Key messages

• Oversight motivates a government to follow its own rules, meet its own objectives or manage public funds in the public interest.
• Independent oversight provides assurances of integrity that internal controls alone cannot provide.
• Legislatures, the judiciary, regulatory agencies, external auditors, the media, civil society organizations or citizens provide strong independent oversight of natural resource funds in Alaska (USA), Alberta (Canada), Chile, Ghana, Norway, Texas (USA) and Timor-Leste, among others.
• Natural resource funds in Abu Dhabi, Algeria, Azerbaijan, Equatorial Guinea, Libya, Kazakhstan and Qatar suffer from a lack of independent oversight. In Libya, this has resulted in huge losses on fund investments. In Azerbaijan, large arbitrary withdrawals have undermined macroeconomic policy objectives without the possibility of objection.
• Independent oversight bodies can encourage good financial management by praising compliance with the rules and good fund governance. In some cases, they can also discourage poor behavior by imposing punitive measures ranging from reputational damage to fines, imprisonment or international sanctions.
• Independent oversight is most effective when the oversight body has expertise in the topic under investigation, possesses the power or capacity to investigate, has access to information, holds enforcement powers, and is integrated with the institutional environment.

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