Corporate Social Responsibility in Developing Countries: Challenges in the Extractive Industry 303127511X, 9783031275111

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CSR, Sustainability, Ethics & Governance Series Editors: Samuel O. Idowu · René Schmidpeter

Steven Kayambazinthu Msosa Shame Mugova Courage Mlambo   Editors

Corporate Social Responsibility in Developing Countries Challenges in the Extractive Industry

CSR, Sustainability, Ethics & Governance

Series Editors Samuel O. Idowu, Guildhall School of Business and Law, London Metropolitan University, London, UK René Schmidpeter, BFH, Bern, Switzerland

In recent years the discussion concerning the relation between business and society has made immense strides. This has in turn led to a broad academic and practical discussion on innovative management concepts, such as Corporate Social Responsibility, Corporate Governance and Sustainability Management. This series offers a comprehensive overview of the latest theoretical and empirical research and provides sound concepts for sustainable business strategies. In order to do so, it combines the insights of leading researchers and thinkers in the fields of management theory and the social sciences – and from all over the world, thus contributing to the interdisciplinary and intercultural discussion on the role of business in society. The underlying intention of this series is to help solve the world’s most challenging problems by developing new management concepts that create value for business and society alike. In order to support those managers, researchers and students who are pursuing sustainable business approaches for our common future, the series offers them access to cutting-edge management approaches. CSR, Sustainability, Ethics & Governance is accepted by the Norwegian Register for Scientific Journals, Series and Publishers, maintained and operated by the Norwegian Social Science Data Services (NSD)

Steven Kayambazinthu Msosa • Shame Mugova • Courage Mlambo Editors

Corporate Social Responsibility in Developing Countries Challenges in the Extractive Industry

Editors Steven Kayambazinthu Msosa Mangosuthu University of Technology Durban, South Africa

Shame Mugova Birmingham City University Birmingham, South Africa

Courage Mlambo Mangosuthu University of Technology Durban, South Africa

ISSN 2196-7075 ISSN 2196-7083 (electronic) CSR, Sustainability, Ethics & Governance ISBN 978-3-031-27511-1 ISBN 978-3-031-27512-8 (eBook) https://doi.org/10.1007/978-3-031-27512-8 © The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors, and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, expressed or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. This Springer imprint is published by the registered company Springer Nature Switzerland AG The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland

Preface

CSR is an important and interesting topic in issues of sustainability and environmental, social, and corporate governance (ESG). CSR, sustainability, ethics, and governance are debatable topics in extractive sectors, as issues of climate risk and the need for switching to sustainable alternatives take centre stage. Sustainability is now an important issue for communities, governments, firms, investors, and financiers. Multinational corporations (MNCs) have failed to contribute significantly to the sustainable development of communities where their operations are taking place. In developing countries, policy and institutions are generally weak, and extracted resources do not benefit local communities. CSR is mainly voluntary, and issues such as environmental degradation, corruption, and a decline in business ethics and morality are some of the challenges affecting CSR in developing countries’ extractive sectors. Natural resources are mismanaged, proceeds are misappropriated, and corruption and conflict on resource control are some of the challenges in resource extraction. Developing countries endowed with natural resources desire foreign direct investment in mining operations; however, the operations of mining companies have a negative effect on local communities. The objective of this book is to add knowledge by exploring and providing an overview of how firms in the extractive sectors cope with CSR challenges. We explore these issues and challenges from the perspective of firms, communities, and academic lenses, suggesting the best practices of CSR implementation. The motivation to consolidate the information into a single book is to have policy and best practices on how firms in extractive sectors of developing countries deal with these challenges. Firms and governments are at the centre of the controversy of CSR in host countries. The role of public administrators or government officials who are in charge of licensing and ensuring firms act in the best interest of society is often underestimated, and they are often part of the problem through corruption. CSR is a concept that focuses on multiple business effects and aspects pertaining to the governance of firms. CSR is heavily influential in the conduct of business towards the environment and various stakeholders. The extraction of natural v

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resources has caused disputes between corporations and local communities. Would CSR help to deal with criticism of MNC operations in extractive sectors? Local sustainable development is requisite in areas where non-renewable resource extraction often occurs with the destruction of the physical environment. Extractive industries are at the cutting edge in regard to practising CSR, and CSR is especially important in the mining sector. The implementation and practice of CSR have much influence in extractive sectors, and best practices can result in meaningful impacts. We explore the performance of CSR implemented in extractive sectors to help find solutions to our social, economic, and environmental challenges. We believe that the dimensions of CSR, sustainability, ethics, and governance in the extractive sector are of interest to scholars, practitioners, and stakeholders in general. Thus, these three editors provide original contributions focusing on experiences from CSR initiatives and challenges from different countries in the developing world. Durban, South Africa Birmingham, South Africa Durban, South Africa

Steven Kayambazinthu Msosa Shame Mugova Courage Mlambo

Contents

Corporate Social Responsibility Challenges in the Extractive Industry: An Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Steven Kayambazinthu Msosa and Shame Mugova

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Corporate Social Responsibility During the COVID-19 Pandemic in the Extractive Sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Steven Kayambazinthu Msosa

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CSR Through Responsible Leadership for Sustainable Community Development: A Developing Nation Perspective . . . . . . . . . . . . . . . . . . . Amlan Haque

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Leveraging 4IR Technologies as a Corporate Social Responsibility to Reduce Environmental Impact in the Extractive Industry . . . . . . . . . Tessa Reddy and Stanley Chibuzor Onwubu

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CSR and Community Development: A Focus on Firms in the Extractive Sector in Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Peter Ansu-Mensah, Kojo Kakra Twum, Gloria Kakrabah-Quarshie Agyapong, and Richard Kwame Nimako Does Corporate Social Responsibility (CSR) Actually Develop Mining Communities? An Examination of CSR Programmes in Kenya’s Mining Sector . . . . . . . . . . . . . . . . . . . . . . . . . Willice Abuya

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Corporate Social Responsibility and Human Rights Issues in Nigeria’s Post-amnesty Niger Delta . . . . . . . . . . . . . . . . . . . . . . . . . . 111 Adiat A. Abiodun The Role of Corporate Social Responsibility in Building Social Cohesion for the Sustainability of Diamond Mining Towns . . . . . . . . . . 123 Nonofo Mokwakwa and France Maphosa vii

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Implications of Bikita Minerals’ Corporate Social Responsibility on Environmental Rights of Mining Communities in Bikita District, Zimbabwe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139 Mutanda Gideon Walter and Chazireni Evans Corporate Social Responsibility and the Challenges of the Regulatory Environment in the Tanzanian Mining Sector . . . . . . 157 Willy Maliganya, Kenneth M. K. Bengesi, Max M. Mbota, and Gideon Bulengela Whistleblowing Measures and Its Implications in the Nigerian Extractive Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175 Onyeka Nwoha Connivance in Criminality: Corruption and Corporate Social Responsibility in Nigeria’s Oil Sector . . . . . . . . . . . . . . . . . . . . . . . . . . . 191 Halimatu Muhammad Bande An Adaptive Approach to Reconceptualizing Corporate Social Responsibility and Corruption in Nigeria’s Oil-Rich Niger Delta . . . . . . 205 Ikpenmosa Uhumuavbi Extending the Frontier of Agitations: Corporate Social Responsibility and Resource Control in Nigeria . . . . . . . . . . . . . . . . . . . 223 Halimatu Muhammad Bande Corporate Social Responsibility in the Extractive Industries in Nigeria: The Role of Public Administrators . . . . . . . . . . . . . . . . . . . . 237 Wasiu Abiodun Makinde CSR and Labor Policies in the South African Mining Industry . . . . . . . 255 Blessing Kanyumba Corporate Social Responsibility and Role of the Indian State: A Transition Beyond Corporate Philanthropy . . . . . . . . . . . . . . . . . . . . 265 Kunal Debnath and Souvik Chatterjee Corporate Social Responsibility Challenges in the Extractive Industry: A Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 281 Steven Kayambazinthu Msosa Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 289

About the Editors

Steven Kayambazinthu Msosa is an expert in marketing. He has worked in the private and public sectors for over 15 years. He is currently a Lecturer in Marketing and Research Fellow at the Mangosuthu University of Technology. He has held positions as a Head of Marketing and Controller of Courier Services responsible for sales at the Malawi Posts Corporation, and Customer Service Representative and Card Marketing Executive at Total Malawi Limited. He obtained his PhD in Marketing and a Master’s Degree in Marketing at the Durban University of Technology, a Master of Commerce in Business Management specializing in Entrepreneurship, a Bachelor of Commerce Honors Degree in Business Management specializing in Marketing from the University of South Africa, a Bachelor’s Degree in Business Administration from the University of Malawi, and a Diploma in Community Development from the Association of Business Managers and Administrators (ABMA), UK. He is a Member of the editorial board of an international journal and a Reviewer for several DHET-accredited journals. He has published in DHET-accredited journals and presented at local and international conferences. His research interests are corporate social responsibility, sustainability, entrepreneurship, services marketing, higher education marketing, international marketing, multilevel marketing, relationship marketing, and integrated marketing communication. Shame Mugova is a financial analyst, a Lecturer in Finance at Birmingham City University, England, and a research fellow at the Durban University of Technology, where he holds a PhD from. He received a Master’s Degree (MBA) from Solusi University (Zimbabwe) and a Bachelor of Commerce Honours Degree in Finance from the National University of Science and Technology (Zimbabwe) in 2012 and 2007, respectively. His research interests are corporate social responsibility, corporate governance, and trade credit. He has 8 years of work experience in Zimbabwe’s tax, medical, private voluntary organisation, engineering, clothing and textile industry sectors. His work experience is in the field of finance and accounting and has worked for 3 years as an independent business consultant for Small-to-Medium ix

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Enterprises. His research interests are corporate finance, financial development, corporate social responsibility, corporate governance, and trade credit. Courage Mlambo is an economist, a Lecturer, and a Research Fellow at the Mangosuthu University of Technology. Dr Courage Mlambo obtained his PhD in Economics from the University of Fort Hare. Dr Mlambo’s research interests lie in Development Economics, Politics, and Economics. However, his research and publication repertoire is versatile, including Economics of regulation, Monetary Economics, Labour economics, Macroeconomics, Social Justice, Politics, Banking and Finance.

Corporate Social Responsibility Challenges in the Extractive Industry: An Introduction Steven Kayambazinthu Msosa and Shame Mugova

1 Introduction Developing countries are among the poorest countries of the world despite vast natural resources. The term resource curse encompasses the significant social, economic, and political challenges unique to countries rich in oil, gas, and minerals. Thus, the natural resources are mismanaged, proceeds are misappropriated, and corruption and conflict are centered on resource control. Could CSR practices help to lessen the burden caused by the burden of the resource curse? The challenges in the extractive sector require governments to make policy decisions that help to reduce and prevent the consequences of the resource curse. Developing countries usually have plenty of natural resources, and they depend on the extractive sector and export raw materials without much value addition since they are not industrially developed. The growth in developing countries is driven by foreign direct investment (FDI), primarily by international firms that acquire mining rights and their interactions with the community, and operating in the host country results in corporate social responsibility issues. Multinational firms have often been criticized for their CSR performance, exploitation of nonrenewable resources, and neglect of the environment (Natural Resource Governance Institute, 2015). The mining and metal sector already contributes 5–7% of greenhouse gas (GHG) emissions globally. Following the Paris Agreement, mining contracts should now have climate-related provisions (Mebratu-Tsegaye et al., 2021). Companies committed to social responsibility incorporate renewable energy sources into their mining ventures. The climate risk assessment and the community vulnerability S. K. Msosa (✉) Department of Marketing, Mangosuthu University of Technology, Durban, South Africa S. Mugova Department of Finance and Economics, Birmingham City University, Birmingham, UK © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_1

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assessment should be required by governments, and corporate social responsibility in the extractive industries should center on reducing deforestation. The threat posed by climate change should result in a reduction in the mining and consumption of coal. At the same time, there is a greater need for governments to create sustainable alternative sources of energy. Additionally, governments, investors, and society should pressure the mining industry to lower its emissions (Delevingne et al., 2020). A corporation’s level of CSR is often measured based on the environmental, social, and corporate governance (ESG) dimensions (Borms et al., 2021). CSR and ESG have become topical and relevant to all sectors but are more relevant in the mining sector, where environmental degradation is more prevalent. However, considering social responsibility ahead of profit in evaluating investment opportunities is changing perspectives on traditional capitalist investors. This entails that investors with a goal of socially responsible investing (SRI) consider alternatives and evaluate portfolios by how well the underlying assets align with corporate social responsibility (CSR) policy (Borms et al., 2021). Responsible corporate governance, compliance with legal norms, ethics, anti-bribery, and corruption, ensures transparency of activities and reporting (Frolova et al., 2021). Most mining firms fail in these aspects of corporate governance, corruption, and emissions into the environment. Studies linking CSR to firm value suggest that higher CSR leads to higher corporate value, higher equity returns, and lower risk, enhancing the general collateral value of the firm (Gerard, 2019). The growth of companies in the extractive industry, mainly made up of mining, oil, and gas companies, has been incredible, especially in terms of how profitable their operations are compared to how bad they are for the environment. According to Vorhees (2011), as cited in Stevens et al. (2013, 6), “calculations by the Revenue Watch in 2011 showed that the combined value of extractive companies listed on the 35 largest stock exchanges worldwide exceeded $9 trillion.” When evaluated in terms of income, earnings, or values on stock markets, the extractive industry is far larger and more prosperous than it was only 10 years ago. According to PricewaterhouseCoopers (PwC, 2013), the top 40 mining companies in the world collectively saw their annual revenues increase by more than a factor of five between 2002 and 2012, while their annual net profits increased by more than a factor of ten, going from $6 billion to more than $80 billion. Profits skyrocketed to $132 billion in 2010 and 2011 when metal prices reached an all-time high. Additionally, according to Standard & Poor’s ranking of the top 2000 corporate capital spenders in the fiscal year 2012, 13 of the top 20 spots were taken up by energy or mining corporations (Stevens et al., 2013). In the same way, research shows that in 2007, six of the ten largest companies in the world were energy and mining companies, and five of the ten most profitable companies were energy and mining companies, with ExxonMobil at the top of the list as the most profitable company in the world (Fortune Magazine, 2007). Multinational mining companies have recently “remodeled” themselves to be seen as responsible corporate citizens, but this is mostly greenwashing. Mining areas and adjacent communities experience numerous social, economic, and environmental problems (Reyneke, 2021). Sustainability issues are still problematic as the

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extractive industry exploits nonrenewable natural resources. Also, there is a possibility that participating in CSR may result in an increased reliance on the corporation, as in developing countries the government usually neglects its role in infrastructure and social service provision. Whether or not this is done on purpose, it may still have a significant impact on the community that is dependent on the mine, especially if the mine shuts down (Jenkins & Obara, 2006). In the era of globalization, practitioners and academics have engaged in soulsearching, which has led to the development of different policies and initiatives (Kashyap et al., 2003). For example, formal policy documents (like a code of corporate conduct and policies addressing health, safety, environment, and community issues); designated health, safety, environment, and community units responsible for the implementation of CSR policies; and a process for assessing and monitoring the environmental, social, and technical risks and impacts of a company are often the essential parts of company-specific management systems, despite differences in compliance requirements. Also, in the past few years, people have become more aware of how important it is to start CSR practices as early as the exploratory stage (Luning, 2012). Due to the very nature of their business, extractive industries (EIs) have time horizons that are much longer than those of many other industrial sectors. They aren’t very mobile and don’t have access to a wide range of places where they could invest. They adhere to the predetermined positioning of the already existing mineral and energy resources. Even though they can work offshore, underground, behind barricades, or even in failed nations, they are most productive in places with stable economies, governments, and markets for their inputs and outputs. Wise and Shtylla (2007) think that improving economic opportunities in host communities, countries, and regions could lower risk, lower production costs, and make extractive companies more profitable. But in the last few decades, the number of protests, complaints, and attacks on businesses, especially those in the extractive industry, has increased. Many of these protests and complaints are caused by the recklessness of businesses and the fact that these businesses are involved in social and environmental problems in the places where they do business (Adeola & Adeola, 2017).

