Transparency Initiative Research Articles

The Conundrums of Illicit Crude Oil Refineries in Nigeria and Its Debilitating Effects on Nigeria’s Economy: A Legal Approach

Nigeria’s oil industry encounters crude oil theft in commercial quantities, which is often exported to neighbouring countries. This has occasioned a loss of revenue and has caused environmental pollution due to oil spillages. There is a need for a stringent legal framework to combat the menace caused by incessant crude oil thefts, pipeline vandalisation by militants, and inadequate maintenance of existing crude oil refineries. The study adopts doctrinal legal research methods and a conceptual approach with the consideration of primary and secondary sources of law, for instance, the Petroleum Industry Act 2021, the Nigeria Extractive Industry Transparency Initiative (NEITI Act 2007, International Conventions, law textbooks and peer-reviewed journals. The justification for using the method was to establish the trustworthiness of the findings on illicit crude oil refineries. The findings reveal that the Nigerian government has lost more than 150,000 barrels of crude oil daily valued at USD six billion as a result of crude oil theft. This has reduced oil revenues, which ought to have added to the national treasury. The Petroleum Production and Distribution (Anti-Sabotage Act) 2007, which proscribes disruption of petroleum products in Nigeria, has not been diligently enforced. There is also an absence of a specific oil and gas legal framework criminalising crude oil theft. Section 3(e)(f)(iv) of the Nigeria Security and Civil Defence Corps Act only offers pipeline security as one of the functions of the corps, without distinctly stating the penalties to be imposed on those damaging crude oil pipelines. The study designs a hybrid model for the renovation of the country’s crude oil refineries. It also advocates the need to redefine legal regimes on illegal oil refineries by amending the Petroleum Industry Act to include specifically illegal oil refineries provision and to effectively criminalise crude oil theft. The implications of the main results are as follows: criminalising crude oil theft and pipeline vandalisation with vigorous punishments will serve as deterrence to others in the sector, increase revenues for the government and reduce environmental pollution.

Self-Regulation with Conflicting Stakeholders

We study self-regulation, a non-market strategy firms use to reduce pressure from activists, in the context of the payment transparency movement in extractive industries. This movement seeks to reduce corruption by promoting disclosure of oil companies’ payments to host governments but often generates a tension between activists that desire transparency and host governments that oppose it. We show that firms are more likely to join the Extractive Industries Transparency Initiative (EITI), a multi-stakeholder initiative promoting transparency, if they invest in countries where conflict between activists and governments is less intense and if they have stronger bargaining power. We find that when legislatures mandated transparency, EITI-member firms became more competitive. We also find local perceptions of corruption fell in areas close to EITI-member firms’ operations.

Does Police Transparency “Work”? Evidence from the Seattle Police Department

Transparency on police use of force has been touted as a means to keep police accountable, yet evidence on its effectiveness has been elusive. This lack of evidence is concerning since police often wield significant professional autonomy, thereby plausibly remaining impervious to attempts by institutional outsiders (e.g., the public) to hold them accountable. Furthermore, police may even respond to transparency by privileging the already-advantaged populations, insofar as they infer the public to also favor such populations. Using difference-in-differences by exploiting the adoption of the Police Data Initiative that was introduced by the US federal government in May 2015 and subsequently adopted by the Seattle Police Department, we find that Seattle police made fewer traffic stops in response to the adoption of the transparency initiative, but the effect was concentrated on neighborhoods with fewer Black residents. Further analyses suggest that the effect is partly driven by relatively fewer unique officers being dispatched to neighborhoods with fewer Black residents after the adoption of the transparency measure. Ultimately, the inequality in police use of force based on the racial makeup of neighborhoods became greater after the Seattle Police Department adopted the transparency policy, contrary to the likely intent behind the policy.

How Does Exposure to EITI Member Countries Affect Extractive Industry Conduct?

