Members of the Canadian mining industry and civil society groups have compiled a draft framework which they believe can lead to more transparency in the mining industry worldwide.
The Resource Revenue Transparency Working Group has issued a set of recommendations and are now accepting feedback from stakeholders. The group is made up of the Mining Association of Canada, the Prospectors and Developers Association of Canada (PDAC), the Revenue Watch Institute and the Canadian branch of Publish What You Pay.
The rules would require mining companies to disclose payments they make to both foreign and domestic governments. The intention is to make foreign governments more accountable – as their constituents would be able to track revenue streams – and to help “companies communicate their contributions” to Canadians and investors.
New disclosure standards could help investors more accurately assess the risks of different mining projects, according to the report.
Twenty-four investor institutions in Canada “with over $362 billion in assets under management” have signalled their support for the disclosure requirements.
Financial transparency could also increase the profitability of mining projects by promoting a “healthy investment climate,” the report stated.
The recommended laws would encompass not just active mining sites but the entire life cycle of a project, including the exploration and closure phases.
The draft comes two days after Prime Minister Stephen Harper announced that Canada will push forward with stricter disclosure laws for mining companies.
Canada is not alone: Transparency is trending internationally in the mining and oil industries.
The European Parliament passed a law on Wednesday making it mandatory for oil, gas, mineral and logging companies to disclose payments they make to national governments.
Meanwhile in Guinea, a revision of the outdated mining code is expected to bring more transparency to the industry.
In the US, litigation is ongoing over a provision of the 2010 Dodd-Frank Wall Street Reform act which forces mining companies to reveal whose coffers they are filling. The American Petroleum Institute argues that the rules violate the industry’s right to free speech and hinders the competitiveness of American companies.
Creative Commons image by Joel Penner
