Five years this week, President Obama signed the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act into law, and with it, the landmark oil and mining sunshine provision, Section 1504. This section requires US-listed oil, gas and mining companies to publish their payments to the U.S. federal and foreign governments as part of their normal reporting to the SEC.  

But thanks to foot-dragging by the SEC and aggressive lobbying and legal challenges by laggards in the oil industry, the implementing rule is still not done. Oxfam America is currently suing the SEC to get them to set a timetable and stick to it.  

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What is remarkable is that despite the delays, this U.S. law and even its SEC rules that were sent back for revision by a U.S. court have set a new global standard for oil and mining transparency. 

Laws modeled on Section 1504 and the SEC’s 2012 rules have been adopted by 30 countries, including Canada, the 28 European Union member states and Norway, covering a range of state-owned oil companies and large private companies registered in these jurisdictions.  

The law also prompted the world’s preeminent transparency initiative, the Extractive Industry Transparency Initiative (EITI), to change its reporting rules to incorporate the US requirement in 2013. Given that EITI is backed by all of the major oil and mining giants, including ExxonMobil, Chevron, Shell and BP, this is significant. And it means that the more than 40 countries that now implement the EITI, including some of the world’s largest oil and mineral producers like Indonesia and Nigeria, will publicly report company payments at the project level. Not surprisingly, this harmonization has been supported by the head of the EITI for years.  

What’s more, Section 1504 prompted the US to join the EITI, which then motivated other developed countries including the UK, France, Italy and the Netherlands to also join up. President Obama made the US EITI commitment public at the 2011 UN General Assembly, which launched the Open Government Partnership, saying, “We’re continuing our leadership of the global effort against corruption, by building on legislation that now requires oil, gas, and mining companies to disclose the payments that foreign governments demand of them.”  

We’re also seeing the impact of Section 1504 in emerging markets. The South African Mining Minister and mining giant Anglo American have endorsed the adoption of mining sunshine rules for South Africa, and civil society pressure is building.  

Companies such as Kosmos Energy and Tullow Oil have decided to report their payments before they’re legally required to do so. US gold miner Newmont Mining has been an early supporter. Canada’s law has the strong support of the Canadian Association of Petroleum Producers, the Mining Association of Canada and the Prospectors and Developers Association of Canada.  

The global standard has now been set. And the reasoning behind it is clear:

1.     The requirement is feasible. Standard oil, gas and mining contracts allow for this type of disclosure, and Columbia Law School researchers confirmed this years ago. 

2.     The business case is clear. Community conflict can cost $20 million per week, according to Harvard and the University of Queensland. Investors are hungry for better reporting from oil and gas companies, according to surveys by PricewaterhouseCoopers. Ernst & Young believes it’s a boon for better corporate risk analysis and management and generally getting the house in order. So it’s a no-brainer that investors worth more than $6 trillion in assets under management have hailed the benefits of the U.S. law and called on the SEC to harmonize with the rest of the world.

3.     The demand for transparency from all over the world is deafening. Five years on, one only need look at the SEC’s website from its first rulemaking and currently to get a scale of the demand. It’s packed with pleas for implementation, including from 500 NGOs from more than 40 countries, and from important oil and gas producing countries such as Angola, Equatorial Guinea, Ghana, Burma, and Tanzania.

The global impact of U.S. leadership on this issue is undeniable. Now imagine if the U.S. would follow through with actual implementation!  

The world is moving ahead and is calling very loudly for the U.S. to keep up. It’s time for the SEC to end the uncertainty, follow the timeline given to it by Congress, and align the U.S. with the global standard. Transparency is good business, for resource producing nations, and for investors. There is no more time to wait.   

Munilla is senior policy adviser for Extractive Industries at Oxfam America. She leads research and analysis to support Oxfam initiatives on oil, gas and mining transparency.