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CHAPTER ONE

INTRODUCTION

BACKGROUND OF THE STUDY

Corporate Social Responsibility an essentially American phenomenon has over the years become a major concern in Western Europe and in other countries of the world following the western model of development. According to Drucker, (1986:66).The genesis of the debate on the concept of corporate social responsibility has been traced to the wave of crisis in social values that engulfed America in the post World War II period and most especially in the sixties. The Chief Executive of General Motors who observed the changing trend could not help observing: “I am concerned about a society that has demonstrably lost confidence in its institutions – in the government, in the press, in the church, in the military, as well as in business”.

Business to America has had a most unique history.  Its development growth and impact on social life in America since the civil war II is almost common knowledge.  What may not be common knowledge, however, is the fact that business which has hitherto shaped and controlled the lives of millions of Americans some two hundred years ago is today being threatened by a wave of protests from various publics it uses to serve.  The crisis of confidence in the social role of business as made explicit in debates on corporate social responsibility points to the fact that America sees big business as a big powerful machine gone out of control.  And efforts to control and at least re-orientate its directions form the core of the argument of all who urge business to change with the times.  In other words, to deemphasize its so much vaunted profit maximization dogma and pay attention to the human lives and environment which it is subtly, ruthlessly and almost surely grinding out of existence.  As one of the protagonists has viewed the concept of corporate social responsibility it is a crude blend of long-run profit-making and altruism, a doctrine which fuses social values with profit maximization goals.

In the early years of the American Republic and especially in the post civil war reconstruction era, business in America played an almost indispensable role as a powerful social tool for harnessing resources and ensuring material progress. Ducker (1986:66). But as the years rolled on and business began to concentrate and centralize capital, its role in the economy became expansive and pervasive.  At the height of prosperity, the captains of industry were heralded as heroes of the society. The later years of the post World War II era harbored a different story.  The boom period following the end of World War II soon gave way to a periodic wave of depressions and crisis that was to rock every foundations of society on which business existed.  The  frustrating economic situation characterized by inflation, unemployment, failing profit, declining investment, pollution of the external environment etc., pushed Americans to re-examine almost every old values and the assumptions behind them.

According to Drucker, (1986:96) the debate on corporate social responsibility did not only take place in the United State of America.  The noise of the debate filtered through to other countries that shares similar business cultures with America most especially the Western European countries.  While the western European nations have responded positively to the debate, accepted and even implemented some of its own far reaching conclusions it is pertinent to know if the discussions and conclusion so far reached have had an impact on the countries  periphery. One of the objectives of this study is to investigate to what extent the current debate on corporate social responsibility and its conclusion has trickled down to the periphery of Nigeria in particular and how it is applied here by firms who have embarked on such projects in Nigeria.

It is believed by the researcher that although the present level of industrialization does not entitled us to discuss the issue on the same platform with the industrialized western economies; the fact that they are imitating their path to industrialization should imply that we should study their experience closely to avoid mistakes. It is arguable also that foreign corporate bodies operating in host countries especially in the Third World countries are most likely to pay lip service to such principles as corporate social responsibility which are most likely to be of benefit to their host countries.  Also local or indigenous organizations can neglect this principle of corporate social responsibility to their host communities.

These days, social responsibility of business is on what should or might be done to tackle and solve problems of society.  The emphasis is on what contribution they can make to such social problems as protected and restoration of physical environment, racial discrimination or social discrimination. In striving to satisfy its corporate goals and achieve its objectives the organization cannot operate in isolation from its environment. The performance of corporate social responsibility is not undertaking to boost profit at the short-run but to meet some social needs, aspirations, and profit at the long-run. Organizations who hold this view of corporate social responsibility believes that once it does what is expected of it by law and its host community the organization is socially responsible. Owing to the vastness of this topic – corporate social responsibility we shall have to restrict our investigation to manageable proportions by focusing attention on telecommunication sector Nigeria, using Globacom Nigeria Limited.

The telecommunication industry is one of the fastest growing sectors in Nigeria.  There are so many telecommunication companies owned by foreign and local corporate bodies in Nigeria. These telecommunication industries have covered a large area in Nigeria from urban to rural areas in the country.  As a result of this, the researcher has selected one out of the many telecommunication companies to take a look at its corporate social responsibility project. The researcher has decided to pick on Globacom Nigeria Limited, Enugu Zone, and has decided to look into its corporate social responsibility activities, to see how the company has gone in performing its social responsibility in host community.

