Leaders or Laggards? ASX mining, gas and oil company tax and revenue transparency

IMMEDIATE RELEASE: 27/7/2020

In response to calls to reduce corporate tax rates and fast track approvals, fund managers Ethical Partners and NGO coalition Publish What You Pay have released new research showing Australian mining, gas and oil companies are falling behind in tax transparency in comparison to the UK, EU and Canada[1].

COVID-19 shows the importance of transparency and well-funded health and social protection systems. While Australia is a giant player in the extractives sector[2], Australia’s current tax and revenue transparency regime does not go far enough. Only three (BHP, Rio Tinto and South32) of top ASX listed extractive twenty companies are required to publicly report at global best practice - all payments to governments (taxes, royalties, bonuses, fees and other payments) on a country-by-country, project-by-project basis - as covered under UK mandatory disclosure laws[3].

Only Rio Tinto discloses any form of donations or fees to industry associations or political parties. Just eleven out the top twenty make a commitment to pay tax where value is created and economic activity takes place.

If the Australia chose to implement equivalent mandatory disclosure legislation to laws in place in the UK, EU, Canada, Norway, Switzerland and awaiting implementation in the US, it would reduce corruption risks, boost government revenues and increase transparency for Australian investors, companies and citizens.

Publish What You Pay (PWYP) has also released Lonergan polling of 1042 Australians from July 6 that shows[4]:

• Most (93%) Australians believe the government should do more to promote transparency in the mining, gas and oil sectors.

• Three quarters (77%) of Australians believe Australian mining, gas, and oil companies should contribute more in taxes to help Australia recover from the impact of COVID-19.

• 7 in 10 (71%) Australians believe Australian mining, gas, and oil companies should contribute more in taxes to help developing countries where they do business respond to COVID-19.

• 3 in 4 (74%) Australians believe Australian mining, gas, and oil companies should publicly disclose donations.

• 4 in 5 (80%) Australians believe their superannuation fund / investment manager should advocate on their behalf with mining, gas and oil companies to be more transparent around taxes and revenues paid to governments here and abroad.

PWYP Australia’s National Director, Clancy Moore said “large mining and gas companies must embrace and not hide from their tax contributions to maintaining Australia’s world class hospitals and health care system”

“Australians and many companies are calling for greater tax and revenue transparency, yet our government blocks its ears.”

“The government should consider a short-term levy on highly profitable industries, such as mining, to boost overseas aid to support women and men living in poverty in developing countries tackle COVID-19”

Ethical Partners, Head of Sustainability Robyn Parkin said “tax and revenue transparency is an issue of utmost importance to good corporate governance and responsible business practice”

“Progressive tax rules are key to solving the climate crisis, to meeting the Sustainable Development Goals and dealing with the devastating inequality and poverty as the world grapples with COVID-19.”

Media contact: Clancy Moore, 0410 508 051

[1] https://www.pwyp.org.au/publications/leaders-or-laggards-asx-mining-gas-oil-transparency

[2] PWYP research shows more than 700 ASX listed extractive companies in 106 countries. Go to https://www.pwyp.org.au/abundant-resources-absent-data

[3] BHP, Rio Tinto and South32 are dual listed on the LSE

[4]https://www.pwyp.org.au/news/polling-shows-australians-call-for-more-transparency-in-big-mining-gas-companies