IMPACT OF CORPORATE SOCIAL RESPONSIBILITY OF A MULTINATIONAL OIL AND GAS COMPANY ON ITS HOST COMMUNITIES
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IMPACT OF CORPORATE SOCIAL RESPONSIBILITY OF A MULTINATIONAL OIL AND GAS COMPANY ON ITS HOST COMMUNITIES
Chapter one
INTRODUCTION
1.0 Background of the Study
Business organisations have long been seen as positive contributors to the communities in which they operate. Though they have helped to create jobs, wealth, products, and services, the pressure on businesses to play a role in social concerns involving employees, stakeholders, society, the environment, and the government is growing.
The society is questioning the existence of commercial organisations, particularly in light of the scandals and frauds perpetrated by corporate organisations. As a result, organisations all over the world are being pushed to recognise the importance of corporate social responsibility (Sharma et al.2009).
Over time, the concept of Corporate Social Responsibility (CSR) has gained remarkable traction in business and public debate, becoming a strategic problem that crosses departmental boundaries and influences how a company conducts business.
It has grown so crucial that many businesses have rebranded their fundamental beliefs to incorporate social responsibility. Almost all business websites, policies, and reports discuss their CSR efforts
which have evolved into a method of verifying that the organisation is meeting all of its societal commitments and hence is suitable for a licence to operate. It ensures that the organisation can grow in a sustainable manner (Malikarjunan K 2006).
In support of the foregoing, Sharma et al. (2009) state that CSR initiatives span from small gifts to larger social welfare programmes. Sustainable practices vary from organisation to organisation, depending on the resources available for implementing sustainable practices.
The business strategies of large and successful corporations with plenty of resources at their disposal have set the trend of being committed to sustainable operations. Such companies around the world demonstrate their dedication to social responsibility. Examples include Microsoft and ExxonMobil.
Corporations are encouraged to be socially responsible on a variety of topics (Welford and Frost, 2006; Engle, 2006). However, there is uncertainty in both the corporate and academic worlds about how CSR should be defined. Some go so far as to state, “We looked for a definition, and basically there isn’t one” (Jackson and Hawker, 2001:3).
This is not quite correct; rather, the issue is that there are numerous definitions, which, according to Van Marrewijk (2003), are frequently biassed towards specific interests, preventing the concept’s evolution and application.
The definitional misunderstanding surrounding CSR could be a big issue. If competing definitions have divergent biases, people will talk about CSR in various ways, preventing constructive involvement.
Unfortunately, any attempt to construct an unbiased definition is difficult because there is no mechanism to determine whether it is truly unbiased (Dahlsrud, 2005).
According to Davis (1960:70), social responsibility refers to corporate decisions and activities that are at least somewhat motivated by factors other than the firm’s direct economic or technological interests.
Around the same time, Eells and Walton (1961) suggested that CSR refers to the issues that occur when a business enterprise casts a shadow on the social scene, as well as the ethical standards that should govern the corporation-society connection.
Drucker (2002) defines his stance on corporate social responsibility as follows: “A business that does not show a profit at least equal to its cost of capital is socially irresponsible; it wastes society’s resources.”
Economic profit performance is the foundation on which businesses may carry out their other duties, such as being a good employer, citizen, and neighbour. However, a company’s obligation extends beyond economic achievement.
Every organisation must accept responsibility for the influence it has on employees, the environment, consumers, and everyone and everything it touches. That’s social duty.
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