Publish what you pay
A call for mandatory disclosure of payments to and transactions with governments by multinational natural resource companies, their subsidiaries and business partners
by George Soros
Significant foreign investment in less developed countries occurs in the extractive industries such as oil, gas, and mining. Revenue from this investment makes its way to governments in the form of taxes, fees and other payments. If this revenue were effectively and transparently managed, it could serve as a basis for successful growth and poverty reduction.
However, the state and other institutions that manage these resources are often, in practice, unaccountable to the parliaments and ordinary citizens of their countries. Revenues from resource extraction are disclosed neither by the governments nor the companies involved. This lack of accountability facilitates embezzlement, corruption and revenue misappropriation. In extreme cases, access to resources fuels regional conflict and the resulting disorder is exploited to facilitate further large-scale misappropriation of state assets.
This problem extends to all countries where extractive resources provide a major portion of state income, where corruption is associated with this income, and where companies are not transparent about payments. Oil, gas and mining industries are important in over 50 developing countries, which are home to some 3.5 billion people and where 1.5 billion of these people live on less than $2 a day. Twelve of the world's 25 most mineral-dependent states and six of the world's most oil-dependent states are classified by the World Bank as "highly indebted poor countries" with amongst the world's worst Human Development Indicators. Recent extractive resource governance problems have been cited in, for example, Algeria, Angola, Azerbaijan, Chad, Congo-Brazzaville, Democratic Republic of Congo, Equatorial Guinea, Gabon, Kazakhstan, Nigeria, Sudan and Venezuela.
Mining, gas, and oil companies cannot control how governments spend taxes, royalties and fees. But they do have a responsibility to disclose the payments they make so citizens can hold their governments accountable. Companies that fail to do so are complicit in the disempowerment of the people of the countries to which the resources belong.
We are not calling on companies to disclose commercially confidential information, but rather to publish the same basic data on net payments made to government and other public authorities which they are required to disclose in many developed countries. Because individual companies might be put at a disadvantage by disclosing information others fail to reveal, voluntary disclosure is not a viable option. Yet all companies and the investment community would benefit from a level playing field if regulators required disclosure. Furthermore, it would enable them to address the risks to reputation arising from lack of transparency. Disclosure would also enable the citizens of those countries to call their governments to account over the management of the revenues from resource extraction.
There is an emerging consensus within the international community in favour of corporate social responsibility and increased transparency, as is evidenced by, for example, the recent European Parliament Resolution, guidelines adopted by the OECD, the UN Secretary General's Global Compact, the Global Reporting Initiative, and the International Chamber of Commerce.
Mandating disclosure of tax, fee, royalty and revenue sharing payments is consistent with this emerging consensus. It would contribute to the development of transparency mechanisms to track revenues, thereby helping to ensure that these revenues are directed to proper investment in growth and poverty reduction. We call on the leadership of governments and multilateral institutions to help empower civil society to hold governments accountable.
Accordingly, we propose that publicly traded resource companies be required by regulators to disclose aggregate information about taxes, royalties, fees and other transactions with governments and/or public sector entities for the products of every country in which they operate.
Endorsed by:
Acção para o Desenvolvimento, Pesquisa e Cooperação Internacional (Angola)
African Oil Policy Initiative Group
Africa Centre for Constitutional Development (Nigeria)
Agência Ecuménica para o Desenvolvimento Social em Angola (Angola)
Amnesty International, UK
Botswana Council of NGOs (Bocongo, Botswana)
Bureau on Human Rights and Rule of Law (Kyrgyzstan)
CAFOD
CEE Bankwatch Network (Czech Republic), Petr Hlobil
Center for Economic and Social Rights (USA)
Christian Aid
Concern for Development Initiatives in Africa (Tanzania)
Environmental Defense (US)
Fatal Transactions (Belgium)
Forest Peoples Programme (UK)
Forum Voor Vredesactie (Belgian affiliate of War Resisters' International)
Friends of the Earth, UK & US
Global Witness
Human Rights Watch
Iniciativa Angolana Antimilitarista para os Direitos Humanos (Angola/Germany)
Intermon Oxfam (Spain)
Journalists in Need (Kyrgyzstan)
Lawyers' Environmental Action Team (Tanzania)
Liga Jubileu 2000 Angola (Coalition Jubilee 2000 Angola) (Angola)
Medico Internacional (Germany)
Mineral Policy Institute (Australia)
Netherlands Institute for Southern Africa
Niza (Netherlands/South Africa)
Novib (Netherlands)
OIKOS (Angola)
Open Society Network
Operation Young Vote (Zambia)
Oxfam America
Oxfam (GB)
Partnership Africa Canada
Public Service Accountability Monitor (South Africa)
Save the Children (UK)
Tanzania Association of NGOs (TANGO, Tanzania)
Tearfund
Transparency International
United Nations Association
Wassa Association of Communities Affected by Mining (Ghana)
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