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Drawing on RGI findings, the following five reforms represent concrete policy responses to the widespread deficit in oil, gas and mining governance:

1. Disclose contracts signed with extractive companies.

Publishing contracts helps citizens evaluate which benefits and protections their country receives in exchange for access to publicly owned natural resources, and lets them monitor whether companies and government live up to their obligations. For companies, the disclosure of contracts can strengthen their social license to operate and build public confidence in the fairness of the deal, both factors which facilitate greater stability. Governments also benefit as contract transparency can boost investor confidence, help reduce conflict between stakeholders over the terms of production, and eliminate opportunities for any single official or agency to negotiate deals in the shadows.

Ten countries surveyed in the Index publish all or most of their oil, gas and mining contracts and licenses, including the DRC, Liberia and Peru. Further indicating the spread and feasibility of this practice, the contracts associated with large extractive projects in Azerbaijan, Ghana and Mongolia have been publicly released. Following the close of the RGI research period, Afghanistan and Guinea disclosed dozens of mining contracts on centralized government websites. International bodies such as the International Financial Corporation and the International Bar Association have endorsed the practice as desirable.

Despite this progress, contract transparency remains the exception rather than the rule. Countries should adopt clear rules for the publication of all licenses and contracts and assign responsibility for maintaining the data repository to specific government agencies.

2. Require regulatory agencies to publish timely, comprehensive reports on oil, gas and mining operations, including detailed revenue and project information.

Out of 58 countries surveyed in the Index, only 13 countries disclose timely, comprehensive information on natural resource operations and revenues. RGI findings reveal that sector ministries and regulators in particular fall short on transparency. In 14 countries, these institutions – the core entities charged with managing valuable resources—publish no information about the sector they oversee, and many others publish delayed or substandard reports. Publishing timely and comprehensive information to the public should constitute a core function for these agencies.

Reporting priorities include the following topics: the allocation of licenses; social and environmental assessments, and revenues. Specifically, the process for allocating licenses should be transparent, given the high value of these assets and widespread examples of how corruption can influence their award. Thirty-three countries publish scant or no information about their licensing practices, illustrating the urgent need for progress in this area. Likewise, citizens require timely access to environmental and social impact assessments. These documents are designed to protect the public interest, so their delayed disclosure or absence in 44 countries undermines their intended purpose. In addition, revenue data should be disclosed. The Extractive Industry Transparency Initiative (EITI) has proven a useful vehicle for disclosing revenue data which non-member countries should embrace.

3. Extend transparency and accountability standards to state-owned companies and to natural resource funds.

State-owned companies and natural resource funds often play a decisive role in the generation, management and allocation of natural resource revenues, yet can operate without accountability. Establishing robust reporting, oversight and audit processes is an urgent priority for country action. Only 12 of the 45 state-owned companies, and seven of the 23 natural resources funds assessed by the Index have satisfactory standards of governance and transparency.

Both kinds of entities should adopt good governance standards which include robust annual reporting on operations and finances, asset disclosures by key officials, legislative oversight and the conduct and publication of independent audits. While often semi-autonomous from the state, and therefore often treated differently than other government agencies, these entities must still operate in a transparent and accountable manner that advances the public interest.

The Index identifies strong performers which provide instructive guidance and demonstrate the commercial feasibility of transparency. Top-scoring SOCs such as those in Brazil and Norway have evolved into global industry leaders thanks in part to high degrees of openness and healthy relationships with their governments. Natural resource funds in Norway, Trinidad and Tobago, Chile and Timor-Leste receive high scores, illustrating the spread of good reporting practices to diverse quarters of the world.

4. Make a concerted effort to control corruption, strengthen the rule of law and guarantee respect for civil and political rights, including a free press.

Over two-thirds of the 58 countries studied receive low scores (below the median worldwide) on national measures of corruption, rule of law and press freedom. Without a broad-based enabling governance environment in the country, natural resource transparency will not generate lasting accountability gains on its own. Civil society oversight and media freedoms should be encouraged, effective corruption control should be in place, and the rule of law should be upheld. Transparency without sanction has limited impact. Concrete strategies to significantly reduce bribery in procurement and contracts need to be put in place in many countries, and likewise reforms in judiciary and legal systems.

Freedom of expression deserves particular mention given its importance. In countries such as Angola, Azerbaijan and China, which score very low in voice and accountability, civil society activists and journalists can face strict legal constraints along with harassment and arrest. Petroleum and mining sector transparency will have little impact in such a subpar national governance environment – what use is some information if citizens cannot use it to ask questions and demand better results from their government?

5. Accelerate the adoption of international reporting standards for governments and companies.

Companies that extract natural resources and the countries where these companies are based share the responsibility to advance transparency.

As a first priority, home countries should adopt legislation requiring their companies to report the payments they make to governments on a project-by-project basis, for every country of operation. Section 1504 of the 2010 U.S. Dodd-Frank Wall Street Reform and Consumer Protection Act requires all oil, gas and mining companies listed on US stock exchanges to report in this manner. It is anticipated that the European parliament will this year require oil, gas, mining and logging companies listed on European exchanges, as well as large European-based private companies, to do the same. Key extractive industry markets including Australia, Brazil, Canada, China, South Africa and Switzerland should follow suit. In Switzerland such regulations should cover payments made to governments by commodity traders, which dominate Swiss extractive sector.

Home country governments and international organizations should also seek to reduce illicit financial outflows from resource rich countries, through the active investigation and prosecution of bribery, money laundering and other forms of corruption, and improved responses to the challenges of tax evasion. These institutions should also promote the spread of global reporting standards for contracts, licensing processes, SOCs and natural resource funds. International financial institutions in particular should take steps to mandate such reporting before providing large-scale lending to resource rich countries.

Through proactive adoption of strong reporting practices and full compliance with disclosure laws and regulations, companies can demonstrate their commitments to good governance and open, competitive markets. Along with detailed reporting of payments made to governments, companies should regularly disclose the licenses they hold and how much each produces, an account of related costs and profits, the text of contract agreements, and social and environmental impact assessments.

Regional and Country Recommendations

Available here, the RGI regional summaries include recommendations which are tailored to the diverse findings which arose from countries in East Asia and the Pacific, Eurasia and South Asia, Latin America, the Middle East and North Africa, and sub-Saharan Africa.

The 58 country pages, found here, identify the specific weaknesses that require attention in each country, from the top ranked performers through to the bottom. Policymakers, civil society and other actors can use the country findings to formulate their own recommendations for how to improve oil, gas and mining sector governance.