Towards improved Governance of the Extractive Industry for Sustainable Future

Compostela Valley Transparency Initiative

Our Core Principle

• Multi-stakeholder Approach can very best demonstrated when,–“Honest people is communicating

honestly with equally honest people…” (Mr. Rey Millan, member, Multi-stakeholder Council)

Our Inspiration

• Compostela Valley has lots of natural resources – fertile lands, thick forests, vast minerals dominantly GOLD.

• Mineral resources can only be a significant endowment for sustainable development when properly managed

• GOOD GOVERNANCE is the KEY. This is our covenant to our people as Stakeholders

Benchmarking Transparent Governance

• Later part of 2010, the Provincial Government together with other stakeholders shared their thoughts if TRANSPARENCY in the MINING INDUSTRY is possible – we all said YES!

• An Interim Council was organized.• Continued dialogue among stakeholders were undertaken,

discussing several mechanisms for transparency• From a very few CHAMPIONS, it multiplied in number• Learning our ASEAN neighbor experience

(Bojonegoro/Blora) – drawing more inspiration• In 2012, the Multi-stakeholder Council was formalized

with the issuance of EO 020-2012

• Oath-taking of the Council last November 2012

Mandate of the Council

• Institute policies, programs and mechanisms ensuring transparency and accountability in the mining industry both large and small scale mining projects in the province

• Formulate, design and approve the Guidebook, tools and instruments for transparency and accountability in the mining industry;

• Design and implement reporting template for disclosure of information

Mandate of the Council

• Conduct periodic review and monitoring of compliance by respective stakeholders to the policies, programs and mechanisms for transparency and accountability

• Prepare annual budget for inclusion in the annual appropriations of the Province.

Scope of Transparency Mechanisms

• Publish What You Say – disclosure of the whole Free and Prior Informed Consent (FPIC) processes among the Indigenous Peoples

• Publish What You Should Do – disclosure of the terms and conditions of the agreement signed by IPs and Mining Companies and Cooperatives including monitoring of compliance

Scope of Transparency Mechanisms

• Publish What You Pay – disclosure of payments by mining companies and cooperatives and Ore Processors to the LGUs and IPs

• Publish What You Receive– disclosure of payments received by LGUs and IPs

• Publish How You Spend – disclosure by LGUs and IPs how they allocated and utilized their respective revenues

• In July 26, 2013, the Council approved our Transparency Handbook that articulates our RULES and Reporting Templates

A Glimpse of the Handbook

• The Handbook articulates the following:– Objectives of our transparency mechanisms– Core Principles of our Transparency

undertakings– Rules on Information Disclosure and

Reporting– Report Template

Core Principles• In addition the Principles of EITI which we

adopted, the following are our stipulations:– We affirm that good governance of the extractive

industry shall start from the full and genuine recognition of the rights of the indigenous peoples to freely come up with an informed decision through full disclosure of vital information in accordance to their customary consensus building practices whether to allow extraction of mineral resources or not where all of these are explored and developed within their ancestral domains

Core Principles

• We believe that enhancing capabilities of the indigenous peoples towards transparent and accountable governance of their communal resources and wealth derived from the development of extractive industry within their ancestral domains will strengthen their constitutional right to self-governance where collection of royalty payments and expenditures are openly and publicly disclosed.

Core Principles

• Finally, we believe that multi-stakeholder approach to transparency and accountability in the extractive industry can only be institutionalized “when honest people are communicating honestly, with equally honest people.” Thus, we commit to collaborate, cooperate and complement grounded on mutual trust and shall not make any actions, statements and pronouncements that can create mistrust among each other.

Champions continue to MULTIPLY

• 9 months after the Creation of the Multi-stakeholder Council, several stakeholders wanted to take part

• To ensure inclusive participation, EO 020-2012 was amended, and EO 018-2013 was signed expanding the membership.

Transparency RULES

• Reconciliation of reports is not an audit process, however, it should be held as a consultative and dialogical mechanisms wherein discrepancies are comprehensively identified, concrete positive actions are agreed and lessons are clearly documented.

