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Transparency
We believe transparency initiatives should apply universally to all companies – publicly traded, private, and state-owned – with an interest in a country’s extractive sector; protect proprietary information; and respect the laws of a host government or a company’s contractual obligations. We support initiatives such as the Extractive Industries Transparency Initiative (EITI), the Group of Eight (G-8) Transparency Initiative, and the United Nations Convention Against Corruption.
Extractive Industries Transparency Initiative
Established in 2002, EITI is a coalition of governments, companies, and civil society that aims to strengthen governance by improving transparency and accountability in the extractives sector. It sets forth global principles for companies to report what they pay to governments and for governments to disclose what they receive from companies. ExxonMobil has served on the EITI Board since 2006 and rotated off the Board in 2009, so that another international oil and gas company could serve. We continue to serve as a Board alternate.
Working to implement EITI
As part of our commitment to honest and ethical behavior, we offer our assistance to countries seeking to implement greater transparency and disclose financial information.
Transparency agreements
We have been actively involved in helping to establish transparency agreements to disclose government revenues in the countries in which we have significant investments:
Kazakhstan
ExxonMobil has actively participated in the multi-stakeholder group to implement EITI in Kazakhstan. ExxonMobil provided significant support to assist the government in making progress on its reconciliation process, through which payments to the government by extractive companies is reconciled with government reports of payments received. Kazakhstan's National Stakeholders Council has published two reports to date covering 2005 and 2006 extractive industry activities. Reports covering 2007 and 2008 activities are under preparation for completion in 2010. Kazakhstan also selected a Validator and is undergoing the validation process to be completed in advance of the March 2010 deadline. ExxonMobil participated as part of the Kazakhstan EITI delegation that shared Kazakhstan's EITI experience at the EITI Conference in September 2009 in Kyrgyzstan.
Equatorial Guinea
ExxonMobil provided support to assist the government in initiating its EITI reconciliation process. In October 2009, EITI finalized its contract with the Auditor for this first reconciliation, which is scheduled to be completed in early 2010, and is preparing for the validation process.
Nigeria
ExxonMobil provided advice and support in 2009 to Nigeria’s EITI reconciliation process for the production year 2005. The 2009 initial report by the NEITI reconciler listed a discrepancy between payments reported by ExxonMobil and payments received by the government. ExxonMobil is working with the government reconciler to resolve the discrepancy.
Cameroon
The official Cameroonian EITI Web site was launched in January 2009. The Cameroon EITI multi-stakeholder committee agreed in March 2009 on a roadmap for validation as it works to complete its validation by March 2010. A Validator was selected in September 2009 and has begun work. The third reconciliation report was initiated in 2009 and will be completed in 2010.
Azerbaijan
In February 2009, Azerbaijan was the first country among 30 EITI Candidate Countries to be designated by the EITI Board as being EITI Compliant. In December 2009, Azerbaijan published its 11th report on its oil and gas revenues.
Up close:
Promoting revenue transparency
With good governance and accountability, the value generated from the natural resources of a country can flow to its people, providing a better standard of living and increasing opportunities for its citizens. Revenue transparency is a key component of good governance. As part of our commitment to honest and ethical behavior, ExxonMobil is an active participant in transparency and anti-corruption programs. Corruption—the abuse of public power for private gain—can significantly distort markets, stifle growth, and undermine the rule of law. Transparency initiatives are designed to increase disclosure of government revenues from the production of oil, gas, and minerals, with the goal of greater accountability by governments on how they spend revenues. Greater accountability helps reduce corruption and promotes greater economic stability.
We provide assistance to countries seeking to implement greater transparency and support initiatives such as the Extractive Industries Transparency Initiative (EITI), the Group of Eight (G-8) Transparency Initiative, and the United Nations Convention Against Corruption. EITI is a unique collaboration between governments, companies, civil society, institutional investors, and international organizations. Together, we share the goal of implementing global principles that support improved governance through the verification and disclosure of extractive industry payments to governments and government revenue from those companies.
Collectively, we need to continue to encourage the cooperation and consent of sovereign host governments in promoting transparency and good governance practices. Mandating disclosure of financial information by companies without regard for host government consent is not the way to encourage the cooperation or accountability necessary to improve governance in resource-rich countries. As such, ExxonMobil believes that individual countries must elect to disclose revenue received from oil, gas, and mining companies at a country level, rather than individual companies reporting this information. The ultimate goal is for citizens to have access to complete information about the revenues that governments receive, so that they can help ensure that government manages those revenues on their behalf.