2 Extractive Sector The extractive sector has always been at the center of the CSR debate and controversy. This may be due, at least in part, to the fact that many mining investments are controversial and that social and environmental problems often follow mining activity. Mining has been at the forefront of corporate social responsibility. This is because most mining is done in countries in the developing world that don’t have good governments, laws, or institutions (Kolk & Lenfant, 2012). Also, because of the “resource curse,” the places where these businesses get their resources are often the poorest, while the rich, like politicians, get the benefits. Some economists think that economic opportunities from global extractive businesses don’t flow quickly

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and evenly to the people who live closest to them and are most affected by them. The benefits that come to communities are viewed as trickery at times and, at other times, illustrated as drops of water. The operations of EI companies cause damage to the environment or don’t do enough to help local development or resource sharing. Both of these things may give the local community a reason to fight back, while the tap goes to the home countries of multinational firms (Warf, 2019; Gilberthorpe and Rajak, 2017). The operations of EI companies may cause damage to environmental commons or make it seem like they don’t do enough to help local development or resource sharing. These things may give the local community a reason to fight back. Furthermore, in extractive places, this frequently overlaps with existing power dynamics and may be linked to long-term political, cultural, geographic, or identity- based oppression. This mix of historical and modern factors could keep people from wanting to use resources (Ayuk et al., 2020; Hoelscher & Rustad, 2019). In addition, the extractive industries do not need a significant amount of manpower. During the building stages of capital projects, employment and other economic prospects get a bit more attention than during the exploration, operation, and shutdown phases. The pay for jobs in the extractive industry is often much higher than the pay for jobs in other parts of the local economy, even though these other jobs are much harder to get (Milicevic & Gayi, 2016). The closing of mines and the loss of economic activity that comes with it can be disastrous, leaving behind damage to the environment, job losses that increase unemployment and other problems, effects on the prices of homes, and changes to the infrastructure that the business originally provided. Extreme poverty, a lack of education, and inadequate healthcare are all big problems in society, and a heavy reliance on mining is strongly linked to all of these problems. About half of the world’s poorest countries are like this because mining is their biggest export business (Sharma & Bhatnagar, 2015). Many people think Africa’s natural resource wealth will help its economies grow, but this is not the case because of the natural resource curse. In the postcolonial era, the history of colonialism and what seems to be an unfair distribution of the benefits of mineral wealth cast a shadow over the chance of being wealthy. Mineral wealth is linked to more inequality in a number of African countries, and it hasn’t helped to reduce poverty or improve the level of social services for the average person. In many instances, governments lack the ability and capacity to offer social services and infrastructure that are very important. This history has led to a lot of social unhappiness and upheaval, and it has put more pressure on governments to turn resource wealth into social and economic progress (Lane & Reggio, 2013). Another school of thought says that business operations are affected by dictatorships, civil wars, insurrections, corruption, and violence between different ethnic groups. These factors also generate human rights duties and liabilities for global corporations. People who work in the extractive sector should be very concerned about whether or not to join a country and do business with a particular government. Should multinational corporations do business in nations with authoritarian governments? Is it appropriate to make a difference between working with governments with

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human rights records that are just “difficult” and dealing with countries that have been labeled pariah regimes by the international community (Ali et al., 2022)?

3 Corporate Social Responsibility in the Extractive Sector in Developing Countries CSR in the extractive sector takes the form of assisting the community, mainly in terms of healthcare, education, clean water, and improved living conditions. In South America, CSR interventions appear to have had a significant overall impact on the neighborhood surrounding the mines, as there has been a substantial improvement in the standard of healthcare provided in the communities, and 85% of the areas surrounding mining companies have access to potable water, contributing to an improvement in the standard of living of the people (Abugre, 2014). In most developing countries, CSR is a contentious topic. There are many different ideas about whether CSR is good or bad for extractive industries. Corporate social responsibility (CSR) in the extractive sectors of underdeveloped nations has been supported by various business justifications. There are a number of reasons for doing so, including but not limited to the requirement for a social license to operate and the fact that management is held responsible by stakeholders (Hilson, 2012). In Angola, oil firms use CSR to increase their chances of winning licenses and contracts, but they do not address governance problems in the country (Wiig & Kolstad, 2010; Cuervo-Cazurra, 2018). The extraction and export of unprocessed raw resources result in fast but unsustainable development. It seldom stimulates value-added processing businesses in host nations and may cause environmental degradation that has an effect on health and well-being. African nations should confront this challenge by making and implementing policy decisions that enable their natural resources to be extracted to benefit their social and economic development, including improved health. While international and global guidance papers outline health requirements for extractive industries (EIs), these standards, including UN treaties, may be optional if they are not incorporated into national legislation unless national constitutions expressly state otherwise (Loewenson et al., 2016). The extractive sectors, specifically the mining business, are under far more pressure to adopt CSR than the oil and gas industry. Contrary to oil and gas operations, which are almost always located offshore, the former’s activities are entirely land-based and, as a result, have more “visible” effects: whether management likes it or not, activities will eventually come into contact with subsistence communities. Additionally, unless operations turn a profit quickly, it will be challenging to appease communities and skeptics. Mining is a protracted process instead of oil, which produces income immediately. Once minerals are discovered and harvested, they need to be processed; this comes after many years of strategic exploration. Management does not realize financial returns on investment until the organization reaches this level, which might take more than a decade (Hilson, 2012).

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Doane (2005) also thinks that the stock market’s short-term needs make it less likely that the market will produce long-term benefits for society. If, for example, the executives of a company have to make sure that the shareholders get the most money from the company’s profits, it will be hard for them to justify spending money on community development or the environment if it means less money for the company. Even though most critics agree that some businesses have been successful at providing both short-term financial gains and long-term benefits to society, some critics (Whellams, 2007) say that these cases are the exception and not the rule. With a global economy becoming more linked and the globalization of social behaviors, world conceptions of CSR in various institutional settings ultimately converge or find themselves in separate equilibriums. Thus, emerging economies and less developed nations have fundamentally distinct social compacts and expectations about the role that firms play. For instance, businesses in developed countries may be subject to increased expectations regarding environmental responsibility and stewardship of natural resources (George et al., 2015). On the other hand, corporations may choose to direct their efforts toward social development goals such as improving education and health. It is expected that the social contract will bring about changes in the methods and procedures of social engagement activities in nations afflicted by poverty (Wang et al., 2016).

4 Corporate Social Responsibility Challenges in the Extractive Sector The growth of the extractive sector, especially the mining industry, has a negative impact on ecosystems that are already in a fragile state and on marginalized populations that are situated in places that are rich in minerals. The contamination of water with lead, arsenic, and other metals; the depletion of groundwater tables as a result of excessive use by large facilities; skin problems, excessive headaches, and blood intoxication as a result of lead; respiratory diseases caused by excessive dust; and the destruction of vegetation as a result of acid rain are some of the environmental and health impacts. Mining operations have direct repercussions for both the environment and human health (CIDSE, 2009). Another school of thought suggests that the environmental damage produced by mining may lead to the loss of land for other economic/livelihood purposes, such as agriculture, hence increasing reliance on the mine. Communities impacted by mining activities, whether via the loss of land and livelihoods or the need to move, are reliant on mining firms for compensation to repair the harm, resulting in the imposition of handout dependence. The social and environmental repercussions of mining impede women’s capacity to support themselves, and it is doubtful that they will gain direct work from the mine. This results in fragility, weakness, and a lack of voice, as well as a greater reliance on the mine, on males, and on people in positions of authority within the community (Sharma & Bhatnagar, 2015).

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The extractive industries are not as dependent on human labor as other industries, such as agriculture, manufacturing, or the service sector. The public populace, on the other hand, often has very high expectations that formal employment would be a key beneficiary of foreign investment in mining, oil, and gas operations. It is quite improbable that these expectations will be satisfied since there are relatively few locals who are skilled enough to be recruited (Östensson and Roe, 2013). Furthermore, the extractive sector brings in health risks for workers and the general public due to hazards such as unsafe working conditions and hazardous environmental conditions, as well as insufficient environmental health infrastructure and social changes that increase the likelihood of contracting infectious and noninfectious diseases being spread. There are also inequities in how these social expenses are handled, notably when extractive industries have a limited impact on poverty reduction or are granted tax exemptions that lower their contribution to social financing (Loewenson et al., 2016). The increasing demand from regulatory bodies to address problems with waste, pollution, and occupational health and safety in activities with a high risk of injury has been a significant factor. Because of this, in addition to the pressures placed on us by society and the law, more people are becoming aware of the significance of these issues (Vintró et al., 2012). Similarly, extant research suggests that companies in the mining industry have been the target of intense scrutiny and punitive measures in a number of nations as a direct result of the harm that their operations have caused to the local environment. As a result, it is of the utmost importance that these businesses find a way to improve their public image while also incorporating CSR into their business plans (López-Morales et al., 2017). The progression that has taken place in the modern corporate world necessitates that the organization pays a greater amount of attention to the social environment. In addition to the interests of management and owners of capital (investors and creditors), the business is supposed to be concerned with the interests of its workers, customers, communities, and the environment (Deitiana, 2015). Barkemeyer et al.’s (2014) analysis of the global sustainable development rhetoric and priorities from 1987 and the present shows a growing preference for environmental issues over development ones (northern priorities), with minimal recognition of constraints and trade-offs. They connect this to a focus on the “win-win” paradigm and increasing sustainability’s acceptability among mainstream audiences, especially those in business. According to Freeman’s stakeholder theory, managers must satisfy a range of stakeholders, such as financial claimants, workers, consumers, communities, government officials, and, in some cases, the environment, terrorists, blackmailers, and thieves, who may affect corporate results. Furthermore, the idea suggests that a firm’s participation in CSR activities that nonfinancial stakeholders deem significant might be advantageous, but the lack of such activities could result in a loss of support from these groups (Freeman, 1984). Nevertheless, it is impossible for managers to obtain an awareness of the expectations of their stakeholders unless they consult with those stakeholders and actively interact with them. Mechanisms need to be implemented that allow the perspectives of stakeholders to be incorporated into the

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decision-making process of organizations and that ensure organizations are held accountable to the standards that are set by stakeholders. Only then can social responsibilities be taken seriously (Ansu-Mensah et al., 2021). According to Luu (2019), cocreation activities will assist stakeholders in developing sentiments of loyalty toward the organization and reduce their susceptibility to adverse information and make them feel good about themselves. Studies such as Korppi et al. (2019) argue that organizations have limited interactions with their stakeholders, especially during times of crisis, which eventually affects their image. This is although corporations have limited engagement with their stakeholders. In recent times, there has been a substantial change toward concern for stakeholders and host communities, regardless of the ideological leaning or the position held by firms. There have been a variety of worldwide standards developed to provide direction to corporations, particularly those in the extractive industry, on how to conduct oneself ethically. These criteria include the Extractive Industries Transparency Initiative (EITI), the Voluntary Principles on Security and Human Rights (VPs), the Kimberley Process, the UN Global Compact (UNGC), and the United Nations Guiding Principles on Business and Human Rights (UNGP). As a result of the work of multinational corporations, Western governments, and nongovernmental organizations in developing these standards, progress in corporate social responsibility has been made possible through the establishment of clear and consistent rules that have helped to break down barriers between businesses and their critics (Litovsky et al., 2007).

5 Corporate Accountability and Stakeholders’ Management in the Extractive Sector The discussion on the issue of the social responsibility of business has, for the most part, centered on two different schools of thought. On the one hand, many argue that the main role of business is to do business in the social domain, notably in the form of programs and activities relating to corporate social responsibility (CSR) (Frynas, 2008). Some of these things are giving to charity, volunteering, working to protect the environment, and being honest at work. As opposed to stakeholder theory, CSR does not aim to explain what business is about in its totality, nor does it try to prescribe the whole scope of the duties that are associated with it. Instead, corporate social responsibility (CSR) focuses on a single set of company responsibilities: ensuring businesses keep their promises to local communities and society. Even though social responsibilities might be set up differently depending on who is involved, the social orientation would still be the most important (Freeman & Dmytriyev, 2017). Businesses are starting to realize that they need to put a higher priority on deeper community engagement, environmental responsibility, and support for local development to improve the lives of local communities and reduce the number of social conflicts that hurt businesses. This is clear from the fact that new

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Fig. 1 The relationship between stakeholder theory and CSR. Source: Freeman and Dmytriyev (2017)

CSR approaches have been accepted by EI participants all over the world. Both transformative corporate social responsibility (CSR) and creating shared value (CSV) are approaches to corporate citizenship that assume, in a general sense, that companies will be more successful if they create value not only for themselves but also for the communities where they operate, govern responsibly, and act with environmental integrity (Visser, 2011; Porter & Kramer, 2011). A number of studies have found that when the health and social impacts of mining are not taken into account in decision-making, local communities can “bear a disproportionate share of the costs of mineral development without adequate compensation, and receive an inappropriately small share of the economic and social benefits” (IIED, 2002:208). CSR is a key part of ensuring that a company has a positive effect on society and doesn’t try to engage in fraudulent activities, which the government has been looking into lately (Msosa, 2019). However, the disparities in expectations that exist between various stakeholders have been a primary source of contention in the extractive sector. This may occur when specific stakeholders are not included in the decision-making chain. In addition, stakeholders may lack awareness of the economic particulars of a mining project, fail to grasp how mining might help each group as a whole, and consider the production of value as a “zerosum” game in which there are winners and losers (Pedro, 2015). As shown in Fig. 1, businesses must keep local communities, the government, and other stakeholders informed about changes in the need for labor at various points over the life of a mining, oil, or gas project. Social dialogue with the government, employers and workers’ organizations, and broader tripartite plus dialogue that includes businesses are critical channels for this communication and provide a platform for cooperation

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along the supply chain and between governments, companies, suppliers, and communities (ILO, 2016). Stakeholder theory says that businesses have to give something of value to all of their many stakeholders. This is the method through which the purpose, the source of inspiration that led to the establishment of the organization, is put into action. When it is understood that the goal of business is to create value for all stakeholders, including customers, employees, financiers, suppliers, and communities, the temptation to use corporate social responsibility (CSR) to cover up wrongdoing with other stakeholders is lessened. This is because the rationale for wrongdoing with some other stakeholders is diminished. It is just as crucial to creating value for different stakeholders as it is to do excellent work in the field of CSR (Freeman & Dmytriyev, 2017). This is in line with what Freeman et al. (2010) said about residual and integrated approaches to corporate social responsibility. The residual approach means giving back to society only after making money, while the integrated approach means making decisions based on economic, social, environmental, and ethical factors. The private sector has a responsibility to protect and advance human rights in a number of different ways, depending on the situation. For example, there are human rights principles that directly affect employees, principles that involve public and private business partners and their employees, principles that affect the community and the general human rights environment of that community, principles that can affect the relationship between a business and a public institution, and principles that can involve concerns for the environment (Ratner, 2001). So, companies that want access to Africa’s rich mineral resources must build strong relationships with local communities, find ways to include these people in their supply chains, and work with the African government as a partner (Lane & Reggio, 2013). For example, they could use the infrastructure built for mining as a way to boost economic growth in other sectors. Thus, for businesses and industries to work and keep a smooth supply chain, they need a calm and friendly environment. The same is true for communities that want to grow in a sustainable way. Increased levels of business involvement with local communities may reduce the number of homicides, kidnappings, and instances of prolonged conflict (Aaron & Patrick, 2013).

