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THE UNIVERSITY OF HULL The Impact of CSR on The Stakeholders of Oil Multinational Corporation In Niger Delta, Nigeria being a Thesis submitted for the Degree of Doctor of Philosophy in the University of Hull By FAIZU ADEAYO EDU (B.Sc., M. Sc) January 2018 Acknowledgment I want to place on record and appreciate the people that contribute to the success of my thesis. First, my appreciation goes to my supervisors for their immense contributions to the success of this thesis. My first supervisor, Dr David Harness, I do not know the exact word to use to thank you for your advice support and encouragement throughout my study especially, during my immigration problem that almost threw me out of the country. Your patience and encouragement that you used in reading my work chapter by chapter by suggesting what next to do at each stage is highly commendable. My unreserved appreciation goes to Dr Joan Cook for her guidance, support and advice without her willingness to read my work despite her tight schedules, my thesis would not have achieved this success, your criticism guides the thesis from many weaknesses and had made it much better, I am proud of both of you for the work well done. Similarly, my heartfelt appreciation goes to those people who participated in my primary research with special reference to the Shell staff and Ogoni People in Niger Delta without your cooperation and willingness to grant the interview my study would not proceed to the conclusion. I wish to acknowledge the support rendered by Mrs K Spry for making sure that this thesis is up to standard, your effort is commendable and appreciated. I like to give special thank you to Dr Muritala Awodun, my brother inlaw. Mr. Fatayi Agbemuyono, Mr. Agbaje Baba Debo, Mr & Mrs Adekoya, my elder sister Tayibat Adebisi, Pastor David in Onne village (Port Harcourt), Kemi Balogun, Taiwo Adegbesan (Shell Staff), Mr. Koiki Ibiyemi (Electoral), Mr Baloo, Mr Sony, and my Landlord and his wife Mr & Mrs Abdul Kahn. Mr & Mrs Graham Firth my neighbour. Lastly, I like to give many thanks to my younger brother Engineer Abu Doyin Edu, your prayers and financial support throughout my studies is highly appreciated. (Jazakum Lahi Khairan). Dedication First, I dedicate this work to my creator. Praise is to Allah the beneficent the merciful. The Alfa and Omega that taught humankind the knowledge of the unknown and blessing upon His Messenger Prophet Mohammed (pbuh). I will like to show appreciation to my parents both of blessed memory, Late Mrs Idayat Ayinke Edu and Chief S. A. Edu (aka Edu Photo); both of them gave me moral education at home prior to my enrolment at formal school. May the Almighty Allah show his mercy on them the way they showed mercy to me when I was a child; whatever we have is not really ours. It belongs to Allah (Q.2:156). May Allah pardon you of your sins and grant you paradise. Second, I wholeheartedly dedicate this work to my wife, Mrs Oyinlola Kafilat Awero Edu (aka first Lady), who stood by me through thick and thin. Her support throughout this journey of my PhD cannot be over emphasised; she is a warrior and motivator. My prayer for her is to live long in life to benefit from the fruit of her labour. Lastly, my son, Abdul-Lateef Oluwatosin Adewale Edu is another strong young boy whom I refer to as ‘The Brave Heart’; your support towards the success of this work is enormous. Well done my boy, I am proud of you! I Abstract This study examines the corporate social responsibility (CSR) of oil companies in developing countries, focusing on the conflict surrounding Shell Oil Company in the Niger Delta. Western literature presents CSR as a philanthropic or moral but largely voluntary activity, intended to satisfy various stakeholders, whose needs can be negotiated through dialogue. However, it is often descriptive and theoretical, and neglects local communities as stakeholders. This study explores the applicability of these Western notions in the Nigerian context, with particular reference to the perceptions within the oil company, and those of the local communities as neglected stakeholders. An ethnographic approach was employed to elicit fresh insights from Shell employees and local groups in the Niger Delta, drawing on formal interviews, informal interactions and documentary evidence regarding understandings of CSR perceptions and expectations of Shell’s behaviour, and impacts on life, livelihood and culture in the local area. A complex picture emerges of CSR as an elusive, contested and context-dependent concept that has different meanings for different people. Western notions of philanthropy, voluntarism and stakeholder engagement are shown to be highly problematic in the Niger Delta, where the difficulty of reconciling conflicting expectations