Gooch

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in a publicly accessible registry. “We need to shine a spotlight on who owns what and where the money is really flowing,” Cam-eron said.

Charmian Gooch couldn’t have said it better herself. Indeed, she had been saying it for years. Gooch is a co-founder and di-rector of Global Witness, a London-based nongovernmental organization backed by hedge-fund billionaire George Soros that’s devoted to fighting corruption in the developing world. For 21 years, work-ing undercover and rooting through court documents, Gooch and other Global Wit-ness researchers have used dogged inves-tigative techniques to reveal suspect oil deals across Africa, document the Khmer Rouge’s destructive logging operations in Cambodia and, in its most-publicized campaign, expose the blood diamond trade that once fueled warfare in Angola, Liberia and Sierra Leone.

In virtually every corruption case Global Witness has pursued, Gooch says, she and her colleagues have found one el-ement in common: Perpetrators stashed their loot in daisy chains of untraceable shell companies, which are corporate en-tities that constitute little more than a post office box in offshore havens such as the

British Virgin Islands. “Anonymous com-panies are not in and of themselves the crime; they are the getaway car,” Gooch, 49, says in Global Witness’s offices in the shadow of the City of London’s high-rises. “This is a massive failure of our financial system that’s happening right under our

noses. And that has a real impact on hun-dreds of millions of people in countries all over the world. This just has to change.”

Since 2010, Global Witness has worked with a coalition of NGOs lobbying po-litical leaders in London, Brussels and Washington to force companies to iden-tify their ultimate, or beneficial, own-ers. New Zealand is the only country that makes shareholder data available to the public, according to OpenCorporates, a London-based group that maintains an extensive database on companies. Some jurisdictions, such as Delaware, require so little data that a company can be regis-tered in less than an hour.

Gooch’s transparency movement is picking up momentum. In July, Parlia-ment began consideration of Cameron’s bill, which would make the U.K. the first member of the Group of Eight nations to do away with what he calls a “cloak of se-crecy” enveloping shell companies. “I applaud the U.K.,” says John Cassara, a re-tired special agent with the U.S. Treasury Department’s Office of Terrorism and Fi-nancial Intelligence. “This is a big step in the right direction.”

The European Union is debating a sim-ilar bill that may be voted on by the end of this year. And a bipartisan group of U.S. senators is co-sponsoring a bill that would require all 50 states to identify the bene-ficial owners of ventures incorporated in their jurisdictions.

Mo Ibrahim, a British-Sudanese tele-communications billionaire, says the stakes are huge for the developing world, including among African nations heavily dependent on oil and mining deals. More than $1 trillion is lost to bribery and state looting annually, according to the World Bank. “This is something that needs to be addressed urgently, and Charm-ian has been instrumental on this issue,” says Ibrahim, whose foundation has cre-ated the Ibrahim Index of African Gover-nance to assess the quality and probity of the continent’s leaders. “There’s no need for anonymous shell companies unless you’re trying to hide ownership. So why are we enabling shady characters to do shady stuff?” PR

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Starting with a $10,000 donation in 2000, George Soros has become one of Global Witness’s top backers.

On Oct. 31, 2013, U.K. Prime Minister David Cam-eron took the stage at the Open Government Part-nership conference in London and announced a decision that anti-corruption activists had been seeking for three years. He told his audience of public officials from around the world that he’d found a simple way to root out tax cheats, fraud-sters and crooked politicians: He was going to in-troduce legislation requiring all companies based in Britain to disclose who their ultimate owners are

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A self-described “lifelong trouble-maker,” Gooch says that from the time she was growing up in London, her par-ents taught her to question authority. Af-ter graduating in 1987 from the University of Wales, Aberystwyth, where she studied history, Gooch landed a job that enabled her to fulfill her family credo. She became a researcher at the Environmental Investi-gation Agency, a London-based NGO that exposes polluters and poachers. Probing black markets in ivory in the Middle East and Hong Kong, Gooch says, “I learned about corporate structures, how money moves around.”

In 1993, Gooch and two kindred spirits from the EIA, Simon Taylor and Patrick Alley, formed Global Witness to expose what she calls the “nexus of corruption, natural resources and conflict.” “This was about the looting of entire countries,” Gooch says. “To us, this was a human rights issue.” At the outset, they asked for donations at London Underground station entrances. Then Oxfam Novib, a Dutch charity, provided enough money so the trio could begin their first campaign, on the Cambodia-Thailand frontier.

They decided to build their activism on facts they collected themselves in the field. Posing as timber buyers, they vis-ited logging camps to document how the Khmer Rouge, Cambodia’s communist in-surgency, was collaborating with Thai in-terests to cut down hardwood forests in violation of a United Nations ban. One night, a guard at a Khmer Rouge check-point stopped the car in which Alley and

Gooch were traveling. “He was out of his head on something, and he leaned into the car with an AK-47,” Alley recalls. “We just said to the driver, ‘Go! Go!’” Because of Global Witness’s work, the Cambodia border was closed to Thai timber imports.

In 1997, Gooch traveled to Angola to probe how militants were mining

diamonds to perpetuate a civil war that had convulsed the southern African na-tion since the 1970s. Reinforcing a reputa-tion for toughness she acquired by shoving a would-be mugger down a stairwell in Angola, she gathered information on the gemstone supply chain from government officials and businessmen in the capital of

Luanda and in the diamond-trading cen-ter of Antwerp, Belgium. With Taylor and Alley, Gooch went to Lisbon to interview members of the anti-communist group National Union for the Total Indepen-dence of Angola, known as Unita, about mining operations in their territory.

