COMPARATIVE ANALYSIS OF THE CORPORATE SOCIAL RESPONSIBILITY (CSR) PROGRAMMES OF MASTERS ENERGY AND SC INDUSTRIAL GAS MANUFACTURERS LIMITED,
TABLE OF CONTENTS
Title Page i
Approval Page ii
Certification Page iii
Table of Contents vi
List of Tables viii
CHAPTER ONE: INTRODUCTION
- Background of the Study 1
- Brief profile of Masters Energy 3
- Brief profile of SC Industrial Gas Ltd 4
- Statement of the Problem 5
1.5 Objective of the Study 6
1.6 Research Question 7
1.7 Significance of the Study 7
1.8 Scope of the Study 8
1.9 Definition of Terms 8
CHAPTER TWO: LITERATURE REVIEW
2.1 Focus of Review 10
2.1.1 Conceptual Overview of CSR 10
2.1.2 Empirical Review of Related Studies 12
2.1.3 Theoretical framework 19
2.2 Summary of Review 22
CHAPTER THREE: METHODOLOGY
3.1 Research Design 26
3.2 Population of the Study 26
3.3 Sample Size 27
3.4 Sample Technique 29
3.5 Instrument for Data Collection 31
3.6 Method of Data Collection 31
CHAPTER FOUR: DATA PRESENTATION AND ANALYSIS 4.1 DATA Presentation and Analysis 33
4.1.1 Sample Characteristics 33
4.2 Discussion of Findings 45
CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATION
5.1 Summary 52
5.2 Conclusion 53
5.3 Recommendation 53
Corporate success and social welfare are interdependent. On one hand a business needs a healthy, educated workforce, sustainable resources and adept government to compete effectively. On the other hand, for a society to thrive, profitable and competitive businesses must be developed and supported to create income, wealth, tax revenues and philanthropy. There is therefore a shared value between business profitability and social relationship. Corporate Social responsibility (CSR) is therefore essential to winning customer loyalty in today’s highly competitive global market. Thus this study compares the CSR programmes of two Port Harcourt based companies, Masters Energy and SC Industrial Gas Limited. The aim is to ascertain how effectively both companies have implemented CSR. Both primary and secondary data were collected, while survey method was employed in data gathering. Questionnaire was the instrument used for primary data while textbooks, journals, magazines and newspapers were used for the secondary data. The research findings revealed that a well-articulated and implemented CSR programme is key to harmonious company/community relationship as well as industrial growth, an example well offered by Masters Energy. Consequently, the researcher recommends that Masters Energy should improve in her philanthropy, environmental and infrastructural developmental stride.SC Industrial, on the other hand should overhaul her PR department in order to reinvigorate a more visible and sustainable CSR programme. Deliberate and sustainable programmes should be put in place to inform, educate and implement CSR. In all, it is agreed that a deliberately planned and sustained CSR programme is panacea for peace and harmony between companies and her publics.
- Background of Study
The place of Public Relation (PR) in achieving Industrial harmony and growth is not questionable. Business experts also agree that an effective public relations, good advertising and Corporate Social Responsibility (CSR) are pivotal to tip the scales in favor of a company.
Maw Liz defines Corporate Social Responsibility (CSR) as “a business practice that involves participating in initiatives that benefit society”. Presently, CSR is becoming mainstream, as forward-thinking companies now embed sustainability into the core of their business operation to create shared value for business and society. Sustainability is not just important for people and the planet but also vital for business success, especially now that communities are grappling with problems that are global in scope and structurally multifaceted, for instance, Ebola, persistent poverty, climate change. (Maw Liz, 2012:3).
The business case for engaging in corporate social responsibility is clear and unmistakable. If properly adhered to, company owners, host communities as well as the government shall be the better for it. On the contrary, billions are at stake if fast and large scale action is not taken. Regrettably though, “companies, in the pursuit of profit have exhibited all sorts of social irresponsibility such as deceiving customers, swindling investors, exploiting and even brutalizing employees, putting consumers at risk, poisoning the environment, cheating and more. Maw Liz, in his essay “what has CSR really accomplished?” aptly observed.