is exacerbated by the colonial legacy of mistrust between multinationals and the local people, as well as weak government. As a consequence of exclusion from decision-making, the local community denies the legitimacy of any CSR initiatives by Shell, and indeed, evidence supports that Shell’s behaviour in Niger Delta differs from its actions in other contexts. Whilst joining academic calls to refocus CSR of oil companies to II one that is community-oriented and negotiated rather than dictated, it recognises the challenges facing these concepts in communities like the Niger Delta. Key Words CSR, Shell Company, MNCs, Oil industry, Community People, Niger Delta, Nigeria, Oil Spillage, Stakeholder. III List of Acronyms BBC British Broadcasting Corporation CBN Central Bank of Nigeria CSR Corporate Social Responsibility DPR Department of Petroleum Resources GDP Gross Domestic Products JJC Journey Just Come MNC Multi National Corporation MOSOP Movement for the Survival of Ogoni People ND Niger Delta NGO Non-Governmental Organisation NDP Niger Delta People NDR Niger Delta Region NNPC Nigerian National Petroleum Corporation PTD Petrol Tanker Driver RCSR Reasonable Corporate Social Responsibility RNC Royal Niger Company SGBPR Shell General Business Principles Report SPDC Shell Petroleum Development Company UAC United African Companies UK United Kingdom IV List of Tables Table 1: Multinational and Local Oil Corporations in Nigeria .................................... 13 Table 2: Pressure /Radical Groups in Niger Delta ....................................................... 25 Table 3: The Niger Delta Bills of Rights ..................................................................... 26 Table 4: Ethnic-Militia Groups and Their Tribes in Nigeria. ....................................... 27 Table 5: Consultative Forum and Their Tribes in Nigeria ........................................... 27 Table 6: Oil Marketing Divisions and Their Problems in Niger Delta ........................ 30 Table 7: Nigeria Oil Regulatory Bodies ....................................................................... 31 Table 8: Respondents’ biography ............................................................................... 335 V Table of Figures Figure 1: Map of Nigeria, adopted from Frynas (2001). .............................................. 20 Figure 2: Monthly Oil Spill Incidents Recorded by Shell, 2011 .................................. 34 Figure 3: Monthly Oil Spill Incidents Recorded by Shell, 2012 .................................. 35 Figure 4: Number of Oil Spills Caused by Sabotage and Operational Fault Recorded by Shell Over Six Years ........................................................................................ 36 Figure 5: An Overview of the Key Theory Areas Reviewed for This Study ............... 41 Figure 6: CSR Pyramid Model, adapted from Carroll (1991, p.42) ............................. 63 Figure 7: Stakeholders Target for This Study .............................................................. 90 Figure 8: Research Methodology Flow Chart ............................................................ 109 Figure 9: Front View of Shell Office, Port Harcourt ................................................. 136 Figure 10: Village Centre Onne, Port Harcourt ......................................................... 140 Figure 11: Summary of Data Analysis Methods ........................................................ 146 Figure 12: An Overview of the Process that Leads to the Findings ........................... 153 Figure 13: Illegal Oil Refining/Sabotage at Gokana Village ..................................... 204 Figure 14: Air Pollution through Gas Flaring at Onne Town .................................... 219 Figure 15: Farmland Destroyed by Oil-Spillage ........................................................ 220 Figure 16: Crude-Oil Leakage at Omu Village .......................................................... 223 Figure 17: Villagers and the Researcher near Oil Spillage, Omu Village ................. 224 Figure 18: Abandoned Community Project by Shell/Community, Kigbaraji Village227 Figure 19: Abandoned School Project, Eleme Village............................................... 228 Figure 20: Farmland Destroyed By Fire and Oil Spillage, Bori Village .................... 229 Figure 21: Communication Process for Social Responsibility in a Developing Country ............................................................................................................................. 242 Figure 22: Overall Findings of the Study ................................................................... 262 VI Table of Contents Acknowledgment................................................................................................................................