The oil and gas industry
The increase in oil exploration in Africa by multinational oil companies has raised the profile of the debate questioning the oil industry's contribution to development in the South. A large body of evidence suggests that rich oil resources obstruct democracy and equitable economic growth in developing countries because of a lack of transparency, and therefore accountability, in oil revenues paid by oil companies to governments.
The resource curse
Despite the potential for social and economic development provided by oil generated wealth, the lack of accountability and transparency in revenues has exacerbated poor governance, conflict and poverty in the majority of oil dependent countries. Recommended reading...The responsibility of oil companies
When oil companies fail to publish what they pay, civil society is left unable to hold governments to account for how and where that money is spent. Oil is a natural resource owned by countries rather than governments and therefore populations should be able to access information on oil revenues and benefit from them. Recommended Reading...Strategies for improved accountability
Mechanisms and policy changes advocated by civil society, research institutes, and some governments and oil companies themselves, range from voluntary codes of conduct for oil companies to compulsory reporting standards and governance reforms. Among the most prominent initiatives is the Extractive industries Transparency Initiative (EITI), a multi-stakeholder initiative which supports improved governance through the verification and full publication of company payments and government revenues from oil, gas, and mining. At the core of the initiative is a set of voluntary principles for governments and companies which are outlined in the EITI Sourcebook. Another important driving force is the Publish What You Pay (PWYP) campaign, an NGO coalition which calls for the mandatory disclosure of payments and revenues. Recommended Reading...More on the oil and gas industry: the complete listings from Eldis