We analyze the effect of petroleum company exposure to host countries that are members of the Extractive Industry Transparency Initiative (EITI) on corporate conduct. To identify causal effects of company EITI exposure, we combine fixed effects models with a shift-share instrumental variable approach. Our results show that increased exposure to EITI member countries increases the amount of negative media attention related to environmental, social and governance (ESG) matters a company receives. This reflects both a significant increase in the range of ESG issues companies receive negative attention on, and an increase in the depth of criticism on individual issues, in particular corruption. The increased negative attention is unlikely to reflect a constructive exposure of companies to more transparent institutions, as company policy on corresponding ESG dimensions shows no improvement with increased EITI exposure. Our results instead suggest that EITI exposure is at best inconsequential for corporate behaviour, and at worst contributes to greenwashing of extractive company conduct.

Artificial intelligence and the Extractive Industries Transparency Initiative as anti-corruption tools for Canadian extractive companies

Artificial Intelligence (AI) offers the promise of improving natural resource governance, including addressing bribery and corruption risks. The mobilisation of computing power requires access to large amounts of data, a task facilitated by disclosure instruments. This paper examines the rationale and potential of artificial intelligence and the Extractive Industries Transparency Initiative (EITI) as anti-corruption tools, with a focus on extractive companies based in Canada. The paper concludes that the integration of AI and the EITI Standard holds some promise to curtail corruption in extractive sectors, despite some ethical, legal and practical challenges.

Building space for transparency in Honduras: Lessons from the Infrastructure Transparency Initiative CoST

The recent history of Honduras is marked by limitations in transparency and accountability, with civic engagement far behind other Latin American countries. The experience of CoST Honduras offers valuable insights to understand how a policy space was created to incorporate open information and social participation in the delivery of public infrastructure. Applying a multi-method approach that combined desk review, qualitative interviews and a process tracing analysis, the research demonstrates how a policy window, combined with a design and implementation sensitive to the nuances of context, were used to sustain momentum for future change efforts. The findings show real shifts in political agency, in the politics of engagement and in society’s capacity to coordinate and act.

Legislative Transparency in the European Parliament: Disclosing Legislators' Meetings with Interest Groups

AbstractResearch on transparency in the EU and at the European Parliament, in particular, has extensively examined the adoption and implementation of transparency initiatives as well as the conditions under which interest groups have access to and influence on EU policy‐making. However, the question of whether Members of the European Parliament (MEPs) are transparent regarding their interactions with interest group representatives has been overlooked by the literature. This study addresses the question of the conditions under which MEPs are more likely to provide information about their meetings with interest groups. The study engages with institutional theory by emphasizing that formal and informal rules incentivize MEPs' behaviour. Drawing on a dataset on MEPs' reports on their meetings with interest group representatives, the study demonstrates that procedural rules, party's position on the cultural dimension and the national corruption tradition affect legislators' propensity to disclose information about their meetings with interest groups.

Do international transparency initiatives substitute for domestic governance?

International institutions affect domestic governance, but their substantial effects primarily depend on member countries’ genuine willingness to comply. This paper explores whether international institutions complement or substitute for domestic institutions. The Extractive Industries Transparency Initiative (EITI) was created for the purpose of complementing domestic institutions in resource-abundant countries that show low levels of transparency. The essential mechanism of the EITI is to provide the public with the information on resource revenues. By enhancing the flow of information on resources, the EITI is expected to improve domestic transparency governance on resource industries. This transparency of information can promote accountability and reduce corruption in resource-rich countries. In contrast, international institutions can substitute domestic institutions in a negative way, leading to reductions in domestic governance quality. By using the instrumental variable estimation to address a selection bias and the survival model to estimate the effect of the EITI membership on domestic transparency governance, this paper finds that the EITI membership has a positive effect on domestic transparency, but there is little spillover effect on institutional reformation.

