CHAPTER ONE
INTRODUCTION
1.1
BACKGROUND TO THE STUDY
The concept of Corporate Social Responsibility (CSR)
focuses on ethical and moral issue which impact corporate decision making and
behaviour. CSR for short, is a concept that emphasizes responsive and extended
social contribution of businesses to the society. Likewise, globalization has
reinforced the relevancy of CSR in business operations. This is because globalization
has introduced new challenges and opportunities emanating from increasing
linkages between social, political, economical and environmental roles of businesses.
Thus, businesses are confronted with new risks in the global dynamic
environment. The implication is that businesses need to be profitable and
respond positively to emerging societal expectations accordingly. The main
purpose of CSR is to ensure that firms are accountable and responsible to the
society and environments they operate. Firms deal with a wide range of
stakeholders, including: shareholders, customers, employees, trade unions and
community (Carroll, 1991; Hillenbrand & Money, 2007; Carroll & Shabana,
2010; Kemper et al., 2013).
Since business have limited resources to devote to
CSR activities; hence, firms need to identify, prioritize and incorporate CSR
in decision-making. Naturally, business seeks to maximize its profits and is
self-interest (Fisher & Lovell, 2009; Hooker, 2011).
CSR practices have become a component of business organization
that enhance competitive advantage and long-term sustainability (Porter &
Kramer, 2006;).
Dunning (2003) urges the development of
what he names a Responsible Global Capitalism that should
not be considered as an end in itself, but as a means of social transformation
of societies to create a better life for its citizens. According to Dunning no single
religion or philosophy can force its unique values and standards upon others
but each religion or philosophy can contribute to a sustainable moral ecology. In
this transformation process it is difficult not to consider the private
business sector as one of the main stakeholders in transforming and improving
society.
The Bali Roundtable on
developing countries in 2002 recognized the business sector as a primary driver
of economic development and the World Summit for Sustainability identified
business involvement as critical in alleviating poverty and achieving
sustainable development (www.un.org).
Corporate Social
Responsibility (CSR), the set of standards to which a company subscribes in
order to make its impact on society, has the potential to make positive
contributions to the development of society and businesses. More and more organizations
are beginning to see the benefits from setting up strategic CSR agendas.
A number of studies
indicate that the understanding and practice of CSR is socio-culturally framed
(Amaeshi, Adi, Ogbechie & Amao, 2006). Despite this fact, research on
management and CSR in Africa is relatively scarce and to a large extent based
on a developing-developed world paradigm (Jackson, 2004).
This study has as its
entry point CSR from a Nigerian perspective. Nigeria has a long experience of
managing cultural diversity and multiple stakeholders and its citizens and
business leaders have to manage cross cultural dynamics on a daily basis. There
ought to be lessons and experiences drawn from good practice in Nigeria that
can contribute, not only to managing in Africa but to managing throughout the
world.
To underscore the above
assertion, Milton Friedman (1972:88) had contended that the only responsibility
of the business is to make as much profit as it can for the owners. Today,
partly due to the interdependencies of many groups in our society, the values,
goals and attitudes of the society changed significantly. This accounts for the
complexity in the society in the area of social, economic as well as
environmental problems which have been experienced. This situation is in
consonance with the view of Ackerman (1973:89), when he opined that the people
increased awareness has brought some expectation and demand to bear on
companies to be socially responsible to the society in which they operate. Thus
we often talk about the social responsibility and social responsiveness of all
organizations although the focus of this study shall be on corporate
organizations. There is a question as to what the social responsibility of
business really means.
The
concept of social responsibility is not new, although the idea was already
considered in the early part of the twentieth century. The modern discussions
of social responsibility got a major impetus with the book “social
responsibility of business suggested that business actors should consider the
social implications of their decisions, society being awakened with respect to
the urgency of social problems is asking managers and owners of business what
they are doing to discharge their social responsibility to the society in which
they operate given negative social impacts of their business on the society
such as pollutions of all kinds air, water, solid waste noise to mention but a
few.
However,
Harper D. (1976) a classical economist consistently argued against the need to
do anything that negates profit maximization. He sees business social
responsibility as an aberration Harper, (1976).
The problems of the
communities where the construction companies operate bring these problems
constructively to the attention of the companies with which they have developed
regular form for meetings. These companies have created ecological disaster in
the communities. Therefore, the problem to be looked into in this research is
that a corporate organization does not bother about their social responsibility
to the environment where they operate. Furthermore, poverty, lack of essential
facilities and unemployment are increasing is alarming proportion. As a result
the needs and expectation of the society are not met by the business organization.
