A G8 transparency revolution: yeah, some

Photo caption: Leaders at the 2013 G8 Summit. Photo credit: Wikimedia Commons. 

ONE’s reaction to the G8 outcomes on Transparency, by Verity Outram, Policy Consultant and Alan Hudson, Policy Director for Transparency & Accountability

Back in January the UK Prime Minister set out a ground-breaking agenda for this year’s G8 Summit ontrade, tax and transparency. While those of us who have been pushing for the G8 to take decisive action on phantom firms are left feeling a little disappointed by the lack of ambition, overall the verdict on thecommuniqué is reasonably positive.

ONE set out its ambitions for the G8 in our recent report “Summit in Sight”. In many areas the G8 has made significant progress but we’ve also seen missed opportunities to give the transparency revolution a real boost.

On transparency in the oil, gas and mining sector, we had some great news with Canada’s announcement that it plans to join the EU and the US in requiring its companies to report on the payments they make to governments to exploit countries’ natural resources. The communiqué goes further in encouraging other countries to adopt equivalent mandatory reporting rules and attention will now turn to Australia, South Africa and Hong Kong to make the standard truly global. In line with the G8’s message to “get their own house in order”, the UK, US, France, Italy and Germany have all stated that they will look to become compliant with theExtractive Industries Transparency Initiative over the coming years.

We still need to go further and ensure that extractive data is usable, used and translates into results for the citizens of resource rich countries.

Open Data
We welcomed the announcement of a new Open Data Charter that G8 members have signed up to and non-G8 countries, perhaps via the G20, will be encouraged to join. The Charter will make more government data available, with health, environment and transport priority areas and a commitment by all G8 members to implement the the International Aid Transparency Initiative (IATI) by 2015. We hope to see the Open Data Charter made relevant across the transparency agenda – from aid, to extractives, to budgets, to service delivery – smashing the silos between transparency initiatives to make them more than the sum of their parts.

The headlines of the day however, focused on what the G8 would commit to around tax and transparency of beneficial ownership. Over the last few days we have heard voices from Kofi Annan to George Osborne, calling for a deal on automatic information exchange for tax authorities to include developing countries.

The G8 announced today that the OECD will take forward work on this agenda and report to the G20. This is great news. It should mean that tax authorities in Africa will be able to trace the money leaving their countries. The UK further announced that it would reign in its own tax havens, once more highlighting the UK’s commitment to this agenda.

Beneficial Ownership
However, on beneficial ownership – despite the leadership demonstrated by the UK and France – the G8 has taken only baby steps towards cracking down on the secret companies that play such a major role in robbing Africa of its resources. These steps must be just the beginning. David Cameron and François Hollande should now take the fight to Europe, leading efforts to get other EU Member States to agree to make information about who really owns and controls companies public. This is what is needed. Nothing less is acceptable.

Global Witness reacted by saying,  “Anonymous shell companies are the getaway car for crime and corruption”.

More announcements
Plenty more was announced today – G8 country partnerships to support countries to implement the new EITI standard; capacity building via Tax Inspectors Without Borders; the tasking of the OECD with the development of a common template for country by country reporting by developing countries –  all of which are further steps in the right direction.

While the G8 has not turbo-charged the transparency revolution in the way that many of us hoped, it has – under David Cameron’s ambitious leadership – pushed things forward substantially. Commitments have been made and will be monitored. And people all over the world, will continue the fight.

Get ONE’s reaction to the G8 in issue by issue detail.