How global norms matter: norm diffusion and the tangled web of localization in Ghana’s extractive industry

ABSTRACT A critical scholarship within the International Relations and Comparative Politics scholarship continues to challenge the conventional view that upheld the extractive sector in developing countries as the space where global technocratic norms take root irrespective of socio-economic bargains and contestations. Through an in-depth account of the politics that augment the implementation of the Extractive Industries Transparency Initiative and the Public Interest and Accountability Committee in Ghana’s oil industry, this article joins this fast-growing literature by tracing the localized dynamics of norm diffusion. It combines the analytical lenses of governed interdependence and contentious politics, alongside critical interpretations about the pathways of norm diffusion in Africa, with data compiled from field interviews and documentary sources to identify the complex dynamics that have sustained the localization of global norms in the country’s extractive industry.

Media users’ and professionals’ responses to personal data receipts: A mixed methods study

European General Data Protection Regulation requires organisations to request the data subject’s consent for personal data processing. Data controllers must be able to demonstrate valid consent was obtained (‘transparency’). Media often struggle to meet GDPR requirements in practice. We identified several issues with existing consent procedures amongst which a need for trustworthy approaches to record and track consent. In this article, we evaluate a specific transparency initiative: a Personal Data Receipt (PDR) for news personalisation. We investigated how European media users and media professionals evaluated the PDR. We conducted qualitative surveys and interviews to explore and describe individuals’ viewpoints on/responses to the PDR. The main strengths highlighted in this study are: GDPR compliance and improved data processing transparency which leads to more control and user trust. PDR weaknesses are mainly related to users not reading the receipt, lack/overload of information, and design issues. Based on our findings, we identified missing elements and formulated recommendations for PDR improvement to optimise consent strategies. By examining how individuals responded to this specific transparency tool, and rhetorical tactics connected to it (placation, diversion, jargon, and misnaming), our study provides informed suggestions for ways out of digital resignation (Draper & Turow, 2019).

Ghana's adoption of the Extractive Industries Transparency Initiative (EITI): The path from data disclosure to community accountability

The Extractive Industries Transparency Initiative (EITI) is a global standard that aims to promote greater accountability and transparency in the extractive sector. Drawing on research carried out in Ghana to assess the impact of the Ghana EITI (GHEITI) at the community level, this paper asks: Is there variation between mining communities in the level of awareness of GHEITI and royalty disbursements to rural districts, and if so, what might this mean for improving accountability to mining communities? Unearthing variation is important, as it can help to identify roadblocks to improved accountability to mining communities which can inform appropriate policy interventions. Recognizing the heterogeneity of communities, the exploratory research considers the potential role of accountability mechanisms, such as community outreach activities of GHEITI, and advocacy on the part of civil society organisations (CSOs) in enhancing awareness. The research builds on studies that examine local dynamics that tend to be lost in national-level analyses.

The Extractive Industries Transparency Initiative (EITI) and local institutions in Ghana’s mining communities: Challenges in understanding barriers to accountability

SummaryMotivationThe Extractive Industries Transparency Initiative (EITI) is a global standard that promotes transparency and accountability in resource‐rich countries to improve governance of the extractive sector. Despite improvements in the subnational disclosure of royalty payments, a significant problem is the failure of these efforts to improve accountability and benefits to mining communities.PurposeThe article asks how institutions of local governance affect national efforts to improve accountability to mining communities in Ghana on the use of mineral revenues for development. It contributes to the broader theoretical literature on EITI by clarifying what outcomes, if any, can be directly attributed to the disclosure of royalty payments.Methods and approachThis qualitative study employs a case‐study analysis of EITI adoption in Ghana, one of the first countries to join the initiative. The article contextualizes local governance institutions and dynamics in relation to the royalty disbursement process. It draws on original field research to analyse their role in impeding the expected benefits of royalty disbursements to mining‐affected communities.FindingsThe research identifies deficiencies in local governance structures and processes as they relate to the use of mineral royalties, but also instances of variation in how officials react to EITI. The range of individual actors, institutions, and complex processes on which the subnational disbursement of royalties depends, makes it problematic to attribute the absence of improvements directly to Ghana's EITI. The findings demonstrate that EITI's role in participating countries is best understood as facilitative and indirect when addressing development outcomes for mining communities.Policy implicationsDisclosure of royalty payments to local governments is unlikely on its own to result in improved development outcomes for local communities, even when the national government is committed to the goal. There is a need for policy interventions aimed at specific communities to ensure royalty payments reach the intended beneficiaries. These interventions should be tailored to the differences in national governance dynamics in countries participating in EITI, paying attention to contestation over the distribution and expenditure of royalties that disclosure helps bring to light.

