flows for political or personal gain to conceal their activities (McPherson and MacSearraigh 2007). Finally, oil is critically important to the economies of many producing countries, which is used to justify extensive government involvement in the sector (Yergin and Stanislaw 1998), spawning opportunities for expropriation and corruption. By viewing oil as strategically important, consumer country governments exacerbate these problems. Their concerns over the security and continuity of supply often lead to arrangements with producer-country governments that overlook corruption and expropriation (McPherson and MacSearraigh 2007). 2.2. Extractive Industries Transparency Initiative The Extractive Industries Transparency Initiative (EITI) was established in 2003 in an effort to reduce corruption and increase accountability for efficient use of government revenues from oil and gas resources. Funded by the World Bank, the Initiative brought together producer countries, companies, and institutional investors to agree on a set of principles for transparency in the sector. Under EITI standards, the governments of complying countries agreed to provide independent EITI teams with information on natural resource revenues. Companies that were members of the EITI agreed to provide information on government payments. The team would then prepare a report that covered areas for concern and disclosed aggregate government and company accounts of natural resource revenues and payments, thereby increasing accountability. By 2014, 48 countries had implemented EITI standards and more than 237 reports on government revenues had been produced. More than 90 of the natural resource extractive world’s largest companies participated in the EITI. 2.3. Section 1504 of the Dodd Frank Act The second effort to increase transparency in the extractive industries came through regulation in the U.S. On July 21, 2010, Congress passed the Dodd Frank Act. Although most of the Act’s rules
flows for political or personal gain to conceal their activities (McPherson and MacSearraigh 2007). Finally, oil is critically important to the economies of many producing countries, which is used to justify extensive government involvement in the sector (Yergin and Stanislaw 1998), spawning opportunities for expropriation and corruption. By viewing oil as strategically important, consumer country governments exacerbate these problems. Their concerns over the security and continuity of supply often lead to arrangements with producer-country governments that overlook corruption and expropriation (McPherson and MacSearraigh 2007). 2.2. Extractive Industries Transparency Initiative The Extractive Industries Transparency Initiative (EITI) was established in 2003 in an effort to reduce corruption and increase accountability for efficient use of government revenues from oil and gas resources. Funded by the World Bank, the Initiative brought together producer countries, companies, and institutional investors to agree on a set of principles for transparency in the sector. Under EITI standards, the governments of complying countries agreed to provide independent EITI teams with information on natural resource revenues. Companies that were members of the EITI agreed to provide information on government payments. The team would then prepare a report that covered areas for concern and disclosed aggregate government and company accounts of natural resource revenues and payments, thereby increasing accountability. By 2014, 48 countries had implemented EITI standards and more than 237 reports on government revenues had been produced. More than 90 of the world’s largest natural resource extractive companies participated in the EITI. 2.3. Section 1504 of the Dodd Frank Act The second effort to increase transparency in the extractive industries came through regulation in the U.S. On July 21, 2010, Congress passed the Dodd Frank Act. Although most of the Act’s rules