Improving governance quality through global standard setting? Experiences from the Extractive Industries Transparency Initiative in Indonesia

Abstract

The Extractive Industries Transparency Initiative (EITI) is a global standard that aims to improve governance quality in the extractive industries sector, particularly through enhanced transparency, participation and accountability. This article analyses to what extent and how the EITI improves governance quality and thereby addresses the environmental and social impacts from extractive industries in Indonesia, a country with pronounced conflicts over natural resources. Drawing on semi-structured interviews and analyses of EITI meeting minutes and reports, we conclude that the implementation of the EITI in Indonesia helped to strengthen civil society participation and empowerment to engage in extractive industry governance, both within and beyond the EITI-Indonesia multi-stakeholder group. The EITI falls short, however, in enhancing transparency and accountability due to important limitations in the information disclosure and misalignment between the country's decentralised governance of extractive industries and the EITI's national implementation. This also means that environmental and social impacts have not become subject to serious debates within the multi-stakeholder group. We lay out some broader policy and research implications and argue that both policymakers and scholars should look beyond the narrow scope of the EITI requirements and consider the EITI's success in light of its ability to foster wider governance reforms.