6 Conclusion Over the past few decades, investments in mineral-rich developing countries have not helped improve their social and economic conditions or kept their environment safe. Most government programs swiftly get mired in political manipulation, corruption, sectarian undertones, and severe internecine conflict. In developing countries, corporate social responsibility has a big impact on society. It lessens the reliance on the government to bring about social transformation. To make the most positive change possible with their resources, there is a need for a publicprivate partnership with clearly defined rules and procedures. Thus, people must be

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brought together, their attention must be directed toward activities that serve society, and peace and harmony will be strengthened because of social changes pushed by corporations and communities. This means that there is a need for a multistakeholder approach that includes all stakeholders and allows them to help make decisions in the mining sector. Every stakeholder needs to be involved, and this can be done by sharing information, running campaigns in the media and other places, and working together with institutions like those in charge of oversight. An approach to engagement that is focused on the community and takes the situation into account needs a deep understanding of the local culture, circumstances, and power dynamics, as well as a sophisticated way to bring in different voices from the affected communities.

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Steven Kayambazinthu Msosa is an expert in marketing. He has worked in the private and public sectors for over 15 years. He is currently a Lecturer in Marketing and Research Fellow at the Mangosuthu University of Technology. He has held positions as a Head of Marketing and Controller of Courier Services responsible for sales at the Malawi Posts Corporation, and Customer Service Representative and Card Marketing Executive at Total Malawi Limited. He obtained his PhD in Marketing and a Master’s Degree in Marketing at the Durban University of Technology, a Master of Commerce in Business Management specializing in Entrepreneurship, a Bachelor of Commerce Honors Degree in Business Management specializing in Marketing from the University of South Africa, a Bachelor’s Degree in Business Administration from the University of Malawi, and a Diploma in Community Development from the Association of Business Managers and Administrators (ABMA), UK. He is a Member of the editorial board of an international journal and a Reviewer for several DHET-accredited journals. He has published in DHET-accredited journals and presented at local and international conferences. His research interests are corporate social responsibility, sustainability, entrepreneurship, services marketing, higher education marketing, international marketing, multilevel marketing, relationship marketing, and integrated marketing communication. Shame Mugova is a Financial Analyst; a Lecturer in Finance at Birmingham City University, England; and a Research Fellow at the Durban University of Technology, where he holds a PhD from. He received a Master’s Degree (MBA) from Solusi University (Zimbabwe) and a Bachelor of Commerce Honors Degree in Finance from National University of Science and Technology (Zimbabwe) in 2012 and 2007, respectively. His research interests are corporate social responsibility, corporate governance, and trade credit. He has 8 years of work experience in Zimbabwe’s tax, medical, private voluntary organization, engineering, and clothing and textile industry sectors. His work experience is in the field of finance and accounting. Moreover, he has worked for 3 years as an independent Business Consultant for small-to-medium enterprises. His research interests are corporate finance, financial development, corporate social responsibility, corporate governance, and trade credit.

Corporate Social Responsibility During the COVID-19 Pandemic in the Extractive Sector Steven Kayambazinthu Msosa

1 Introduction Numerous businesses have closed due to the COVID-19 pandemic, particularly in underdeveloped countries. This has dramatically impacted the socially responsible actions that companies engage in, which in turn has influenced shareholders, customer preferences, and business assurance. CSR during the COVID-19 pandemic is challenging and fascinating to consider in relation to developing nations. Due to the COVID-19 pandemic’s travel restrictions and social isolation policies, the execution of CSR initiatives in the extractive industry continues to be a significant hurdle for many businesses; nonetheless, numerous organizations have developed strategies to achieve their CSR objectives during the pandemic (Sanchez & Sanchez, 2020). This pandemic has been among the worst outbreaks in various locations in recent years. People, the community, the economy, and business activities were affected for at least several months, if not longer. During this time of critical importance, it was essential to safeguard workers’ health, safety, and well-being, deliver essential goods to consumers, and promote community involvement. The critical scarcity of medical equipment, such as personal protective equipment (PPE), including protective gowns, goggles, and masks, has been a primary concern. At this time, goods of this kind are in very high demand. As a result, CSR leaders are expected to prioritize satisfying urgent demands at regional, municipal, and global levels by providing critically essential supplies and medical equipment for patients, healthcare professionals, and first responders combating the COVID-19 pandemic (Mahmud et al., 2021). Equally, there is an expectation that companies in the extractive industry will work hand in glove with various governments to mitigate the effects of the pandemic. Thus, the socioeconomic growth of state economies involves a significant S. K. Msosa (✉) Department of Marketing, Mangosuthu University of Technology, Durban, South Africa © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_2

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role for corporations. The COVID-19 pandemic has tested businesses’ ability to withstand uncertainty and severe economic downturns in Africa. In times of crisis, a business needs to have strong corporate governance and well-established CSR policies to maintain a healthy balance between the value of its shareholders and the interests of its stakeholders, as well as improve its long-term organizational performance. Indeed, individuals and the community will not forget the business that assists them during their time of need because of its support (Lateef & Akinsulore, 2021). Increasing awareness, supporting change, developing trust, and accepting responsibility are the cornerstones of corporate social responsibility. In the past, CSR was observed only in large corporations, but in recent years, purchasing patterns have changed, and consumers have become more committed to social awareness. As a result, CSR has become a priority for businesses of all sizes. Historically, large, successful corporations that wished to do their part for the communities where they worked treated “corporate social responsibility as an afterthought. It was just a show of good faith from those businesses. However, given today’s consumers’ changing views and interests, it is essential for businesses to include charitable giving in their mission and operations if they hope to maintain public interest and financial viability over the long term. In the spirit of the Sustainable Development Goals (SDGs), corporate social responsibility (CSR) is not just about grand gestures or colossal spending; it is about doing things that will have a long-term positive effect on people and society”. Corporate social responsibility, to restate, is not always synonymous with opulent outlays (Salam & Bajaba, 2021). Therefore, corporate social responsibility (CSR) requires businesses to address concerns beyond their stakeholders on human rights, employee welfare, and climate change, including their workers, customers, impacted communities, and the broader public (Hamann, 2003). Thus, there has never been a more critical time to address the needs of various stakeholders through CSR than during the COVID-19 pandemic.

2 State and Extractive Sector Intervention in Response to the COVID-19 Pandemic Many of Africa’s economies are supported by the extractive industry, and the vast bulk of their national budgets depend on the sale of minerals, oil, and gas. In light of this, the regulatory framework built for the extractive industry during the pandemic substantially decided these economies’ survival. In light of this, it shouldn’t come as a surprise that many of these African nations that had enforced statewide curfews were fast to restore their mining industries after they had been closed. South Africa, for instance, authorized mining companies to restart normal activities as part of their recovery process. The whole nation of Zimbabwe was under lockdown, except for the mining industry, which was deemed a “vital” function. Despite the partial shutdown, the Namibian government permitted diamond companies to continue

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normal operations. Other nations, like Mozambique, Angola, Zambia, and the Democratic Republic of the Congo, did not entirely shut down their mines; nonetheless, individual mining corporations in these nations unilaterally elected to scale back their activities (Dhliwayo & Gwanyanya, 2020). In South Africa, the National Collaborating Center for Communicable Diseases (NCCC) developed a five-level risk-adjusted strategy to contain the spread of COVID-19. This strategy involves the imposition of a variety of economic and social measures, such as restrictions on local and international travel, the closure of educational institutions, a ban on public gatherings, and the closure of borders. At no point throughout the lockdown were vital services, such as the delivery of medical care, the operation of retail food shops, the police force, the financial system, or the distribution of government benefits, impacted in any way. Within the levels, maintaining a certain distance from one another physically, regularly washing and sanitizing one’s hands, and donning cloth face masks became required procedures in all public areas. Within the context of the risk-adjusted strategy, level 5 had the strictest limits, while level 1 included the fewest restrictive constraints (South African Government, 2020). The responsibility to protect workers in various sectors of the economy was not only left to the government alone. Mine workers share tools, transportation, and even places to shower, making it hard to keep a social distance. Some workers are especially at risk because they already have lung problems because of their jobs. Mining unions complained about the lack of health and safety measures during COVID-19, and the Association of Mineworkers and Construction Union of South Africa went to court to demand that the government makes rules to keep workers safe during the crisis (OXFAM, 2020). As the crucial national industry resumed operations that had been progressively halted, mining companies in South Africa established common quarantine facilities for miners who tested positive for COVID-19 and were contemplating alternative collaboration methods. Companies such as Sibanye-Stillwater, AngloGold Ashanti, Harmony Gold, and Gold Fields turned to social media, radio stations, and newspapers to inform their staff members on how to stop the spread of the coronavirus. Sibanye said it would convert many of its worker hostels in West Rand, the Free State, and Rustenburg into quarantine facilities. The company also stated that it would make these facilities available to employees of other companies diagnosed with the virus (Reuters, 2020). The Mine Health and Safety Act has motivated mining companies to take certain initiatives. Thus, employers in the South African mining industry are expected to adopt health and safety management systems to ensure compliance with legal requirements that strive to protect employee health and safety. Pieter Colyn, an executive at the law company ENSafrica responsible for mine and occupational health and safety problems, reached this conclusion. Employers must comply with the Mine Health and Safety Act (MHSA), the Mine Health and Safety Regulations, and the Minerals Act Regulations (James, 2022). The outcomes of COVID-19 have altered the relationship between the government and the business sector. Due to the widespread expectation that mining firms will perform government responsibilities in remote places, there is an opportunity for these companies to produce additional value by working more actively with the

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communities and governments in which they are hosted (Cholteeva, 2020). Although mining corporations are assisting the government in improving its response to COVID-19, more than their efforts may not be needed to motivate widespread reform and close the trust gap. As the dynamic connection between governments and corporations continues to develop, the approach taken by the industry toward contributions to the community will need to become more sophisticated. Typically, this means investing one’s financial resources in activities that will pay off in the distant future (Lane & Muricy, 2021).

3 Corporate Social Responsibility During a Crisis Mineral-dependent nations are especially concerned about losing tax revenue and going through a balance of payment crisis when metal prices fall sharply. More than 20 nations, whose primary source of foreign exchange is from the sale of minerals, were concerned that they would not have enough foreign exchange reserves at the beginning of 2020 to cover imports or fulfill external obligations. There were other African nations at risk of “export dependence, foreign reserve, and credit default swap (CDS) spread” at the time, including the Democratic Republic of the Congo, Guinea, Mauritania, Sierra Leone, and Zambia (Bauer, 2020). The pandemic and the fact that many growing economies rely heavily on mining left mineral-rich nations torn between conflicting and frequently incompatible objectives. Money has to be raised rapidly to halt the spread of COVID, prevent the economy from imploding, and get it back on its feet. On the other hand, to retain economic activity and mining earnings, they were advised to provide economic assistance to the mining industry, mainly through changes to tax policy (Ericsson & Löf, 2019). Corporate social responsibility (CSR) is becoming more critical in the business world as issues such as social justice and climate change receive more attention and support from the public. Environmental, social, and governance (ESG) challenges are essential to people who are part of this trend, such as customers, workers, suppliers, and the community. Companies understand that these issues should be strategic priorities for CSR reporting and competitive advantage rather than just talking points in corporate boardrooms and among investors. Additionally, from a business’s point of view, one of the best things about CSR is that it often protects the business, such as insurance, by building reputational assets that help the business stay strong during crises (Lee & Singal, 2021). COVID-19 may allow CSR and corporate community teams to reevaluate and restructure strategies to prioritize community needs in their discussions. In certain nations, COVID-19 redefines behaviors that fall under CSR activities and includes tight standards. For instance, according to instructions from the Indian government, corporate donations made to the Prime Minister (PM) Care Fund would be included as CSR donations, while donations made to the Prime Minister’s Fund would not (Asante Antwi et al., 2021). Profits and profitability globally plunged to levels not seen even during severe economic downturns due to the COVID-19 pandemic. The global epidemic is to

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blame for this decrease. As a result of the current economic climate, businesses’ commitment to ethical business practices and CSR duties is being tested (He & Harris, 2020). CSR (corporate social responsibility) is a new management trend that incorporates ideals such as sustainability and accountability into a company’s operations. The SDGs (Sustainable Development Goals) serve as the framework for this plan. It is far more than something you must do or a plan to boost brand recognition and client retention rates. This is because it serves a much greater goal than fulfilling those seemingly insignificant objectives, notably improving the company’s market status. One of the industry’s goals, particularly the firm, is to maintain fundamental ideas such as social responsibility. The SDGs advocate for firms and industries to have high levels of social value. A company’s growth and success are intrinsically related to its reputation and brand, which are influenced by such factors. It is how businesses of all sizes are making a difference and contributing to society (Salam & Bajaba, 2021). Businesses must uphold their standards of behavior because of the extensive damage caused by the COVID-19 outbreak. This will benefit local communities, NGOs, and companies (Lee, 2021). The COVID-19 pandemic had a devastating impact on all segments of society, but those in the most vulnerable groups have suffered the most thus far. Nevertheless, the outbreak is causing harm to many people; the poor, the disabled, the old, the young, and the natives of affected nations are particularly vulnerable. Preliminary studies show that the health and financial effects of the virus fall disproportionately on the poor. For example, those who have to make a living on the streets may not have anywhere to go if they catch the virus. Because of the disease and its repercussions, such as less travel, decreased economic prospects, and increased xenophobia, individuals without access to running water, refugees, travelers, or those forced to flee their homes are disproportionately affected (United Nations, 2020). Moreover, the consequences of the COVID-19 pandemic are not adequately addressed by policymakers. Consequently, they might worsen in the medium and long term and lead to issues such as global unemployment, discrimination, and social isolation. Long-term worker protection and poverty reduction are greatly aided by comprehensive and universal social safety nets once they are in place. This is because these innovations might serve as self-regulating mechanisms. Simply defined, they ensure a minimum income, which aids in people’s resilience and adaptability in the face of adversity (United Nations, 2020).