In 1998, Global Witness published an

expose of how Unita, over a six-year pe-riod, had raked in $3.7 billion from di-amond sales to purchase arms. Unita supplied most of the stones to Luxem-bourg-based De Beers. In 2002, De Beers, its competitors and 50 nations agreed to a system ensuring that diamonds didn’t originate in war zones. Global Witness’s work inspired Blood Diamond, a 2006 film starring Leonardo DiCaprio.

Gooch then turned to scrutinizing oil deals. BP Plc and other majors secured off-shore drilling rights in Angola by making undisclosed signature bonuses to the gov-ernment of President Jose Eduardo dos Santos and state-owned oil company So-nangol EP. While such transactions were standard industry practice worldwide, for Gooch, this opaque arrangement fos-tered corruption. In 1999, Global Witness released a report calling on BP and other oil giants to disclose details of their pro-duction deals. “How can a parliament or

Global Witness’s drive to make company ownership and corporate spending more transparent is transforming the way companies do business.


2 0 0 1 : A N G O L ABP CEO John Browne heeds GW’s call for oil majors to disclose signature bonuses paid to secure offshore deals.

2 0 0 2 : A N G O L A , L I B E R I A , S I E R R A L EO N EDe Beers agrees to certify that its gems don’t originate in war zones after GW exposes trade in blood diamonds.

2 0 1 0 : U. S .Congress directs oil and mining firms to disclose payments made in development deals after lobbying from GW.

2 0 14 : U. K .Prime Minister David Cameron, embracing GW’s transparency push, introduces a law requiring companies to make public their true owners.

2 0 12 :D E M O C R AT I C R E P U B L I C O F C O N G OThe IMF stops loans to the DRC after GW campaigns against mining projects owned by anonymous shell companies.


the media or the public hold their own government to account for billions of dol-lars in revenue if it isn’t being reported?” Gooch asks.

John Browne, who was then BP’s chief executive officer, says he was jolted by Global Witness’s report. “For me, the re-port reset the agenda on transparency,” he says. In 2001, he directed BP to disclose that it had paid a $111 million signature bo-nus. “We could see more places where we would do similar business,” he says. “I felt we should let people know what we were doing, and we wanted countries to explain what they were doing with the money.”

What’s more, Browne enlisted the help of Tony Blair, then the U.K.’s prime min-ister, in supporting the formation of the Extractive Industries Transparency Ini-tiative in 2003. Today, the EITI, compris-ing 29 nations and dozens of energy and mining companies, maintains a voluntary system for disclosing taxes and other pay-ments companies make to governments.

By 2000, Gooch and Global Witness had won another influential ally: Soros. Begin-ning with a $10,000 donation, the investor has gone on to become one of the top back-ers of Global Witness, which reported in-come of 7.8 million pounds ($13 million) in its 2012 fiscal year. “They think ahead and

find an opening for bringing about signifi-cant change, which is fairly strategic,” So-ros says in a telephone interview.

In March, TED, which organizes a global conference series, awarded Gooch its $1 million TED Prize for her shell compa-nies campaign. The Skoll Foundation, a philanthropy founded by technology bil-lionaire Jeff Skoll, granted Global Witness $1.2 million for its work. “By highlighting the importance of transparency, Charm-ian Gooch and Global Witness have moved global business towards better, fairer, more sustainable practices,” former U.N.

Secretary General Kofi Annan says in an e-mail. Annan now chairs the Africa Prog-ress Panel, a Geneva-based economic de-velopment group.

Gooch started formulating her strat-egy for going after shell companies in the wake of Global Witness’s 2009 probe of

mineral deals in the Democratic Repub-lic of Congo. Her organization found that the state sold off copper and cobalt depos-its at below-market prices to shells in the British Virgin Islands that didn’t disclose their beneficial owners. In December 2012, the International Monetary Fund stopped a $532 million loan program to the central African nation, citing the DRC’s failure to share details of a mining contract.

In 2010, after lobbying G-8 members to embrace transparency, Gooch and her al-lies scored a victory when the U.S. Con-gress passed the Dodd–Frank Wall Street

Reform and Consumer Protection Act. Two provisions embedded in the legisla-tion directed U.S.-listed energy and min-ing companies to disclose to the Securities and Exchange Commission how much they pay governments for production rights on a project-by-project basis.

The U.S. Chamber of Commerce and the American Petroleum Institute, Big Oil’s Washington lobby, saw the energy provision as a violation of their members’ right to protect competitive information, says Stephen Comstock, the API’s direc-tor of tax and accounting policy. In 2012, in an action that’s pending, the two indus-try groups sued the SEC to block the new rules.

For Gooch, such jousting is well worth the breakthrough she’s made in advancing the cause of corporate transparency. As she anticipates the establishment of the U.K.’s public registry for shell companies, Gooch recognizes that it’s just one step in a crusade two decades in the making. “Whether it’s big polluters or tax avoiders or corrupt politicians, they all use this ve-hicle,” she says. “But it takes a lot of differ-ent solutions to go after corruption. And this is like any big movement; it’s not go-ing to happen overnight.”

Edward Robinson is a senior writer at Bloomberg Markets in London. [email protected] B

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Near Koidu in Sierra Leone, a country racked by civil war from 1991 to 2002, miners pan for diamonds.

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Gooch