Natural Resources: Time for Accountability

By Kishan Khoday, July 18, 2012, Blog Humanum

Among the important elements of the recently issued Rio+20 Outcome Document was a focus on the state of the world’s natural resources and the important implications for achieving social equity and sustainable development. 2012 marks 50 years since the passage of the UN Declaration on Permanent Sovereignty over Natural Resources (1962), and as emphasized in Rio+20 and other major global forum, natural resources are again shaping the nature of development around the world.

The world is experiencing a convergence of increasing demand for natural resources from emerging economies, historic prices across commodity groups, a downward trend in resource supply and ecological stability, and the rise of inequality between those who develop and profit from such resources and the communities that host them. Much of the planet’s resources are located in rural areas where more than two-thirds of the 1.4 billion people currently living in extreme poverty reside. Amidst record high commodity prices and corporate profits, the gap is growing between urban industrialists and market speculators on the one hand, and rural communities who live on a treasure of natural assets but are often excluded from benefit-sharing, while also suffering the impacts of extractive industry and ecological change.

As a result of these trends recent years have seen a surge of social movements calling for more transparent, accountable and participatory governance of natural assets, and new models of growth that address concerns of justice, equity and sustainability in use of resources. A new area of interest-based social-accountability politics is moving the pendulum sharply, swinging towards rights-based, accountability-driven mechanisms, and posing questions on the nature of wealth and power in society. As we advance the post-Rio+20 agenda, progress in four areas will, I believe, prove critical:

Natural resource governance. Countries around the world are adapting to calls for social accountability. This includes new fiscal measures to better account for extractive-sector revenue, institutional frameworks to secure long-term value of ecosystems, and increasing equity in access and benefit sharing to sustain poverty reduction and prevent conflict. Reforms in the governance of energy, mineral, food and water resources, and the increasing engagement of civil society through reforms tailored to rights-based approaches and more inclusive growth, are encouraging and need to be rapidly expanded and mainstreamed.

Indigenous rights. Indigenous autonomy regimes are emerging in many countries, legal frameworks specially-tailored to recognize the unique history of indigenous peoples, customary rights of ownership, use and access to resources, and the need for prior and informed consent. Some local efforts are yielding tangible results for equity and sustainability. Beyond participation, regimes also do more by recognizing historic injustices towards indigenous communities, indigenous paradigms of nature and society, and customary law related to access to and use of natural resources.

Corporate citizenship. Many multinational and local businesses are trying to engage inclusive, green growth in energy, food, water and mineral sectors, and scope exists to scale up clean technology for less resource-intensive and toxic growth. Key multilateral platforms include the Ruggie Protect, Respect and Remedy Framework endorsed by the UN Human Rights Council in 2011, the UN-backed Principles for Responsible Investment to integrate environmental, social and governance principles into investments, and the Extractive Industry Transparency Initiative.

South-south cooperation. A marked shift from the 1992 Rio Earth Summit to the recent 2012 Rio+20 Summit is the role of emerging economies in terms of new challenges and solutions to the world’s sustainability goals. In recent years, we have seen a dramatic surge of outward investments and official development assistance from emerging economies into resource-rich but less developed countries. Emerging economies are leading new clean technology solutions to overcome resource scarcity and create foundations for a future green economy. South-south opportunities exist to integrate these trends into outward investments, with an important role for multilateral partners to exchange knowledge and best practices.

As we move beyond Rio+20, new institutional frameworks for sustainability need to arise that not only make development greener but also more inclusive, fair and just. Achieving a green economy will be about more than market mechanisms and technology transfer; it will also crucially be about issues of governance, justice and accountability.

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