable development goals while using public funds for investments in developing countries.

  • For more information, contact Karin.Debroey[@]