4 The COVID-19 Dilemma in the Extractive Industry The global coronavirus pandemic has had a devastating effect on people’s ability to make a living in various countries, which has led to a number of those nations invoking disaster management laws and regulations as well as state of emergency laws and regulations, such as imposing nationwide lockdowns, to combat the virus’s ability to spread. It is not yet possible to determine how the epidemic will affect society and the economy, but its effects will be seen for many years. Numerous

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African nations have implemented various countermeasures to control the virus’s spread while fostering economic revival. Human rights continue to be an essential component of any effort to strike a balance or develop strategies for economic recovery. In particular, this refers to the rights of workers and communities in vulnerable situations to healthcare, a clean environment, and fair working conditions, among other things. In times of crisis and pandemics, it is almost always the case that the rights of workers and communities are put on the chopping block (Dhliwayo & Gwanyanya, 2020). COVID-19 has unquestionably presented the working world with one of the most critical CSR problems ever. However, CSR must address several issues, including salary changes, furloughs, redundancies, ongoing payment of wages and salaries for sick and at-home employees, support and staff replacement in the event of a death, and unanticipated absenteeism, to name a few. Businesses must balance their moral duty to renounce extreme free-market philosophies that prioritize profit over employee safety with their financial and emotional obligations to lessen the societal impact of COVID-19. Businesses urgently need to reevaluate how they approach issues related to employee health and safety issues. This is more important than ever. Businesses should invest more in international health and safety inspections by updating risk assessments and collaborating with government organizations more closely (Antwi, 2020). The South African economy benefits significantly from the mining sector. It employs approximately 450,000 people directly or indirectly and accounts for 8.1% of GDP. Despite these significant contributions, the industry has only grown slowly over the past 10 years and is now suffering from the shutdown’s severe economic effects. The outbreak is challenging several widely held mining myths. Many people have been compelled to adopt a strategy centered on digital technology for the first time. Even though most mines operate in unfamiliar terrain, those affected are stepping up to the plate and proving the industry’s resilience (WinWin International, 2021). The COVID-19 epidemic, which has disrupted corporate operations in an unprecedented fashion, has increased the focus on mines’ environmental, social, and governance (ESG) performance. In a time when company profits are declining, there is a greater need from society for businesses and corporations to help fight the epidemic. COVID-19 forced mining businesses to scale down operations, enact temporary mine closures, and carry out cost-cutting measures in response to a faltering local and global economy. Despite this, various media coverage reports and archives emphasize the contributions made, particularly in donating medical facilities and tools. With resources, including equipment, money, and the construction of health facilities in its operational locations, the mining industry has significantly contributed to the battle against COVID-19 (Shaanika, 2021). Many businesses are struggling due to the COVID-19 issue because of the decline or cancellation of business. Workers’ income and jobs are threatened as a result. Some businesses have been able to protect their employees from these effects, opting to retain them and continue paying them throughout the suspension of their operations. However, many others have been forced to lay off employees or cut their hours

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(Edgecliffe-Johnson, 2020). Due to operational difficulties or pricing repercussions from COVID-19, several businesses have looked for tax incentives or regulatory relief. While there may be a good case for some targeted assistance, such as a brief tax holiday, excessive tax breaks risk depriving states and municipalities of money needed to combat the epidemic. Recognizing this, several mining firms in less difficult financial circumstances have tried to help governments and communities in their efforts to address the problem. For instance, the world’s two largest mining companies, Newmont and Rio Tinto, established $20 million and $25 million worldwide community assistance funds, respectively, while Barrick donated $530,000 to the Zambian government for their COVID-19 response (OXFAM, 2020).

5 CSR Initiatives in Response to COVID-19 in the Extractive Sector Corporate mismanagement, corruption, and other problems afflicting Africa’s business climate are apparent. In contrast to the standards and norms in developed countries, these new challenges affect how well the continent’s governance institutions function. Africa can only benefit from these models once its analytical framework is expanded beyond the conventional norms developed from studying corporate cultures in wealthy nations. Additionally, a concerted effort must be made to develop a local African corporate governance model consistent with economic globalization dynamics (Lateef & Akinsulore, 2021). In most African nations, corporate social responsibility (CSR) is not required by law, and the legal framework is still being refined or established. The development of ethical business practices can be attributed, in large part, to the actions taken by a variety of stakeholders and regulators, as well as to the fact that businesses have been subjected to negative publicity as a result of some instances in which they have neglected their responsibilities. This indicates that a firm’s practices may improve or worsen depending on the amount of volatility in the industrial sector in which the company operates, the direction and quality of the leadership inside the organization, or the degree of regulation in place (Rampersad & Skinner, 2014; Lateef & Akinsulore, 2021). CSR is crucial when people make every effort to get through a tough time. Corporate social responsibility (CSR) is sometimes referred to as a “self-regulating business model” since it requires businesses to engage with both internal company stakeholders and external stakeholders in the community and industry. This interaction sets the stage for the firm to assume some degree of social responsibility (Das & Ray, 2020). Some of the most important areas that businesses in South Africa focus on in regard to their corporate social responsibility activities are “education, social and community development, health and HIV/AIDS, environment, food security and agriculture, entrepreneurship and the support of small businesses, job creation, training and skill development, sport development, arts and culture, housing and living conditions, safety and security” (The CSI Handbook, 2013).

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Mining serves as the foundation of the economy in several countries that are rich in resources; both developed and developing countries stand to gain from the industry’s contribution to the alleviation of poverty, the promotion of inclusive economic growth, and the advancement of social conditions. However, similar to other economic subsectors, the mining industry has also been subjected to the detrimental effects that COVID-19 outbreaks have had. The confined working circumstances at mine sites are putting workers on the frontline about health and safety concerns, which has prompted the mining industry to quarantine workers even if national lockdown legislation does not require them to do so (Ramdoo, 2020). COVID-19 has left its imprint on the globe in various ways, and its effect may be felt in various pursuits. It has impacted not only continents, countries, states, and communities but also the natural world and the ecosystems that it sustains. The government, the armed forces, religious institutions, public and private schools, nonprofit organizations, higher education, and a wide range of other areas are just a few of the significant industries and fields it has an impact on (Carroll, 2021). The pandemic’s path, severity, and outcomes have all been characterized by perilous uncertainty, which has created a vicious cycle of insecurity for businesses, consumers, and employees and restricted financial conditions. Because of this, businesses have cut back on their investments and laid off employees due to the economic climate. Because of these factors, conducting research and gaining knowledge of their effects on the economy have proven to be extremely difficult. To further complicate matters, economies have suffered nonlinear impacts, cross-country spillovers, and tremendous uncertainty about future economic prospects (Chudik et al., 2020). The coronavirus disease (COVID-19) pandemic is a worldwide phenomenon that has produced a major health catastrophe and caused significant socioeconomic disruption in many countries (Mahmud et al., 2021). Companies’ dedication to CSR and ethical business practices have inevitably been tested in the wake of the COVID crisis. Some might argue that the short- and long-term financial strains caused by the outbreak could significantly push firms to pursue short-term gains, sometimes even through fraud and misconduct, and reduce long-term CSR investment, likely because of a lack of slack resources and mounting pressure for survival (He & Harris, 2020). During natural disasters such as floods, landslides, and earthquakes, many corporations have provided relief operations and voluntary services to support those affected. The pandemic caused by COVID-19 has highlighted how unprepared the world is to deal with the situation, in terms of both the healthcare facilities that are currently accessible and the financial capacity that is necessary to perpetuate the epidemic. The pandemic has caught the globe by surprise. Because “we are all in this together,” as the head of the WHO put it, business contribution during the COVID-19 crisis is necessary (Aguinis et al., 2020). As of July 2020, the mining industry in South Africa was hit the hardest. The Minerals Council said that 4874 miners had tested positive for the virus, which led to 39 deaths. Because of these fatalities and illnesses, mining productivity in the country was down 30% yearly, raising questions about the industry’s preparedness for the epidemic. In response, on July 17, the Minerals Council declared a “national day of health and safety” to raise awareness about issues such as the proliferation of

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COVID-19 in the workplace. The organization also released a “behavioral change field guide” to curb the virus’s spread, recognizing the importance of teaching and equipping mineworkers to safeguard themselves and their coworkers against infection (Casey, 2020). The subject of obtaining a valid operating license continues to be one of the most contentious in South Africa. Many mining companies need help to maintain good relationships with their communities, especially in places where essential services are not always available in a fully functioning way. All projects should be designed with government, industry, and community input to establish long-term development plans for what communities should look like in the future. Then, specific projects need to be put into long-term, all-encompassing plans for community development that can be carefully tracked over time. The upskilling of local communities should also be a priority for mining firms to develop long-lasting empowerment for such areas (Chaumontet et al., 2020). The mining companies used the pandemic to show their might and bravery and to enhance their reputation as hardworking, compassionate, strong, and caring organizations. By fostering better relationships, collaboration, and contact with locals, they also increased people’s dependence on local jobs, benefits, services, opportunities, and social safety. This had two outcomes. Third, they emphasized mining as a necessary endeavor in their discourse but neglected to discuss the long-term consequences of maintaining the intensity of mining in relation to the demands of the “global population.” “It is significant to highlight that the mining industry, a socially sensitive sector, has come under scrutiny, criticism, and assault from environmental activists for ruining the living conditions of its workforce and disregarding the implications of that devastation” (Jindřichovská & Eckert, 2022). According to del Mar Miras Rodríguez (2013), the crisis may present itself as either a danger or an opportunity. Recessions or other crises or calamities that have a negative impact on social stability and economic development are examples of what might be expected during trying times. Because of the acute lack of resources and the growing unpredictability of the financial climate, some businesses may suspend their typical corporate social responsibility (CSR) efforts in such a scenario. Even yet, many firms participate in charitable giving voluntarily; for instance, they may provide cash, goods, or their own time to various community organizations. CSR is critical for addressing socioeconomic issues and achieving the goals of developing countries. This illustrates the mining industry’s significant financial potential to contribute to the expansion of the education sector, among other things. Despite this, their CSR agenda and practices face several hurdles that impede them from fulfilling their stated CSR goals. Inadequate post-project monitoring and evaluation, a lack of policy alignment with significant government development efforts, and a lack of coordination and cooperation among key partners are also issues. This overview has shed light on how the existing CSR strategy and practice may need to be tweaked to address social concerns and advance socioeconomic development goals (Siyobi, 2015). The COVID-19 outbreak has brought to light the flaws of undeveloped public health systems. Because of these shortcomings, the private sector has stepped in to provide services that would normally fall under the purview of the government. Concerns have been expressed about the long-term

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viability of some mining businesses’ health initiatives if the mines close and the equitable distribution of these resources throughout the country’s various demographic divides. In the absence of more concerted actions and the setting of regulatory failures, the mining industry has been able to advance its agenda, including the search for more legitimacy, by creating new strategies in reaction to the pandemic. Because of the outbreak, this is now a genuine possibility. This is still the case, even though the pandemic was the source of the problem (Campbell, 2022). The policies adopted by mining firms in Africa would give special consideration to protecting the security of their personnel and the communities in which they operate. However, it should be recognized that the protection of mining communities has not received little attention up to this point. Keeping everyone safe should be the priority right now. If the communities in which a company operates and its workers are protected, then the company is better off. COVID-19 offers mining firms and African governments a chance to reevaluate their socioeconomic goals. The status quo cannot be maintained. Violence, greed, injustice, exploitation, and tyranny marred the pre-coronavirus age. Governments and mining businesses must consider the past as they create a new “normal.” It prioritizes human life above everything else. African nations must now guarantee more significant and profound changes if they want to create fast-growing, more inclusive economies. Additionally, mining corporations must adopt a nonexploitative economic strategy and assume greater accountability for employee and local community concerns about the environment and human rights (Dhliwayo & Gwanyanya, 2020). The COVID-19 pandemic in Africa has once again highlighted the reality that mining operations are an integral part of the local community. This was made abundantly evident by the fact that mining companies and local communities collaborated to fight the pandemic with minimal production losses. In the long term, mining companies’ capacity to maintain their operating licenses will become a distinguishing characteristic of these enterprises and a source of competitive advantage. Because of this, predicting how COVID-19 would affect mining in Africa has taken much work. However, what is certain is that the mining industry must reorganize and reconfigure itself to operate under a new normal, one in which it can operate and sustain itself despite the additional constraints and challenges that such pandemics bring to the already complex and difficult task of running mines (Jindřichovská & Eckert, 2022). The mining industry has been able to continue operations despite the COVID-19 problem, but businesses have had to adapt and develop to the new norm. Remote workforce planning and an increase in the usage of automation are examples of positive developments. The pandemic has prompted mines to embrace digitalization earlier than anticipated, and they are now beginning to reap benefits such as decreased costs and better employee productivity. In addition to enabling remote workforces, reduced on-site presence, and enhanced off-site operational control, technology assists in mitigating the dangers and effects of coronavirus. Due to recent revisions to the mining charter and growing pressure from the government and shareholders, mining companies have been forced to prioritize their corporate social responsibility (CSR) initiatives. The mining industry should utilize technology from

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the Fourth Industrial Revolution. It can make mines safer and more efficient and positively affect the communities they serve (WinWin International, 2021).

6 Conclusion The extractive industry plays a vital role in the overall effort to contribute to sustainable development on all levels—local, national, and global. However, it is generally accepted that mining is a limited economic activity. Businesses in the extractive industry have grown into critical social actors who meet societal needs and provide desirable outcomes for a much more comprehensive range of stakeholders. They are no longer merely economic units with the only objective of maximizing profits for their owners. Consequently, it is expected that companies in the extractive industry will contribute to the social and economic development of areas in which they operate and in areas from which they source the majority of their labor. In the years to come, the need to incorporate broad social and environmental sustainability objectives into organizational strategies and decision-making criteria will remain, if not increase. The COVID-19 pandemic has caused and continues to cause irreparable harm to millions of people’s lives, health, and safety. The virus and the pandemic’s expansion, which resulted in a resource deficit, increased food insecurity, and poverty, have directly contributed to this devastation. There is a need for CSR initiatives by the extractive industry to lessen the burden on both governments and people. Thus, the healthcare and social care systems are in disarray due to inadequate financing, infrastructure, and staff. An increasing proportion of individuals cannot receive treatment for noncommunicable diseases. The COVID-19 crisis will inevitably result in temporary setbacks and a reordering of priorities. However, sustainability goals for the nation, the government, and businesses must continue to be prioritized as before the COVID-19 crisis. Therefore, organizations and leaders who incorporate this focus into their future strategies and objectives will be more resilient and able to make a lasting impression.

