ExxonMobil, Chevron undermined anti-corruption effort they help manage by refusing to disclose tax payments in US
EITI chairman Fredrik Reinfeldt said the companies, although they support the initiative and serve on its board, did not follow a central requirement to report their tax payments in the US. ConocoPhillips, Hess and Noble Energy — three other US companies that are members of EITI but do not serve on its board — also did not report their US tax payments, the EITI said.
Reinfeldt said it was "unprecedented" to have supporting companies make a "conscious decision" not to comply with the group's own disclosure requirements.
"It is serious when supporters of the EITI as a group undermine EITI implementation," Reinfeldt said.
The EITI sets standards that encourage oil, gas and mining companies to disclose detailed information on payments to governments, allowing the public to track if funds are lost. The EU, Canada and others have adopted rules based on the initiative, but President Donald Trump blocked mandatory disclosure requirements in the US and last year pulled out of the initiative.
ExxonMobil, Chevron, ConocoPhillips and Hess each pay $60,000/yr as supporting members of the initiative. Noble Energy pays $40,000/yr.
Good government advocacy groups have pushed for ExxonMobil and Chevron to be kicked off of EITI's board, given their refusal to release their taxes. But Reinfeldt rejected that request.
"I consider it better for the realization of the EITI principles that they remain supporters and members," Reinfeldt said.
Chevron said it had a long-standing commitment to promoting revenue transparency but said it did not report its tax payments to the US Internal Revenue Service (IRS) because of the "confidential nature of IRS data." ExxonMobil said it supports anti-corruption efforts but said tax returns contain "complex, proprietary and competitive information that nearly all companies choose to keep confidential."
ConocoPhillips, Hess and Noble Energy did not respond for comment.
Payment disclosure advocates first raised concerns that ExxonMobil and Chevron were not following the initiative through a grievance letter on 7 February. They say Reinfeldt's criticism of the companies was a needed step to preserve the integrity of the EITI, which received $1.1mn, or 17pc of its funding, from the oil and gas industry.