transparent GLOBAL MINING

Beneficial ownership

Who benefits?

Governments can reduce corruption risks in the mining licensing process by strengthening their beneficial ownership and integrity screening controls.

Our corruption risk assessment of 18 resource-rich countries revealed that a lack of due diligence on licence applicants and inadequate government mechanisms to prevent, detect and manage conflicts of interest in the licensing authority were a major source of corruption risk.

When the people who own, control or benefit from entities applying for a mining right are hidden behind opaque corporate structures, governments may inadvertently grant rights to applicants with a history of corruption or to entities that will not carry out the mining activities responsibly.

Doing background checks is necessary to screen in appropriate and responsible applicants and to detect conflicts of interests involving government officials and their associates. Beneficial ownership and integrity screening also help governments to evaluate the risk of tax evasion and other illicit financial flows by the prospective licence-holder.