References Aguinis, H., Villamor, I., & Gabriel, K. P. (2020). Understanding employee responses to COVID19: A behavioral corporate social responsibility perspective. Management Research, 18(4), 421–438. Antwi, H. A. (2020). Beyond COVID-19 pandemic: a systematic review of the role of global health in the evolution and practice of corporate social responsibility. Available online: https://assets. researchsquare.com/files/rs-40212/v1/018b56c3-bf54-4bf4-9356-eaa43a93e7df.pdf?c=163184 5350 Asante Antwi, H., Zhou, L., Xu, X., & Mustafa, T. (2021). Beyond COVID-19 pandemic: An integrative review of global health crisis influencing the evolution and practice of corporate social responsibility. Healthcare (Basel), 9(4), 453. https://doi.org/10.3390/healthcare9040453

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Bauer, A. (2020). “Three proposals for mineral-dependent countries during the coronavirus pandemic.” Natural Resource Governance Institute. https://resourcegovernance.org/blog/proposalsmineral-dependent-countries-coronavirusmining (Accessed 11 October, 2022). Campbell, B. (2022). Corporate influence and the global pandemic–reflections from the mining sector. Revista Brasileira de Política Internacional, 65(1), 1–20. Carroll, A. B. (2021). Corporate social responsibility (CSR) and the COVID-19 pandemic: Organizational and managerial implications. Journal of Strategy and Management, 14(3), 315–330. https://doi.org/10.1108/JSMA-07-2021-0145 Casey, J. P. (2020). Buffalo suspends work as nearly 5,000 South African miners contract Covid-19. Available: https://www.mining-technology.com/news/buffalo-suspends-work-asnearly-5000-south-african-miners-contract-covid-19/ Chaumontet, L., Kuipers, H., Mőncks, T., Bour, A., Scholtz, D, & Erasmus. D. (2020). Mining after COVID-19: The South African Case. How South Africa Can Emerge Stronger. Available: https://web-assets.bcg.com/42/19/76e796a748029831ddde5c021fea/mining-after-covid-thesouth-african-case.pdf Cholteeva, Y. (2020). How the mining industry is rallying to help during Covid-19. Mining Technology, 2020. Chudik, A., Mohaddes, K., Pesaran, M. H., Reissi, M., & Rebucci, A. (2020). “Economic consequences of COVID-19: a counterfactual multicountry analysis”, VoxEu and CEPR, available at: https://voxeu.org/article/economic-consequences-COVID-19-multicountry-analy sis (accessed 13 October 2022). Das, S. K, & Ray, N. (2020). License to operate remains the top risk in mining and metals for 2021. https://www.ey.com/en_za/news/2020/10/mining-and-metals-businessrisksAvailable: report-2021. del Mar Miras Rodríguez, M. (2013). Is CSR in crisis? In D. Crowther & G. Aras (Eds.), The governance of risk (developments in corporate governance and responsibility, vol. 5) (pp. 19–32). Emerald Group Publishing Limited. https://doi.org/10.1108/S2043-0523(2013) 0000005005 Dhliwayo, M & Gwanyanya, M. (2020). COVID-19: Impact and lessons for the extractive industry in Africa. Available: https://www.business-humanrights.org/pt/blog/covid-19-impact-and-les sons-for-the-extractive-industry-in-africa/ Edgecliffe-Johnson, A. (2020) Coronavirus lay-offs split corporate America. Financial Times, New York, https://www.ft.com/content/c49e6a74-6c60-11ea-89df-41bea055720b Ericsson, M., & Löf, O. (2019). Mining’s contribution to national economies between 1996 and 2016. Mineral Economics, 32(2019), 223–250. https://doi.org/10.1007/s13563-019-00191-6 Hamann, R. (2003). Mining companies’ role in sustainable development: The ‘why’ and ‘how’ of corporate social responsibility from a business perspective. Development South Africa, 20(2), 237–254. He, H., & Harris, L. (2020). The impact of Covid-19 pandemic on corporate social responsibility and marketing philosophy. Journal of Business Research, 116, 176–182. James, N. (2022). Mining industry leads way in Covid-19 health and safety. Available: https:// www.miningweekly.com/article/mining-industry-leads-way-in-covid-19-health-and-safety2022-01-07 Jindřichovská, I., & Eckert, E. (2022). Social responsibility of mining companies at a time of COVID-19: Dear shareholders! Sustainability, 14(1), 350. Lateef, M., & Akinsulore, A. (2021). Covid-19: Implications for corporate governance and corporate social responsibility (CSR) in Africa. Beijing Law Review, 12, 139–160. https://doi.org/10. 4236/blr.2021.121008 Lane, A, & Muricy, P. (2021). Trend 4: ESG: Working to overcome the social trust deficit: Linking social investments to sustainable outcomes. Available online: https://www2.deloitte.com/za/en/ insights/industry/mining-and-metals/tracking-the-trends/2021/mining-industry-trust-deficit. html

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Lee, A. L. (2021). Adapting corporate social responsibility to COVID-19. Available online: https:// www.mottmac.com/views/adapting-corporate-social-responsibility-to-covid-19 Lee, S, & Singal, M. (2021). Does corporate social responsibility matter during crises?. Available. https://www.bu.edu/bhr/2021/10/29/does-corporate-social-responsibility-matter-during-crises/ Mahmud, A., Ding, D., & Hasan, M. M. (2021). Corporate social responsibility: Business responses to coronavirus (COVID-19) pandemic. SAGE Open, 11(1), 2158244020988710. OXFAM. (2020). Oxfam’s top three recommendations for mining companies during the COVID-19 crisis. Available: https://42kgab3z3i7s3rm1xf48rq44-wpengine.netdna-ssl.com/wp-content/ uploads/2020/06/Oxfams-Top-3-Recommendations-for-Mining-Companies-During-theCOVID-19-Crisis.pdf Ramdoo, I. (2020). The impact of covid 19 on employment in mining. Available: https://www.iisd. org/system/files/publications/covid-19-employment-mining-en.pdf Rampersad, R. and Skinner, C., 2014. Examining the practice of corporate social responsibility (CSR) in Sub-Saharan Africa. Corporate Ownership & Control (Print). Reuters, (2020). S. Africa mining firms work together against COVID-19 as mines reopen. Available: https://www.reuters.com/article/health-coronavirus-safrica-mining-idUSL3N2CG3 9A Salam, M. A., & Bajaba, S. (2021). Corporate social responsibility during the COVID-19 pandemic: A sequential mediation analysis. Social Responsibility Journal. Sanchez, I. M. G., & Sanchez, A. G. (2020). Corporate social responsibility during COVID19 pandemic. Journal of Open Innovation : Technology, Market and Complexity, 6, 126. https://doi.org/10.3390/joitmc6040126 Shaanika, F. (2021). Unearthing social responsibility in Namibia’s mining sector. Available: https:// www.rmb.com.na/news/social-responsibility-in-the-mining-sector (Accessed 12 November 2022). Siyobi, B., (2015). Corporate social responsibility in South Africa's mining industry: An assessment. Available: https://saiia.org.za/wp-content/uploads/2015/09/Policy-Briefing-142.pdf South African Government. (2020) About alert system, 2020. Available: https://www.gov.za/covid19/about/about-alert-system [Accessed 20 October 2022]. The CSI Handbook. (2013). The authoritative guide to corporate social Investment in South Africa, CSI handbook (16th ed.). Trialogue. United Nations. (2020). Everyone included: Social impact of COVID-19. Available: https://www. un.org/development/desa/dspd/everyone-included-covid-19.html [Accessed 13 October 2022]. WinWin International. (2021). The impact of digital learning in mining. Available online: https:// www.winwinza.com/post/the-impact-of-digital-learning-in-mining

Steven Kayambazinthu Msosa is an expert in marketing. He has worked in the private and public sectors for over 15 years. He is currently a Lecturer in Marketing and Research Fellow at the Mangosuthu University of Technology. He has held positions as a Head of Marketing and Controller of Courier Services responsible for sales at the Malawi Posts Corporation, and Customer ive and Card Marketing Executive at Total Malawi Limited. He obtained his PhD in Marketing and a Master’s Degree in Marketing at the Durban University of Technology, a Master of Commerce in Business Management specializing in Entrepreneurship, a Bachelor of Commerce Honors Degree in Business Management specializing in Marketing from the University of South Africa, a Bachelor’s Degree in Business Administration from the University of Malawi, and a Diploma in Community Development from the Association of Business Managers and Administrators (ABMA), UK. He is a Member of the editorial board of an international journal and a Reviewer for several DHET-accredited journals. He has published in DHET-accredited journals and presented at local and international conferences. His research interests are corporate social responsibility, sustainability, entrepreneurship, services marketing, higher education marketing, international marketing, multilevel marketing, relationship marketing, and integrated marketing communication.

CSR Through Responsible Leadership for Sustainable Community Development: A Developing Nation Perspective Amlan Haque

1 Introduction Building a sustainable community in developing nations involves balancing economic, social, and ecological goals (Roseland, 2000). The concept of sustainable community development (SCD) emerged as a popular solution to meet the business requirements of modern society while also respecting the environment’s integrity among the mass (Roseland & Spiliotopoulou, 2017). A sustainable community considers and addresses multiple human needs, not just one at the exclusion of all others. Diversity in this community is welcomed and protected, where everyone can have a voice and where prosperity is shared. The debate between economic growth and environmental protection is centered on whether community development can also reduce crime, conserve valuable resources, reduce waste, attract sustainable economic development, preserve the natural environment, and bring communities together for a greater good (Roseland & Spiliotopoulou, 2017). Hence, SCD seeks to balance ecological concerns and developmental goals while fostering better social relations; sustainable communities promote a more humane society and protect the environment (Roseland, 2000). However, communities have differences in environmental problems, natural resource endowments, economic and social development levels, and physical (i.e., geological and topographical) and climatic conditions. Moreover, in recent years, scholars and policymakers have become increasingly concerned with the adverse effects of business activities, particularly for the extractive industries in developing nations, and have raised questions about their leadership and corporate social responsibility (CSR). Companies in the extractive industries extract raw materials, such as oil, coal, gold, iron, copper, and other minerals, from the ground. Over 3.5 billion people live in countries rich in oil, A. Haque (✉) CQUniversity, Australia (Sydney Campus), Sydney, NSW, Australia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_3

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gas, or minerals (The World Bank, 2022). However, these resources often become a source of conflict rather than opportunities for developing nations. For example, some developing countries suffer from poverty, corruption, and lack of effective CSR and public interest due to poor governance and irresponsible leadership. CSR and sustainability are two aspects of community development that are criticized heavily in the literature on SCD due to poor leadership, especially in developing nations. As a result, developing countries offer scholars and researchers a fascinating and relevant context for leadership and community development research opportunities. In contrast with developed nations, emerging economies have rapid economic growth, increased market orientation, and constant transformation on the business and industry levels that contribute to SCD (Roseland, 2000). Several scholars have suggested that leadership and talent development programs focusing on adaptability and flexibility in developing economies will help them be more sustainable from the community’s standpoint (Roseland & Spiliotopoulou, 2017). For example, developed-country multinationals continue to send their managers and employees to their subsidiaries in emerging economies to fill various key expatriate positions. Unfortunately, this is not enough, and practitioners and researchers have emphasized the need to develop local leaders to address the “common talent challenge” found in this context (Roseland, 2000). Today, business leaders from emerging economy countries are active in their home countries and abroad, thanks to the outward foreign direct investment (FDI) movement (e.g., Luo and Zhang 2016), so understanding them and how they lead is more critical than ever before. Developing responsible leadership skills for SCD in emerging economies is particularly challenging due to ethical and accountability concerns. Unlike the developed world, there are no robust, formal institutions regulating the functioning of markets for the extractive industries in emerging economies (Haque et al., 2019). Corruption and bribery are more likely to occur when there is no adequate and effective regulatory environment. Researchers at Transparency International (Kowalczyk-Hoyer et al., 2016) have found that corruption levels in developing economies are rather high, whereas they are relatively low in developed economies. According to them, not only major (Western) multinationals but also emerging economy multinationals need to “play their role in fighting corruption and raising standards of integrity and transparency in business” (p. 6), as they are increasingly active in regional and global markets. Therefore, it is crucial to explore and implement responsible leadership for SCD and CSR to enable the extractive industries to uphold their commitment to integrating social and environmental concerns.

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2 Understanding the Underlings 2.1

What Is Sustainable Community Development (SCD)?

The notion of SCD requires an understanding of what a sustainable community is. A sustainable community considers and addresses multiple human needs at once, not just one at a time. For example, sustainable communities have a common purpose: creating a high quality of life where people can thrive. A sustainable community considers future changes and anticipates and adapts to them, taking a long-term perspective. It involves managing human, natural, and financial resources to fulfill current needs and ensure adequate resources for future generations. Moreover, a sustainable community acknowledges the interdependence of economic, environmental, and social resources without compromising the natural environment, such as land, water, air, and any natural or cultural resources (e.g., languages) that underlie them (Williams & Millington, 2004). As a result, a sustainable community is economically, ecologically, and scenically preserved through housing, transportation, and resource conservation. Furthermore, a sustainable community reduces fossil fuel consumption, greenhouse gas emissions, water consumption, and pollution (Gismondi et al., 2016). As a result, people from various backgrounds and perspectives feel welcome and safe in a sustainable community. In a sustainable society, every group has a voice in decision-making, and prosperity is shared by all. The sustainability of communities is, in many ways, related to the sustainability of development (Moreno et al., 2017). Recent developments in SCD acknowledge the Earth’s regenerative limits and the need for socioecological and economic resilience at all levels (Roseland, 2012). Therefore, new fields of study, such as community economic development, circular economy, eco-localism, and social economy initiatives, have emerged as alternatives to older approaches. Accordingly, SCD evolved rapidly, moving from simple local economic activities reflecting responsible, social, and cultural values to ventures addressing broader community needs and environmental well-being toward sustainable development (Gismondi et al., 2016). Today, communities gradually incorporate social and ecological factors into policymaking through collaborative and systemic processes. However, they often encounter challenges in setting sustainability goals and navigating the complexity of local agendas driven by diverse conceptual backgrounds and stakeholder interests (Roseland & Spiliotopoulou, 2017). Adopting sustainable frameworks and employing responsible leadership practices are recommended to address such challenges; a sustainability framework can be defined as a rational and structured approach for integrating concepts, methodologies, methods, and tools (Gismondi et al., 2016). As a result, communities can achieve their goals and measure progress in ecological, social, and economic areas while engaging their citizens responsibly (Moreno et al., 2017).

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What Is Corporate Social Responsibility (CSR)?

