UPHOLDING CORPORATE SOCIAL RESPONSIBILITY AND THE ROLE OF CIVIL SOCITIES

1. BackgroundTanzania shows unprecedented discoveries of natural gas. As of December 2014, Natural gas discoveries totaling about 8 trillion cubic feet (TCF) and 45.2 TCF have been made in onshore and offshore basins respectively. The deep - sea discoveries have brought about new exploration targets for hydrocarbons in Tanzania and the whole of Western Indian Ocean Region.While such development brings crucial opportunities to the Government and the people, for instance, through employment creation, improved livelihoods, and poverty eradication, it also brings with it dreadful risks both to people and the environment. This could be exacerbated by infancy of regulatory framework on oil and gas. Therefore, it is imperative for oil and gas companies to base their behavior on international standards, guidelines or rules of best practices that are in accordance with accepted principles of right or good conduct in the context of specific situations, even when these situations are challenging i.e., Corporate Social Responsibility (CSR).

The National Natural Gas Policy of 2013 defines Corporate Social Responsibility (CRS) as the commitment by the business to share benefits arising from the business with the community in which it operates. Beyond the ‘feel good’ outcome of such practice, CSR is an instrumental in developing and maintaining sound and trustworthy relations between business and the community.

The role of Civil Society Organizations (CSO’s) is acknowledged in the National Policy on Natural Gas, 2003 and the National Environmental Policy, 1997. The Policy recognizes CSO’s by being independent, play a critical role in implementation of environmental objectives, as they possess diverse experience, expertise and capacity.Moreover, the National Natural Gas Policy of 2013 requires the Government to ensure a contractual obligation to all investors and contractors in the natural gas

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Policy brief no. 2

2015

TANZANIA

activities to undertake locally prioritized community development programs; and ensure companies in the natural gas industry submit credible Corporate Social Responsibility Action Plans to the appropriate authority. However, it has been noted that the preparation and implementation of the CSR Action Plan is not in line with the local community needs and priorities. It is worth to note that the preparation of CSR Action Plan is not participatory and rather a top-down invasion.

The main purpose of this Policy Brief is to show the importance of the Corporate Social Responsibility in oil and gas industry, its contribution to local communities’ poverty reduction and the role of civil societies in the preparation and implementation of the CSR. Moreover, this Policy Brief is also intended to advocate for stronger voice and more spaces for civil societies particularly in monitoring compliances and auditing CSR action plan as well as ensuring accountability and transparency on investments surrounding oil and gas investments in Tanzania.

2 ContextCSR Policies of oil and gas companies in Tanzania were assessed against the international standard and practices. Mostly, the standard and good practices require that a comprehensive CSR Policy to include six core subjects, namely: human rights, good labor practices, the environment, fair operating practices, consumer issues, community involvement and development.

It was noted that most of the CSR policies of oil and Gas companies operating in Tanzania had incorporated only one subject which is “Community involvement and development”. Regarding CSR implementation, most of the oil and gas companies have made a significant effort in supporting the community in terms of health services, education, water supply, improvement of infrastructures and sports.

3 Legal and Policy ImplicationsThe Natural Gas Policy is still at infant stage (developed in 2013) and it stereotypes CSR as a philanthropic issue (sharing profit) instead of advocating for ethical corporate citizenship. The Policy prescribes that Local Government Authorities and CSOs should be involved in setting up CSR strategies, however, it is anticipated that mandate for monitoring and evaluation of the strategies shall be provided in subsequent principal legislation and regulations of natural gas.

CSR policies of most oil and gas company embrace just one core subject, community involvement and development; presumably, due to limitations existing of the Natural Gas Policy 2013. Leaving out other five CSR core subjects, which are: human rights, fair operating practices, consumer issues, the environment and labour practices.

CSOs have very limited access to relevant information and training, and lack capacity to engage in a meaningful way in the petroleum development debate or influence petroleum development or its consequences on the environment and local communities.Civil Society Organizations are not consulted in most oil and gas environmental assessment studies. CSOs are acknowledged in National Environmental Policy as critical group in environmental management. By being able to articulate environmental and socio-economic issues of the society, their comments add significant value to environmental assessments.

4. Policy recommendationsa) The National Policy on Natural Gas should provide framework that will enable

compliance of CSR by oil and gas companies and other investor in the supply chain.

b) Subsequent regulatory framework on natural gas, principle legislations and regulations, should give provisions for monitoring and evaluation of CSR policies of oil and gas companies to Local Government Authorities who should collaborate closely with CSOs

c) Companies should go beyond Corporate Social Responsibility (CSR) d) Develop and customize industry standard metrics that define and address

the community needs.e) Capacity building to CSOs on the basics of Corporate Social Responsibility

and auditing of CSR strategies of oil and gas companies.f) The EIA reports on oil and gas projects should be made available to the

public and the Environmental Management Plans provided in the EIA reports should be effectively implemented and monitored;

g) There is a pertinent need to build the capacity and enable CSOs to make a follow up on implementation of the Environmental Management Plans.

h) Where there are no national standards and guidelines, the policy on natural gas should emphasize the usage of international standards which require organizations to go beyond regulatory requirements.

i) The Government should Facilitate indigenous firms to form partnerships with international suppliers

For further information please contacts;Novati Kessy, Program Officer, Oil and Gas, WWF Tanzania country office, Plot 350, Regent Estate Mikocheni, P.O.Box 63117, Dar es Salaam, Tanzania, Email. NKessy@wwftz.org, info@wwftz.org, Website.www.panda.org

AcknowledgementIt is worth to note that most of the information which was analyzed, documented and used to prepare this Policy Brief was collected from the consultations and interviews conducted to members of Mazingira Network (MANET), and Mtwara Region Non-Governmental Organizations networks (MRENGO).

We also feel indebted if we would not appreciate the insightful comments which were given by the Oil and Natural Gas Environmental Alliance during the stakeholders meeting workshop which was held in Bagamoyo on 10th to 12th December 2014. Their views and opinions helped to recast and revisit the contents of this Policy Brief.

DisclaimerThe statements, opinions, and ideas used in this Policy Brief have been retrieved and paraphrased from desk review research studies done by Environmental and TANSHEQ Limited, Dunny Geo-informatics Consultancy and Services companies respectively. The views presented in this document don’t reflect the official positions of the organisations or individuals involved.

World Wide Fund for Nature (WWF) is one of the world’s largest and most respected independent conservation organizations. WWF’s mission is to stop the degradation of the earth’s natural environment and to build a future in which humans live in harmony with nature.info@wwftz.org