“Many of the changes and reforms the government is now pushing through are directly attributable to the work of NEITI.”
Zainab Ahmed, Nigerian Minister of Budget and Planning, EITI Board member and previous Executive Director of NEITI, at a recent call of the EITI Board’s Implementation Committee
“The EITI has identified a wide range of reforms, including on how to modernise the records for production audits and revenue collection.”
Victor Hart, Chair of the EITI Multi-Stakeholder Group in Trinidad and Tobago and EITI Board member
"The EITI supports our open data policy so that we can routinely disclose extractives data and encourage reform across government agencies involved in oil, gas and mineral sectors."
Montty Girianna, Deputy for Energy and Mineral Resources Indonesia and EITI Board member
These quotes are only three illustrations of the impact the EITI is having every day in the 51 countries that are rich in natural resources and implementing the EITI.
It is all too obvious that around the world there is voter dissatisfaction with politicians and elites. The social compact between citizens and their political representatives is being challenged like never before.
There are many reasons for this lack of trust and confidence in how we govern our countries. Enormous wealth inequalities, fears of large migration flows, corruption and mismanagement are all amongst what contributes to the desire for change.
In April this year, the Panama Papers scandal broke, with 11.5 million leaked documents. The challenge became one of turning outrage into change. The Panama papers point the finger at the use of anonymous shell companies to hide or launder money. As Joseph Stiglitz and Mark Pieth argues in their recent paper Overcoming the Shadow Economy: “secrecy-havens … pose a global problem: they facilitate both money laundering and tax avoidance and evasion, contributing to crime and an unacceptably high level of global wealth inequality.”
Following the release of the documents, the British government hosted a global anti-corruption summit in May. The timely focus was on beneficial ownership disclosure, on governments opening their company registers and requiring public information about the owners of companies. For citizens of resource rich countries, the risk of losing out on extractive revenues is particularly acute.
The Extractive Industries Transparency Initiative (EITI) agreed earlier this year to adopt new rules on disclosing beneficial ownership for all extractive companies operating in its 51 member countries. By 2020, companies that bid for, invest or operate extractive assets in an EITI country must report the name, nationality, and country of residence of the beneficial owner. Further, politically exposed persons in the extractive sector who own extractive assets will be identified and published. This means that countries that produce oil, gas and minerals will know who the owners of the companies that develop their natural resources are, regardless of where these companies are registered, and regardless of how many layers there are between these companies and their ultimate beneficial owners.
The 51 governments will need a lot of advice and political support in turning these commitments into reality. My first end-of-year appeal to our stakeholders is that we support these governments, and that we show how companies can easily disclose their owners and how civil society can use the ownership information.
As 2016 comes to an end, the EITI is on the eve of a new phase. None of our countries are compliant with the 2016 Standard. We have moved away from our binary arrangement with countries either being candidates or compliant. With our new Validation approach, we have introduced more nuanced assessments of progress – satisfactory, meaningful, inadequate, and no progress. I welcome this. The first set of countries are due to shortly have completed Validation under this system. My second appeal is that we support committed governments through Validation and make sure that it becomes a learning experience leading to further reforms.
In a world where polarisation is common, it is likely that smaller coalitions of like-minded actors will come together around specific challenges and causes. The EITI is good example of such a coalition. These groups do not sustain themselves, it takes political and other forms of leadership. We must look after the EITI. Therefore, my third and final appeal end-of-year appeal to you all is to join in and remain part of our collective action and decision-making process. Remarkable achievements have been made, but we have so much further to go. Unfortunately, many urgent global challenges will only be successfully addressed if we are prepared to doggedly year in and year out work on reform efforts like the EITI.
To all of you, for supporting the implementation of the EITI and contributing to its impact, thank you. I look forward to working with you in the New Year.
Fredrik Reinfeldt
EITI Chair
