A key aspect of the responsible raw materials sector is the governance established by governments over the bidding for and extraction of natural resources. An important part of that governance is knowing who really owns, controls or benefits from extractives companies. Knowing the ultimate beneficial owners.
In addition, being a responsible extractives company may include being comfortable with the responsible nature of suppliers and customers. Again that includes knowing who really owns, controls or benefits from those companies. Knowing the ultimate beneficial owners.
There is a global trend towards disclosure of the beneficial owners of companies. Beneficial ownership transparency is, though, still evolving as a concept. BO6 is the first framework of its kind that supports governments and other stakeholders along the whole beneficial ownership transparency process.
From the moment a president, prime minister or minister makes a commitment to implementing BO reporting obligations, through to a functioning system that allows users to reap real benefits from clear data on the ultimate owners of companies, the framework supports the decision making and policy implementation process. It asks the right questions at the right point to allow officials to make policy choices and decisions in an efficient manner and at the optimal time. It creates opportunities for engagement with the private sector, professional advisors, civil society and other stakeholders to ensure a fit-for-purpose reporting system.
For civil society, BO6 provides a structure to assess implementation of beneficial ownership initiatives. Civil society organisations can use BO6 to ensure that government agencies are addressing all challenges and making appropriate policy decisions.
For companies, especially those supporting beneficial ownership implementation, BO6 provides structure for engaging with governments and civil society to ensure any reporting regime is fit for purpose and meets their needs. Companies can be significant users of beneficial ownership information.
BO6 allows stakeholders to make the right decisions at the right time to optimize the benefits of having reliable information on business ownership available for use. Michael and Tim have developed the BO6 framework based on their combined experience of research and practical implementation of BO reporting across four continents.
As with any structure that needs to stand for many years, a BO reporting system needs a well-developed blueprint, solid foundations, well designed infrastructure and reliable support mechanisms. A BO system implemented on this basis is more likely to bring benefits to the economy: reduce the risks of doing business, creating higher levels of integrity and trust and allow government and the citizens to know who is really investing in their economy.
Michael Barron and Tim Law are independent consultants who have advised governments on four continents on implementing effective beneficial ownership reporting systems.
Michael previously worked as a government relations manager for BG Group (British Gas) where he led on the extractive industry transparency agenda.
Tim is a UK chartered accountant and tax professional, who previously worked for the global mining company Anglo American.