The Troubled Path Towards Greater Transparency as a Means to Foster Good Corporate Governance and Fight Against Corruption in the Energy Sector

Abstract

Corruption has traditionally been wildly rampant in the energy sector and its effects have proved to be extremely dramatic. For decades energy companies have perpetrated corrupt practices with impunity to obtain from the local governments the green light to construct intrusive energy infrastructures, which have the potential of causing serious damages to a country’s environment and social fabric. This illicit way of carrying out business activities has been de facto tolerated by governments for a long time. It affected in particular developing nations, causing the so-called “resource curse”. Then, almost unpredictably, over the course of last two decades, significant and increasingly determined efforts have been devoted to fighting against such a criminal phenomenon. It is well established that the role that transparency plays within such a grim scenario is fundamental. This chapter will examine the intimate relationship between the lack of corporate transparency and corruption, and analyze the most important legal instruments that have been developed to encourage a transparent way of conducting business activities in the energy sector at the international, regional and domestic level. Then, will also focus on the recent Trump's administration decision to nullify the US transparency rules for the extractive industries analyzing the scope of its potentially dramatic consequences.

Keywords: Transparency, Corruption, Resource Curse, Corporate Lobbying, EITI, Extractive Industry, Energy Sector, Oil and Gas

JEL Classification: K14, K2, M14, K10, K42