The EITI has evolved over ten years since the first EITI Conference in 2003 at which the EITI Principles were agreed. These principles, on which the EITI is based, state that the wealth from a country’s natural resources should benefit all its citizens and that this will require high standards of transparency and accountability. After the principles were agreed, rules were drawn up to ensure that all EITI member countries committed to a minimum level of transparency in company reporting of revenues paid and government reporting of receipts.
Much has been achieved in our first ten years, and on the basis of this experience all stakeholders recognise that it is time to develop our Standard in order to better achieve the objectives we set ourselves when the EITI Principles were adopted. Most importantly, we need to progress from a process that encourages the ticking off of our requirements to one that encourages better governance of the extractive sector in each of our member countries.
The EITI Board and our partners have spent two years consulting and working together to improve the EITI Standard. The result is a standard that encourages more relevant, more reliable and more usable information, and better linkage to wider reforms. It is also important that we put in place a minimum standard that is not too onerous for countries facing a major reform challenges but which also encourages continuing improvement whatever the starting point.
The new EITI Standard retains the majority of the requirements of the existing EITI Rules, but has been significantly restructured into a smaller set of requirements with clearer expectations. The need for the EITI to encourage national ownership of reform efforts in order to better serve the interests of the citizens of member countries has been an important principle guiding these revisions. The requirements for national EITI workplans are designed to ensure that EITI reporting is better grounded in national priorities and reforms. In order to make the EITI reports easier to understand, and use, we are introducing a new requirement that the reports must contain basic contextual information about the fiscal regime, contractual framework, production, licensing procedures, revenue allocations and expenditures. It is hoped that this summary will be readable by interested citizens and help to generate more informed national debate.
We have strengthened the requirements for EITI reporting to try to ensure that the data in the EITI Report provides the full picture of revenues received. It has also, in the past, in some cases, been difficult to establish the reliability of the data. A significant improvement is that it has been agreed that all EITI reports should show payments by each company rather than aggregated data. With new provisions related to state- owned enterprises and procedures for assuring the reliability of the figures, EITI reports will contain better and more accurate disclosure of payments and revenues. Finally, the Validation system, which assesses whether countries have implemented the EITI in accordance with our requirements, is now simplified so that implementing countries can dedicate time and resources to achieving improved governance of the sector.
At the 2009 EITI Global Conference in Doha, the EITI was established as a legal entity and the EITI Members Association was established through the adoption of the EITI Articles of Association. Experience has shown that the Articles of Association have worked well, and only minor changes have been necessary.
As with any organisation that seeks to achieve difficult objectives, the requirements for EITI implementation have developed over time and will no doubt be subject to further refinement in the future. The EITI obviously needed to evolve, given what we have learned and in light of other significant developments and complementary initiatives requiring improved transparency in natural resource governance. One of our key challenges ahead is to ensure that we recognise and learn from countries that exceed the minimum requirements and create incentives for more innovative use of EITI to the benefit of the countries that implement the EITI.
As the EITI Chair, it is a privilege to lead the sometimes complex but always worthwhile work of this multi-stakeholder process. All partners have worked hard in reaching compromises that support the development of a more effective EITI. I am tremendously grateful to everyone who has been involved. Obviously the EITI alone cannot ensure that natural resource wealth benefits all citizens; this requires a broader reform effort. But the transparency that EITI drives can help deliver reform. There is still a long way to go until the citizens of resource-rich countries truly see the benefits. I hope and believe that this new EITI Standard will make an important contribution towards realising this aim and bring us further towards delivering on the aspirations laid down in the EITI Principles.
Clare Short, Chair of the EITI Board London, 2 May 2013
Note from the Editors: The Standard has been updated to reflect the revised Civil Society Protocol in section 4, approved by the EITI Board on 1 January 2015.