Nworgu, K.O. also defines Corporate Social Responsibility as “veritable tool for effective public relations, at least, to clean up image of the companies”. He therefore advocates that corporate bodies should be responsive to their environment and to the needs of their host communities, as well as be able to make the best out of their business through profit maximization. He further opines that corporate social responsibility borders on the ability of a corporate institution to provide basic and essential social services and or amenities to the communities where they operate. Such arts are seen as a good corporate citizenship attributes. Companies must be involved in corporate social responsibility programmes and projects. This is about corporate charity as against corporate stinginess. (Nworgu, 2007:133)
Interestingly, some firms have nonetheless shown reasonable sense of responsibility by responding to the yearnings of her publics. Through engaging in charity, to providing employment and basic social amenities, their presence have become more visible and in turn well appreciated .There are now verifiable projects and programmes put in place to identify with their environment and publics. Similarly workers as well as the host community are duly carried along in order to maintain requisite standard of honesty and integrity.
These deliberate CSR policies are timely considering the rapid globalization of world economy coupled with highly competitive business environment. It is therefore pertinent that any resourceful organization must think out- of- the –box strategies to succeed and remain profitable. Moreover, the slow pace of infrastructural growth among developing countries has also intensified pressures on companies to assist in the provision of social amenities as well as employment for the people.
One thing, no doubt, is obvious, as consumer’s awareness about global social issues increases so also their knowledge of basic CSR privileges. Technology has also brought global connectivity and enhanced global advocacy and awareness for social needs that were once obscure and unattractive. It is therefore within the purview of organizations to respond to these developmental gaps and consequently create sustainable activities and programmes that will facilitate harmony and social equilibrium between companies and her publics. This is in line with Jefkins’ believe that CSR entails parting with little out of your profit and investing into the society that will in turn create enabling good will and enhanced profitability.(Jefkins F, 1998:68).
In a bid to practice CSR, it has been observed that some companies either do not have a clear-cut policy or implements it haphazardly. This research therefore will comparatively analyze the CSR programmes of two Port Harcourt based companies, Master’s Energy and SC Industrial gas manufacturing Limited.
- Brief Profile of Masters Energy
Masters Energy is an active player in the downstream oil sector, precisely lifting and storage of petroleum products. It owns a tank farm of massive capacity and has other business interest spanning across the oil & gas, banking, Insurance, Aviation, Shipping, Dredging, logistics, construction, travel agency, power, etc. Founded by a renowned technocrat, entrepreneur, philanthropist and former banker, Dr Uchechukwu Ogah. (Company profile of Masters Energy Ltd, November,2014).
It is located in Rumuolumeni community, a suburb of Port Harcourt town. An excerpt from the company’s profile indicates that Masters Energy’s CSR policy is borne out of the understanding that the host community contributes to the growth of the company. Also in the words of Mr. Emmanuel Iheanacho, manager, corporate affairs department of Masters Energy group as reported in (Thisday.com, Retrieved December 14, 2015 from http://www.thisdaylive.com/articles/creating-14-000-jobs-in-masters-energy-s-industrial-city) “we do not hesitate in responding to the needs of such environment because we believe that companies that prosper economically are also companies that operate responsibly.” According to him, “we have therefore established very harmonious and symbiotic relationship with our host communities”. An indigenous company with 100% local content. Mr Iheanacho also said that their greatest motivation towards engaging in CSR is their understanding that mutually cohabiting with their host community will maximally influence and protect their interest hence they deliberately provide services that promotes societal norms and values that is beneficial and would engender mutual trust, understanding and enabling environment for the conduct of their business. (W3.mastersenergyltd.com).
- Brief Profile of SC Industrial gas Limited.
SC Industrial gas manufacturing company limited is also an indigenous company with specialty in industrial gas production. Founded over ten years ago by Messer’s Sylvester Chiaha and Christian Chiaha, two young and astute business entrepreneurs with proven years of experience in merchandising and strategic business management. Before delving into manufacturing, they have for many years provided logistics and core material services to the oil and gas industries in Nigeria. According to Mr. Ernest Nnagbo, the project consultant, their primary target is to bridge the gap created in the oil and gas industry with regards to inadequate industrial gas supply, monopolized over the years by few players like, Air Liquid and BOC gases.SC Industrial gas manufacturing company located in Igbo Etche, a suburb of Port Harcourt town, “produce and supply both industrial and medical gas”. Their Oxygen /Nitrogen gas plant is over 400liter/hour or 400 cu metric tons/liter capacities. (SC Gas newsletter, January, 2014)
It is instructive to note that Masters Energy and SC industrial gas companies have one thing in common, their operations are highly environmentally sensitive and if not well managed may pose great hazard to the environment and the life and well being of their host communities. That indeed informed their choice as case study for this research work. (www.scgases.com).
