ASX review of mining sector should include revenue transparency: Oxfam

Campaigns and Advocacy, Media Releases, News article written on the 06 Oct 2011

The ASX review of its disclosure rules for mining, oil and gas companies could lead to greater transparency in the sector, but should go further and include revenue transparency, Oxfam Australia said today.

The ASX launched a review process yesterday which flagged a series of changes to the way companies in the mining and energy sectors report the size and potential of their reserves and resources.
Oxfam’s mining advocacy program manager Serena Lillywhite said more and more Australian-listed mining, oil and gas companies were operating in resource-rich, poor countries, including over 230 companies in African countries.

“Improved reporting of minerals reserves will help citizens in these countries gain a clearer picture of the value of their natural resource wealth but that alone is not enough,” Ms Lillywhite said.

Oxfam would like to see the review widened to include the reporting of payments – such as royalties and taxes – made by companies to governments, as this is critical for citizens to be able to hold governments to account for how any money generated is spent.

“Mining can bring great benefits to communities, but the millions of dollars ASX-listed companies pay to governments in poor countries do not always end up being used to pay for essential services like schools and hospitals,” she said. “In fact, mining, oil and gas money has the potential to lead to greater poverty and conflict when shrouded in secrecy.”

“While we welcome the news that the ASX is looking at improving the reporting of reserves information, we are disappointed that it has not used this opportunity to examine revenue payment disclosure, which is gaining momentum around the world.

“Two-thirds of the world’s listed mining, oil and gas companies will be required to report on their payments to governments under rules currently being developed in the US and EU. Australia should follow suit.”

She said investors also were increasingly looking for improved transparency in the payments made between companies and governments, as a critical tool to assess the risk of their investments.

The Financial Services Council, which represents 128 members responsible for investing $1.8 trillion per year, recently wrote to the ASX asking payment disclosure to be considered as part of this review.

For interviews, please contact Laurelle Keough, Oxfam Australia on 0409 960 100