This document outlines the steps for developing an effective corporate social responsibility (CSR) process for an oil company. It discusses establishing goals and objectives, determining which CSR policies offer competitive advantages, anticipating future changes, and identifying opportunities for positive visibility. The document also covers potential problems like managing community expectations and local political influences. Examples of CSR projects include investing in alternative energy, road safety programs, microcredits, and workforce diversity initiatives. The conclusion recommends understanding community needs, starting with small pilot projects, and measuring success before expanding CSR efforts.
4. Outline
Steps
Problems
Examples
Conclusion
Strategy
Centrality
•Determine the
socially valuable CSR
policies
Specificity
•Assess the degree to
which these CSR
projects offer benefits
Proactivity
•Anticipate future
changes in the firm's
environment
Voluntarism
•Determine the
baseline of mandated
requirements
Visibility
•Identify opportunities
to create positive
visibility
VALUE CREATION
Measure and
compare the value or
potential value
expected
5. Outline
Steps
Problems
Examples
Conclusion
Process
• Cost, benefits, feasibility
Analyze
• Understand what company want to
achieve
Strategy
• Making sure the process is clear
Integration
• Web page, Ads
Communication
• Internal and External
Feedback
Karlsson,Jonkoping Business School, Implementing CSR
With respect to strategic CSR, programmes or policies
which are related closely to the organization's
mission or tightly linked to its accomplishment have
much higher centrality than traditional broad-based
corporate philanthropy programmes. For example,
the design, testing and manufacture of air bags for
automobiles-a socially responsible product-was
highly central to TRW, as was the correction of safety
problems with this product. Similarly, political
activities in support of mandatory automobile safety
equipment have high centrality for a manufacturer of
such equipment. But even philanthropy decisions can
have a high degree of centrality
Specifity –how much the firm benefits from it
Proactivity is the planiing and anticipating the technological and social atmosphere isn the company and tekin gmeasure before smth happens
Identify the stakeholders which are critically
important for achieving the firm's mission, goals
or strategic objectives.
o Determine the socially valuable CSR policies, programmes
and projects which address the needs
and interests of these stakeholders.
o Assess the opportunities offered by these CSR projects
to enhance the firm's attainment of strategic
objectives or to solve significant problems and
threats facing the firm. (Centrality.)
o Assess the degree to which these CSR projects
offer benefits which can be captured and/or internalized
by the firm as opposed to all firms in the
industry or society at large. (Specificity.)
o Anticipate future changes in the firm's environment
and changes in the needs of its key stakeholders
which could be addressed through
proactive CSR policies and activities. (Proactivity.)
o Determine the baseline of mandated requirements
in order to identify the opportunities for voluntary
acti vities. (Vol un tarism.)
In this step it is important to find out where the company is today and where they would
like to be and then form different solutions of how to reach the preferred stage. These solutions
shall then be compared and the most efficient one should be selected.
Once having selected the strategy they would like to use the third step of integration becomes
very important. This step is crucial for the outcome of the implementation of the
CSR activity. If the activity is well integrated with the day to day business of the company
and the goal as well as the means of how to reach it is clearly conveyed to everyone involved
the CSR activity is more likely to be successful in terms of reaching the goal. This
step is not easy and also very time-consuming in most cases. However if the first and second
step has been thoroughly conducted this facilitates the third step a lot. If the manger
49
for example has a clear picture of what he would like to implement and how to implement
it, it is easier for him/her to convey the information to the different employees of what
there task in it will be and what is expected from them. If the employees get a clear understanding
of what they are meant to do and why they are more likely to do the job correctly
thus ensuring that everyone is working towards the same goal as well as doing the right
Since the ‘business case’
drives CSR, it is not surprising that many corporate social initiatives do not go
beyond narrowly philanthropic gestures; for example donating objects such as
schoolbooks, mosquito nets or lifejackets to local communities, without any
attempt to consult either the community itself or development specialists. Even
The false developmental promise of Corporate Social Responsibility
In Nigeria, the author witnessed many non-functioning white
elephants, including unfinished buildings designed to be health clinics or schools,
water projects where the water was unfit for consumption, or projects such as
health clinics which lacked light, running water, basic equipment or staff.
587
such simple gestures sometimes end up as failures. In Equatorial Guinea,
ExxonMobil donated mosquito nets to the Health Ministry for malaria prevention,
but officials then reportedly sold them not least through export to
Cameroon.
Many of these problems could be avoided through in-depth consultation
and the participation of the local people in genuine self-help initiatives using
local knowledge, skills and tools. But the involvement of local communities is
inherently constrained by the companies’ lack of developmental expertise and
the technical/managerial approaches of oil company staff.
Few people with overseas development expertise move into commercial
companies, and community development units are often staffed with
managers, former administrative staff, engineers or former government officials.
When BP initiated courses to teach its managers about issues such as biodiversity
and global warming, they typically turned to a business school (the
Judge Management Institute at Cambridge University) rather than a development
institution. Furthermore, the staff often spend very little time in the field
and lack an understanding of specific local problems.
The internal workings of oil companies also render long-term development
initiatives more difficult. Asset managers are often rotated among subsidiaries in
different countries (BP moves them every four years), so they tend to lack a
long-term commitment to the local communities where the firm operates.
Even if one asset manager is committed to genuine CSR, his/her successor
may not be as committed and may simply halt a social initiative begun by the
predecessor. Thus the championing of development projects with a long-term
planning horizon may depend on the leadership of individual managers whose
term of office is inherently limited.
Since projects are often driven by short-term expediency, ‘decisions are
taken at too low a level as to which projects to execute’, as one development
professional put it. So there may be little coordination in determining which
areas should benefit and how projects can be put together to contribute to a
greater whole. In one local area visited by the author, an oil company in
Nigeria built a road which ran parallel to another road built by the Niger Delta
Development Commission: this is an extreme example of coordination failure,
but it underlines the importance of planning and coordination for the success
of development projects.
Worse still, by not integrating CSR into macro-level developmental plans,
oil companies run the risk of causing local conflicts and creating negative
The false developmental promise of Corporate Social Responsibility
593
developmental consequences. One example from Nigeria is the concept of a
‘host community’, according to which oil companies have a social responsibility
towards the local community located closest to their oil facilities. Preference
for one community may breed jealousy from other communities and give
rise to intercommunal conflicts.