Monitoring impact and revenue flows in extractive communities Communities that depend on extractive activities for revenues and employment have been particularly vulnerable in the volatile situation created by the COVID-19 pandemic. Constraints on resources and mobility have hampered engagements with local stakeholders, which are a critical component of the EITI process. Yet, extractive companies and investors are placing increasing attention on environmental, social and governance (ESG) standards. Reporting ESG data can shed light on the local impact of extractive operations, as well as unsustainable government and corporate practices. Some EITI countries are demonstrating progress in this area by disclosing detailed information on the social and economic benefits of the sector. For example, Mali recently published a study examining the transfer of extractive revenues to local communities and reports on local content in service contracting. In 2020, the EITI conducted field research in Colombia, Ghana and Indonesia on local oversight of extractive activities, which identified opportunities for promoting greater community engagement. Burkina Faso To centralise the collection and transfer of extractive revenues to local communities, Burkina Faso’s government established a fund (Fonds Minier de Développement Local) intended to finance regional and local development plans. The fund collects a 1% share of monthly revenues from mining companies and 20% of the royalties collected by government. Burkina Faso’s latest EITI Report highlights discrepancies between the revenues that were owed and paid. It also documents several legal disputes between the government and companies that had not transferred expected shares in accordance with a 2017 decree. In June 2020, Burkina Faso’s Court of Auditors published a report to ascertain whether the funds were properly allocated and managed. It identified weaknesses in the revenue sharing mechanism and provided a number of recommendations to improve the management of mining revenues owed to regional and local authorities. EITI reporting has helped to shed light on issues related to the fund, and has subsequently informed national media and public debate. 18 Understanding the local* impact of extractive activities* Photo credit: Anglo American Plc