1.2   STATEMENT OF PROBLEM

In recent years there have been series of arguments, debates and controversies among businessmen, academics, government officials and the society in general on what should be the principle objectives or business enterprises. Over the years, managers have neglected the problems created by corporate firms to their host communities. These problems possess a lot of threat and sometimes make life difficult for these communities.  The privilege giving to organization to operate in the society stems from the act that society believes that there is a mutual interdependency existing between them, that is, the organization and the society. The relationship between organizations and their host community has become increasingly important.  The decision made in an organization may influence community prosperity and also national and even internationally economic activity might be affected.  An example of these problems is the on-going crisis in the Niger Delta region which has led to the destruction of lives and properties.  There are accusations from the youths in these areas that companies misdirect their efforts and resources that they should have used to develop the community to bribe opinion leaders in order to overlook their responsibilities to the community, and these have caused a lot of acrimonies between the two parties, community and the firm.  These same problems can also be identified in other arrears and in other communities across the country where large companies are located.  This prompted the researcher with deep sense of burden to these communities to unraveled the need for these large firms to see the need in helping the society solve some of its problems, most especially those they help to create, and involve in philanthropic donations to the needs of these communities and provide the community with some social amenities. Despite the roles played by organizations carrying out corporate social responsibility and the growing importance of social responsibility, the following issues have not been fully addressed:

1.  Why should organizations be socially responsible to their environment?

2.  What benefits do organizations get from performing its corporate social responsibility?

3.  Why is social responsibility considered as a waste drain of business resources?

4.  Are organizations in Nigeria socially responsible?

In view of the above, the researcher has taken up the issue of social responsibility in the telecommunication sector in Nigeria and used Globacom Nigeria as a case study to examine the extent of the company’s involvement in corporate social responsibility.

1.3    PURPOSE OF STUDY

For organizations to successfully survive in business, it must recognize the importance of social responsibility to the society.  The broad objective of the study is to:

1.  Examine the argument for and against corporate social responsibility.

2.  Whether Globacom Nigeria Limited has been involved in social responsibility activities, and if so, to what extent have they been involved in their corporate social responsibility to their environment.

3.  To examine whether the immediate environments are taking into cognizance during planning and implementation of social responsibility.

4.  To know the factors that motivates the adoption of corporate social responsibility.

1.4   RESEARCH QUESTIONS

1.  Why is social responsibility necessary in an organization?

2.  To what extent does an organization involvement in social responsibility have an effect on the company and its host community?

3.  What factors motivates the company in carrying out social responsibility activities?

4.  Who do you think are the beneficiaries of the company social responsibility activities?

1.4   RESEARCH HYPOTHESIS

Hypothesis I

Ho: The organization involvement in social responsibility does not have an effect on the company and its host community.

Hi: The organizations in social responsibility activities have an effect on the company and its host community.

Hypothesis II

Ho: Globacom corporate social responsibility programme does not    enhance organization-societal relationship.

Hi: Globacom corporate social responsibility programme enhances organization-societal relationship.

1.5     SIGNIFICANCE OF THE STUDY

The study of social responsibility of a business organization is hoped to be of benefits not only to student’s businessmen, government, customers, community, stockholders, academics, but the whole society. The study also hopes to highlight the problem associated with social responsibility and to make use of the analysis to improve the working situations thereby minimizing the problems social responsibility conflict in that organization and its environment as well. Finally, the study will inform all at large, the need for corporate social responsibility not only to the firm, but to the society at large.

1.6    SCOPE AND LIMITATION OF THE STUDY      

This research work focuses on the telecommunication industry in Nigeria, but with particular reference to Globacom Nigeria, Enugu sector.

This research was faced with a lot of problems and limitations.  The major problem acting as a limitation was a problem of Nigerians attitude to the supply of data to a researcher due to fear.  Secondly, because of financial constraints, the scope and dimension of this study could not be extended beyond this limit.

1.7     DEFINITION OF SPECIAL TERM          

(Globacom): Global communication. It is a name of a telecommunication firm in Nigeria. Global communication limited is the case study for this research work.

(Glo): A short name for Globacom.

(CSR): Corporate social responsibility.

(BSc): Bachelor of Science.

(NCE): National Certificate in Education.

(OND): National Diploma