PROJECT TOPIC- CHALLENGES OF SOCIAL RESPONSIBILITY TO CORPORATE MANAGEMENT A CASE OF CHEVRON TEXACO

ABSTRACT

This study is on the challenges of social responsibilities to corporate management in Chevron Texaco Warri. These challenges are some of the problems that the organisations encounter in trying to perform their social responsibility and in achieving its corporate goals. The total population of the study was 75, a sample size of 43 was used to administer questionnaire while 38 were returned and used for analysis via simple percentage. Some of the major findings include: Management dilemma in deciding how to implement high profitable project, which has a negative social effect on the community, and deciding to what extent should they respond to social demands of their host communities (external stakeholders) at the expense of their inside stakeholders [shareholders and employees].  The researcher recommends that decisions showing both high profitability and high social benefit should be adopted, so as to avoid project that are considered dangerous to the well being of the community and would lead to social crises. Community development programmes should also involve more loans for community entrepreneurs, skill development to enable the youths to be self-employed as a panacea to the risk and challenges of employing unqualified community youths. In spite of these additional challenges to corporate management arising from social responsibility needs and obligation, social responsibility remains a critical consideration for a company’s strategic decision makers [corporate management] since the mission  statement must express how the company intends to  contribute to society that sustains it. A firm needs to set social responsibility aspiration for itself, just as it does in other areas of corporate performance. It is an obligation that must be perform for the whole society as a matter of duty and without being told or ordered by law to execute them.

CHAPTER ONE

INTRODUCTION

1.1    BACKGROUND OF THE STUDY

In the early nineteenth century, the only and major concern of many business organisations was about how much financial profit they could make. The community at large equally used profit making as the only yardstick for measuring the effectiveness of management. But within the past few decades, there have been pronounced changes in the views of many organisations about their social responsibilities. Hicks and Gullet (1981) argued that organisations especially in the business sector are no loner viewed as totally private endeavours that are free to pursue their own ends as long as they break no laws.

In view of this, the interrelationship between organisation and their environment has become increasingly important, since these business organisations draw their work-force from the community, sell their products or services to consumers in the society, purchase their supply from other firms. As a result, business organisations should consider themselves as owning social responsibilities to the community as well as to their own interest. (Okafor and Udu 2002). None of these stakeholders should be neglected by the business entity. The outcome of this notion is a rising public clamour for social responsibility (social responsiveness) on the part of business.

All these claims have made the issue of social responsibility of great concern to business. This is as a result of the fact that business cannot solve all society’s problems with its limited resources. Yet, they are expected to get actively involved in getting them solved. Another area of social responsibilities is for business organisations to consider the needs and interests of those that might be affected by their actions. For example oil companies are known to have polluted farmlands and fish ponds with their oil spillage without adequate compensation to the affected communities. Davis and Blomstrom (1975).

It is further contended that organisations especially oil companies must be responsive to the feelings of the people in their environment because their actions are seen as having public consequences that go beyond serving customers and paying returns to investors, government, employees and the society. Therefore, the business organisations are expected to ameliorate their problem and make the community a better  place to live. Pertinent to this, business organisations are expected to carry out their social responsibilities since the

needs of the society if unattended to turn into social ‘diseases’ and no institution whether business, university, or government is likely to thrive in a diseased society. (Uzoaga, 1976). In Nigeria, businessmen have been relatively insensitive or have overtly isolated themselves from the problems peculiar to the areas in which they live and amass their wealth. In the USA and Britain, businessmen, scholars, and the media have made numerous speeches, reports in different forums on the very important issue of social responsibility.

According to Epstein (1976), some large USA corporations have started to include “Social Audits”, “Social Action Reports”, or “Social Balance Sheets” in their annual reports. These include company performances with regard to societal pressing. social issues such as racial or ethnic minorities, women, the physical environment, under-developed nations, consumers, employers and the general community. Because of the sensitivity of this problem, big corporations have established departments such as public affairs and environmental relations

under the leadership of a top executive who appraises the managing director of what society expects from business and ensures that they are implemented. Schools of Business Administration in USA have established courses such as Business and Society to bring about awareness of social responsibility to future managers. (Nwachukwu, 1988). It is in this context that the researcher hopes to find out the challenges of this social responsibility to corporate management. The historical background of the firm used for this study Chevron Texaco Nigeria,

according to its official website, is a product of a recent merger between two American energy giants, Chevron and Texaco Corporations. The company is involved in crude oil and gas exploration and production, and petroleum products marketing in Nigeria. It operates NNPC’s (Nigeria National Petroleum Corporations) oil mining leases in the on shore and offshore Niger Delta and provides about 2,000 jobs in the country. Over 90% of these are held by Nigerians. Chevron Texaco Nigeria has recorded several milestones in the history of the Nigeria energy industry as expressed in the following records:

  • First offshore discoveries in Nigeria in 1963 the Kaluama and Okan fields.
  • First Nigeria major project to gather and process natural gas, in 1997
  • Discovery of the Agbami field (estimated to contain 1 billion barrels of crude oil, one of the country’s largest deepwater fields in 1999. Its workforce is made up of a combination of expatriates and local staff with an overwhelming majority of this workforce being local.