CSR is not a new concept and generally refers to corporations’ responsibility for their economic implications, social implications, and environmental consequences. However, its scope has expanded over time. Interest and debate are likely to increase over time. Early seminal works on CSR include Bowen 1953, who argued that organizations must consider social implications and responsibilities given their position and influence (Lee, 2008). In his contribution, Friedman (1970, p. 6) asserts that in a free society, “there is one and only one social responsibility of business [...] to use its resources and engage in activities designed to increase its profit so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.” The extractive industries’ CSR has multilevel stakeholder responsibilities to their societies to run and manage their business in the developing nation. In other words, they will never have a sustainable business performance without considering how the community develops or impacts their societies effectively through CSR. This concern is more apparent in developing countries with weak economies and no business support than in developed countries. Ackers and Eccles (2015) point out that society around the world is demanding government and businesses share the collective responsibility to ensure economic development does not compromise the ability of future generations to meet their own needs. In line with this notion, the extractive industries’ CSR contributes to sustainable economic growth (Misura et al., 2018). However, if the business environment in which the extractive industries operate is ignored, the business contribution to SCD may not be successful. Thus, when conceptualizing CSR for extractive industries, particularly for developing nations, it is essential to consider the social, cultural, legal, political, and economic connections and interactions between organizations and the large society (Rim & Dong, 2018). Using the CSR pyramid as a guideline (see Fig. 1), this chapter emphasizes Visser’s (2008) economic responsibilities, followed by philanthropic, legal, and ethical responsibilities. For example, Visser’s (2008) model differs from Carroll’s (1991), where Carrol suggested responsibilities in the following order: economic, legal, ethical, and philanthropic. While developing countries vary considerably in terms of the order of their CSR orientation, it is probably closer to that envisioned by Visser (2008) than by Carroll (1991). Every nation, including developed and developing countries, stresses the importance of economic responsibility in both CRS pyramids since economic development is a fundamental aspect of any nation’s development. In addition, extractive industries in developing countries are expected to play an essential role in implementing sustainable communities by participating in CSR programs (Visser, 2008). In developing countries, philanthropy is a second focus, and there are several reasons for this. First, there is a strong tradition of philanthropy in developing countries, and it is the old form of CSR that people are familiar with (Visser, 2008). Second, philanthropy is viewed by extractive industries as the most direct

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Fig. 1 CSR pyramid for developing countries. Sources: (a) Carroll (1991) and (b) Visser (2008) (as cited in Ragodoo, 2009. p. 22)

method for giving back to the communities where they operate. Third, many developing countries have been exposed to donor assistance in the past five decades, resulting in an ingrained philanthropic culture. Furthermore, philanthropy is often considered synonymous with CSR since, generally, developing countries have yet to fully experience the benefits of CSR outside of philanthropy (Visser, 2008). The third level in both pyramids is a legal responsibility. Some developing countries have made significant progress in strengthening legislation’s social and environmental aspects, but many lag behind the developed world in incorporating human rights and other CSR issues (Visser, 2008). For example, as an upper-middleincome country, Malaysia has already put in place several laws since the 1970s, such as the Environment Quality Act (1974), the Anti-corruption Act (1977), and the Human Rights Commission of Malaysia Act (1999) (Lu & Castka, 2009), which have all been instrumental in facilitating the implementation of CSR. Finally, ethical responsibility involves activities expected by society for companies to perform in extractive industries (Carroll, 1991; Wilson, 2015). However, ethical responsibilities were found to have a minor influence on developing countries, particularly SCD. Shareholder and employee accountability, corruption, and tax payment transparency remain concerns in developing nations. In contrast, Western countries emphasize philanthropic responsibility in CSR at the top of the top, as marked in Carroll (1991).

2.3

Responsible Leadership for the Extractive Industries

Since the early 2000s, responsible leadership has emerged as an umbrella concept to reconsider the idea of leadership based on stakeholder theory (Waldman & Galvin,

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2008; Haque et al., 2019). Maak and Pless (2009) defined responsible leadership “as a values-based and principle-driven relationship between leaders and stakeholders who are connected through a shared sense of meaning and purpose through which they raise to higher levels of motivation and commitment for achieving sustainable value creation and responsible change” (p. 539). In the context of this chapter, responsible leadership focuses on the socially responsible behaviors of the organization. Accordingly, responsible leadership can be perceived as value-based and principle-driven relationships between extractive industries and their stakeholders, achieving their CSR objectives and outcomes in developing countries. Responsible leadership for the extractive industries can be seen as a social and relational phenomenon that focuses on the connection between a leader and a follower stakeholder point of view (Maak & Pless, 2006: Haque et al., 2021). However, it departs from the traditional view of hierarchical and dyadic leadership in many ways. First, this concept expands the leader-follower relationship to include a broader range of stakeholders (Haque et al., 2019; Maak & Pless, 2006). Second, responsible leadership identifies normative dimensions (e.g., what should be done) behind relationships between corporate leaders and their core stakeholders (Freeman, 1984) in demonstrating that “to not be responsible is to not be an effective leader” (Waldman & Galvin, 2008, p. 327). Third, it presents a more balanced perspective on the link between the corporation and its stakeholders by portraying leaders as facilitators of relationships within and across stakeholder groups (Maak & Pless, 2006). The extractive industries operate in an increasingly interconnected and globalized world and need to develop more relationship-based communication channels with all their stakeholders. “In a stakeholder society, leadership must reach beyond the traditional leader-follower concepts. Here, the leaders become coordinators and cultivators of relationships toward different stakeholder groups” (Maak & Pless, 2006, p. 100). Responsible leadership for the extractive industries can be developed on the relational perspectives in leadership theory (Haque et al., 2019) as well as on stakeholder theory’s core concepts and frameworks (Freeman, 1984; Haque et al., 2019) to propose a renewed perspective on CSR management (Pless and Maak, 2005). The chapter argues that leaders of extractive industries have an equally important role in achieving business sustainability and contributing to SCD in developing countries through responsible leadership.

3 Significance of the CSR of the Extractive Industries for Developing Nations CSR for the extractive industries has received much attention in recent years, so scholars across the globe have shifted their attention to CSR-related topics such as leadership and SCD (Aguinis and Glavas, 2012). CSR is a helpful framework for exploring the attitude of extractive industries toward stakeholders (Wheeler et al.,

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2002). For example, CSR for extractive industries is about balancing the diverse demands of communities and the imperative to protect the socioeconomic environment with the ever-present need to profit (Wilson, 2015). Therefore, CSR calls for extractive industries to respond to their shareholders and other stakeholders, including employees, customers, affected communities, and the public, on human rights, employee welfare, and climate change (Alkire & Santos, 2010; Haque, 2018; Haque & Jahid, 2021). One outcome of the CSR agenda is the increasing need for extractive industries to justify their existence and document their performance by disclosing socioeconomic and environmental information (Ramachandran, 2017). Consequently, most extractive industries are now expected to disclose social and environmental performance, health and safety issues, and ethics. Contemporary interpretations of CSR emphasize its ability to contribute to sustainable economic growth (Wilson, 2015). However, the question remains whether CSR initiatives achieve international development goals, facilitate local development, reduce conflict, and mitigate the impacts on communities (Lin, 2010). Moreover, CSR’s role in the extractive industries as an instrument of socioeconomic development has been criticized for its material conception of development (Lin, 2010; Ramachandran, 2017) and its inability to address the causal model of poverty and marginalization (Wilson, 2015). No country can succeed without economic growth (Ramachandran, 2017), and most countries, especially those in developing countries, look for economic growth as an indicator of their economic development. One of its benefits is that it encourages investment, which has a multiplier effect. In addition, the economy’s growth generally increases profits and business confidence and increases sustainability. Consequently, Campbell (2007) argues that if extractive industries are experiencing an economic climate where inflation is high, productivity growth is low, and consumer confidence is weak. It appears that they will face many challenges in turning a healthy profit shortly; they are less likely to engage in socially responsible behavior. Several studies support this claim. For example, Harrison and Berman (2016) found that extractive industries tend to ignore certain areas related to corporate social performance during an economic downturn. Similarly, Li et al. (2019) reported that extractive industries operating in low-economic regions are less likely to implement environmental and social sustainability projects than those in more affluent areas. Chih et al. (2010) found that self-regulation within the financial sector had a significant positive effect on CSR, with firms exhibiting a higher level of social responsibility in countries with a better macroeconomic environment.

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4 Multilevel CSR Outcome for Sustainable Community Development The CSR component of community development encompasses a broad range of activities that support the local community (Maloni & Brown, 2006). The operational meaning of SCD in this chapter also considers the increase in living standards, health improvement, and the advancement of education resulting from the extractive industries. Accordingly, this chapter’s framework for community development is shown in Fig. 2. Following Alkire and Santos (2010), living standards refer to people’s quality of life through CSR programs for SCD that should improve their income, employment, access to clean water and sanitation, electricity, and house structure. The health dimension includes nutrition programs, breast cancer awareness campaigns, and health-care opportunities provided to community members. Finally, this dimension has student enrollment and years of education, study expenses, scholarships, attendance, literacy and numeracy, quality education, and student achievement. Therefore, one of the main objectives of CSR educational programs for developing nations is to spread the education and literacy rate (UNDP, 2010). Accordingly, this chapter considers the extractive industries based on the types and contributions they provide through CSR for SCD in developing countries.

Community Development Dimensions

Living Standards

• • • • • • • •

Income Cooking fuel Employability Sanitation Water and plumbing system Electricity Housing Floor and rooftop

Education

• Health

• •

Health awareness and nutrition Healthcare opportunities

• • • • • •

Children enrolment and years of schooling Schooling expenses School attendance Reading literacy Counting literacy Quality education Student performance

Sources: Alkire and Santos (2010, p.13) and UNDP (2010, p.96)

Fig. 2 Community development dimensions. Sources: Alkire and Santos (2010, p. 13) and UNDP (2010, p.96)

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5 Responsible Leadership for SCD The extractive industries in developing nations must recognize that responsible leadership and the context in which they deal with their business play an essential role in SCD and future reputation (Maak et al., 2016; Sobhani et al., 2021). Responsible leadership in extractive industries can be recognized as “a relational [and purpose-driven] influence process between leaders and stakeholders geared toward the establishment of accountability in matters pertaining to organizational value creation” (Maak et al., 2016, p. 464). Adopting responsible leadership within extractive industries for SCD is much more than a mere public relations exercise. Sustainability for extractive industries and community development occurs only when active leaders or managers champion this approach. For example, a leader is always needed to lead a company to become a sustainable, socially responsible enterprise to contribute more to SCD (Székely & Knirsch, 2005). Leadership for SCD begins with analyzing all the factors that influence its sustainability performance and stakeholders. Many of these factors can be internal (mainly managerial and organizational) or external (stakeholder demands), and there is no easy solution to these issues. However, it is essential to note that community-led initiatives do not always lead to positive outcomes (Hennchen, 2015). The environment in developing countries with weak institutional structures may lead business leaders to “mirror” the low standards in their business operations (Preuss et al., 2016). This approach may be compounded in crises and is especially relevant in stakeholder conflict situations. Communities need responsible leadership from their business owners to overcome socioeconomic threats and uncertainty, and the extractive industries, particularly in developing nations, have a significant role in SCD (Székely & Knirsch, 2005; Pless et al., 2021). Society expects extractive industry leaders to show commitment, assert themselves, and resolve issues by taking responsibility and accountability. Several scholars suggest that leaders in extractive industries need to implement policies that promote community engagement to achieve higher SCD (Pless et al., 2021; Haque et al., 2021). Leaders should also be aware of the community’s needs and respond accordingly, such as organizing infrastructures and procedures to meet their demands once a crisis has occurred. There is a risk of losing credibility and trust from stakeholders if leaders do not adhere to this urgency to make the extractive industries more effective (Székely & Knirsch, 2005). Therefore, the extractive industries must act responsibly to gain the public’s trust, accomplished through responsible leadership. Responsible leadership can uphold effective CSR practices for several reasons. First, responsible leaders are more inclined to address stakeholder issues and act altruistically than other leadership approaches, such as transactional leadership (Pless et al., 2021). Several scholars have suggested that responsible leaders are highly ethical and focused on values for societal development (Haque et al., 2021; Sobhani et al., 2021; Pless et al., 2021). Several theoretical (Maak & Pless, 2006; Pless and Maak, 2011; Haque et al., 2021) and empirical (Haque et al., 2019) studies also indicate that responsible leaders promote stakeholders’ interests in the pursuit of

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SCD. Second, responsible leadership reinforces ethical, moral, and intellectual considerations and leads followers to develop more innovative and accountable approaches to tackling complex issues and problems (Pless et al., 2021). Scholars suggest that responsible leaders, especially those who are ethically and morally stimulating, scan and think broadly about the environmental context and how various stakeholders may be served for higher SCD (Sobhani et al., 2021; Pless et al., 2021). According to these authors, ethical, moral, and intellectual stimulation factors positively relate to CSR practices and are more effective for SCD. Third, responsible leaders recognize that extractive industries have complex and interconnected stakeholder relationships and see each firm as interdependent with the environment and community rather than isolated from them (Sobhani et al., 2021; Pless et al., 2021). Hence, responsible leaders’ broader view of the extractive industries should stimulate organizational learning and foster institutional CSR practices that consider stakeholders and prioritize SCD (Sobhani et al., 2021). Finally, Voegtlin et al. (2012) suggest the role of responsible leadership on organizational outcomes across three levels: the “macro,” “meso,” and “micro” levels (see Voegtlin et al., 2012, p. 5). At the macro level, organizations interact with society. The meso level is observed as the level of analysis of internal organizational structures and practices. Last, the micro level is characterized by personal interaction between individuals. According to Voegtlin et al. (2012), responsible leadership may change organizations’ mutual practices and natures at the meso level. Moreover, responsible leaders can also have a direct and considerable influence on their followers at a micro level (Voegtlin et al., 2012). Consequently, responsible leadership is more likely than any other form of leadership to accelerate SCD in the short and long term.

6 Responsible Leadership: A Call for the Solution In recent years, CSR for extractive industries has become increasingly critical among corporations in developing nations. However, the implementation and integration of CSR and responsible leadership for SCD need cultural changes within organizations and society (Maak, 2007; Waldman & Galvin, 2008) and require evidence to adapt an understandable and applicable responsible leadership model. Hence, a model or framework will help scholars and practitioners promote responsible leadership, iterative learning, effective CSR management, and SCD awareness in extractive industries. Accordingly, based on the discussion above, this chapter provides a framework for understanding the connections between CSR, responsible leadership, and SCD (see Fig. 3). Furthermore, from the stakeholder perspective (Freeman, 1984), Fig. 3 highlights the extractive industries’ institutional input (see Gond et al., 2011, p. 118) and institutional output (Voegtlin et al., 2012, p. 5) that allow them to determine their desired level of SCD. Charity begins at home, and therefore organizations’ policies should reflect the value of SCD and be influenced by the manager’s and employees’ attitudes toward

CSR Through Responsible Leadership for Sustainable Community Development:. . .

