February 10, 2012
Secretary Elizabeth M. Murphy
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549-5546
Re: Disclosure of Payments by Resource Extraction Issuers, File No. S7-42-10
Dear Secretary Murphy,
I write as a person of faith to urge you to adhere to a strict interpretation of Congressional intent of Section 1504 of the Dodd-Frank Act, which enables the United States to be a leader in an international effort to ensure mandatory reporting of payments to governments in the oil, gas and mining sectors.
The Presbyterian Church (USA) joined the Publish What You Pay coalition in 2008 because, for more than one hundred years, we’ve had ties to Africa and other parts of the world that are endowed with natural resource wealth, and paradoxically, are burdened by massive poverty. Corruption and embezzlement sustain this reality and we believe that access to information about revenue paid to governments by oil and mining companies is a way to empower citizens to hold their governments accountable.
Further, our church is an investor, with hundreds of thousands of dollars in our portfolio tied to the extractive industries. Clear reporting will help us to be better stewards, both as individuals and as a denomination.
We welcomed Section 1504 of the Dodd-Frank Act, as it enables the Securities and Exchange Commission to require the reporting of payments made by extractive companies to governments, and, makes this information available to civil society. Strong leadership demonstrated by the United States in passing this legislation inspired others, such as the European Union, which has proposed similar rules. Do not succumb to pressure by the extractive industries to dilute these critical regulations.
Transparent financial reporting not only enables our partners to hold their own governments accountable for natural resource revenue; it allows shareholders to see the business practices of the corporations in which they invest. Project-level reporting is the only way for investors to assess risk on a per country basis, rather than attempting to decipher aggregate numbers for the entire country by year, which is the preference of the oil industry lobby. Do not compromise on project-level reporting as you begin finalizing the rules that govern the extractive industries.
Given the behavior we’ve seen on Wall Street, and the financial crisis that has damaged our own country, it is hard to argue against more transparency in corporate practices. It is essential that corporate reporting be mandatory, with provisions for enforcement.
The moral test of any economy is the impact it has on people and on the creation as a whole. It is clear that huge sectors of the world’s population do not benefit from our globalizing economies and the rules that increasingly benefit corporate interests. Worse yet, many are further impoverished by the ordinary functioning of the economy, reflected here in the workings of the extractive industries and the corruption that is systematically embedded in the practices of some governments.
The biblical vision is not maximization of freedom to seek individual benefit, corporate profit or national advantage in a global society, as our denomination’s resolution on Just Globalization warns. Rather, that vision calls forth a compassionate, sustainable society that furthers global community. It is time to shed light on corruption and to adhere to a strict interpretation of the provisions within Dodd-Frank that support transparency.