“The mission of this company is to find, produce, process and sell oil gas for the maximum benefit of the Federal Republic of Nigeria, the Nigeria National Petroleum Corporation and Chevron Texaco Corporation”. These mission statements are protected by certain principles that relates to conducting business in an ethical manner through respects of such values as trust and integrity, rule of law, respect for human rights, protection of the environment and support to operational communities through advocacy and partnerships (http//www.chevrontexaco.com). It has different divisions which are based in Warri Delta State, Port-Harcourt, Abuja and Lagos.

PROJECT TOPIC- CHALLENGES OF SOCIAL RESPONSIBILITY TO CORPORATE MANAGEMENT A CASE OF CHEVRON TEXACO

1.2    STATEMENT OF THE PROBLEMS

In the last two decades, oil has supplied more than 90% of Nigeria’s export earnings and more than 80% of the federal government revenues. Yet many Nigerians particularly those who live in oil producing communities would say that oil production has been more of a curse than a blessing to the country due to the damage caused by oil spillage to the environment. (https://www.greatdecision.org). As a result of this the relationship between the oil companies and their host communities has not been cordial in recent years owning to

different perceptions of the roles companies should play in the development of their host communities. In the quest to stop these oil companies youths have taken up arms against multinational oil firms in respect of taking hostage indigenous and foreign oil platform workers, shut-in of barrels of oil, vandalization of equipments, etc. These developments constitute as it were new and important  variables to the management of these oil companies. The researcher perceives that the situation constitute management challenges to companies concerned.

This research work is therefore aimed at ascertaining the challenges to corporate management, posed by the over increasing demand of and compliance to social responsibility. The choice of Chevron Texaco is based on its high pedigree in the oil sector and on the fact that it has been a major player in meeting its social responsibilities but also in the conflicts arising from the violent demand for corporate social responsibility.

1.3 RESEARCH QUESTION

This research is aimed at answering the question: what challenges does social responsibility pose to corporate management?

1.4 OBJECTIVE OF THE STUDY

In line with the research question, the objective of this study is to identify the challenges to corporate management arising from social responsibility.

1.5 SIGNIFICANCE OF THE STUDY

The outcome of this study will hopefully throw some light on the management implications and challenges of corporate efforts to meet the demands of social responsibilities by its environmental stakeholders.

It will also hopefully make corporate organisations to better appreciate the need to achieve a delicate balance between the need to be socially responsible and the need to achieve its traditional corporate objectives.

This work may also provoke ideas for further research.

1.6 SCOPE OF STUDY

The study will focus on the activities of Chevrontexaco Warri, Delta State, vis-à-vis its effort to meet its social responsibilities to its host community and the challenges to management arising therefore.

1.7 LIMITATIONS OF THE STUDY

The limitation of the study are:

Time frame: Due to the time limit, the researcher made use of one research question and objective. It also constrained the research to only one base office.

Source of Data: Much of the data used in this research were collected via questionnaires. The validity of our result(s) will therefore be influenced by not just the methodology used but by the response rate and by the reliability of responses.

Access to Official Information: Due to the need to maintain vital official secrets, the management of the branch was unable to grant us full access to official information.

1.8 SOURCES OF DATA

Data from this research were obtained from the company’s official website (www.chevrontexaco.com) others include data from the inhouse publications, specialized journals, newspapers, mimeographs and others.

PROJECT TOPIC- CHALLENGES OF SOCIAL RESPONSIBILITY TO CORPORATE MANAGEMENT A CASE OF CHEVRON TEXACO

1.9 ORGANISATION OF WORK

The study is presented in five chapters, with sections and sub-sections. Chapter one contains the general introduction, while literature review come under chapter two. Chapter three briefly overview the research methodology used in the study. Presentation of data and analysis occupies chapter four. In the concluding chapter, we summarise the study, draw conclusion and proffer suggestions for policy recommendations.

PROJECT TOPIC- CHALLENGES OF SOCIAL RESPONSIBILITY TO CORPORATE MANAGEMENT A CASE OF CHEVRON TEXACO

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