1.3
OBJECTIVES OF THE STUDY
The corporate
organizations naturally have its own mix and different emphasis. The overall
objectives of every organization are survival, growth, profit, economic
contribution and social obligation. It is known fact that firms in Nigeria
usually lay more emphasis on profit maximization. The objective of this
research work includes the following:
i.
To appraise the general attitude of
construction companies towards social responsibility.
ii.
To examine the consequences of these
companies ignoring its social responsibilities.
iii.
To evaluate the problems which hinder
the performance of social responsibility practice by these construction companies.
iv.
To
recommend possible solutions for the identified problems.
1.4
RESEARCH QUESTIONS
To ensure an in-depth
research work with a view to providing best solutions to problems identified,
the study will make use of the following questions:
i.
Could business organization carryout a
successful social responsibility practice?
ii.
Should
social responsibility be legalized?
iii.
In what form should social
responsibility be performed?
Based on the research questions already
mentioned, the following
Hypotheses were formulated:
There
are two types of hypothesis, the Null hypothesis that takes the negative form
and the Directional or Alternative hypothesis that takes the positive form.
Let
H0 stand for Null
hypothesis
Let
H1 stand for
Alternative hypothesis
HYPOTHESES
I
H0: Business organizations
cannot carry out a successful corporate social responsibility practice.
H1: Business organizations
can carry out a successful corporate social responsibility practice.
HYPOTHESES II
Ho: Business corporate social responsibility
should not be legalized.
Hi: Business corporate social responsibility
practices should be legalized.
HYPOTHESES III
Ho: Corporate Social Responsibility practices
cannot be achieved in any form.
Hi: Corporate Social responsibility practice can be
achieved in different form.
The importance of the
study cannot be over-emphasized given the Interdependencies of many groups in
our society. The study is therefore important because, it will not only appraise
the attitude of business organization towards the issue of corporate social
responsibility but will go a long way to help these organizations on policy
making and decision in order to eliminate the negative effects and consequences
of these attitudes in the discharge of corporate social responsibility
practices. The study will be of immense benefit to researchers and students
looking for more information on this topic.
Another significance of
this research is that, it will help in finding ways to improve relationship
between companies and the communities in which they operate. It enables manager
of different organizations to know actually what corporate social
responsibility is all about. The study will equally be beneficial to private
and public sector organizations.
1.7
SCOPE OF THE STUDY.
The study aims at
appraising the corporate social responsibility practice by construction
companies in FCT using SETRACO as case
study.
The study is therefore, is restricted to the study of the SETRACO as a
corporate organization in Abuja, F.C.T.
It is, however, expected that the study of SETRACO, Abuja
would give enough information on how business corporate social responsibility
can successfully be rendered by other construction firms.
1.8
LIMITATIONS OF THE STUDY
In the course of
carrying out this research work, some difficulties were encountered. These
constraints were however managed. Among these were time, materials and
financial constraints.
TIME:
Time factor was one of the constraints faced by the researcher; however, the
researcher took time management seriously, as the study was successful. So many
useful times was involved to make the study as the researcher had to combine
full time employment with the collection of data for the work.
MATERIALS:
It is not easy for the materials to be collected or obtained due to limited
books, journals and other reference materials, particularly obtaining
information from the case organization was a tedious exercise, as some information was termed confidential despite the purpose and
intentions to which they were requested for. But some management staff and
senior supervisors were very helpful as they assisted in providing necessary
data that formed the basis for this project write-up, conclusion and
recommendations.
FINANCE:
Financial
problem was also encountered by the researcher in the course of the work- going
to various libraries, stay connected online for materials etc.. But notwithstanding
the above constraints, the quality of the research work could not be impaired.
1.9
DEFINITION OF TERM
CSR: Short form of “Corporate Social Responsibility”
SETRACO: Setraco was established
in 1977 and started by constructing township and district roads in what was
then Bendel State. Over the last thirty years the Company has rapidly grown to
become one of the largest construction companies in Nigeria specialized in
roads and bridges. With a presence today in around 20 states; Setraco has
played a key role in developing Nigeria’s infrastructure as the Country strives
towards becoming a developed nation.
ORGANIZATION: an organized group of
people with a particular purpose, such as a business or government department.
Ackerman, R. and Bauer, W. (1973). Corporate
Social Responsibility; The Modern Dilema, New York: Preston
Publishing Company Inc.
Harper, D. (1976). A View of the Corporate Role
in the Society, Houston: Carriage Melon University Press
Milton Friedman,
(1972). Capitalism and Freedom, Chicago: University of
Chicago Press
Enudu, T.O. (2005). Corporate Planning in Modern
Organizations: A Fundamental Approach, Lagos: Johnkens and Willy
Publications Ltd.
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