Corporate Social Responsibility in Developing countries: Nigeria as a case study

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TABLE OF CONTENTS

Introduction1

CSR in Nigeria2

CSR in Practice4

Critical Analysis5

Social Responsibility and Investors6

Nigeria: The Twin Challenges of Oil Companies6

Nigeria: A High-Risk Environment7

Recommendations8

Conclusion9

REFERENCES10

Introduction

Corporate case studies have shown that corporations can benefit from adopting socially responsible policies (Webster, 2009, 188). Some of these benefits include better reputation among communities, cost savings, new sustainable management strategies, increased customer confidence, and improved recruitment and retention capabilities (Weber, 2008, 247). (Rowley, 2005, 57) suggested that corporations could adopt proactive corporate social strategies instead of merely reacting to public pressure or crisis. (Mohr, Webb, Harris, 2001, 45) urged business leaders to consider executing strategies aimed at reducing the risk and the possibility of adverse consequences to organisations.

Community organisations in the Nigeria demand equal participation, the right to make decisions about land allocation and equitable distribution of oil generated wealth. Community advocates also demand the reinvestment of wealth derived from oil in the oil producing communities. Emphasising the significance of rural community involvement in developing corporate social strategies, (McWilliams, Siegel, 2001, 117) suggested that CSR need to move beyond mere public relations and compliance with regulatory requirements. (Carroll, 1999, 268) suggested the need to explore CSR based on the perspectives of people living in developing countries. In the 1960s, Shell's community relations strategy focused on providing philanthropic grants or offering what the company thought the communities desired (Bhattacharya, Sen, 2004, 9). Community roles seemed peripheral until the 1990s when pressure groups forced a shift in Shell's strategy.

A study of community members' perceptions of their roles in corporate social strategy is considered essential to improve future company-community collaboration in the Nigeria region. (Argenti, 2009, 105) argued that more attention had been given to corporate-community relations in Western industrialised nations. Less appears to be known about CSR practices in developing countries (Webster, 2009, 189). Even less evident was literature that captured the experiences and contextual issues surrounding the formation of CSR perceptions in unfamiliar regions such as the Nigeria (Weber, 2008, 248).

CSR in Nigeria

Since the 1990s, a growing body of literature about relations between transnational corporations and rural communities has emerged. (Rowley, 2005, 58) proposed an outline for corporate social responsibility that requires companies to conduct cognitive assessment of their relationship with the communities in the areas in which they operate. It has been argued that examining CSR through the lens of organisational sense-making helps organisations integrate social responsibility as a central organisational activity (Mohr, Webb, Harris, 2001, 46).

The Nigerian case demonstrates that violent conflicts could severely disrupt business operations and profitability. The Nigeria case also illustrates the need to generate empirical data about company-community relations in developing countries in order to develop effective community-based strategies. (McWilliams, Siegel, 2001, 118) discussed the relative power differences between transnational corporations and rural communities. At one end of the scale are the communities who stand in a weak power position without vital resources. The lack of power severely limits the ability of these communities to mobilise or make demands on corporations Local communities in ...