Global Citizenship Report 2017

As a financial institution, our approach to remedy usually involves working with clients to ensure they have the right policies in place and channels available to enable victims to lodge grievances. In addition, companies must follow up on allegations and have established processes to offer remedies or cooperate with authorities to make sure effective remedy is provided. In 2017, we worked to enhance access to remedy in the following ways: • I ndigenous Peoples : We updated our ESRM Policy related to the consultation of Indigenous Peoples to account for gaps between the legal requirements in developed countries and international human rights norms. Through our updated approach, we hope to assist our clients in enhancing their engagement of Indigenous Peoples to ensure that the right of free, prior and informed consent is more robustly and universally respected when project impacts require it. • Roundtable on Sustainable Palm Oil (RSPO) : The palm oil sector faces systemic human rights risk, and our leverage with any one palm oil client can be limited. We are able to tackle this risk more broadly as a member of the finan- cial institutions task force of the RSPO complaints body. Recently, we helped upgrade the labor provisions of the RSPO standard and trained other member companies on various labor risks in the sector, with the goal of improving overall access to remedy for people working on palm oil plantations around the world. • Migrant Labor : Citi helped finance the construction of an infrastructure project in the Middle East that is bringing a projected influx of approximately 100,000 migrant workers into a region known for human trafficking-related risks. We anticipated that, because of the scale of the workforce, traditional methods for lodging grievances would not be adequate. In response, we recommended that our client, the project sponsor, expand beyond traditional consul- tant audits and basic worker hotlines to use cutting-edge technology to create a mechanism capable of receiving grievances from the massive construction workforce of this project. The client agreed to implement this technology, which will enable them to better monitor subcontractor management and respond to emerging issues, from minor complaints to more serious grievances. STAKEHOLDERS HEARD THROUGH DUE DILIGENCE PROCESS Responding to human rights concerns often means taking the time to understand the local context and the different stakeholder perspectives through direct engagement. This proved important prior to a bond offering by Petropavlovsk PLC, a London-based gold mining company with operations in Russia. During our due diligence process, we discovered that a formal complaint had been filed with the UN’s Office of the High Commissioner for Human Rights, alleging that an Evenki indigenous leader had been falsely convicted and imprisoned for his advocacy against the Russian government’s treatment of his community and Petropavlovsk’s mining activities near his village. We knew it was critical to gain insight directly from the Evenki community to understand their perspectives on the case against the indigenous leader and to evaluate the company’s social license to operate near Evenki traditional territory. We engaged a social consultant to travel to the remote region and conduct interviews with community members and NGOs, as well as with company and government representatives. The consultant’s report revealed a complex web of issues stemming from decades of exploration by various mine operators, as well as more current concerns regarding the impact of Petropavlovsk’s activities .  Importantly, the due diligence found there to be constructive dialogue in recent years between the company and the indigenous community, and paved the way for improved relations through an enhanced stake- holder engagement strategy. Before launching the bond, we encouraged the company to be more responsive and transparent regarding allegations in the public domain. The company agreed to implement a multifaceted action plan to enhance its approach to stake- holder engagement in line with the International Finance Corporation’s Performance Standards. Petropavlovsk was also receptive to our suggestion that the bond offering fully disclose to investors the risks related to its interactions with the Evenki community as potentially relevant to its ability to obtain project-related licenses and permits, and thus, to the viability of its operations. GRI INDICATORS: 102-40, 102-42, 102-43, 102-44 Citi 2017 Global Citizenship Report 51 CONTENTS    INTRODUCTION    HOW WE DO BUSINESS     SOLUTIONS FOR IMPACT    APPENDICES Conduct and Culture    Digital Innovation    Talent and Diversity    Human Rights     Environmental and Social Risk Management    Operations and Supply Chain