Instuonal Input and Funcons

Instuonal Output and Funcons

MACRO-LEVEL: Relaons to External Stakeholders Legimacy Trusul Stakeholder Relaons Social Capital

ORGANISATIONAL LEVEL: Organisaonal and funconal relaonships of HR and CSR

PRACTICAL LEVEL: HR pracces enhancing CSR or tackling CSR issues

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RELATIONAL LEVEL: HR influence on and support for employees’ involvement in CSR

MESO-LEVEL: Shaping Organizaonal Culture and Performance Ethical Culture CSR Character Social Entrepreneurship Performance

SUSTAINABLE COMMUNITY DEVELOPMENT

MICRO-LEVEL: Personal Interacons Effect on Followers’ Atudes and Cognions e.g., OCB, Movaon, Job Sasfacon

Fig. 3 CSR and SCD through responsible leadership

CSR (Gond et al., 2011). Although employees are recognized as crucial internal stakeholders on which responsible leaders should focus their attention (Maak & Pless, 2006; Maak, 2007; Waldman & Galvin, 2008), this chapter emphasizes the integration of human resources (HR) management and stakeholder management to increase the extractive industries’ focus more on SCD. According to Gond et al. (2011), “HR department plays a key role in promoting positive behavior, in creating an engaged workforce and in creating an environment where CSR is embedded in every aspect of the employee’s lifecycle... HR can greatly contribute to shape the organizational context for the exercise of responsible leadership” (p. 117). Hence, it is significant to install a culture to develop the internal stakeholders (i.e., employees, managers, or CEO) of the extractive industries to adopt the value of CSR and responsible leadership within their organizations first. Therefore, the extractive industries can appreciate the importance of CSR and the importance of responsible leadership for influencing the culture toward higher SCD. The three-level model of responsible leadership proposed by Voegtlin et al. (2012) addresses challenges at different organizational levels and suggests that responsible leadership does not conceptualize leader success in financial performance as the primary or only driver of leadership performance. Responsible leadership, instead, implements consensus solutions widely accepted by all stakeholders. Accordingly, this model underlines the role of responsible leadership on organizational outcomes across three levels of analysis. First, macrolevel evidence involves the interaction between organizations and society. It explains how responsible leadership can help organizations maintain their corporate legitimacy, build trusting relationships with stakeholders, and strengthen the social capital inherent in those relationships. Voegtlin et al. (2012) noted that “responsible leadership produces

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legitimate decisions and thus helps to secure the legitimacy of the organization. It closes the gap with corporate social responsibility in that it guarantees legitimacy for the organizational actions, which could be regarded as the main goal of an extended social responsibility of organizations” (p. 7). A leader’s responsibility evokes trust among stronger stakeholder relationships (not just those they interact with directly) and promotes mutual gains between them (Voegtlin et al., 2012). Moreover, when responsible leaders anticipate the (negative) consequences of their decisions, use their influence to engage stakeholders in an active dialog, and weigh and balance stakeholder interests, they can build trustful stakeholder relationships (Voegtlin et al., 2012). Last, engaging in frequent stakeholder interaction and active stakeholder dialog makes social capital through responsible leadership behavior (Voegtlin et al., 2012). Social capital consists of a shared set of values that enable organizations to work together effectively and achieve a shared goal (Maak, 2007). Responsible leadership can promote social capital accumulation by positively affecting the stakeholder network. Responsible leaders engage in fair and balanced stakeholder dialogs to facilitate a discourse-based decision-making situation. By doing so, stakeholder interests are considered (Maak, 2007; Pless et al., 2021). Thus, relationships with responsible leaders extend beyond market orientation (interaction with external stakeholders) or hierarchical exchange processes (construction of relationships with employees). The meso level is observed as the level of analysis of internal organizational structures and practices (Voegtlin et al., 2012). This level entails organizational routines, operational actions, and discourses historically enacted in all levels of the organization (Maak, 2007; Pless et al., 2021). Voegtlin et al. (2012) argue that responsible leadership can gradually influence an organization’s ethical culture and enhance the CSR image of the organization by sensitizing their employees to the potential social and environmental consequences of their actions and by emphasizing and demonstrating in their actions the value of stakeholder engagement and participation. Last, Voegtlin et al. (2012) suggest that responsible leaders encourage social innovation. The concept of innovation can be defined as “the generation, acceptance and implementation of new processes, products, or services for the first time within an organizational setting” (Pierce & Delbecq, 1977, p. 29). It was recommended that responsible leadership resolves the conflict between market orientation and recognizing stakeholder interests while fostering innovation for higher organizational performance (Voegtlin et al., 2012). The micro level is considered the degree of personal interaction of individual agents. Here, responsible leaders may also have a direct and considerable influence on their followers. For example, Voegtlin et al. (2012) found that responsible leadership affects follower attitudes and cognitions in two ways: First, the role of leaders as role models could influence follower behavior through improved organizational citizenship behavior (Podsakoff et al., 2000). Second, responsible leadership can directly affect followers since decision-making impacts them when leaders actively engage in stakeholder dialog. Thus, participatory practices and engaging followers in decision-making strengthened work-related attitudes (e.g., motivation, job satisfaction).

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Taking the perspective of developing nations and combining it with Gond et al.’s (2011) model for institutional inputs and Voegtlin et al.’s (2012) for outputs, Fig. 3 advances the literature on responsible leadership for higher leadership SCD through CSR. The model integrates responsible leadership and CSR to generate a theoretical foundation into a practical pathway to promote and achieve higher SCD with CSR in developing countries.

7 Metrics for Responsible Leadership, CSR, and SCD This chapter recommends Fig. 3 and suggests that leadership that demonstrates responsible behavior and invests in CSR can help build social legitimacy (Handelman & Arnold, 1999), moral capital (Godfrey et al., 2009), and long-term competitive advantage (Porter & Kramer, 2011). Figure 3 has several theoretical significances. First, it extends our fundamental knowledge of the role of responsible leadership in implementing CSR for higher SCD in developing nations. Research suggests that responsible leaders should consider stakeholders’ importance when motivating employees within organizations and should impact employee motivation and performance (Pless et al., 2021; Sobhani et al., 2021). Second, it contributes to the leadership literature by examining the responsible leader’s role and using stakeholder theory (Freeman, 1984) to describe how responsible leadership affects SCD. Third, Fig. 3 indicates the less recognized role of employee engagement in responsible leadership for CSR and SCD (Haque et al., 2019). Fourth, by including HR-integrated CSR with responsible leadership, Fig. 3 expands the responsible leader’s literature in extractive industries. Finally, there is ample evidence of responsible leadership influence in the literature of business studies for the Western context, but there is a lack of evidence for the non-Western environment (Haque et al., 2019; Sobhani et al., 2021; Haque, 2021). This chapter expands the current literature on responsible leadership and the extractive industries in developing nations. In addition to the theoretical significance, Fig. 3 has several practical implications. First, this chapter described how responsible leadership could influence CSR effectiveness for higher SCDs in developing nations. Accordingly, Fig. 3 indicates how the extractive industries can develop responsible leadership competencies to enhance employee motivation and engagement to uphold their performance. Hence, the implication of effective CSR contributes to higher SCS. Second, Fig. 3 suggests how practitioners can pitch responsible leadership to increase employee motivation and attitudes toward CSR for the culture to increase SCD for higher organizational sustainability. Third, organizations putting more effort into responsible leadership will likely achieve a higher corporate reputation and SCD (Haque et al., 2019; Pless et al., 2021). Hence, Fig. 3 can be a blueprint for how the extractive industries in developing nations can implement more efforts to include responsible leadership into their organizational strategy and CSR application to enhance SCD for industry reputation. Finally, Fig. 3 extends the scope for the United Nations’ sustainable

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development goals (i.e., 2030 SDGs), particularly SDG 11 (sustainable cities and communities), for developing nations to develop the performance and reputation of their extractive industries for sustainable economic development (The 17 Goals, 2021).

8 Conclusion It is more important than ever to explore the role of responsible leadership in CSR for developing nations. CSR focusing on SCD has been conceptualized as “the broad array of strategies and operating practices that a company develops in its efforts to deal with and create relationships with its numerous stakeholders and the natural environment” (Waddock, 2004, p. 10). The effects of CSR on SCD can include a more positive corporate image, stronger stakeholder relationships, and more effective corporate learning and development (Godfrey et al., 2009). Moreover, it is essential to note that the business effects of “doing good” depend on the extractive industries and market-specific factors, such as their business-specific expertise, reputation, and competitive position (Godfrey et al., 2009). Responsible leadership plays an essential role in expediting the process to achieve higher SCD through CSR (Angus-Leppan et al., 2010). Responsible leadership plays a critical role in accelerating and achieving higher SCD through CSR (Angus-Leppan et al., 2010). Therefore, there is a need for further empirical analysis of how responsible leaders conceptualize and execute CSR initiatives (Angus-Leppan et al., 2010) and how extractive industries influence the future interpretation of CSR.

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Visser, W. (2008). Corporate social responsibility in developing countries. In A. Crane, A. McWilliams, D. Matten, J. Moon, & D. Siegel (Eds.), The Oxford handbook of CSR (pp. 473–499). Oxford University Press. Voegtlin, C., Patzer, M., & Scherer, A. G. (2012). Responsible leadership in global business: A new approach to leadership and its multi-level outcomes. Journal of Business Ethics, 105(1), 1–16. Waddock, S. (2004). Parallel universes: Companies, academics, and the progress of corporate citizenship. Business and Society Review, 109, 5–42. Waldman, D. A., & Galvin, B. M. (2008). Alternative perspectives of responsible leadership. Organizational Dynamics, 37(4), 327–341. Wheeler, D., Fabig, H., & Boele, R. (2002). Paradoxes and dilemmas for stakeholder responsive firms in the extractive sector: Lessons from the case of Shell and the Ogoni. Journal of Business Ethics, 39(3), 297–318. Williams, C. C., & Millington, A. C. (2004). The diverse and contested meanings of sustainable development. The Geographical Journal, 170(2), 99–104. Wilson, S. A. (2015). Corporate social responsibility and power relations: Impediments to community development in postwar Sierra Leone diamond and rutile mining areas. The extractive industries and society, 2(4), 704–713. Amlam Haque is currently working as a lecturer and researcher in the School of Business at CQUniversity, Australia (Sydney Campus). He received his PhD in responsible leadership and presenteeism from the University of Wollongong, Australia. He is also working as a research scholar at the Fight Food Waste Cooperative Research Centre (FFWCRC), Australia. He has been actively involved in research initiatives and published several conceptual and empirical papers in peer-reviewed journals, including the Journal of Business Ethics and Leadership & Organization Development Journal. His research interests include leadership practices, employee performance, strategic HRM, climate change, and modeling with SEM.

Leveraging 4IR Technologies as a Corporate Social Responsibility to Reduce Environmental Impact in the Extractive Industry Tessa Reddy and Stanley Chibuzor Onwubu

1 Introduction Various economic activities have an adverse impact on the natural environment. This has resulted in global warming and climate change. The extractive industry is a primary driver of pollution, degradation, and resource depletion—from emitting dangerous chemicals into the atmosphere and creating air and water pollution to displacing communities; loss of ecosystems, biodiversity, and wildlife; and health implications for humans. These result from economic activities undertaken by the extractive industry, namely, mining, oil, and gas. Hence, corporate social responsibility has been designed to ensure that sectors such as the extractive industry (mining, oil, and gas) take accountability for their economic activities, in addition to the implications those economic activities have on the natural environment and humans. CSR can therefore use 4IR technologies to combat climate change. This chapter brings to the forefront the adoption of 4IR technologies in the extractive industry and how it can result in reducing the negative impact on the natural environment and humans while at the same time fulfilling the extractive industry’s corporate social responsibility.

2 South Africa’s Extractive Industry The South African extractive industry spans the African continent. South African mining corporations are active in Botswana, the Democratic Republic of the Congo, Ghana, Guinea, Lesotho, Mali, Mozambique, Madagascar, Namibia, Tanzania, T. Reddy · S. C. Onwubu (✉) Durban University of Technology, Durban, South Africa © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_4

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Zimbabwe, and Zambia. South African oil and gas enterprises SASOL and PetroSA have operations in Angola, Equatorial Guinea, Egypt, Gabon, Guinea, Mozambique, Nigeria, and Sudan (Hughes, 2012: 2).

2.1

Mining

South Africa has been involved in mining for over 100 years. There are approximately 549 mines in South Africa as of 2022. South Africa is the world’s largest producer of platinum, the third largest producer of coal, the sixth largest producer of gold, and the seventh largest producer of diamonds. A total of 22 minerals are mined in South Africa (Mines in South Africa, 2022). Mining directly contributes more than 300 billion rands to the country’s gross domestic product (GDP), employs over 450,000 people, and serves as the economic backbone of many towns. Unfortunately, most of the latest news concerning mining in South Africa has been bad. In the previous 10 years, total mining employment has decreased by approximately one-tenth, resulting in a loss of more than 50,000 jobs. Furthermore, according to a McKinsey report, there has been a drop in South African mining operations’ productivity in the previous 5 years for essential commodities and substantial productivity advances in other countries (Cassim et al., 2019).

2.2

Oil and Gas

South Africa’s fuel sector includes petrol, diesel, jet fuel, illuminating paraffin, fuel oil, bitumen, and liquefied petroleum gas. This accounts for approximately 8.5% of the country’s gross domestic product (GDP) and provides approximately 18% of the country’s primary energy. South Africa needs to invest in its old refineries to avert a worsening trade deficit in liquid fuels, mainly because half of its six refineries have closed. However, shale gas reserves in Karoo and two recent gas finds could reduce South Africa’s reliance on diminishing domestic gas supplies and imports (Research and Markets, 2021).

3 Corporate Social Responsibility Corporate social responsibility (CSR) is a business concept that allows corporations to be socially responsible to themselves and their stakeholders. Awareness of all company activities and their impact on economic, social, and environmental areas is vital; companies practicing corporate social responsibility can help reduce their negative contribution (Fernando, 2021). According to Stobierski (2021), corporate social responsibility (CSR) is divided into four categories of responsibility:

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(1) environmental, (2) philanthropic, (3) ethical, and (4) economical. CSR benefits several stakeholders. The beneficiaries of CSR include employees, communities, governmental institutions, established charities, sponsored foundations, and global welfare projects (Lamb et al., 2017). The extractive industry needs to provide CSR to direct mining-related activities, for example, skills transfer to local people or, in other words, skills transfer within the areas where mining operations occur and business skills to manage mining-related projects for people within the community. Schools should be provided with technological resources to equip youth with technical skills and knowledge to engage with 4IR technologies in future mining operations.

