Message from the Chair

2016 shows us 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.

It will take many different efforts over a long time to rebuild what is not working. A common thread, however, is the need for openness and transparency. We need the EITI and similar efforts like never before.

Many of our 51 countries already provide project- level reporting, a growing number of countries publish contracts and many of the over 2000 articles in printed media about the EITI last year were about how this transparency is leading to change and reforms in how we govern precious natural resources. Remarkable achievements have been made, but we have so much further to go.

As I write, none of our countries have met all the requirements of the 2016 Standard. We havemoved away from binary categorisation of countries as either candidate or compliant. With our new Validation approach, we have introduced more nuanced assessments of progress – satisfactory, meaningful, inadequate and no progress. I welcome this. We need to support committed governments to make sure that Validation becomes a learning experience leading to further reforms and improvements.

In April last 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. For citizens of resource-rich countries, the risk of losing out on extractive revenues is particularly acute.

The EITI had earlier last year agreed 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 in 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 their extractive sector who own extractive assets will be identified and disclosed.

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 substantial advice and political support in turning these commitments into reality. As well as supporting these governments,we need to show how companies can easily disclose their owners and help civil society to use the ownership information.

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 a 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, I urge you to join in, provide leadership and remain part of our collective action. Unfortunately, many urgent global challenges will only be successfully addressed if we are prepared to work doggedly year in and year out on reform efforts like the EITI.

Fredrik Reinfeldt

Chair of the EITI Board

Stockholm 8 February 2017