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LONDON (Reuters) - Britain's parliament will this week consider whether to probe the transparency of oil and mining firms listed in London, an issue highlighted by corruption probes at emerging market miners which MPs fear have dented the stock market's reputation.
The chairman of parliament's Committee for Business, Innovation and Skills said on Sunday he would this week propose an inquiry into issues including governance and anticorruption protection at mining and oil companies.
The probe could start before the end of the parliamentary session in July. The committee will, though, have to decide the specific terms of the inquiry.
Parliamentarian Adrian Bailey said those set to give evidence are expected to include executives from Kazakh miner ENRC and Indonesia-focused miner Bumi, both facing corruption probes that have hit already beleaguered shares. The banks that advised the two could also be called.
He said the committee had already been considering a look at the extractive industries but the current turmoil around ENRC - now facing a buyout bid from its founders that would take it private after just over five years - had given the inquiry "added significance".
"We will be looking at the issue of transparency in general. It is not an inquiry looking into just ENRC and Bumi," Bailey said, adding that the concerns raised by those two miners would, however, be central.
"We have not yet defined the focus of the inquiry, or indeed decided whether we are going ahead."
Parliamentary committees often bring political pressure to bear on companies by publishing reports and calling witnesses to evidence sessions. While their reports have no legislative weight, findings are aimed at influencing government policy.
Given the spotlight on London's reputation in recent months, the inquiry is widely expected to go ahead and could, among other things, look at the benefit of having major extractive companies listed in London.
It would also look at whether Britain should sign up to the Extractive Industries Transparency Initiative (EITI) as well as examining mining and oil companies' roles in communities and their environmental efforts.
The EITI, supported by the World Bank, was set up to improve transparency and accountability in countries rich in mineral resources.
Troubles at ENRC, the largest of the companies in question, have made it the focus of headlines and a fierce debate around foreign resources companies with majority owners. Boardroom battles and corruption probes have helped drag its share down more than 50 percent since the start of last year alone.
Indonesia-focused miner Bumi has been another listing troubled from the start. Corruption probes and a damaging shareholder battle between the founders - Indonesia's powerful Bakrie family and financier Nat Rothschild - have added to low coal prices, dragging the shares down almost 80 percent since its listing.
But Bumi and ENRC are only two of a clutch of foreign-owned resource companies that have listed in London in the past decade, transforming the once UK-focused bluechip FTSE index.
Scandals at both have overshadowed some of the successful listings, prompting questions over governance, the number of shares that should be required to be freely available for purchase and the role of willing bankers. The UK Listings Authority has proposed tighter entry rules, hoping to create a higher hurdle for companies wanting to access the London market.
The revised rules, on which it consulted with the market last year, could be published in the coming weeks.
Additional reporting by Kylie MacLellan; editing by Keiron Henderson