EITI Partners OpenOwnership On Beneficial Ownership Reforms
The Extractive Industries Transparency Initiative (EITI) says it is teaming up with OpenOwnership to tackle corruption and open up ownership in the extractives sector through Beneficial Ownership (BO) reporting.
Without beneficial ownership disclosure, the EITI says it is difficult to understand the flow of capital and to know who controls companies in the sector.
“It is no secret that anonymous companies make it harder to address money laundering and corruption. They enable corrupt and criminal actors to hide behind a chain of companies registered in multiple jurisdictions,” the organisation said.
It noted that this is particularly true for the oil, gas and mining industries, where citizens of resource-rich countries have often been left footing the bill. “Two recent cases – the LuandaLeaks and 1MBD scandals – provide reminders of how revenues can be siphoned out of resource-rich countries using opaque company structures,” the EITI said.
Due to the magnitude of the challenge and with civil society pushing for more transparency, corporate and government commitment to ownership disclosures is on the rise, the EITI says.
“In total, 90 countries have committed to beneficial ownership transparency globally in some form. Of these 53 implement the 2019 EITI Standard which requires extractive companies to name their beneficial owners.”
It listed Myanmar, Nigeria, the UK and Ukraine as countries which have already started disclosing beneficial ownership data through registers, adding that companies such as BHP and Rio Tinto, have either made statements supporting beneficial ownership transparency or made disclosures.
“These government and industry champions know that equipping countries with beneficial ownership data helps ensure natural resource wealth will help curb corruption, ultimately benefiting all citizens,” the EITI stated.
The EITI explained that despite the evident need, beneficial ownership transparency reform remains new territory for many governments that are already overburdened and daunted by the technicalities, which is why it is joining forces with OpenOwnership to deliver beneficial ownership transparency reforms at scale in the extractives sector.
“Our programme will see us working intensely with 10-12 countries that are committed to reform by providing hands-on technical assistance to make ownership data open and accessible. We will widely disseminate the lessons learned to help make beneficial ownership transparency in the extractives sector a reality within five years,” the organisation said.