News: Most companies endorse implementation of strong US transparency law
March 6, 2020.
For Immediate Release: March 6, 2020
CONTACT: Kathleen Brophy – email@example.com
Most companies endorse implementation of strong US transparency law
Laggard EITI-supporting companies fail to promote international standard
Washington, D.C. – In response to a letter sent by Publish What You Pay – United States (PWYP-US), several Extractive Industries Transparency Initiative (EITI)-supporting companies confirmed their support for the global transparency standard. This sends a strong message to the U.S. Securities & Exchange Commission (SEC) as it considers how to implement a related transparency regulation that requires companies in the extractive industries to disclose payments made to governments in countries where they operate. The current SEC proposal does not meet the EITI Standard or disclosure laws now in place in over 30 countries.
BP, BHP, Eni, Gold Fields, Kosmos, Newmont, Rio Tinto, and Total all submitted statements illustrating their companies’ willingness to uphold their obligations under the EITI-supporting company expectations to publicly declare support for the EITI Standard and a mandatory disclosure rule in the US that aligns with the Standard.
“This is an important moment for the oil industry in particular,” said Kathleen Brophy, Director of Publish What You Pay-US. “This rule is a test for how oil and gas companies want the world to see them. Are they for secrecy, or are they for the public’s and investors’ right to know? We’re glad that some companies were willing to stand up for transparency in their responses. For the rest, this is their chance – they have until March 16th to prove once and for all whether they will support, or stand in the way of a strong global standard for payment transparency.
EITI Board Member Chevron and EITI Supporting Company ConocoPhillips both mentioned competitive harm and undue compliance costs as their primary concerns. However, these hypothetical concerns have been disproven by the experience of 850 companies that have now disclosed, without issue, more than $800 billion in payments under payment disclosure laws in Canada, the EU, Norway and the UK. Barrick and Shell expressed their support for the EITI Standard but failed to promote the adoption of a strong rule in the US. A number of other companies including ArcelorMittal, Equinor, Exxon, Freeport McMoRan, Hudbay Minerals, and Kinross failed to use this opportunity to expressly support the EITI Standard or call on the SEC to align its final rule with the Standard.
A recent comment from French oil major Total to the SEC further debunks the burdensome compliance cost argument made by some US oil companies. In its comment, Total shared that its costs for compliance with the EU payment disclosure regulations represented roughly .0007% of the company’s overall operating costs in 2019.
“Certain American oil companies have pushed baseless talking points over the past decade in an effort to undermine implementation of Dodd-Frank 1504 , even as the rest of the world has moved forward by embracing the long-established global transparency standard.” said Brophy. “The SEC must take into account the diversity of views among the industry, instead of giving in to a small number of hardliners – clearly, the American Petroleum Institute does not speak for all of its members. We call on the EITI Board Chair to demand that its members support the EITI Standard not only in rhetoric, but in practice.”