Transparency and Global Initiatives in the Face of Natural Resource Depletion in Sub-Saharan Africa

This research focuses on Natural Resource Depletion in Sub-Saharan Africa, as well as ways to overcome it, with a particular focus on the role of transparency in Sub-Saharan Africa (SSA). The transparency initiative is a global initiative aimed at eradicating corruption, ensuring accountability, and assisting participating countries in developing quality budgets that will ensure a good standard of living for their citizens now and in the future. Hausman test was applied and a fixed panel regression model was specified which reveals that there is a significant relationship between GDP per capita, inflation, the EITI dummy, and the transparency indicator is established using a panel regression model. The results show that the model fits the data well and can be used to forecast future economic growth in SSA countries that participate in the EITI scheme. The fixed-effect model also shows that the Transparency indicators such as voice and accountability, and corruption have a positive significant impact on the economic growth of the 10 SSA countries under consideration, indicating that transparency is a critical factor in determining good economic performance. Meanwhile, diagnostic tests such as normality test was performed, with satisfactory results, indicating that the model is very robust and reliable. Meanwhile, inflation have positive significant impact while natural resources show a negative significant influence on the economic growth of all the 10 Sub-Saharan Africa (SSA) in the EITI scheme which can be attributed to the natural economic depletion. Then, using correlation analysis, it was discovered that there is a strong link between transparency indicators (voice and accountability, corruption as well as quality of budget, and fiscal management) and economic growth. This suggests that the greater the transparency, the more natural resource constraints will be overcome, and SSA countries participating in the EITI scheme will achieve greater economic performance.

Transparency and Global Initiatives in the Face of Natural Resource Depletion in Sub-Saharan Africa

Transparency and Global Initiatives in the Face of Natural Resource Depletion in Sub-Saharan Africa

Social‐ecological reflexivity of extractive industry governance? The case of the Extractive Industries Transparency Initiative in Indonesia

AbstractThe Extractive Industries Transparency Initiative (EITI) sets standards to improve the governance of extractive industries and thereby stimulate sustainable development. Member countries implement this standard through a multi‐stakeholder group (MSG) which facilitates deliberation between government, civil society and business representatives. This deliberation could enable what we call ‘social‐ecological reflexivity’: the ability to reconfigure oneself in response to critical reflection on one's performance in governing not only the economic, but also the social and environmental dimensions of sustainable development. Such reflexivity is crucial for countries to not only comply with the EITI standard, but also improve governance quality to address the social and environmental impacts from extractive industries. Drawing on a fully operationalised conceptual framework, we analyse social‐ecological reflexivity in the implementation of the EITI in Indonesia, a country that is heavily impacted by extractive industries. We draw on content analysis of the MSG meeting minutes and EITI‐Indonesia reports between 2012 and 2019. We show that the EITI‐Indonesia has not (yet) generated deep social‐ecological reflexivity. First, there is limited recognition and rethinking of extractive industry governance and no real response in the form of governance reforms. Second, there are even signs of what we call ‘anti‐reflexivity’, whereby members of the multi‐stakeholder group ignore and resist public debates around the negative impacts from extractive industries. In analysing the different components and degrees of reflexivity around the EITI‐Indonesia, the article provides vital insights into the (study of) conditions under which global norms such as the EITI find meaning in and affect specific contexts.