Reporting Process

• Report Preparation

Notice / Statement of Commitment

Orientation on the Report Template/ Validation Process

NCIP (FPIC/ Contracts disclosure

MINING INDUSTRY (Revenue Payments)

LGUs/IPs (Revenue Collection/ Utilization

Reporting Process

• Report Validation

Formation of Validating Teams

Pre-Validation Conference

On-site Validation

Report Consolidation

Reporting Process

• Report Reconciliation

Hiring of Reconciler

Review of the Validation Report

Communicate Findings/ Request

for additional documents

Review and Approval of the

Reconciled Report

The Report TemplatesReference

CodeTitle Description Expected

PreparerTICV-001-2013 FPIC

Transparency Report

Provided relevant information on the process and results of FPIC Activities.

National Commission on Indigenous Peoples – Compostela Valley

TICV-002-2013 Community Contracts Disclosure Report

Discloses Terms and Conditions of the Memorandum of Agreement between the indigenous peoples and Mining Companies or Cooperatives and other entities engaged in mining activities including status of compliance.

National Commission on Indigenous Peoples – Compostela Valley

The Report TemplatesReference

CodeTitle Description Expected

PreparerTICV-003a-2013

Large Scale Mining Companies Revenue Payments Disclosure Report

Discloses payments by large scale mining companies to National and Local Government including payments to indigenous peoples.

Large Scale Mining Companies

TICV-003b-2013

Small Scale Mining Cooperatives and Other Entities Revenue Payments Disclosure

Discloses payments by small scale mining cooperative and other entities engage in mining to Local Government including payments to indigenous peoples.

Small Scale Mining Cooperatives and other Entities such as CIP Operators and Quarrying Permittees

The Report TemplatesReference

CodeTitle Description Expected

PreparerTICV-004a-2013

Provincial Local Government Revenue Collection Disclosure Report

Discloses information on actual revenues collected by the Provincial Government.

Provincial Treasurer’s Office

TICV-004b-2013

Municipal Local Government Revenue Collection Disclosure Report

Discloses information on actual revenues collected by the Municipal LGU.

Municipal Treasurer’s Office

The Report TemplatesReference

CodeTitle Description Expected

PreparerTICV-005-2013

Indigenous Peoples Revenue Collection Disclosure Report

Discloses information actual revenue collection of indigenous peoples.

Indigenous Peoples Organization/ Council of Elders/ Tribal Councils

TICV-006-2013

Indigenous Peoples Revenue Expenditure Disclosure Report

Discloses information on actual expenditures of indigenous peoples

Indigenous Peoples Organization/ Council of Elders/ Tribal Councils

Material Information

• FPIC Transparency Report– General Information of the Agency– Objectives and Brief Narrative on the context– General Information of the Ancestral Domain (people,

land and customary laws)– Company Information– Mining Project Brief Description– Participation Mix in each mandated activities– FPIC Fund Utilization– Self-Assessment (Yes or No) and Recommendation for

positive actions

Material Information

• Community Contracts Disclosure– General Information of the Agency– Objectives and Brief Narrative on the context– General Information of the Ancestral Domain

(people, land and customary laws)– Company Information– Terms and Conditions– Compliance– Self-Assessment (Yes or No) and Recommendation

for positive actions

Material Information

• Revenue Payment Transparency– General Information of the Company– Objectives and Brief Narrative on the context– Production and Sales Disclosure– Revenue Payments (Tax and Non-tax) for both

National and Local Impositions– Social Development Fund Disbursement (Large

scale mining companies only)– Self-Assessment (Yes or No) and Recommendation

for positive actions

Material Information

• Revenue Collection Transparency– General Information of the LGU/ IP community– Objectives and Brief Narrative on the context– Annual Collection Statement both for metallic and

non-metallic– Revenue Collection Efficiency (except for IP)– Self-Assessment (Yes or No) and Recommendation

for positive actions

Material Information

• Revenue Expenditure – General Information of the IP community– Objectives and Brief Narrative on the context– Budgeting Policies– Disbursement Policies– Annual Statement of Expenditures– Self-Assessment (Yes or No) and Recommendation

for positive actions

Publication Rules

• All reports received shall be kept confidential until completion of the validation process and approval by the multi-stakeholder council for full disclosure and dissemination.

• Within 15 days upon completion of the validation and reconciliation process, the MSC shall convene to review and approve the report. Not later than 30 days after the approval of the report, the secretariat shall ensure the printing of the report and posting to the assigned websites.

THANK YOU VERY MUCH. HOPE WE HAVE INSPIRED

YOU TO CONTINUE TRAVERSING THE PATH

TOWARDS TRANSPARENCY…