Exploring the Impact of Strategic Proactivity on Perceived Corporate Social Responsibility in Nigeria’s Petroleum Industry: A Structural Equation Modeling Approach

Chidi M Ibe,Kwek C Ling,Yii D S K,Wang Z Min

doi:10.5539/ass.v11n4p275

Abstract

In the past few years, there has been a gradual re-orientation taking place in the relationship between business and society in the Nigerian petroleum industry. The re-emergence of democracy has led to an increased awareness about the role of oil companies in their host-communities. Oil companies are aware of this, and have devoted increased effort towards contributing to their host-communities. Despite the fact that, of recent, these oil companies are contributing more than ever, there is an increase in the conflict between these companies and the stakeholders in their host-communities. This is threatening their sustainability. This problem highlights a gap in theory and practice of CSR. In recent times, there have been calls for shift of scholarly focus towards a performance based CSR theory and practice. This paper empirically tested this performance based perspective by exploring the interactive process that leads to CSR outcomes. This was done through a quantitative research study. 623 members of Eket and Ibeno youth councils took part in a survey from which 591 valid samples were generated. A structural equation modelling (SEM) statistical technique was employed. The results showed a positive relationship between strategic proactivity and perceived CSR, with perceived economic value dimension demonstrating partial mediating impact on the relationship.

Highlights

The discovery of petroleum in the Niger-Delta region of Nigeria in 1956 led to the influx of multi-national oil companies into Nigeria
The results showed a positive relationship between strategic proactivity and perceived corporate social responsibility (CSR), with perceived economic value dimension demonstrating partial mediating impact on the relationship
In line with the context of this research, it can be concluded that the reason for the frequent conflict between the Oil Company and the members of its host community is not related to the non-perception of the CSR initiatives implemented by the company

Summary

Introduction

The discovery of petroleum in the Niger-Delta region of Nigeria in 1956 led to the influx of multi-national oil companies into Nigeria. The 1970s to 1990s was characterized by strings of military coup d’états that saw oil companies operating under military leadership for many years Within this period, the host-communities of these oil companies experienced a sporadic degradation of their social, economic and environmental wellbeing (Babatunde, 2012). The members of the host-communities of oil companies saw them as being exploitative (Omotola, 2006) This led to protests that were initially peaceful, but became radicalized as these oil companies increasingly showed insensitivity under the protection of military governments (Omotola, 2006). This was the root of the rise of social activism in the Niger-Delta region of Nigeria. This was described as having developed from the shared experience and aspirations that stemmed from the deprivation of social good by the activities of oil companies (Jike, 2004)

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Conclusion