Critical reflection on the extractive industries transparency initiative in Kyrgyzstan

The purpose of this article is to shed light on the implementation of anti-corruption efforts in extractive industries. Through the case study of the Extractive Industries Transparency Initiative (EITI) in Kyrgyzstan, the article aims to capture how the transparency norm is enacted in a development and ‘resource cursed’ context. Building on the literature on resource governance and anti-corruption and on fieldwork conducted in Kyrgyzstan, this article discusses the implementation of EITI at national and subnational levels, as well as, community discourses and practices around transparent resource governance. It attempts to explain how anti-corruption initiatives function in authoritarian settings and why they fail to deliver the promised outcomes. The study highlights the incongruence between normative claims underlying global anti-corruption standards and actual policy and community practices on the ground. It argues that the implementation and outcomes of global anti-corruption interventions such as the EITI are conditioned by the local domestic context. The article stresses the need for scholars and policymakers to examine how transparency is articulated and implemented at national and subnational levels.

Standardization, transparency initiatives, and liquidity in the CDS market

We investigate liquidity changes in the credit default swap (CDS) market around two events that increased market transparency and standardization during the Great Financial Crisis: the dissemination of CDS positions starting in November 2008, and the implementation of the Small Bang in July 2009. We build an econometric model based on bid and ask quotes to measure liquidity in thinly traded CDSs. We find that, after the release of CDS positions, the market-wide deterioration in liquidity is less important for banks, consistent with information revelation alleviating systemic risk uncertainty. The Small Bang also improved liquidity, particularly for more illiquid CDSs.

Tracing the Story of Food Across Food Systems

This paper addresses the impulse to render systemic food systems issues into stories in light of ongoing challenges such as food scares, food fraud, and the COVID-19 pandemic. Such stories about food systems are seen as embodying the ideal of supply chain transparency currently in vogue and regarded as key to solving food system inequities by shedding light on them. Read in the context of documentary cinematic unveilings of unethical production practices, transparency initiatives of various types, particularly those dependent on the real-time, crypto-ensured storytelling of blockchain and digital twinning technology, would seem to provide a new model of indexicality, a new contract with social reality. However, such tracing systems and the questions they raise instead describe the way in which food—and the land, people and animals who are involved in its production—becomes fodder for various power plays.

Combatting illegal fishing through transparency initiatives : Lessons learned from comparative analysis of transparency initiatives in seafood, apparel, extractive, and timber supply chains

Over the last two decades, efforts to combat illegal, unreported, and unregulated (IUU) fishing have led to an expansion of initiatives to enhance transparency across the seafood industry through international agreements, national government regulations, and voluntary private initiatives. Understanding of the effects of these initiatives remains limited, and approaches contested among stakeholders. Yet similar transparency initiatives introduced in recent decades across other sectors whose goal is to expand sustainability in global supply chains, may offer applicable lessons for seafood sustainability. Through a comparative review of transparency initiatives adopted in apparel, extractives, and timber supply chains, this study draws out lessons to inform efforts to expand transparency in seafood supply chains in order to combat illegal fishing. Across the literature reviewed on these three industries and seafood, there was mixed consensus that the initiatives met their intended sustainability goals or significantly affected costs and revenues, based on the evidence available. The review finds a trend across the three industries for increased transparency initiatives in international supply chains, which are often voluntary or state-based initiatives. This trend was commonly motivated by expanded trade and reputational risks from consumer demand, and external pressure from civil society. Transparency initiatives were often driven by governments, lead firms, and markets from developed countries. Conversely the resources and/or producers targeted by the transparency activities have been more widely dispersed worldwide, with many located in developing countries. Comparing across the sectors, lessons learned are distilled to inform efforts aiming to expand transparency in seafood supply chains.

Transparency and natural resources in sub-Saharan Africa

The resource curse has drawn much attention from economists and policymakers. An effort to resolve this curse is the Extractive Industries Transparency Initiative (EITI), a global standard to improve transparency and accountability in resource-abundant countries. This study theoretically and empirically assesses the impact of EITI on natural resource rents. We present a simple model to describe the collusion between politicians and resource companies. Our model reveals that monitoring both politicians and resource companies under schemes such as EITI is effective in preventing illegal transactions. Then, using data for sub-Saharan African countries from 1991 to 2015, we show that EITI implementation increases total natural resource rents and mineral rents, although it has no significant impact on oil and natural gas rents.