What is now known as the EITI evolved from the first statement of the EITI Principles agreed at the Lancaster House Conference in June 2003. Today, EITI Rules contain these and all the requirements for implementing the EITI. Still, the EITI Principles and Criteria are the most concise statement of the beliefs and aims of the EITI. These beliefs and aims are endorsed by all EITI stakeholders.
The EITI Principles
The EITI Principles provide the cornerstone of the initiative. They are:
- We share a belief that the prudent use of natural resource wealth should be an important engine for sustainable economic growth that contributes to sustainable development and poverty reduction, but if not managed properly, can create negative economic and social impacts.
- We affirm that management of natural resource wealth for the benefit of a country’s citizens is in the domain of sovereign governments to be exercised in the interests of their national development.
- We recognise that the benefits of resource extraction occur as revenue streams over many years and can be highly price dependent.
- We recognise that a public understanding of government revenues and expenditure over time could help public debate and inform choice of appropriate and realistic options for sustainable development.
- We underline the importance of transparency by governments and companies in the extractive industries and the need to enhance public financial management and accountability.
- We recognise that achievement of greater transparency must be set in the context of respect for contracts and laws.
- We recognise the enhanced environment for domestic and foreign direct investment that financial transparency may bring.
- We believe in the principle and practice of accountability by government to all citizens for the stewardship of revenue streams and public expenditure.
- We are committed to encouraging high standards of transparency and accountability in public life, government operations and in business,
- We believe that a broadly consistent and workable approach to the disclosure of payments and revenues is required, which is simple to undertake and to use.
- We believe that payments’ disclosure in a given country should involve all extractive industry companies operating in that country.
- In seeking solutions, we believe that all stakeholders have important and relevant contributions to make – including governments and their agencies, extractive industry companies, service companies, multilateral organisations, financial organisations, investors, and non-governmental organisations.
The EITI Criteria
Implementation of EITI must be consistent with the criteria below:
- Regular publication of all material oil, gas and mining payments by companies to governments (“payments”) and all material revenues received by governments from oil, gas and mining companies (“revenues”) to a wide audience in a publicly accessible, comprehensive and comprehensible manner.
- Where such audits do not already exist, payments and revenues are the subject of a credible, independent audit, applying international auditing standards.
- Payments and revenues are reconciled by a credible, independent administrator, applying international auditing standards and with publication of the administrator’s opinion regarding that reconciliation including discrepancies, should any be identified.
- This approach is extended to all companies including state-owned enterprises.
- Civil society is actively engaged as a participant in the design, monitoring and evaluation of this process and contributes towards public debate.
- A public, financially sustainable work plan for all the above is developed by the host government, with assistance from the international financial institutions where required, including measurable targets, a timetable for implementation, and an assessment of potential capacity constraints.