Combatting corruption in the oil, gas and mineral industries

The exploitation of natural resources represents big business globally. Like any industry where there is so much money to be made, every step of the way may be vulnerable to corruption.

The Extractive Industries Transparency Initiative (EITI) acts as a global standard for the good governance of oil, gas and mineral resources.

In a recent factsheet, the EITI states that it “requires the disclosure of information along the extractive industry value chain, from licensing to extraction, to how revenue makes its way through to government, to how it contributes to the economy and wider society”.

This helps to promote a culture of strong governance and transparency, as well as providing data that can help to identify corruption risks, guide legislative reforms, strengthen tax collection and foster public debate.

 

Which countries follow the standard?

The EITI standard is implemented in 52 countries.

Furthermore, there are a number of:

  • Supporting countries (including Australia): who are committed to promoting good governance in the extractive industries across the world
  • Outreach countries: other resource-rich countries that could benefit from EITI implementation and could contribute to improved global governance of natural resources
EITI countries

What data is disclosed?

The EITI follows the exploitation of natural resources through each stage of the process to public benefit, including:

  • Contracts and licenses: including beneficial ownership
  • Production: e.g. exploration activities
  • Revenue collection: includes sales by governments and state-owned enterprises
  • Revenue allocation
  • Social and economic spending: including contribution to national economy and environmental impact

 

How is the EITI implemented?

Each implementing country has local multi-stakeholder groups (MSGs) which oversee implementation and ensure alignment with national priorities.

MSGs are responsible for analysing and communicating data required by the EITI Standard to government and community groups, who leverage this data in the fight against corruption and in the effort to strengthen governance.

 

Conclusion

The Extractive Industries Transparency Initiative (EITI) helps to promote transparency and strong governance of oil, gas and mineral resources. This not only levels the playing field for companies but also ensures that nations rich in natural resources properly manage the revenues from extractive industries to reduce poverty and strengthen the local economy.

Nyman Gibson Miralis provides expert advice to organisations involved in the extraction and commercialisation of natural resources, to ensure compliance with global laws and standards.

Contact us if you require assistance.