Does transparency lead to development? Not necessarily. At least not when it comes to the oil, gas, and mining sectors. Transparency is important but far from sufficient to improve livelihoods. An ongoing discussion among practitioners on the Governance of Extractive Industries (GOXI) platform reveals a lack of clear answers to this question.
For example, Eva T. Thorne argues,
“Revenue transparency is a necessary yet insufficient part of the drive to attain sustainable development outcomes from extractive industries. Transparency must go hand-in-hand with competent public institutions and good public spending in the context of government leadership and commitment to using the revenue to promote sustainable development outcomes.”
While increased transparency is a reality in many countries, and globally, the challenge is whether citizens can and will use the information that is disclosed.
In many cases, those disclosures are made directly by producer country governments or to comply with international requirements, such as the Dodd-Frank Act. Yet, while it is relatively easy to put data in the public domain, it is far harder to build understanding, informed debate and action based upon disclosures. Without that, the value of transparency gets lost.
We still lack clear evidence of development impact, even where there is a history of disclosure, such as through the Extractive Industries Transparency Initiative. This topic demands a strong empirical study. The Transparency and Accountability Initiative is looking at the impacts of transparency and accountability interventions. While its request for proposals is a good template, unfortunately, it does not cover extractive industries.
The question still remains: Can you reasonably link contract or revenue disclosure to sustainable development outcomes? Judging by the ongoing GOXI discussion, many have their doubts even though believing transparency is an important first step. The challenge is posed. All proposals welcomed.