Transparency

With good governance and accountability, the value generated from natural resources can provide a better standard of living and increased opportunities for the citizens of host countries. As part of our commitment to honest and ethical behavior, ExxonMobil is an active participant in transparency and anti-corruption programs. Transparency initiatives are designed to increase disclosure of government revenues from the production of oil, gas, and minerals, with the goal of greater accountability by governments on how they spend revenues.

We believe transparency initiatives should apply universally to all companies – publicly traded, private, and state-owned – with an interest in a country’s extractive sector; protect proprietary information; and respect the laws of a host government or a company’s contractual obligations. We support initiatives such as the Extractive Industries Transparency Initiative (EITI), the Group of Eight (G-8) Transparency Initiative, and the United Nations Convention Against Corruption. EITI is a unique collaboration among governments, companies, civil society, institutional investors, and international organizations. Together, we share the goal of implementing global principles that support improved governance through the verification and disclosure of extractive industry payments to governments and government revenue from those companies while protecting confidential company information.

Extractive Industries Transparency Initiative
Established in 2002, EITI is a coalition of governments, companies, and civil society that aims to strengthen governance by improving transparency and accountability in the extractives sector. It sets forth global principles for companies to report what they pay to governments and for governments to disclose what they receive from companies. ExxonMobil has served on the EITI Board since 2006 and rotated off the Board in 2009, so that another international oil and gas company could serve. We continue to serve as a Board alternate. ExxonMobil also serves or has served on national multi-stakeholder committees in many of the countries where we have significant production.

Working to implement EITI
As part of our commitment to honest and ethical behavior, we offer our assistance to countries seeking to implement greater transparency and disclose financial information. We provide assistance to our newest partners as they seek to implement greater transparency. At the same time, we recognize that transparency initiatives can only be sustainable when national governments have ownership and responsibility. In 2010, Iraq joined EITI as a candidate country and ExxonMobil will serve on the Iraqi EITI Council. In Papua New Guinea, our project has the potential to boost the country’s gross domestic product and provide a catalyst for employment and further industry development. Project team members from Esso Highlands Limited are active members of Transparency International and acknowledge the government’s bilateral Memorandum of Understanding.

Transparency agreements
We have been actively involved in helping to establish transparency agreements to disclose government revenues in the countries in which we have significant investments:

Azerbaijan
In February 2009, Azerbaijan was the first country among 30 EITI candidate countries to be designated by the EITI Board as being EITI compliant. In December 2010, Azerbaijan published its 12^th report on its oil and gas revenues.

Chad
Chad was accepted as an EITI candidate in April 2010 and has until April 2012 to publish a revenue report and complete the validation process.

Equatorial Guinea
Over the past several years, ExxonMobil has been active in the multistakeholder committee working to implement the EITI process in Equatorial Guinea. As part of that effort, Equatorial Guinea EITI published its first revenue report in 2010. However, Equatorial Guinea did not complete its required validation within the prescribed time period and was delisted by the EITI Board in April 2010.

Indonesia
Indonesia was accepted as an EITI candidate country in February 2010 and has until February 2010 to publish a reconciled revenue report and complete the EITI validation process.

Iraq
Iraq was designated an EITI candidate country in February 2010. A multi-stakeholder Iraqi Stakeholders Council has been established and ExxonMobil is one of three international oil companies on the Council. Iraq has until February 2012 to publish reconciled revenue reports and complete the EITI validation process.

Kazakhstan
In 2010 Kazakhstan's National Stakeholders Council published its third and fourth reports to date covering 2007 and 2008 extractive industry activities. Kazakhstan also completed its Validation process. The EITI Board deemed Kazakhstan "close to compliant" in December 2010 and Kazakhstan has until June 2011 to clarify some issues raised by the Board.

Nigeria
Nigeria submitted its final validation report in June 2010 and was designated "close to compliant" by the EITI Board in October 2010. In November, the Nigeria EITI multi-stakeholder group formed a taskforce to address the issues raised by the EITI Board. As recommended by the EITI Board, Nigeria published reconciled revenue reports for 2006 to 2008 in February 2011 and has taken action to address other recommendations. Nigeria was deemed compliant by the EITI Board on March 1, 2011.