In a speech to the Africa Jubilee Business Forum on 13 May 2013, which marked the fiftieth anniversary of the founding of the Organisation of African Unity (now the African Union), Nick Clegg, Britain’s Deputy Prime Minister, pledged Britain’s commitment to implementing the Extractive Industries Transparency Initiative (EITI).

The EITI was set up in 2003 to ensure transparency around payments from countries’ oil, gas and mineral resources. The EITI’s objective is to set a global standard (the EITI Standard) that requires companies to publish what they pay to governments and governments to publish what they receive from companies in an EITI Report.

The EITI is a coalition of governments, companies, civil society groups, investors and international organisations. It is overseen by a mutli-stakeholder group of governments, (including the UK, the US and Japan providing political, technical and financial support to the initiative), companies and civil society groups like Transparency International, but is implemented at a local level by countries. The EITI Rules establish the methodology that countries need to follow to be EITI compliant. The EITI Rules are due to be replaced by a revised EITI Standard at the Global Conference in Sydney on 22-23 May 2013.

The EITI Principles are the cornerstone of the EITI and were agreed by stakeholders in 2003. The Principles outline the general aims and commitments of all stakeholders which include the prudent use of natural resource wealth for sustainable economic growth, development and poverty reduction. The EITI Principles also include a commitment to transparency by governments and companies, as well as public accountability, which will empower citizens to better influence the decisions of these institutions in the public interest.

Nick Clegg’s speech comes one month after the European Parliament and Council agreed that the EU’s proposed Accounting and Transparency Directives will require all EU listed and large private oil, gas, mining and logging firms to disclose all payments over €100,000 made to governments, globally. The Directives are expected to gain final approval in the European Parliament in June 2013.

Nick Clegg also pledged to discuss how to achieve progress on tax, trade and transparency at a high-level G8 event that he and Prime Minister David Cameron will be chairing on 15 June 2013.

37 countries now implement the EITI standard. There 21 EITI compliant countries meeting all requirements in the EITI standard and 16 EITI candidate countries implementing the EITI, but not yet meeting all requirements, which include disclosure, dissemination, review and validation requirements. A total of 33 countries have produced EITI reports. However, 6 EITI members have had their memberships temporarily suspended due to an inability to fully meet the requirements.

The Africa Progress Panel’s report “Equity in Extractives” published on 10 May 2013 reports that countries’ EITIs have helped to build a new culture of openness and sparked reform in several countries. Recent successes and the introduction of US (under s 1504 Dodd-Frank Act 2010) and EU disclosure requirements suggest that the future looks promising. However challenges remain, including the costs of reporting and the need to make appropriate use of the wealth of data that will become available.