The FT has an interesting interview this morning with Michel Barnier, the EU internal market commissioner.
The article notes: “Europe is set to impose mandatory transparency measures for mining and forestry companies, requiring them to detail their financial relationships with foreign governments”
Barnier has told the FT that: “…the new transparency obligations – which would cover money flows, such as tax payments and royalties to foreign governments – were likely to extend beyond “extractive” industries such as mining and energy, and cover other “primary materials” businesses, such as forestry.”
He is quick to add that the cost of doing this and the effectiveness of any measures will be taken into account.
At the core of debate seems to be a discussion about whether an EITI (Extractive Industries Transparency Initiative) model could be used, or whether regulation is best.
My sources in Brussels tell me the European Commission remains very keen to push companies on all kinds of responsible business related disclosure in the coming years. Increased corporate disclosure is on the way via some kind of regulation, they tell me. What that looks like and how it will work is another matter.
This is not surprising. We’ve seen pushes on all sorts of disclosure in recent years, from Danish CSR reporting requirements, Swedish state-owned firms having to use GRI, and increased calls (and some action) around mandatory carbon reporting. Water, too, is coming up this agenda, alongside older issues around the extractive industries.
Here’s some further reading: