msc final work

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Corporate Social Responsibility of Oil Firms in Nigeria and the

Contribution of the Human Resource Department in their

Strategy Formulation

(A Case Study of Shell Petroleum Development Company of

Nigeria)

By

Evelyn Cynthia Chukukere

2725575

Written in Partial Fulfilment of the requirements for the award

of masters degree in international human resource management

2009

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Acknowledgement

I thank Almighty God who gave me the strength and ability to complete this research

work successfully.

The preparation of this research work would not have been possible without the

support, hard work and endless efforts of a large number of individuals and

institutions.

I dedicate this work to my beloved husband who in all circumstances gave me the

financial and moral support and encouragement to further my education. And also to

thank him for his patient love that enabled me to complete this work and I hope that I

have done enough to make him proud.

My sincere appreciation to my children, Julianne, Jeslyn and Jayden for listening and

behaving well whenever I ask them to be quite or go to sleep when is bed time so I

can be able to do my work.

I would like to express my gratitude to all those who gave me the possibility to

complete this research work. I want to thank my course coordinator, Dr. Due Hack-

Polay, Mr. John Opute and my supervisor Elizabeth Shaw for taking their time to gothrough my work and making the necessary comments and corrections.

I have furthermore to thank my brothers and sisters for their support especially

during the time we lost our father and to my colleagues, Chinenye Onyema and

Blessing Duru, also to my friends Chidi Ughonu and Ifeanyi Okeke for helping in

facilitating this work.

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A B S T R A C T

This work is an attempt to investigate the Social Responsibility issues of oil

companies and their host communities. Specifically, this study falls within the

area of business social responsibility and the contributions of human resource in

having an effective CSR. The study is a case of Shell Petroleum Development

Company (SPDC) in Nigeria which is known as Shell and is being used

interchangeably in this project. The study is based on some simple structured

questionnaire, unstructured telephone interviews and hypotheses formulated on

the basis of some research problems. These will help to create some knowledge

about how the host communities conceive the presence of an oil company and

how an oil company responds to the demands of the host communities. The

researcher acknowledges the efforts Oil companies in Nigeria, especially Shell in

helping in advancing the Nigerian economy, assisting in the growth and

development of the rural communities they are operating in. SPDC engages

conscious corporate responsibility strategy to better lives in the operating

communities. The study prevails that drawback of these polices emanates from

the fact that they are designed without the input of the host communities, civil

societies, right activities, and other non-governmental bodies that have direct orindirect interest in the communities. The absence of environmental footprint on

the part of shell and government legislation which will be guide on the level of

obligation on the part of SPDC and restrict unending demands from the host

community makes the situation on the ground difficult for all the stakeholders.

SPDC non application of a uniform operational system helps in breeding hatred

and disruption in their operation. The level of quality control, environmental

safety and standard, communication and consultation that is present in Shells

operation in other western countries is regrettably absent in the Niger delta. This

create the doubt and the question, how socially responsible is SPDC, irrespective

of what their paper tiger claimed. How has SPDC changed or re-engineered

their social activities to reflect the situation in the current dispensation, instead of

using the same social strategy that their personnel devised in the late 1970s in

this century.

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In order to be able to do this, the following research questions were mapped out

by the researcher

1. Do oil companies consider social responsibility as a key issue in

formulating business strategy?

2. Are organisations stable when they are not socially responsive?

3. Does the negative impact of not being socially responsive affect the

overall image of the organisation?

4. Does the Nigerian government have statutory regulations on oil firms on

strategy formulation relating to social and environmental issues?

To achieve the aim of this research project, the researcher adopted a methodological

approach from a positivist perspective. Postal questionnaires were used and they

were distributed to a total of 100 people in the company (SPDC) Nigeria. The

response was good irrespective of the short period it was carried. Out of the 100

questionnaires distributed, 95 were returned. The interview was done over the phone

in which 2 males and 2 female were the interviewees.

A brief background of SPDC was stated. The social problems facing the oil

producing communities were discussed as well as their demands to the company.

This was aimed at making the reader aware of the ills the communities are facing

and the effect of their anger on Shell was also established. The impact of the HR

department and their contribution towards meeting the communitys demand was

cited to prove the extent of their commitment towards the betterment of the host

communities.

The analysis of the findings helped the researcher to answer the research questions as

well as trying to provide the answer to the aim of this research project. Although the

findings are thought to be dependable, generalisations cannot be made due to the fact

that the research was carried out in SPDC and their host environment.

These are some of the major findings of this study:

1. That shell in spite of good policies and objectives formulated to manage

social responsibility issues emanating from its business environment

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(community), could not implement them effectively to meet the demand of

the oil communities.

2. That SPDC causes the highest environment hazards in the Niger-Delta area in

the process of producing the highest quantity of crude petroleum oil and gas

in Nigeria.

3. That SPDC recorded the highest community disturbances in the oil

communities of Niger-Delta area.

4. That when organisations are not socially responsive enough to the demands

of the task environment, the environment becomes very hostile, complex,

turbulent, and makes increasing heterogonous social demands.

Based on the above findings, the major conclusion is that, although Shell has

good policies and objectives on social responsibility issues, it could not

implement them effectively to benefit the oil communities, resulting to conflict

and unstable business operation.

Then, based on the above conclusion, recommendations were made to the oil

producing communities, organisation (SPDC) and Nigeria as a whole. This study

creates the following recommendations:

1. That Shell should match policies with effective action programme to

command a peaceful and stable environment.

2. That SPDC should use awareness strategy especially community contacts toregain lost corporate image.

3. That the company should commercialise its social responsibility programme

to some extent for self sustenance.

4. That the oil producing communities should be prudent in their demand.

5. SPDC should step up its environmental pollution control measures on itsoperations in the various communities.

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6. Government should be seriously lobbied to adjust policies on the legalrequirement on oil firms in Nigeria.

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Contents

Title Page.....................................1

Acknowledgement ...................................2

Abstract.....................................3

Chapter 1

1.1Introduction.........................................................................................................8

1.1.1Area of study.........................................................................................

1.2Company background..............................................................................

1.3 Significance of the research.....................................................................

1.4Motivation of study................................................................................

1.5 Research hypothesis................................................................................

1.6Aim and objectives of the research.........................................................

1.7Summary.................................................................................................

Chapter 2

2.1 Literature review...................................................

2.2 The importance of HR in the strategic formulation of an effective CSR................

2.3 SPDC of Nigeria and social responsibility....................................................

2.4 CSR related issues............................................................................................

2.4 Summary..............................................................................................................

Chapter 3

3.1 Methodology.................................................................................................

3.2 Data collection techniques.............................................................................

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3.2.1 Primarydata................................................................................................

3.2.1 Secondary data............................................................................................

3.3 Research design..............................................................................................

3.4 Sampling Procedure.........................................................................................

3.5 Questionnaire Design.......................................................................................

3.6 Interviews..........................................................................................................

3.7 Precaution taken for accuracy............................................................................

3.8 Summary............................................................................................................

Chapter 4

4.1 Data presentation and analysis.................................................................

4.2 Interpretation of research findings.............................................................

4.3 Interpretation of interview question and responses....................................

4.3 Summary....................................................................................................

Chapter 5

5.1 Research findings....................................................................................................

5.2 Conclusion................................................................................................

5.3 Summary.....................................................................................................

5.4 Recommendations....................................................................................

5.5 Limitation of study

5.5 Areas for further research.........................................................................

References...........................................................................................

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Reflective statement........................................................................................

Appendix 1

Questionnaire.................................................................................................

Appendix 2

....................................................

Appendix 3

.......................................

Appendix 4

.................................................................................................

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Chapter 1

1.1 Introduction

1.1.1Area of study

This study is focused on the area of social responsibility issues in oil companies in

Nigeria and the impact of the human resource department in implementing strategy

formulation of these organisations. Social responsibility issues have become an

important area of management today because of increasing turbulences in the socio-

economic, political, and technological environment in which majority of business

organisations find themselves. Therefore, this study could be visualised from the

perspective of business policy and strategic management of social responsibility

behaviour of business organisations under environmental challenges (turbulence).

Oil companies in Nigeria have been associated with various types of dilemma in

Nigeria over the past years and which has resulted in different types of un-peaceful

demonstrations as serious as militancy carried out by the citizens of the

communities where the oil companies are located. According to Eweje (2007), there

have been increasing demands of these oil companies operating in Nigeria to provide

community development programmes and aid to their host communities especially in

the developing countries such as in Nigeria. Developing countries as Nigeria are lack

some of the structural infrastructures and the governments who are sometimes

unable to provide these developmental structures hope on the oil companies on most

occasions to provide these. MNCs including oil companies in Nigeria have now

made it a point of duty to publicly report the extent of the success of their corporate

social responsibilities in their host communities in order to reduce the negative

impact of not doing so could have on the image of the company.

Generally, social responsibility issues have become important factors that influence

strategic formulation in business organisations. However, the conceptual frame work

for analysis of the strategic management of social responsibility behaviour of oil

companies in Nigeria will be drawn from the literature of business policy or strategic

management. On the basis of understanding gained by making contemplated

strategic analysis of selected oil companies in Nigeria. Some suggestions will be

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made for improvements in strategy formulation process for social responsibility

issues in oil companies in general.

Company background

According to Frynas et al(2000) Nigerias oil industry came into being during the

colonial rule. Shell, a British oil company was given preferential treatment by British

colonial authorities and it is today, a dominant oil company in the country.

Previously known as Shell-BP petroleum Development Company of Nigeria

Limited, it developed from a Royal Dutch-British multinational oil company

operating in over 100 countries. The company was established in Nigeria in 1938 as

Shell DArcy by joint sponsorship of Shell overseas Exploration Co. Ltd. It was

granted licence to explore oil in Nigeria and was incorporated in 1951. Shell DArcy

was renamed Shell petroleum Development Company of Nigeria Ltd in 1956. it was

the first company to discover oil in commercial quantity in 1956 at Oloibiri-Niger

Delta area, with first commercial production of 5100 barrels per day, the company

started exportation of crude oil in 1958 (www.shell.com, accessed 10/12/09). SPDC

is among the four companies that make up Shell companies in Nigeria. It is the

largest oil and gas producing company in Nigeria and has over 6,000 kilometres of

pipelines and flow lines, 87 flow stations, 8 gas plants and more than 1,000

producing wells. SPDC supplies 95% of Nigerias commercial gas demand from

dedicated gas fields in Niger Delta area.

Authors such as Frynas et al(2000) believe that SPDCs dominance in Nigeria can

be related to the concept of a first mover advantage which basically means that

pioneering firms are able to obtain positive economic profits as a result of entering

the market early.

According to Frynas et al(2000): A micro-theoretical analysis based on the idea of a

'first mover advantage', which explores the position of individual corporate entities

within a political economy structure, provides a better explanation of Shell's

domination in Nigeria as compared to conventional macro-theoretical structuralism

approaches. (Frynas et al, 2000: 407).

Significance of the research:

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This work would be of immense significance to the business organisation especially

oil firms, government agencies, and the society at large.

This research work will make business organisations in Nigeria aware of the

importance of considering social responsibility as a key issue in strategy formulation.

It will also provide the oil companies with a better understanding on how to adjust

policies/strategies to the socio-environmental demands of their business communities

to safeguard their public image and have more stability. The government and its

agencies will also learn more about the social commitment and protective obligations

that they have towards communities and business corporations respectively.

The academic significance of this study will be for scholars engaging in research

about the corporate social responsible of oil companies to their host communities,

not only in Nigeria, but in other countries of the world. This research work can be

used as a point of reference for further research in this area.

Motivation of study

The researcher has read with keen interest a lot of media publications on the

lingering hostilities between the oil mineral producing companies and their host

communities on issues of social responsibility, but has never for one day come

across any comprehensive research work dealing with the issue. Embarking on this

research will be useful to the researchers future career ambitions as she intends to

work in a multinational organisation with high preference for the oil sector. The

researcher believes that by carrying out this research, that she will be able to

investigate to find out more about the issues related to corporate social responsibility

as it relates to oil companies in Nigeria and will be able to answer the research

questions that will be set for the purpose of this research work.

Finally, when the initial idea to research on this topic was conceived, there were a lot

of discussions with friends, relatives, and course mates. The researcher developed an

interest to investigate about the public perception of SPDC and other oil firms and

their host communities relating to CSR in Nigeria and possible strategies to control

the situation.

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Research hypothesis

Organisations do not ignore social responsibility issues in formulating business

strategies.

1. Organisations that are socially responsive do not have more stability in their

task environment.

2. Organisations that are socially responsive do not have good public image.

3. Strategy formulation for social responsibility issues is not usually

handicapped by government statutory regulations on oil corporations.

Aim and objectives of the research

The aim of this research is to investigate the corporate social responsibility issues

encountered by the oil producing companies in their host communities in Nigeria and

the importance of HR in having an effective CSR. The research will be investigating

how socially responsive the oil companies in Nigeria have been to both ethical and

discretionary demands of their host communities especially SPDC in Nigeria.

In order to aid in achieving the overall aim of the research, the researcher has come

up with some research questions that she intends to answer. They are:

1 Do oil companies consider social responsibility as a key issue in

formulating business strategies?

2. Are organisations stable when they are not socially responsive?

3. Does the negative impact of not being socially responsive affect the

overall image of the organisation?

4. Does the Nigerian government have statutory regulations on oil firms on

strategy formulation relating to social and environmental issues?

In light of the above, the objective of this research will include:

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1. To critically analyse the social audit of Shell petroleum Development

Company (SPDC) of Nigeria Limited and to find out how socially responsive

the firm is to its business communities in terms of ethics and discretion.

2. To find out whether oil corporations consider social responsibility a key issue

in formulating business strategies and how the human resource department

helps them to achieve this.

3. To investigate how stable business organisations are when they are not

socially responsive.

4. To determining whether business organisations especially oil companies have

a good public image when they are not socially responsive to the

environment and the role of human resource department in building their

image.

5. The study would also determine the effect of government statutory

regulations on oil firms on strategy formulation relating to social and

environmental issues.

6. How do we determine the satisfactory level of social responsibility or how

cana company evaluate hersocial responsibility performance?

The research will be reviewing what other authors have already written about this

research topic in chapter 2 of this dissertation and will use the information got from

this as a background to further explore on her research. In chapter 3, the researcher

will be exploring research methodologies and choosing the appropriate one to use.

She will therefore analyse and present the findings got from the research carried out

in order to reach a conclusion in chapter 5 and also make recommendations.

Summary

This chapter has succeeded in giving this research work a focus and a serious guide.

The problem and motivation that necessitated this study has been clearly defined.

Investigation is therefore intended to reveal how socially responsive oil companies in

Nigeria actually are to the community demands as there is a serious study yet on thesubject matter. Useful hypothetical formulations have been made in clear terms. The

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relevance of the study to business organisations and government has been stated. The

academic significance of the research and the motivation of the study to the research

were also stated. The aims and objectives as well as the research questions were

clearly stated.

Chapter 2

Literature review

This chapter reviews the contributions of various scholars, industrial groups,

governments, and other interested observers of the concept. The issues of Corporate

Social Responsibility are very versed. This is perhaps why the several authors

visited, defined the subject matter in a high degree of ambivalence. And yet, there

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are quit a good number of areas of congruence in the conceptual views. Taking few

definitions from various scholars might justify this claim.

The concept of Corporate Social Responsibility is still very new in Nigeria. The

Corporate Managers, Government institutions and the society at large, though deeply

involved in the concept, still have a very parochial understanding and wrong

approach to the issues (Onwuchekwa, 1996).

The major contributors to the literature are dominantly foreign scholars. There are

quite few text and research works (many of which are unpublished seminar papers)

that can approach the concept from Nigerian perspective. This has affected the

corporate managers tremendously in realizing the importance and acquiring the

necessary theoretical skills for formulating viable strategies for managing issues of

social responsibilities.

According to Kew and Stredwick (2005), corporate social responsibility (CSR) is

the way in which an organisation expresses its values in behaviour towards

stakeholders. The European Commission defines it as a concept whereby companies

decide voluntarily to contribute to a better society and a cleaner environment

(European Commission 2001), while the DTI defines it as an organisation which

recognises that its activities have a wider impact on society; takes account of the

economic, social, environmental and human right impacts of activities, and works in

partnership with other groups and organisations (DTI 2002).

Neil (1973) is of the view that corporate behaviour in recent time is responsive to

political force, public opinion, and governmental pressure; the forces which are non-

market forces have induced large companies to allocate resources to a variety of

social purposes while other authors such as

Monbiot (2001) is of the opinion that CSR is often being used slightly as a PR stunt

intended to enhance sales rather than to benefit society. However, this is principally

true of community involvement activities- it has been called cause-related

marketing the idea of using CSR as a public relations stunt can be seen in these two

examples such as Vodafone which For example, Vodafone sponsors the Englandcricket team, but in return gets endless exposure of its logo on players shirts during

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Test Matches. Tesco runs its Computers for schools project, which helps schools to

purchase computers at a cheaper rate, but only after customers have collected

vouchers to confirm their shopping in Tesco stores.

ODonnell et al, (1987) defined social responsibility as being in three parts - social

obligation, social reaction and social responsiveness.

Social obligation: A corporation engages in a socially responsible behaviour when it

pursues profit within the constraints of law as imposed by society. In their view, any

corporation that does business where profit is not maximized or outside the

framework of law is socially irresponsible.

Social Responsibility as Social Reaction: implies engaging in behaviour that is in

reaction to currently prevailing social norms, values and performance expectations".

This view emphasises that society has expectations from business and corporations

behaviour that go beyond the provision of goods and services. In their views, at

minimum, business must be responsible for the ecological, environmental and socialcosts incurred by its action. At maximum, business must react and contribute to

solving society's problem.

Social Responsiveness: Socially responsible behaviours must be anticipatory and

preventive rather than reactive and restorative. The idea here is that social

responsiveness refers to actions that go beyond social obligation and social reaction.

For any corporation to do, it means taking stands on public issues, accounting

willingly for actions to any group, anticipating future needs of society and then

moving towards satisfying them, and communicating with the government regarding

existing and anticipated socially desirable legislation. In essence, it is not when

damages have occurred that corporations should contribute in making repairs.

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Corporate social responsibility may seem to mean the same thing from a general

point of view, but it has been defined by different authors in so many different ways.

According to Davis (1980:70), social responsibility refers to the businessmans

decisions and actions taken at least for partially beyond the firms direct economic or

technical interest, while Votaw (1972:1-2) adds that social responsibility may also

refer to an obligation, a liability, social consciousness, corporate legitimacy,

charitable contributions, managerial enlightenment and so on . More recently,

scholars have defined CSR in the following ways. The definition offered by Votaw

justifies the fact that corporate managers especially in Nigeria actually know what

they should do or the right policies to apply to alleviate the burdens of our society,

failing in them leaves them accountable to the society.

These definitions presented here, and others not in sight, though originated from

different school of thought or a group of them, have one or two vital issues in

common. The most salient one being that business must be socially responsible to

the environment that offers it that legitimacy to exist The major bone of contention

is the approach or methodology. As the classical school of management maintainsthat production of goods and services at maximum profit and operation within the

limits of the law is the only method of being socially responsible, others insist on the

firms going beyond their economic selfish interests to improve the societal welfare.

Many business organisations hold the assumption that their business can thrive

without giving due attention to social responsibility issues. To them, it is wasteful

spending on social issues which as they feel, makes no contribution to profit. But

this is a very erroneous assumption. The primary purpose of a business organisation

is to serve the needs of the society. And there is no way an organisation can perfectly

serve the needs and wants of the society without considering their social welfare. In

fact, it is very inevitable for a business organisation to live in isolation of the

environment where it is located. They must live in symbioses which is called inter-

dependency in management terms. In essence, they must interact and exchange

resources. As the society offers labour, materials information and other resources,

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they expect in returns the company's output (at moderate price), social concern, and

environmental protection from the operations of the business. But many business

organisations are concerned with their product offers and the resultant profit. They

are concerned less with the demands of the society on issues.

As Onwuchekwa (1993) stated, the society makes demands on the business because

of the utilisation of resources in the area of its location. Initially, the business has

ignored these demands but today the business has started to realize that the

compliance to these demands is crucial for its survival in the society.

According to Maignan et al (2005), an organisation is considered to be carrying out a

good business ethics if it actively engages its stakeholders in the development of

sustainable strategies that will bring about economic and socially responsible

outcomes. Eweje (2007) points out that multinational corporation have faced

corporate scandals over the years for not engaging in economic and social

development of their host communities. They have in most cases in Nigeria,

neglected their host communications and this has lead to the deadly and rising issues

in the Niger-Delta region in Nigeria- home to the oil companies in the country

including SPDC. The hopes of stakeholders who are increasingly looking to the

private sector for help in areas that their governments are lacking such as in pressing

social and economic issues are sometimes left hanging (Frooman, 1997).

There has been increasing pressure on both the oil companies and the Nigerian

government from the citizens in the Niger Delta region in Nigeria to give back to the

community as much as it takes from it. These regions that contribute more than 80%

of Nigerias foreign earnings are in most cases usually faced with environmental

devastation as a result of oil exploitation and exploration. The region expects the oil

companies operating there to provide employment for their youths build schools and

provide scholarships for the community as well as reduce the impact of

environmental damage on their farmlands which has negative impacts on theirlivelihood. Frynas (2005) argues that the oil companies have initiated, funded and

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implemented a good number of community development schemes which have

included providing education, giving scholarships and building roads, but it may not

seem to be enough to the host communities maybe because they believe that the

companies are taking more than they are giving to them. According to him, global

spending by oil, gas and mining companies on community development programmes

in 2001 was over US$500 million. In economic terms, these CSR duties are not the

functions of businesses, but in less developed countries such as in Nigeria, they are

expected from these oil companies.

According to Eweje (2007), the complaints about how bad the CSR of oil companies

are, in 1995, the World Council of Churches sent observes to Ogoni land (where

Royal/Dutch Shell began operations in 1958 in a joint venture with the Nigerian

government) to find out about the contributions of the oil companies there. The

observers found out that the community had no pipe borne water, no good roads, no

electricity, no telephones and even had inadequate health care facilities. These basic

amenities were lacking and were affecting the way these communities were living

their lives. The people in these communities did not understand why they were living

at such a poor condition when these oil companies could easily provide the social

amenities necessary for them. These poor conditions causing uproar in this region

has raised questions about the behaviour of the oil companies operating in the region

which have contributed to excessive pressures on the oil companies to publicly

declare how socially accountable they have been to the region most especially the

businesses operating in such a politically and environmentally sensitive country as

region.

Not much has been done to improve the situations in the Niger-Delta region and this

has continued to lead to more aggressive protests by the citizens who have formed

various militant groups to fight their marginalisation by the oil companies. Among

them is the Movement for the Emancipation of the Niger Delta (MEND) is a popular

militant group in the Niger- delta. The members of this militant group strongly

object to the degradation and underdevelopment suffered by their region and the lackof benefits that the community has received.

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According to www.cfr.org/publication (accessed 12/01/2010):

However, while there is a revenue-sharing plan in which the federal

government distributes roughly half of the country's oil revenues among state

governors, these funds do not drop down to the roughly 30 million residents

of the Delta. In 2003, 70 percent of oil revenues was stolen or wasted,

according to an estimate by the head of Nigeria's anticorruption agency.

Although many residents used to work as fishermen, oil installations and

spills havedecimated the number of fish population and now markets must

import frozen fish, according toNational Geographic.

Recently, there has been a rapid increase in the public awareness of the

consequences of exploratory activities of oil companies especially on environmental

degradation. This has resulted into several demands on oil companies by oil bearing

communities on compensation in terms of execution of developmental projects.

Meeting these Legion of requests will imply a serious cut on profit. Inability and

or refusal by oil companies to meet these requests had often led to serious conflicts

resulting in loss of life, property, stoppage of work by the oil company, reduction on

profit etc.

The Ogoni crisis that led to the stoppage of oil production in the area has the

capacity of providing 350,000 barrels of oil per day, loss of lives and property is a

case in point. Also, the face off in 1995 and 1996 between Soku youths and SPDC in

the Soku oil field is yet another classic example (http://allafrica.com Accessed 6/12/

2009).

Other militant groups have also emerged during the past years as a result of the

marginalisation of the Niger- Delta region of Nigeria by the oil companies and the

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Nigerian federal government. Such groups also include the Movement for the

Survival of the Ogoni People (MOSOP) who fought to save their people from the

hands of their predators. According to www.cfr.org/publication (accessed

12/01/2010), this group of rebellious citizens usually comprised of young men not

satisfied at their inability to find jobs launched a non-violent campaign against the

federal government and the Royal Dutch/Shell to protest against the environmental

degradation and the how economically the region has been neglected in 1990.

Reports showed that this demonstration led Shell to cease production in Ogoni land

in 1993 therefore affecting the companys accounts, even though it may not have

been huge. The oil companies neglect of the Niger Delta region has not only caused

forms of neglect that have affected the livelihood of its citizens, but have also led to

the loss of the lives of those who were fighting to make life better for their

community. In 1995, Saro- wiwa, the leader of the demonstration against the

government and Royal Dutch/Shell and eight other members of the militancy group

(MOSOP) were executed by the military regime. This group of 9 individuals who

were executed while fighting for justice and freedom for their community were

famously known as the Ogoni Nine.

Some other groups such as the Ijaw Youth Council and the Niger Delta Vigilantes

were organized at the village or clan level mainly to extort short-term funds or

municipal development projects from multinational oil companies. The Niger Delta

People's Volunteer Force (NDPVF), which is an Ijaw militant group led by Alhaji

Mujahid Dokubo-Asari (Ijaw are Nigeria's fourth largest ethnic group), were also

another group of militants who actively fought for justice for their people.

The host communities where the oil companies are located believe that these

companies have a moral responsibility to protect the physical environment in which

they carry out their operations. The people of these communities feel disappointed

and left out where these companies do not live up to the responsibility expected of

them which is giving back to these communities. The militant groups in this region

have gone as far as attacking oil pipelines and kidnapping the expatriates workingfor these oil companies. These oil pipeline attacks and kidnapping have been

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information,and material resource needed for the business. According to

www.authenticityconsulting.com (accessed 22/01/2010), the inter-relationships and

alignment of the organisation and the environment is becoming increasingly

important. Hence, in order for these organisations to survive, it becomes necessary to

study their environment and formulate appropriate strategies that will accommodate

social responsibility issues and negotiate them into the task environment for a

domain consensus in the HR department has one of the major roles to play.

Aswathappa (2005) states that the HR department obtains environmental information

and feeds it back to the key decision makers and also play a role in the decision

making. The author further stated that the HR department helps in linking the

organisation to its environment through environmental scanning.

The standard of social-environmental concern in oil mineral producing communities

in Nigeria is very poor. Perhaps, that is what NIBORO observed and commented in

News watch (1997) that compared to their protection strategies elsewhere Shell and

other oil companies exploration activities devastate the Niger Delta, thus creating

fear of future ecological anarchy.

The oil mineral producing communities are complaining bitterly about rapidenvironmental devastation and lack of social concern for their citizens by the oil

companies, and thus pressing and increasing their social demand daily (Tell weekly,

1997). As many of those demands are turned down, the result is environmental

turbulence. Hence, the oil mineral corporations seem to be operating at high level of

uncertainty which could lead to instability and poor corporate image. Balmer &

Geyser (2003) stated that managing corporate reputation is becoming an increasingly

important strategic issue for organisations in both developed and developing

economies. Nigeria being a developing economy and a huge market makes it even

more necessary and important for these oil companies to build their reputations and

brands following the spate of corporate governance.

Reich (2007) highlights that there has been a recent and marked interest in CSR as a

strategic tool. Therefore, CSR and the corporate governance/leadership agendas are

driving the current interest in corporate reputations. Bouchikhi & Kimberly (2008),

added to this by saying that corporate scandals which could result from poor CSR

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can damage reputations of organisations and in most cases could lead to the demise

of these companies. In the researchers opinion, it is therefore pertinent for HR to

adopt a best fit approach to determine the strategic formulation of the company that

will best fit in the environment.

The overall objective of the business organisation which is survival is usually

threatened. The exit of Shell from Ogoni land (whether temporal or permanent) is a

good example of what poor strategic management of social responsibility issues can

degenerate into. It is therefore very imperative that strategic managers should be

very skilful and thorough in search for appropriate strategy/policy that is capable of

safeguarding the business organisation from undue instability and weak image.

Though, often times, expert managers might have the skills and intentions to

formulate good strategies that can accommodate the social responsibility issues of

business but, the effects are being thwarted by government statutory requirements on

business (Africa Briefing, 2008).

The Federal government of Nigeria in its response to the spats of conflicts between

oil companies and their host communities had requested oil companies to be socially

responsive while oil bearing communities were asked to be prudent in their request.

The concern of the Federal government is not farfetched because of the role of oil in

the Nigerian economy. According to Amu (1983) crude oil account is over 70% of

the nations revenue.

Panter- Brick (1978) also noted that oil is money, power, life and death in Nigeria. It

has provided the revenue, raw materials, and energy etc. needs for the countrys

industrial development. The frequent clash of oil companies and their host

communities is seen to have the capacity of frustrating federal governments

objective of developing the economy through loss of revenue. This brings a serious

problem for both economic analyst and industry watchers.

Managing the conflicts will imply that the oil companies should be responsive

socially to their host communities by designing programmes that would mitigate the

adverse impact of their operation on the immediate environment. At the same time,

oil bearing communities should realise the extent to which they can present requests.

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It is therefore the intended objective to adequately harmonise these conflicts by

providing meaningful solutions that will be beneficial to all the stakeholders in the

conflict with a view to proffering lasting measure that will address the problem of

social responsibility performance.

The importance of HR in the strategic formulation of an effective CSR

To quote www.cipd.co.uk(accessed 22/01/2010), CSR without HR runs the risk of

being dismissed as PR or shallow window-dressing. This statement supports the

view of Monbiot (2001) stated earlier, who is of the opinion that some organisations

tend to use CSR as a PR stunt which would be geared towards enhancing the sales of

the company rather than contributing to their host communities.

The CSR of an organisation gives the HR an opportunity to demonstrate a strategic

focus and act as a business partner for the effective running of the organisation. The

roles that HR play in the organisation and how it is viewed by the community help in

giving the CSR of any organisation the credibility that it needs. HR roles such as the

recruitment of the community members, their retention in the organisation and the

reward given to them as well as their training and development all encompass the

CSR of the organisation in that given community. Therefore, it may be possible at

this point to say that the CSR and HR of an organisation are most effective in

achieving organisational goals when they work hand in hand.

SPDC of Nigeria and social responsibility

According to the Nigerian Government provisions on oil production, shell operates a

joint venture (JV) agreement with Nigeria. By this provision which is applicable to

every foreign company in the industry, Shell with its partners (ELF and Agip)

remains as the operator while the government through Nigerian National Oil

Cooperation (NNOC) now Nigerian National Petroleum Cooperation (NNPC) holds

the controlling interest. A joint operating agreement (JOA) governs the

administrative and financial relations of the funding, crude lifting and sales by the

partners in proportion to their equity. A joint operating committee (JOC) is also set up

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with NNPC as chairman and JV partners as members. The committee among other

things approves annual budgets a five year work programme and any contract in

excess of $5000, 000 is referred to it. Nigeria government through NNPC controls 55

Percent equities SPDC, ELF, and Agip has 30%, 10% and 5% equities respectively

(Energy Bulletin, 1996).

The provision requires that each partner in the JV agreement pays 85% petroleum

profit tax net of costs 10% loyalty, and bears a community development expense

equal to its percentage investment. As provided by the memorandum of

understanding, this expenditure on community development comes under cost and it

is guaranteed that it would not affect the companies' profits.A 10% tax credit (up to

technical cost of $3.50 bpb) and profits margin of $2.5 bpb)was also guaranteed.

Production cost is valued at $2 per barrel. Though this costhas remained steadily at

about $1.60 for some years now, Shell considersthe $2 value as one of the lowest in

the world. The provision also guarantees SPDC an equity oil profit of $1 (US

dollar) bpd outside what it may make as technical operator. This profit is certain

when oil is sold at $15 per barrel (SPDC Annual Report: People and Environment

1996).

The above brief review of Nigeria crude oil stand is considered necessary to

investigate why SPDC is being attacked by the host communities and whether the

company is capable ofmeeting the numerous social obligations imposed on it by the

communities.This could assist the researcher in concluding appropriate strategy to

be formulated in social responsibility issues of oil firms in Nigeria. Perhaps a further

reviewon the communitys perception of the company regarding social issues and

the companys management philosophy would present a better opportunity of

achievingthe research objective.

It is highly suspected that SPDC has suffered one of the highest environmental

turbulence in oil industry today. And this could be attributed to either a poorperformance on social responsibility issues or poor strategy formulation on the same

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subject matter or both. Interviewing one of the village chiefs of Umuechem

community where SPDC operates, he said and I quote, We thought Shell was

coming to take our oil and in return give us social amenities, but this place is still in

the dark more than three decades of Shell's operation here".

The ineffectiveness of HR of an organisation could be a problem in achieving an

effective CSR, but in the case of shell in this situation, HR was magnificent in terms

of harnessing and deploying talents especially people within the community. The

human resource manager makes sure that the right talent is recruited for the quality

of the needed output point into the industry. Although in the mid 90s, Shell set up a

recruitment campaign only to discover that out of the thousands of people that

applied, not many of them will meet the minimum qualification standard that they

expect. As part of their continuous CSR in the community, the company decided to

organise an intensive training programme for fresh graduates for one year to help

train them and give them the knowledge required for a better position in the

company (www.sunnewsonline.com, accessed 16/01/2010).

This training was made possible as a result of an effective HR department in the

company and by doing this; they tried to change the perception that the community

had about the company. This also shows as stated earlier, how effective an

organisations CSR can be if it works closely with its HR division.

Several complaints, criticisms, petitions, riots and subsequent loss of lives and

properties have been observed in many communities all leading to efforts to enforce

Shell to develop their communities. In one of the cases in 1991 as reportedby News

Watch Magazine 1995, the villagers (Umuechem) felt they had not received a fair

deal from Shell.They embarked on a demonstration to compel Shell to provide them

with social amenities which became very chaotic when the company invited the

Nigeria police to intervene in the situation. Several people were reportedly killed

and lot ofproperties weredamaged. The report revealed that Shell has 52 oil wells

and a flow station in thatcommunity and produces27, 00barrels of crude oil daily

but was not engaging in CSR as expected by the community members. The paper

further reported that the same feeling is being nursed by Uzere community in IsokoLocal Government Area of Delta State, where Shell produces 30,000 barrels of oil

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daily. They regret Shell's non challant attitude towards their communitys plight

despite the above offers.

In more than 1000 oil producing communities which spread mainly in three states -

Rivers, Delta, and Akwa Ibom, the complaint is the same to them; oil exploration in

their land is a curse rather than a blessing. The central focus of their criticisms is that

SPDC has been operating in their environment (causing damages) for 30 years or

more without substantial development. A land where oil flows still lacks good access

road, electricity, pipe - borne water, better schools, health facilities voiced etc.

Manpower resource development through scholarship awards, building and

expansion of schools, donation, of educational materials, employment of their youths

and considering their people for contract jobs are equally part of their failed

expectations from Shell. These communities insisted on securing this assistance from

SPDC and its allies as the only compensation in their environment. They feel highly

deprived of their farm lands, fishing creeks, forest reserves, potable-water etc. These

are being ravaged by constant oil spillage which causes pollution. Gas flares they

say, ramshackle roofs of houses (by corrosion), produce acid rains that pollute water,

cause skin irritation, and develop respiratory diseases. The communities also

complain bitterly that SPDC always tries to wave-off their responsibility of

compensating them for oil spills, blaming it on them as acts of sabotage.

Another report, as noted by News Watch (1995) states that although Shell operates in

100 countries, 40% of spills occurred in Nigeria. This situation attributed to poor and

outdated operations and materials by Green Peace International Organisation. Such

equipments, the organisation said would be illegal in other parts of the world. SPDC

was further accused of not maintaining equal standard of operation worldwide. This

Green-peace commented that the issue of pipelines running right in front of houses

in Nigeria emphasises the fact that Shell does not apply the same standards

worldwide.

The environmental degradation caused by Shells operations is widespread across

Ogoni land. High-pressure pipelines pass above ground through villages and over

agricultural land. Some pipelines are laid within metres of houses. Others criss-cross

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land that was once used for agricultural purposes, rendering it economically useless.

The Ogoni claim that they have never seen, let alone been consulted over, an

environmental impact assessment.

According to www.newint.org (accessed 20/01/2010), it is a far cry from Shells

vaunted gentle treatment of the British countryside. When constructing its pipeline

from Stanlow in Cheshire to Mossmoran in Scotland, for example, the company

commissioned 17 different environmental surveys before cutting a single turf. Shell

however has an answer to the criticism over its operations in the Niger Delta region.

It maintains that 60 per cent of oil spills are caused by sabotage, and that therefore

the company is not directly responsible. The Nigerian Ministry of Petroleum

Resources is surprisingly in support of Shells defence because out of the 2,676 oil

spills that took place between 1976 and 1990, sabotage has been responsible for 18

per cent. The largest single cause of 38 per cent being equipment malfunction.

At the climax of these arguments and accusations against oil firms on issues of social

responsibility, Shell declared its stand. The company's position which they argued is

that it is the dutyof the Federal Government to develop the oil communities and not

the oi1 companies. It maintained that the company has moral but not legal

responsibility to develop these communities. A legal responsibilityis an enforceable

duty or mandate on an individual or group by law or by terms of contractual

agreement to discharge and such responsibility falls within defined limits. Moral

obligation or responsibilityas relates to business is a social performancedesigned

by or expected of an individual or group (organisation) to maintain a good

relationship in an environment of business. Here, one is not legally bound to

discharge such but is necessary and expected out of moral justification and for

smooth running of business operations.Although SPDC insisted that its role in the

community development is a complementary one to government efforts, they have

never achieved stability in the environment.

When the community and the environmental manager were confronted by NewsWatch magazine in 1995 on the issues, he observed that it is obvious that oil

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producing communities are not developed. That, according to him, is quite obvious

to anybody who looks at that. However, he believes that it is the responsibility of the

government to develop the land not really the private companies. In his own words,

so, when we get involved in infrastructural development, it is a complement to

governments efforts and itis also an indication of good neighbourliness. But when

thisobservation was presented to the oil communities, the counter declaration was,

"we dont know government, and Shell is the one we have been seeing". This

statement conforms with one of the statement made by a former Senator and a

lawyer from Ogoni land in one of the Shells documentary, and I quote -

"Government is like God and you don't see God, but God is everywhere. So, we

can only talk to the person we see, we see the shell company and Shell is on our

land". But one crucial question that was raised in the courseof this controversy is, if

oil firms do not have the statutory responsibility, don't they have the moral one to a

community where they operate their business and whoseland they have appropriated

forsuch activities?

At the course of discussion the management realises the importance of the question,

and reactedto it by admittingthat they really have.He further reviewed part of the

companys social audit and according to him, $20m (US. Dollar) budget on

community development programme was made available by SPDC which is a

demonstration of that responsibility. The programme he said covers education and

employment, health, agriculture, and community infrastructure. He also revealed

that Shell in 1993 alone awarded 1,100 secondary school and 430 University

scholarships to children from oil producing communities. By 1994, the secondary

school scholarships increased to 1600. He also claimed building 120 classroom

blocks, providing science equipment to 100 schools and furniture for 150 other

schools between 1986 and 1994. Chevron also claimed to have budgeted N300m for

community development this year. If the oil firms especially Shell spend all these to

satisfy the demands of the oil communities, and yet face this turbulent or unstable

environment, should we now attribute the problem to lack of effective strategy

formulation on social responsibility issues.

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In the early 1990s, the mission of business firms was exclusively economic. Today,

partly owing to the interdependencies of the many groups in our society, the social

involvement of business has increased. Society, awakened and vocal with respect to

the urgency of social problems, is asking the business managers, particularly those at

the top, what they are doing to discharge their social responsibilities and why they

are not doing more (Weihrich and Koontz, 1993). Since it is the community or

society that grants the organisations the legitimacy to operate, the organisation should

be very careful in considering social issues to avoid a revolt from the community that

offers them the vital resource exchange which an organisation may be forced to a halt.

Corporate organisations are faced with several issues of social responsibility. But

these problems vary with organisational business environment and the level of

societal awareness of the area of operation. Even in a particular area of business,

social demands vary with time. What the society considers as pressing issues today

may not be good for them overtime. Thus, Hicks and Gullet (1971) noted that our

society is dynamic and always changing, and what would today be considered best

for the firm and for the society may not be considered best tomorrow. The societal

demands in a manufacturing business environment should never be expected to be

the same with service organisation. Oil production is quite a distinct area. It has inaddition, a lot of environmental hazards.

Business managers sometimes lack the social skills to deal with the problems of the

society. Their training and knowledge is with economic matters, and their skills may

not be relevant to social problems. HR practitioners are often well equipped with

people skills and are most likely to have a clearer idea on how to deal with the

lamentations of the community where the company is operating and thereby relating

it back to those business managers who are trained about the more economic aspect

of business.

A comprehensive training and development of all employees in an organisation by

the HR department would embed the importance of engaging in CSR. The

employees would be made aware that maximisation of profit can be achieved as part

of the advantages of engaging in CSR in a community.

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It is argued that, social involvement of business boosts organisational image. Image

is goodwill and goodwill profits business. It is believed business enterprises that have

noble ideas may excel where other institutions have failed. They should therefore be

given a chance to try.

A further argument is that business corporations have the required resources to solve

societal problems. They should not wait until society rise against them in reaction to

their pressing issues before action should be taken. It is better to prevent social problems

than to spend more money in reconstruction of damages. Businesses should be

proactive rather than restorative in issuesof social responsibility.

CSR related issues

Corporate organisations are faced with several issues of social responsibility. But

these problems vary with organisational business environment and the level of

societal awareness of the area of operation.

Even in a particular area of business, social demands vary with time. What the

society considers as pressing issues today may not be good for them overtime. Thus,Hicks and Gullet (1971) noted that our society is dynamic and always changing.

What would today be considered best for the firm and for the society may not be

considered best tomorrow.

These are some of the general issues of common interest:

Environmental issues: The society demands from the business corporations

healthy environment free from air, water, land pollution; preservation of aquatic and

terrestrial lives; compensation for the effects of oil spillage and devastated farm

lands. They press for assistance in overcoming urban blight, community

development, minority education and entrepreneurship encouragement, social

welfare and involvement in fund-raising activities; checking population outburst and

breakdown of law and order as attracted by presence of business etc. These problems

are made more manifest in oil producing communities.

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Employment Opportunities: The society demand for equal employment

opportunities, employment of physically handicapped, and creation of job. Social

responsibilities of the firms should be towards an effective personnel and

employment relations policies and practices; and provision of social and leisure

facilitates (Mullins, 2005).

Better conditions of service: Provision of medical facilities, good salary offers and

periodic reviews, favourable terms of supply, workers growth incentives,

accommodation and recognition of union activities, provision of adequate safety

devices for workers especially in complex technology etc.

Poverty: Elimination of poverty by assisting in adequate supply of the need of the

society at affordable rate.

Product quality: Ensuring quality product and performance, avoiding adulteration,

deceit and selling expired products.

The corporations in addition, are expected to show interests in the arts cultural and

aesthetic values of society. They can contribute to the cultural values of the

community by sponsoring cultural activities in the community.

The enumerated issues of social responsibility above are in the basket-bundles of

Nigerias problems. But overtime, one issue seems to superimpose on the other and

overshadows it temporarily. Later on, it resurfaces and poses a major management

problem.

Today, workers demand for a better condition of service that leads to serious strikes

has been overshadowed by alarming rate of unemployment situation in the country.

Everyone seems to be looking for an employment opportunity at all cost. Although

the cyclic effect of this is being ignored by the government and corporations but later

they usually manifest in the high level of corruption affecting every part of the

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economy adversely. The increasing wave of product scarcity seems to suppress the

cries for problem of product adulteration, deceit, and sub-standard offers. Koontz,

and ODonnell shares this view when they said:

The presumption that the consumer will, if informed, act to protest his own

safety, make wise and economic decisions and voice his own views to

producers, is often challenged by evidence that consumers may still buy a

shoddy product or services because it is the least expensive and remains silent

about the lack of quality. (Koontz and ODonnell 1976:89)

This is a form of indirect denial of consumer rights which may latter culminate into

a worse reaction perhaps, a revolution. Today, oil industry is facing the community

music resulting from accumulated grievances of social and environmental

negligence. Tomorrow, it could be construction industry abandoning community

projects.

For many years now, oil has been the largest source of revenue in Nigeria. It

accounts for over 80% of the total revenue derivation and the most dominant oil

trans-national corporation in Nigeria. SPDC accounts for 40 per cent of Nigerias

total crude oil production (Frynas et al. 2000). Realizing this, the government makespolicies that favour or encourage oil exploitation but these policies often neglect the

environmental problems suffered by the oil communities. Oil production is a

technical activity that involves exploration and exploitation. It is highly sophisticated

and requires a complex technology and equipments that is capital intensive. The

investors who are of course technical partners with government expect returns to stay

in business.

Oil communities suffer ecological and environmental degradation occasioned by oil

exploration and exploitation affecting their means of lively-hood - farming and

fishing. The communities complain bitterly of air, water, and pollution which affect

their natural labiates for animals, birds, and fishes. The deep sea fishing is being

disturbed and made to pose a great risk to the fishermen, potable water, they say, is

no longer easy to come by. The pollution of water results to water borne diseases.

Gas flaring renders the roofs of houses shackled and sends dawn acid rains. Farm-

lands are polluted by oil spillage and devastated. Marine erosion is threatening the

coastal fringes of the development area. Several efforts to get government assist to

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construct embankment in order to save the coastal settlements seems to be very

unfruitful.

The oil communities have hence been demanding for adequate health facilities,

provision of good network, electricity, recreational facilities, and other

infrastructures. The communities cry for compensations for the untold hardship,

devastated farmlands, effects of pollution, and oil spillage has caused the people.

They accuse the oil companies of not employing their indigenes rather; they come in

with staff from other states. The indigenes are not considered for contract awards.

Undoubtedly, oil exploration and exploitation upsets the eco-system of any

community it is established. The communities are usually denied of their primary

activities that sustain them. Such activities include farming, fishing, grazing, small scale

trading, and forestation. Since Nigeria is still a developing nation, these communities

depend largely on these basic activities for survival. Any attempt to acquire this

natural endowment without adequate plan to improvise for their sustenance leads to

utter resistance.As a matter of fact, this kind of development manifests into high

cost of living, hunger and starvation, poverty, social insecurity and feeling of

deprivation. Social unrests should not be unexpected from such society.

Ideally, such communities should be provided with the following to balance loses: a

network of good access roads, network of electricity and constant supply of power,

well treated pipe-borne water circulated around the towns, well staffed and stocked

health institutions, adequate checks and control of epidemic diseases, award of

scholarship and other educational encouragements

The production activities should be planned to check air, land and water pollution

and where pollution could not be controlled entirely adequate compensation

provision should be made.

Small scale subsidiary industries capable of utilizing oil by-products as raw materials

should be established or encouraged to absorb the community man power resources.

This may even yield additional revenue to the corporations. In addition, the

communities would develop a feeling of belonging as they would be answering the

staff of the giant corporation. Similarly, food processing cottage industries that can

be sourcing food stuffs from neighbouring states can as well be encouraged to

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replace loses from devastated farmlands and wage hunger in the communities. This

may end up hostilities.

Oil spillage should be seriously put on check using the paid community guards who

would be held responsible for any incidence of noticed. When in an occasion of

sabotage, the community guard or guards are treated seriously; the community

members would definitely plead on their behalf. And by so doing, their interests would

change towards safeguarding their member as against demanding for full compensation.

Finally, engagement in other social activities of the communities and regular visits to

their chiefs will create very good relationship with the companies. Although, these

enumerated socialissues involve high cost to pursue, their negligence may even costmore.

Summary

Business Social Responsibility is still at an infant growth stage inNigeria in bothconceptualisation and practice. We still have very limited authors who can address

the subject matter as a full separate text andwith Nigerian background. This hasactually affected organisations perception, conceptualisation and operation of the

concept.

To avoid Government intervention and regulation, corporate managers shouldformulate strategies that will keep societal welfare in view and enjoy their freedom.

A question that arises from this study the researcher will try to find an answer to, it is

thus: What should SPDC do to wriggle itself out of this precarious situation and

enjoy a good domain consensus with its task environment as construed in the

questionnaire.

Society has become conscious about the operations of the business within its enclave

and the consequences of this operation. To survive this situation the business must

study the situation and formulate appropriate strategy/policy that will bring domain

consensus with the society where it is located. By the above views, Onwuchekwa

(1996) maintains that social responsibility demands of a business organisation

needs to be studied and appropriate strategy chosen to achieve a domain consensus

with the environment through which the organisation can survive.

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The various literary works reviewed gave varied definitions and logics concerning

the issues of social responsibility. Generally, their lines of argument and logical

presentations revolve around how and to what anextent organisation should perform

in relation to societal demands to be considered as being socially responsive .

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For this research, two population targets that are in view are the Shell management

and the oil communities in Nigeria. Since a census population cannot be made by

interviewing the whole population due to the location of the researcher and most

especially time constraints, a sample representation will be made to achieve the

desired objective.

For issues of clarity, this chapter will be grouped under the following sub-headings:

data collection techniques, research design, sampling procedure, questionnaire

design.

Data collection techniques:

Base on the nature of this research work which requires gathering information from

oil communities, SPDC management staff, and written materials, two sources of data

collection will be considered. They include:

- Primary Data

- Secondary data

Primarydata:

This concerns information collected from the original source. Here, two sets of datawill be collected through questionnaire administration to the oil community

inhabitants and the shell management. In addition to this, questions not adequately

covered by the questionnaires will be addressed through oral interviews with the

SPDC management and few heads/prominent members of the communities.

Secondary Data:

This are those sources of information already made available by earlier researchers,

authors, analysts, company records, government documented records, journalists etc.

