Fortune and fantasy on Africa's oil frontier
S.E.C. in bed with the oil companies? Oxfam event in front of S.E.C., February 10, 2012. Photo: Oxfam America
Ian Gary at Oxfam America has posted another excellent piece on the shameless hypocrisy of oil companies now pressuring the S.E.C. to water down parts of the 2010 Dodd-Frank financial reform legislation. (Read my blog post from yesterday for more background on this story.) Here’s the article cross-posted from Politics of Poverty:
The yawning gap between the transparency rhetoric of companies and the reality of their actions has never been more apparent than it is now.
The oil and gas industry loves to trumpet their support of international transparency initiatives and their tax contributions to the US government, but when a new law requires them to tell the public exactly how much gets paid to whom around the world, they bring out the lobbyists and lawyers.
Browse through the corporate social responsibility reports of the top oil and gas companies, and you’ll see them singing from the same transparency hymnbook. Chevron says it “believes that the disclosure of revenues received by governments and payments made by extractive industries to governments could lead to improved governance in resource-rich countries.”
Many oil and gas companies are also “supporters” of the global Extractive Industries Transparency Initiative (EITI). (Companies can become a “supporter” simply by declaring “their support publicly”.) Unless a country decides to implement EITI, though, they are obliged to disclose nothing. For a company such as Chevron, this means disclosing tax and other payments in Nigeria (perhaps years after the fact), but nothing in next-door Equatorial Guinea, a classic petro-dictatorship. For the citizens of Equatorial Guinea—mala suerte (tough luck)!
In July 2010, the Dodd-Frank Wall Street Reform Act was signed into law. Dodd-Frank contains an important provision (“Section 1504″) that requires each oil, gas, and mining company to disclose their tax, royalty and other payments to governments in every country of operation. (Oxfam and our allies in the Publish What You Pay campaign fought hard for the inclusion of this provision—alongside our support for EITI.)
Many of the same companies praising transparency have been actively lobbying since the law passed to gut implementation by the Securities and Exchange Commission (SEC). The hypocrisy is out there in the open if you know where to look. Senate lobbying disclosure forms show that Chevron, Exxon, Shell, Conoco Phillips, Marathon, Occidental, the American Petroleum Institute (API), and others have been very active in Washington on this provision, targeting not only the SEC, but the House of Representatives, Senate, Department of State, Department of the Interior, and the National Security Council.
As I wrote last week, API (revenues of more than $198 million in 2009) has now threatened to sue the SEC unless the agency withdraws its proposed rule and starts from scratch to meet big oil’s secrecy wishes rather than the law and Congressional mandate. (Five API member companies are also on the EITI board, Exxon, Chevron, Shell, BP, and Statoil.)
Wiston House where the EITI board meeting will be held next week. Wikimedia Commons
No one knows how much the oil and gas industry is spending specifically to undo the Dodd-Frank provision, but the oil and gas industry is one of the biggest lobbyists in the US, spending more than $145 million on lobbying activities in 2011. ConocoPhillips, Shell, ExxonMobil, Chevron and BP were the top five oil and gas spenders on lobbying in 2011, with ConocoPhillips spending a staggering $20.5 million. API spent more than $7 million in lobbying in 2011 and is spending a “significant amount” on its faux “grassroots” advertising campaign called “Vote 4 Energy”. These are the same companies who complain that the cost to disclose information they already collect is too onerous.
The yawning gap between the transparency rhetoric of companies and the reality of their actions has never been more apparent than it is now. The SEC may shortly issue a final rule to implement the Dodd-Frank provision, while on February 14th the oil industry’s designated transparency groupies, governments, and civil society groups will convene in the UK for the latest EITI board meeting. While the EITI board members enjoy the lovely and historic “Downton Abbey”-esque country manor setting of their board meeting, the industry’s lawyers and lobbyists will be working hard in Washington to gut a new global corporate transparency standard.
It’s time to blow the whistle on the industry’s transparent hypocrisy. For the more than 1.5 billion people living on less than $2 a day in resource-rich countries, there’s no time left to wait.
February 9th, 2012 | by Ian Gary
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If you have been reading about this issue and wondering what you can do, the people at ONE have a petition out.
Here is information from that campaign:
Two years ago, ONE members helped win a hard fought battle to make sure that big oil companies – by law – must reveal what they pay. But now, oil company lobbyists are pressuring the Securities and Exchange Commission to secretly kill the best parts of the law and keep these deals hidden.
Will you join me and ask the SEC to put an end to these closed door deals once and for all?
http://act.one.org/sign/big_oil_dirty_secrets/
Thanks!
Christiane Badgley has been producing and editing documentary films for the past twenty years, with much of her work focused on the U.S. criminal justice system and post-colonial African politics and history.
