body-container-line-1

The New Approach To Resource Governance In Africa -Adopting A Pro-Social Resource Governance Framework In Ghana– Part 1

Feature Article The New Approach To Resource Governance In Africa -Adopting A Pro-Social Resource Governance Framework In Ghana– Part 1
MAR 3, 2019 LISTEN

Africa has a governance problem. This is why natural resources have become a curse to the continent rather than a blessing. Natural resources in themselves are not a curse. When natural resources are properly managed, they will become a blessing and the converse is true. Management of any resource depends predominantly on the quality of the people managing it and the kind of system(s) used. These two factors are fundamental for resource governance. This means that it does not matter how much resource potential Africa has, if the fundamentals are misplaced, natural resources will not translate into tangible developmental outcomes for the continent. For Africa’s resources to work for its people, the management system(s) and managers must respectively be efficient and ethical.

It is interesting that most often, the conversation on resource governance hovers primarily around the existence and implementation of policies, laws and/or institutions. Whereas these are important, there remains one missing link: the human factor which oversees the implementation of the policies and the functions of institutions. Yet, there is very little conversation on it and even where there is, it is mostly informal and ends up on a lighter note without any commitment to remedy the situation. The importance of the human factor in resource governance cannot be overlooked as policies and institutions neither implement nor govern themselves. The quality of human behavior or characteristics in resource governance in Africa is therefore fundamental to its success.

The African continent is made up of fifty-four (54) countries which possess a vast deposit of extractive resources like gold, diamond, oil, etc. Key amongst Africa’s resource base include Ghana, Sierra Leone, Nigeria, Ivory Coast, Cameroun, Mauritania, Tanzania, etc. Ghana is the world’s tenth largest gold producer whilst Nigeria remains Africa’s largest and the world’s sixth largest oil producer. The presence of these countries and others unmentioned, in their global resource productions continue to make Africa relevant. Yet, it is not uncommon to find that these countries share challenges of poverty, inequality, high illiteracy, poor health and underdevelopment. If Africa possesses 12% of the world’s oil reserves, 42% of its gold, 80 - 90% of chromium and platinum group metals, 60% of arable land, in addition to 30% of the earth’s remaining mineral resources, then there must be a corresponding level of development seen in the African people.

The end of natural resources must be seen in people. In other words, the effect of having resource wealth must be seen in the people on whose behalf it is managed. When resources are governed without the people in mind, they do not translate into development. The approach to good resource governance therefore begins with being intentional about achieving the wellbeing of people and establishing systems or frameworks that can accomplish that. This means that human behavior is crucial for good resource governance, and the leaders to whom management of resources have been entrusted, need to adopt a prosocial behavior. Prosocial behavior refers to voluntary behavior intended to benefit others. Prosocial behavior is particularly important in the area of resource governance which often tends to be selfishly motivated. In the absence of prosocial behavior, corruption will thrive, and resources will benefit the few elite instead of the masses, as is typically witnessed in Africa. To change the African story, there is the need to shift human behavior to becoming prosocial in managing resources. An effective way to do so is to have in place a prosocial framework designed to help resource managers take decisions that will benefit the masses rather than satisfy their personal interests.

The perception people have about corruption influences the efforts made to combat it. Corruption is a complex phenomenon, which is not only caused by political and economic factors but to some extent, is also determined by cultural and social traditions. It is crucial that those who seek to fight corruption effectively first understand its nature and root cause(s) within a particular context. It is not enough to tackle corruption solely from one perspective. For anti-corruption measures to be effective, they must align with all relevant standards; not only market or social but also behavourial. This means adopting integrity standards in addition to economic principles. As African countries respond to the call to strengthen institutions, strengthen rule of law, improve transparency and accountability processes, it remains important for them to check the quality of behavior of the people they have placed in leadership. This is because once leadership is exercised by human beings, their behavior will always play a role. For example, leaders who are corrupt are inherently driven by selfish behavior, although extrinsically, weak laws, ineffective institutions, among others can contribute to creating an enabling environment. It is therefore critical that the behavior of people entrusted with the management of resources is influenced to become prosocial. Every human being has the potential to be corrupt, mainly because it is human nature to be selfish. Notwithstanding, like any human trait, prosocial behavior can be cultured.

In Africa, the fight against corruption is most often extrinsically motivated rather than intrinsically motivated. Extrinsic motivation refers to “the performance of an activity in order to attain some separable outcome” meaning it is done to attain some kind of reward or avoid some sanctions. On the other hand, intrinsic motivation is the “inherent tendency to seek out novelty and challenges, to extend and exercise one's capacities, to explore, and to learn”, or ‘’doing an activity for the inherent satisfaction of the activity itself’’. It appears that the adoption of initiatives, laws, or institutions, etc. by African countries is merely a quest to tick the box to be recognized as following international best practices. Imported models often do not work. For example, there are instances where foreign aid comes with certain conditions, causing governments to put in place measures to satisfy those conditions. Although such measures will yield positive results if adhered to, they are not necessarily driven by a conscious and collective effort by the stakeholders and therefore the commitment needed for their implementation becomes a challenge. To win the fight against corruption, anti-corruption measures must be homegrown and initiated by both the potential culprits and would-be victims, i.e. all relevant stakeholders. When this happens, the effort is collective as both groups of people recognize the benefits and costs required to deal with the menace. As Ngozi Okonjo-Iweala, a former Finance Minister of Nigeria expresses in her book, Fighting Corruption is Dangerous: The Story Behind the Headlines, “outsiders can only assist. Corruption must be fought by insiders and from the inside.’’ Even where the fight against corruption is extrinsically motivated, the drive should be mainly through internalization and integration rather than to satisfy an external demand or reward, or to avoid guilt and anxiety. “Internalization refers to people's ‘taking in’ a value or regulation, and integration refers to the further transformation of that regulation into their own so that, subsequently, it will emanate from their sense of self’’. This approach to tackling corruption can stir up stakeholders to, by themselves, strengthen policies and laws and create more effective institutions, thereby resulting in an overhaul of their entire governance system.

The journey of a thousand miles begins with a step. Whereas Africa’s story may not change overnight, one country’s commitment to effective governance can make a significant difference for its people and influence others to do same. Ghana’s buy in of a prosocial resource governance framework can be the stepping stone to bringing about good governance in Africa. Ghana has demonstrated some commitment to effective resource governance, especially in the petroleum sector. The country has passed a number of laws to promote transparency in the sector. Key among this includes the Petroleum Revenue Management Act (PRMA) Act 839 (Amendment) Act 2015, the Exploration and Production (E&P) Act 2016 (Act 919), provision for beneficial ownership in the Companies (Amendment) Act, 2016 (Act 920), among others. Ghana is also signatory to the Extractive Industries Transparency Initiative (EITI). Although these are good initiatives, a lot remains undone in tackling corruption in the sector and beyond. It is important that corruption is seen primarily as a human problem and not just that of a system failure. This is because although governance structures and institutions are necessary in fighting corruption, they cannot be effective without tackling the human aspect. This is the gap stakeholders must seek to address.

How can prosocial behavior be cultured to make the difference, watch out for Part 2.

This article is an excerpt from The New Approach to Resource Governance in Africa – Adopting a Prosocial Resource Governance Framework in Ghana,

By Linda Ahunu,

President at Lind & Associates and an affiliate of the Ostrom Workshop, Indiana University, USA.

Find full paper at http://dlc.dlib.indiana.edu/dlc/handle/10535/10414

body-container-line