The timing of the report’s publication – a call for increased transparency across the oil and gas industry – could not be better. At this moment, the oil industry is putting heavy pressure on the United States S.E.C. to weaken the parts of the 2010 Dodd-Frank financial reform that require S.E.C. listed corporations to disclose their payments to foreign governments.
A few days ago I posted information on Section 1504, along with a few links.
Since then, some additional information has come my way:
Back to the Global Witness report: It’s one of those good news-bad news things. The good news: transparency is increasingly recognized as an important first step towards accountability, reform and fighting corruption. The bad news: the forces opposed to transparency are as strong as ever and today some of them even claim to fight corruption (giving themselves a veneer of respectability), while carrying on with business as usual. Unfortunately, “fighting corruption” has become a convenient way for some leaders to discredit or imprison political opponents.
It’s also a bit disheartening to note the current state of opacity and corruption is not much changed from 2004 when Global Witness published its ground-breaking report, Time for Transparency.
An important feature of the new report is the long list of recommendations. There are action plans for citizens and governments of the countries studied (Nigeria, Angola, DRC), for the global community (including aid organizations, the IMF and WBG) and for the home governments of extractive companies.
I’m particularly interested in this last category. Far too often in the U.S. foreign corruption is described in ways that would lead readers to believe that (1) we have nothing to do with it, and (2) there’s nothing we can do about it.
This, of course, is false on both counts.
Our corporations, policy and financial system are, more often than not, enablers of corruption. For details, read Ken Silverstein’s recent article, “Obiang’s American Enablers.” Silverstein, who has been covering oil politics in Equatorial Guinea for close to a decade has extensively documented the U.S. role as key “enabler” of that country’s corrupt regime.
You can also read, “You can’t address corruption without addressing the financial system,” a recent blog post from the Task Force on Financial Integrity and Economic Development, which describes a U.S. banking system that facilitates corruption.
Here are the Global Witness Actions for home governments of extractive companies:
The home governments of multinational companies that seek access to oil, gas or mining rights should work to combat corruption by:
a. using their fiscal and regulatory powers to ensure that such companies disclose their revenue payments to governments around the world, on a country-by-country and a project-by-project basis;
b. implementing and consistently and proactively enforcing bribery laws that cover bribing another person or entity, being bribed (as the recipient of the bribe), bribing a foreign public official and failure to prevent bribery;
c. implementing and consistently and proactively enforcing laws against the laundering of the proceeds of foreign corruption;
d. establishing laws to protect whistleblowers;
e. working with the international community to end secrecy over the ultimate beneficial ownership of extractive companies, especially in offshore jurisdictions, to prevent shell companies being used by corrupt officials;
f. working to coordinate policy efforts, particularly through the G-20, to tighten regulation of illicit financial flows through international banks;
g. refraining from actions that undermine transparency and accountability, such as pressuring resource-rich countries to give undue preference to “our” companies or blocking the renegotiation of contracts, in cases where there is evidence that the contracts were not legal under local law, for instance if they were obtained corruptly or included abnormally low market prices;
h. providing independent civil society with a formal forum in which to express their findings, concerns, and recommendations related to the extractive sector; and
i. endorsing and implementing the EITI and supporting extending the remit of the EITI to cover the allocation of oil, gas and mineral rights.
Clearly, there is much to do here in the U.S.