A letter from our Director of Policy, Andrew Wilson, appeared in the Financial Times earlier this week dealing with the issue of natural resource transparency.
As an organisation which works to promote the rule of law, we fully recognise the potential for enhanced transparency to be a driver of good governance in resource-rich countries. However, new rules requiring extractive companies to disclose details of payments they make to governments need to be carefully calibrated.
The key is to ensure that corporate disclosures enhance transparency in a meaningful way without unduly damaging corporate competiveness. This is a difficult task, and there are real questions as to whether new US Rules—passed by the US Securities and Exchange Commission last week—meet either objective.
European legislators are set to wrestle with these issues after the summer recess in Brussels. What is needed is a sensible and rational debate around the utility and effect of corporate disclosure rules—not an NGO-led charge towards unworkable (and potentially counterproductive) rules. Postcard campaigns are not necessarily a good recipe for sound policy-making.
Our letter is available on the FT website.