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Incentivising and acknowledging systematic disclosure

Incentivising and acknowledging systematic disclosure

EITI Manila Board Meeting Blog: Day 1

The EITI has been at the forefront of discussions on accountability and governance, for many years.  This week the Jakarta Conference “Opening Up Ownership” was the first time that the individuals who are charged with leading their beneficial ownership transparency efforts have been brought together.  It creates dynamic, practical, substantive conversations about the legal mechanisms, how to define and collect the data and how to build registers.  Getting the information into reports is a big step forward.  Getting the information – whether it is on beneficial ownership, licenses, production, taxes, roaylties, the role of the state owned companies, etc – into on-line government and company systems is a major irreversible leap.

EITI Board members and around 50 stakeholders gathered today in Manila for the 38th EITI Board meeting to discuss progress made by the EITI in promoting these systematic disclosures of payments in their 50+ countries, as well as the status of several countries.

Breaking new ground – Norway becomes first country to fully progress from EITI reports to systematic disclosure

Norway was the first OECD country to implement the EITI.  It has published eight EITI reports to date with no material unresolved discrepancies and no substantive delays in reporting.  Whilst they have used the process to monitor and evaluate the implementation of regulations about transparency in the oil sector, it has not highlighted any problems with financial data in the sector.  In recognition of this, they recently sought to find ways to “exit the reporting and reconciliation”.  The Board considered the question of whether to accept the application from Norway to ‘mainstream’ its EITI process to enable this exit without leaving the EITI.  Norway’s proposal is to have continuous stakeholder consultation and dialogue including an annual stakeholder meeting instead of a specific multi-stakeholder group.  It also focuses on the continuous disclosure of the information required by the EITI Standard by the government on and by the companies through payments to government reports, including an independent review of material discrepancies if concerns are raised about the reliability of the data disclosed.  The Board accepted these proposals and will continue to make sure it is happening through a ‘validation’ every three years.  The Board acknowledged the difference of opinions on corporate data quality and emphasised the responsibility of all stakeholders in Norway to agree an approach that will ensure data quality in accordance with the EITI Requirements. Norway will also be expected to implement the EITI’s requirement for public beneficial ownership disclosure for all oil and gas companies applying for, or holding, licenses for petroleum exploration and production in Norway.

Welcome to Mexico and Guyana

The Board agreed to two major resource rich countries into the EITI family – Mexico and Guyana.  Mexico has been undergoing a historic set of reforms to open up the sector to international competition and accountability.  Meanwhile Guyana has made huge oil and gas finds in recent years which look set to transform the economy.  They see the EITI as part of ensuring a good deal for the citizens.  

Honduras, Mozambique, Tanzania and Zambia are assessed as having made meaningful progress against the EITI Standard.   

The Board also agreed that Honduras, Mozambique, Tanzania and Zambia had achieved meaningful progress.  Whilst these were major steps forward for the countries, the EITI urged stronger ownerships by the government in Honduras, Mozambique and Tanzania.  They were each set a list of corrective actions and recommendations and will be assessed again in the middle of 2019 or earlier if they wish. 

In parallel to the Board meeting, Asian EITI stakeholders shared good practices

“What comes out depends on what goes in” was the opening theme of the EITI regional workshop on building capacity for impactful implementation in Southeast Asia and the Pacific. More than 40 participants from Indonesia, Mongolia, Myanmar, Papua New Guinea, Philippines, Solomon Islands and Timor-Leste are gathered in Manila for three days to identify common challenges and share best practices. The focus of the first day was on linking national priorities to EITI objectives.  They discussed how to develop country strategies through maximising the use of the EITI.  The workshop is organised in collaboration with the World Bank and the Philippines EITI national secretariat.

And a word to our hosts…

The day ended on a high note, with a discussion amongst the Philippine stakeholders on how they have used the EITI. Earlier in the month, the Philippines became the first EITI countries to meet all the requirements of the Standard.  This discussion showed that for the stakeholders the process was much more than a tick-box exercise.  The data is being explored and analysed to drive reforms and diagnose any problems. In over 10 years at the EITI, I have never seen such an interactive set of tools for exploring the EITI data.  Right now, Manila seems like the right place to be holding this meeting.  We are grateful to our excellent hosts.    

Eddie Rich