Publish What You Pay campaigns for the mandatory disclosure of taxes, fees, royalties and other payments by oil, mining and gas companies to governments and other public agencies.
The call for companies to “publish what you pay” is a necessary first step towards a more accountable system for the management of natural resource revenues paid by extractive industry companies to governments in resource-rich developing countries. There is also a need for governments to “publish what you earn”. If companies disclose what they pay in revenues, and governments disclose their receipts of such revenues, then members of civil society will be able to compare the two and thus hold their governments accountable for the management of revenues. This will also help civil society groups to work towards a democratic debate over the use and distribution of resource revenues.
Revenue transparency is a vital first step towards alleviating the crushing poverty of ordinary citizens in many resource-rich but poor developing countries. It is fully consistent with internationally agreed objectives of accountable government, corruption prevention, and democratic debate over resource management, such as the G8 Action Plan on Fighting Corruption and Improving Transparency.
Business will benefit too. Transparency will strengthen companies’ social “license to operate”, by demonstrating their positive contribution to society, and increase the likelihood that the revenues they pay to governments will be used for sustainable development – which creates a stable business environment – rather than being wasted or diverted by corruption, which exacerbates social divisions and can lead to state failure and conflict.
Transparency would protect companies from allegations of complicity with corrupt governmental practices, as recognised in a recent statement by North American, European and other investors managing nearly US$7 trillion worth of funds. Business would benefit from a level playing field in which all companies would be required to disclose their payments. This would protect progressive companies from having their contracts terminated by corrupt governments if they disclose information voluntarily, and would prevent them being undercut by less transparent competitors.
Transparency can be achieved through a comprehensive and global approach which involves simple adjustments to existing company law, accounting standards and the lending conditions of financial institutions and banks, so as to require disclosure of revenues by companies and governments. Publish What You Pay believes that disclosure should be on an individual company basis for each country of operation, not aggregated amongst more than one company. The Extractive Industries Transparency Initiative (EITI) has developed one model of a reporting template that could serve as a model for disclosure.
A number of regulatory mechanisms are needed to ensure that multinational and state-owned companies disclose payments made to governments, and that governments disclose revenues received from the extractive sector. In calling for the implementation of these mandatory mechanisms, Publish What You Pay’s primary targets are:
- Stock market listing authorities
- The World Bank Group (IBRD, IDA, MIGA and IFC)
- The International Monetary Fund
- Other multilateral and bilateral lending institutions
- Export credit agencies
- Producer country governments
- Developed country governments
- The International Accounting Standards Board
- Private, commercial and retail banks that make resource-backed loans
Transparency is in the best interests of everyone concerned – citizens, companies, donor governments and the wider international community – except a corrupt elite that benefit from the spoils of the systematic misappropriation of state assets.