ETHICS AND HUMAN RIGHTS IN THE OIL INDUSTRY
IN 2017, I was selected and invited as one of the speakers at a premier event; the 22nd World Petroleum Congress held in Istanbul, Turkey from July 9 - 13, 2017.
This global event is held every three years and attracts very senior politicians, diplomats, captains of industry and several other stakeholders.
I presented three papers in three different sessions. One of the papers I presented was on
“Ethics and Human Rights in the Oil Industry - The case of Sub Sahara Africa.”
I have decided to share with the readers some aspects of the paper which I delivered on a panel discussion on the subject matter. I will share other presentations in future columns. The paper was as follows:
This case study draws upon a topography of geo-referenced oil industry conduct which has significant ethical and human rights implications in the Sub Sahara Africa (SSA).
The oil industry is part and parcel of the wider extractive industry. Extractive industry can be defined as one that involve different activities that lead to the extraction of raw materials from the earth (such as oil, metals, mineral and aggregates), processing and utilization by consumers.
These processes take place within host countries and home countries of operating companies, as well as consuming markets (Sigma and Garcia, 2012, p.9).
According to a 2012 United Nations Conference on Trade and Development (UNCTAD) Report, in 2010, six out of the 10 largest companies in terms of revenues were from the energy and mining sectors.
These companies have enjoyed record profits over the past few years, fueled by significant and sustained rise in commodity prices before they started collapsing. Paradoxically, in developing countries where these extractions occur, the majority of the people still remain in poverty.
This asymmetric distribution of benefits arising from economic activity created by the extractive industry suggest that the industry operates as an enclave in the host country with limited linkages to the broader economy.
This gap between the profits of operating companies and local economic benefits is likely to widen if resource owners do not put appropriate policies in place to capture and retain value created from the industry.
Issues which border on unethical conduct have in the past been highlighted as a harbinger for creating and sustaining weak institutional framework.
When weak institutions are in place, human rights and ethical conduct cannot adequately be guaranteed. Before delving deeper, it is critical to contemplate the scholarly definition of ethics.
According to Northouse (2013, p.424), the word ethics has its roots in the Greek word ethos, which translates to customs, conduct, or character. Ethics is concerned with the kind of values and morals an individual or a society finds desirable or appropriate.
While there are several companies demonstrating ethical conduct, others are involved in perpetrating significant malfeasance to the detriment of the wider host communities.
More often than not, they are assisted by a few who continue to benefit for facilitating and sustaining malfeasance on the peddle of prebendalism and weak institutional frameworks.
In 2016, five West African countries agreed to ban importing dirty fuels from a named continent, a move that will dramatically reduce vehicle emissions and help more than 250 million people breathe safer and cleaner air.
Together, the countries of Nigeria, Benin, Togo, Ghana, and Ivory Coast agreed on December 1, 2016 in Abuja, to introduce strict standards to ensure cleaner, low sulfur diesel and vehicle emissions standards, effectively cutting off the West Africa market as destination for dirty fuels.
A report by Public Eye in September 2016 exposed how trading companies from the named continent were exploiting the weak regulatory standards in West African countries, allowing for the export of fuels with sulfur levels up to 300 times higher than is permitted in Europe (Atani, 2016, p.1).
This was compromising health and environment on
top of aggravating vehicle maintenance costs due to dirty fuels.
Erik Solheim, the head of UN Environment said: “West Africa is sending a strong message that it is no longer accepting dirty fuels. Their decision to set strict new standards for cleaner, safer fuels and advanced vehicle emission standards shows they are placing the health of their people first.
“Their move is an example for countries around the world to follow. Air pollution is killing millions of people every year and we need to ensure that all countries urgently introduce cleaner fuels and vehicles to help reduce the shocking statistics” (Atani, 2016, p.1).
Elsewhere within the continent, anti-corruption watchdogs and whistle blowers such as the Global Eye have linked some major players to massive unethical conduct which include payment of bribes, tax evasion and avoidance, buying of oil from anyone regardless and fuel smuggling to mention but a few thereby defrauding national treasuries of billions of dollars per annum. This is unethical conduct.
Human rights are basic standards aimed at securing dignity and equality for all. Every human being is entitled to enjoy them without discrimination.
They include the rights contained in the “International Bill of Human Rights” – meaning the Universal Declaration of Human Rights, the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights.
Those documents set out a range of rights and freedoms such as the rights to life, to freedom of expression, to privacy, to education, and to favourable conditions of work, to name a few.
Internationally-recognised human rights also include the principles concerning
fundamental rights set out in the International Labour Organisation’s (ILO) Declaration on Fundamental Principles
and Rights at Work, which addresses freedom of association and collective bargaining, forced labour, child labour and non-discrimination.
In addition, some potentially vulnerable or marginalised individuals and groups are the subject of international human rights instruments that help provide clarity on how human rights apply to them.
Human rights are not guaranteed adequately where weak institutional frameworks exist. It is my considered view that Sub Sahara Africa needs to continue improving upon its institutional frameworks and reforms in order to promote more ethical and human rights conduct within the industry.