Such data are very vital in research project because they tend to expose the

researcher on the extent of work already done by others and to identify the gap in

literature. This serves as a guide to primarydata collection and above all, it is more

economical and less time consuming compared to primary sources of data collection.

Some of the secondary sources the researchers used include books form the library,

journals, business Publications, magazines and internet sources.

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researcher has chosen to conduct an analytical survey because she intends to test

more than one variable which are the community and corporate social responsibility.

There are several methods for collecting data in a positivist study which include

postal questionnaires, internet questionnaires, telephone interviews and face-to-face

interviews. The distance of the country from which the study will be carried out has

prompted the researcher to choose a postal questionnaire method. However, there

will be a time constraint due to the distance from where the researcher is to the area

of study, and the expected number of questionnaires that would have initially been

sent out will not be realised. Also the researcher will be relying on her uncle who is

working with SPDC to help in distributing these questionnaires as well as collecting

them. He may not be patient enough to go round like the researcher would have done

if she was in Nigeria carrying out the research herself.

Collis and Hussey (2008)point out that the response rate of 10% or less are not

uncommon with the postal questionnaire method and also stated that this introduces

bias because those who respond may not be representative of the population although

they also argued that the response rates can be increased if the questionnaire is kept

as short as possible and by using closed questions of a simple and non-sensitive

nature.

The researcher has sided to make the questions not more than 2 sides of A4 paper to

avoid the participant from getting exhausted although she tried to keep the questions

as close-ended as possible. This will not only limit the length of time that will be

spent in analysing the data of the researcher but it will help in keeping the

respondents interested and not discouraged at the first sight of the questionnaire. The

researcher will try as much as possible to ensure that all the necessary information

will be obtained even with the short length of the questionnaire. The researcher

intends to distribute 100 questionnaires to some of the oil companies especially

SPDC. Some will be administered to the community members through secondary

and tertiary institutions in the state while the remaining will be shared amongst the

community elders.

Interviews

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The researcher will be using unstructured interviews which will allow more depth

into areas of discussion that may arise during the course of the interview. This will

give the respondents the opportunity to express their feelings more appropriately and

in their own language. It will also give room for the respondents to delve into areas

that may be useful for the research that have not been covered by the researcher. The

respondents especially the community members in the Niger- Delta will cease this

opportunity to voice out their grievances for the oil companies.

Although this method of unstructured interview may seem to be time consuming for

the researcher as irrelevant issues to the research may be discussed by the

respondents, Miller (1965) argues that there is no such thing as a worthless

conversation, provided you know what to listen forand further adds that questions

are the breath of life for a conversation. Therefore, the researcher will use her

discretion and time management skills to minimise the waste of time and sieve the

relevant data from the irrelevant.

The interview will be conducted over the telephone and it is important at this point

for the researcher to note that the cost of carrying out an unstructured questionnaire

will be too much. Due to distance, the researcher will have no choice than to use this

method as she would like to carry out a comprehensive interview. For the purposes

of analysing the interview responses, the researcher will record the telephone

conversations and will later note down points that she thinks are necessary for the

research. The points taken down will be transcribed and later coded.

Although the researcher is working under a tight time frame, she has devised ways to

manage her time effectively in order to make sure that each section of this research is

given the adequate attention and focus that it needs to ensure that the reliability and

validity of this research is not compromised at any given time.

Precaution taken for accuracy

Covering Letter: A brief letter will be given to SPDC management introducing the

research and its objective. The letter will help to solicit for the respondents co-

operations and assuring them of the confidentiality and anonymity that will be given

to them as regards to their participation in the research.

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Question Construction: In the first place, the respondents will be required to tick [ ]

their chosen options where applicable, or/and fill in a few information as the case

may be. Secondly, the cheap and relevant questions will put in the beginning while

more technical questions will be placed last. Generally, the language of the

questionnaires will be made very simple to avoid ambiguity and likely resultant

errors from the respondents. There is a general lap between the questions in the

questionnaire and the interview questions, though the interview questions are

rephrased to such every situation and in line with responses from the respondents.

SUMMARY

The methods adopted in the data collection are considered by the researcher to be themost effective for this research. The sampling procedure used here is stratified

random sampling. A stratified sampling permits the population sample to be divided

into groups of smaller samples from where the actual random sampling would be

carried out.

The sampling techniques are also considered very necessary as it would reflect the

opinion of the SPDC management and staff as well as the communitymembers that

feel the actual impulse of the socio-environmental situation in Niger-Delta area.

The technique that was engaged in this analysis was to calculate the percentage of

returned questionnaires and same applies to other issues like sex, marital status of

respondents and other variables of this study are as follows:

F x 100 95 X 100 = 95%

N 1 100 1

Where:

F = Frequency of response

N = Total respondents

100 = percentage base

CHAPTER 4

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DATA PRESENTATION AND ANALYSIS

The data collected are transposed in tabular format and analyzed in relation to

responses of the survey and the postulated hypothesis questions. As a matter of fact,

these will complement the reviews in chapter 2 and the interview responses.

Table 4.1

How Questionnaires were distributed and returned by Respondents in the survey

were as below.

NOS DETAILS RESPONDENTS %

I DISTRIBUTED 100 100

II RETURNED 95 95

III NOT RETURNED 5 5

IV ANALYSED 95 95

As above, 95% of the distributed questionnaires were completed and returned, and in

the other hand, 5% was not return. The reasons for the non response by those that did

not return their questionnaires are not known. The study was based on the 95%

returned questionnaires.

Question (1) what is your sex?

Table 4.2: Sex of respondents

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S/N SEX NO. OF RESPONDENTS STAKEHOLDER %

SPDC Host

Community &

the Public

A MALE 58 24 34 61.1

B FEMALE 37 22 15 38.9

TOTAL 95 46 49 100

The objective of this distribution was to know the sex of respondents and how their

specific characteristics will affect their objectivity and decisions. The malerespondents were 61.1% and their female counterpart was 38.9%. This shows that

55.6% percent are male while 44.4% percent are females, this represent the actual

percentage of male to female employees in these sectors.

The balance in the distribution where men response are more reflect the cultural

setting of the Niger Delta region in Nigeria, where men are considered first in

decision making as it relates to community welfares.

This trend was not same when the response from SPDC was cast; there are more

female contributors than those responses from the Host community and residents or

non-indigenes of these task environments. That portrays the situation with the

organized system in Nigeria, where decisions are made from opinion leaders,

irrespective of their sex.

Question (3): What is your Marital Status?

Table 4.3: Marital status of respondents.

S/N STATUS RESPONDENTS STAKEHOLDER %

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SPDC General

Public

A SINGLE 31 17 14 32.6

B MARRIED 54 22 32 56.8

C DIVORCED 7 5 2 8.4

D OTHERS 3 2 1 3.2

TOTAL 95 46 49 100

From the table for the survey responses, the singles consist of 32.6%, the married

people has a larger proportion of the questionnaire, as the objective is ensure that

accurate response of those affected more by the environmental impact of oil

explorations and related activities will be chanced to express their views.

This group with families and greater societal responsibility will judge correctly if the

SPDC is a good corporate citizen or not and will be in a good position to state how

they are benefited or not from the SPDC acclaimed social responsibility to them as

host communities, non-indigenes resident there and SPDC families living in the

region.

The categories in both divorced and others returned 8.4% and 3.2% respectively; this

did not in no way suggest that these groups are not import

msc final work

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