1.4 Statement of Problem
In his essay, “Misguided Virtue: False notions of corporate social responsibility”, David Henderson (1980), argues that CSR, as an obligation, do much more harm than good.” According to him, CSR represents a clear break from traditional corporate value setting .He consequently paints picture of CSR as a policy mired in ‘ill-defined terms’ and ‘irresponsible thinking’, that could have potentially dire consequences in the developing world.
Towing the thought of Henderson, is Friedman in Nworgu (2007:134), who maintains that the one and only social responsibility of business, is to use its resources to increase its profit within the rules of the game. To him, to say that business responsibilities go further than that, is a “fundamentally subversive doctrine” and offers insoluble practical problems. He argues that ‘companies who embark on social responsibility are only reducing returns on shareholders’, which therefore amounts to spending their money on irrelevancies. In so far as corporate social responsibility programmes are money spending activities, it is still some employee’s money that is being spent, while these workers are now paid low wages, he concluded.
On the contrary, Herman in Nworgu (2007:134) opines that business responsibility to the society is beyond producing goods and abiding by the law of the society. This responsibility to society has been expressed for many years in charitable projects and public service functions (participating in school boards, fund raising for hospitals, churches and colleges).”Corporate social responsibility therefore sees leaders as serving a trustee function for the people.
The bias of Henderson and Friedman notwithstanding, the demand on companies to invest in the CSR has obviously increased in recent years, from customers to employees, suppliers, community groups, governments as well as some shareholders. So far some companies have increased their CSR budget. They now take more interest in the environment and social issues, observed McWilliams & Siegel (2000).Sadly too some companies have also resisted the pressure to invest in CSR as they believe that it contradicts their aim to maximize profits.
Obvious evidence abounds to show that Masters Energy and SC Industrial Gas Companies have an understanding of what Corporate Social Responsibility means. But what is not clear is the depth of that understanding and the extent to which they implement CSR programmes among their publics. This research, therefore, tends to comparatively analyze the CSR programmes of both companies, against the backdrop of four key underlining elements, awareness, extent, effectiveness and attitude. By awareness, the researcher will investigate the level of awareness about the companies CSR programmes amongst her publics. It will also ascertain the extent of engagement and thereafter evaluate the effectiveness of the said CSR programmes. Ultimately, researcher will investigate the attitude of the host community, in particular, towards the companies in response to, either, their CSR programmes or lack of it.
1.5 Objective of the Study
The general objective of the study is to comparatively analyze the CSR programmes of Masters Energy and SC Industrial gas manufacturers limited. Specifically, the study intends:
- To determine the level of awareness about Masters Energy and SC Industrial gas CSR programmes.
- Ascertain the extent Masters Energy and SC Industrial gas Limited engage in CSR programmes.
- Evaluate the CSR programmes of Masters Energy and SC Industrial gas limited.
- Ascertain the attitude of the host community towards Masters Energy and SC Industrial gas limited.
1.6 Research Questions
- What is the level of awareness about the CSR programmes of Masters Energy and SC Industrial gas companies?
- To what extent have Masters Energy and SC Industrial gas companies engaged in CSR programmes?
- How effective are the CSR programmes of Masters Energy and SC Industrial gas?
- What is the attitude of the host communities towards Masters Energy and SC Industrial gas?
1.7 Significance of this Study
The research is significant to the extent that an effective CSR programme should go beyond mere rhetoric to impacting positive social values into the life of a company’s publics, internal or external. In order words, the research advances the need for corporate organizations to embrace and implement deliberate measures that will transform the lives of her stakeholders: consumers, employees, investors, communities.
To that extent this research will be an invaluable resource material to companies who desire an improved relationship with her publics as well as to PR practitioners who genuinely seek an understanding of how CSR should be implemented.
Emerging scholars on CSR as well as public relations will also find in this work a dependable source of knowledge and information.
1.8 Scope of Study
Basically the research limits itself to an evaluation of the CSR programmes of Masters Energy and SC Industrial gas manufacturers companies located in Rumuolumeni and Igbo Etche communities of Rivers State.
1.9 Definition of Key Terms
Public Relations: It is a concept used to describe a deliberately planned and sustained programme geared towards maintaining mutual understanding and good image between an organization and her publics.
Corporate Social Responsibility (CSR): :In line with this study, CSR is a deliberate commitment by organizations to contribute to economic development while improving the quality of life of the workforce, and their family as well as the local community and the society at large.
Host Community: This refers to the town and community where a company or an organization is located.
Publics: these are group of people, organized or un-organized, who have direct association with an organization. They include the employees, customers ,host community.