4 Corporate Social Responsibility South African Perspective The term “CSR” is used globally to define the practice of good corporate citizenship. However, “corporate social investment” is a unique South African phenomenon. This may be claimed to be a byproduct of South Africa’s history and developments. Moreover, the growth of corporate social responsibility (CSR) on the African continent owes a great deal to developments in South Africa. Hence, South Africa continues to have the continent’s most comprehensive public relations practice. It is said that businesspeople began to respond to the notion of “investment” more warmly than they did to the concept of “responsibility,” which tied business to apartheid’s horrors. Corporate social investment (CSI) refers to a business-oriented outcome that is chosen above doing something because it is vaguely “ethical” or “the company’s obligation” (Skinner & Mersham, 2020). Hence, CSR is the degree to which an organization or industry is responsible for its economic activities and their implications for society and the natural environment. Moreover, since 1994, South Africa’s economic and financial presence across the continent has increased dramatically, notably in retail, banking, telecommunications, and extractive industries. South Africa has emerged as a representative for Africa on issues ranging from UN Security Council reform to climate change and international economic imbalances (Hughes, 2012: 2). CSR is particularly prevalent among mining, oil, and gas firms in Southern Africa due to the potential for severe negative social and environmental repercussions (Rampersad & Skinner, 2014).

4.1

CSR and 4IR in Education

The education system should be a focus of CSR in the Fourth Industrial Revolution era. Companies will be unable to rely entirely on universities to obtain new employees for new occupations due to the technological dynamics of professions

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in the 4IR era. New skills will be acquired in the workplace through continuing vocational education. It should be a critical component of lifelong learning and skills development. Short-term training courses will be replaced with comprehensive education programs in which new abilities will be learned in simulated environments. This training will take advantage of virtual reality capabilities and improved virtual reality. Because of the importance of training, companies must actively participate in its planning and funding. Unfortunately, this is a task that the government will not be able to complete on its own. CSR is concerned with creating the necessary conditions for employees to learn new skills and the preservation and development of independent training organizations. This raises the bar for businesses and CSR. Its primary use has evolved, and it increasingly addresses stakeholder issues such as employment, robotic replacement, new jobs, and skills to be demanded in the current and new labor market, remote work, and reduced working hours. However, this is concerned with internal stakeholders and a subset of CSR activities (Keremidchiev, 2019).

5 Fourth Industrial Revolution (4IR) Industry 4.0 was first introduced in 2006 in Germany as part of a high-tech strategy program. The goals of the high-tech strategy program were to assist in the integration of cyber-physical systems (CPS) and the Internet of Things and Services (IoTS), to increase flexibility and productivity, to improve production process efficiency, and to boost economic growth. However, only when the German government-appointed advisory board released its “recommendations for executing the strategic goal Industry 4.0” in 2011 did the term “Industry 4.0” become widely known. Thereafter, the concept of Industry 4.0 was adopted throughout the world to create new business models. In 2015, the founder and executive chairman of the World Economic Forum, Klaus Schwab, coined the term “Fourth Industrial Revolution” (Szlávik & Szép, 2022). “The Fourth Industrial Revolution” (Industry 4.0) is an umbrella term for the industrial paradigm shift. 4IR is described as an era of technological progression. The Fourth Industrial Revolution is powered by various components, such as the Internet of Things (IoT), robotics, big data, cloud manufacturing, and augmented reality (AR) (Pereira & Romero, 2017). Other 4IR technologies include but are not limited to radio frequency identification technology (RFID), artificial intelligence (AI), blockchain, facial recognition, sensor data, cloud services, and data security (Kumbhat & Mishra, 2020). Technologies are viewed as tools that breakdown the fine line between people, the Internet, and the physical world (World Economic Forum, 2020). Hence, it could be rightly said that the 4IR is a convergence of the digital, physical, and biological spheres.

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6 Global Reliance on the Extractive Industry Minerals, metals, oil, and gas are essential for the survival of humanity, as mining forms an integral part of our daily lives (Examples of minerals used in our daily lives, 2019). According to Peša and Ross (2021), all modes of transportation (cars, aeroplanes, and ships) and digital devices (smartphones and computers) contain various metals. Fossil fuels power these digital devices. Fossil fuels are extracted underground, directly in refined petroleum or via coal- and gas-dependent electrical systems built of copper and aluminum. Nutrient-rich foods and medicine contain mineral and metal resources. The extractive industry is essential, as there are various socioeconomic contributions of the mining industry in South Africa. It includes but is not limited to employment opportunities and contributions to tax income, increasing the value of the gross domestic product (GDP), the rate of economic growth, and the contribution to the country’s balance of payments (Zulu et al., 2021). According to Engwicht and Ankenbrand (2021), the extractive industry impacts economic, food, health, environmental, personal, community, and political security. This is illustrated in Table 1.

7 Natural Environmental Impact of the Extractive Industry In recent years, the natural environmental impact of the extractive industry has been at the forefront of political and religious debate. This has generated a fever pitch of activism due to the concern and contribution of the industry to climate change and global warming. Global warming refers to the continuous heating of the Earth’s climate system. Climate change is another significant negative impact on the environment. Due to heavy machinery, drilling for oil and gas often destroys large land areas. This results in an effect on wildlife, humans, and vegetation. Table 1 Types of human insecurities and root causes Types of insecurities Economic insecurity Food insecurity Health insecurity Environmental insecurity Personal insecurity Community insecurity Political insecurity

Root causes Persistent poverty, unemployment, lack of access to credit and other economic activities Hunger, famine, sudden rise in food prices Epidemics, malnutrition, poor sanitation, lack of access to primary health care Environmental degradation, resource depletion, natural disasters Physical violence in all its forms, human trafficking, and child labor Inter-ethnic, religious, and other identity-based tensions, crime terrorism Political repression, human rights violations, lack of the rule of law and justice

Adopted from Human security handbook (2016)

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Climate change is a long-term change in the average weather patterns. This is driven by human activities by burning fossil fuels, which increases heat-trapping greenhouse gas levels in the Earth’s atmosphere. Since the preindustrial period between 1850 and 1900, human activities have increased the Earth’s global average temperature by approximately 1 degree Celsius, a number that are presently growing by 0.2 degree Celsius per decade. Human activities have warmed the atmosphere, sea, and land (Shaftel, n.d.). Mine activities are solely responsible for 4–7% of worldwide GHG emissions, with methane emissions from coal mining accounting for at least three-quarters of them. Copper, gold, iron ore, and zinc production are already concentrated in areas with significant water stress. This is expected to continue as climate change causes frequent droughts and floods (Grègo et al., 2020).

7.1

Land Degradation

On the same token, mining has created several negative impacts: mountains were leveled, canyons were excavated, hillsides were demolished, valleys were filled with waste chemicals and materials, and tunnels, shafts, and boreholes were dug into the earth (LeCain, 2009). This has contributed to global warming, climate change, and greenhouse gases, negatively impacting the planet. As a result, the discovery, processing, and transportation of underground oil, gas, and coal deposits have a substantial influence on our ecosystems and landscapes. The fossil fuel industry leases substantial amounts of land for infrastructure such as wells, pipelines, access roads, processing, waste storage, and disposal. Strip mining exposes subsurface coal or oil by scraping and blasting large sections of land, including forests and whole mountaintops. Critical animal habitats and land required for breeding and migration are fragmented and destroyed as a result. Even animals that could flee may suffer because of being forced into less-than-ideal habitats and competing for resources with other animals (Denchak, 2018) (Fig. 1).

7.2

Water, Soil, and Air Pollution

Due to mining processes, there has been a contamination of soil, air, streams, surface water, and groundwater. In the Republic of Côte d’Ivoire, between 2012 and 2015, there was mining for gold. The mining resulted in tons of waste rock and mine tailings stored in the waste rock dump and tailings storage facility in the vicinity of the mine. Due to heavy rainfall and winds, the heavy metals from the waste and tailings were dispersed into the adjacent soil, streams, and air, which migrated into both surface water and groundwater, causing severe contamination (Sako et al., 2018). Oil spillage can occur during the oil exploration and drilling process. One such event is the oil spillage in the Niger Delta in Nigeria. The oil spillage contaminated

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Fig. 1 Life cycle and associated environmental impacts for a mined material (source: adopted from Gorman and Dzombak (2018)

marine life due to wind and wave actions that contaminated the shorelines, affecting the soil and contaminating the plants. Pipeline ruptures, oil well blowouts, seepages, tanker accidents, deballasting operations, and intentional damage to operational infrastructure are all reported to cause oil spills (sabotage) (Osuji & Onojake, 2006). Even small-scale mining contributes negatively to the natural environment and creates water pollution. This is due to the drainage system in the research area being negatively damaged. Solid suspensions pollute rivers and streams during the sluicing process, and mercury discharged into local water bodies during amalgamation creates water pollution (Kumah & Adum Nyarko, 2018).

7.3

Ocean Acidification

The burning of oil, coal, and gas makes the ocean more acidic. A quarter of all carbon emissions created by humans are absorbed by the oceans. The sea has become 30% more acidic since the industrial revolution. As the acidity of the waters rises, the amount of calcium carbonate—a chemical used by oysters, lobsters, and

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other marine organisms to make shells—decreases. Growth rates might be reduced, shells could be compromised, and entire food chains could be put in jeopardy. Ocean acidification also has an impact on coastal communities. The oyster industry in the Pacific Northwest has lost millions of dollars and thousands of jobs (Denchak, 2018).

7.4

Impact of Humans and Wildlife

Extractive industries alter human demographics, potentially boosting pathogenvector-host contact and shifting parasites and susceptible populations between low- and high-disease endemic locations. During the extraction process, excavated pits are left unfilled and abandoned. Hence, rainwater fills the holes, which become breeding grounds for mosquitoes that are a danger for humans and animals as mosquitoes carry malaria, resulting in severe illness or even death for humans (Jones et al., 2018). Oil and gas production impacts people near active wells and processing plants, as residents are exposed to fumes daily. Air pollution negatively impacts humans, wildlife, and marine life, leading to respiratory infections, cardiovascular disease, and other diseases. These toxic fumes are entering the atmosphere, but they can also leak into the soil and drinking water, which, when consumed, can lead to cancer, congenital disabilities, and liver damage (7 ways oil and gas drilling is bad for the environment, 2021). The Gulf of Mexico oil leak, which occurred on April 20, 2010, was one of the greatest disasters. An explosion on the Deepwater Horizon oil rig caused the leak, which caught fire and sank in the Gulf of Mexico. This incident resulted in 11 employees dying, 17 employees being injured, and millions of gallons of oil spilt in the ocean. The disaster negatively impacted the environment within the Gulf of Mexico and surrounding areas (Arora & Lodhia, 2017). According to Cherry and Sneirson (2011), the Gulf of Mexico oil spill negatively impacted marine life, residents, tourism, and fishing businesses.

7.5

Mercury and Lead Poisoning

Another danger for employees and residents within the vicinity of mines is when small-scale miners use mercury to capture the most delicate gold particles. Mercury and lead are toxic and bioaccumulative, threatening humans and wildlife. Moreover, small-scale miners handle mercury without protective gloves. In addition, miners inhale fumes from burnt mercury and mercury dust from crushing machines, resulting in mercury poisoning. Mercury poisoning leads to itchy skin, insomnia, and hypertension (Hilson, 2001).

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Seismic surveys use air gun arrays that emit high-decibel explosive impulses, which scare marine mammals as they communicate with sound and use sound to survive and find food (Guy & Waterworth, 2021). One adverse event was the lead poisoning epidemic in Zamfara, Nigeria. This epidemic resulted in approximately 400 children dying due to acute lead poisoning and thousands of others severely poisoned, causing neurocognitive damage. The epidemic transpired due to traditional mining processes whereby large quantities of lead dust were deposited throughout rural and urban residential areas through wind, foot traffic, and direct tailings disposal. Furthermore, mercury in the process equates to solid, dust, water, food, and vapor exposure (Tirima et al., 2018).

8 4IR Can Help the Extractive Industry Fulfill CSR One way of ensuring the continued protection of the environment and the efforts to reduce the carbon footprint of the extractive industry is to take care of environmental issues through corporate social responsibility programs by reducing the adverse effects of mining, oil, and gas industries on the natural environment and conserving and protecting the natural environment. Hence, corporate social responsibility programs help promote environmental protection (Andrei et al., 2014). On December 12, 2015, the United Nations Framework Convention on Climate Change (UNFCCC) parties gathered in Paris for COP 21. Parties signed an agreement to combat climate change and speed up and scale up the activities and investments needed to transition to a low-carbon society. The Paris Agreement, for the first time, unites all nations together in a single cause to battle climate change and adapt to its repercussions, including increased help for developing countries. The Paris Agreement aims to create a unified approach to climate change by reducing global temperature rise this century to less than 2 degrees Celsius above preindustrial levels and even further to 1.5 degrees Celsius (United Nations Climate Change, n.d.). The extractive industry should use 4IR technologies in conjunction with their CSR policies to help the planet. A proactive approach to environmental preservation is cleaner production. Its primary goal is to increase the efficiency of manufacturing processes by better using raw materials and energy sources while also reducing the danger of exposure to environmentally harmful compounds by substituting substances. Applying the techniques to items positively impacts the environment throughout the life cycle, from the extraction of raw materials through final disposal. Cleaner manufacturing solutions include material and energy flow analysis (MEFA), material balance and material balance analysis, establishment of environmental indicators, waste and emission reduction, and priority action (Szlávik & Szép, 2022).

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9 Adoption of 4IR to Help Reduce the Negative Impact Introducing 4IR technologies to the extractive industry will reduce the negative environmental impacts created by the industry. 4IR can reduce wastage, eliminate pollution, and provide real-time insight to save people from disasters such as mine collapses and earthquakes. Hence, climate-smart mining has been introduced to reduce the impact mining has on humans and the climate. The mining, oil, and gas industry is increasingly adopting innovative digital technologies to conduct their operations from resource exploration, development, production, processing, and environmental restoration (Choi, 2020). The South African mining industry has adopted digital technologies in its operations. The adoption of digital technologies resulted in enhanced safety; hence, there has been a decrease in fatalities, a reduction in time lost because of injury, and a reduction in DMRE Section 54 stoppages. A decrease in waste and minor damage to the mine and its reserves with improved reliability of exploration data indicates whether it is conducive for mine workers to work in such conditions due to several geological constraints (Zulu et al., 2021). Temkin (2020) further states that innovative digital technologies improve processes such as managing risk, improving the health and safety of employees and society, reducing the cost of extraction, and improving employees’ skills set. However, Ndlovu et al. (2022) states that implementing 4IR into the mining sector can result in displaced workers, thus tipping the power balance favoring mining companies and against organized labor. Hence, the existing political situation in South Africa is likely to impact the adoption of 4IR technologies. It is commonly known that technology connected with the Fourth Industrial Revolution (4IR) may result in labor displacement. The World Economic Forum (WEF) estimates that 75 million jobs will be lost by 2022 with the adoption of 4IR. Simultaneously, technological developments are predicted to create 133 million new jobs (Schwab, 2018). Moreover, the use of 4IR technologies does not create unemployment. Instead, it is an opportunity for employees to reskill and upskill. Hence, the future labor market requires employees to be prepared with the skills needed to fill the new occupations created by 4IR and the talents needed to flourish as entrepreneurs. This may create new work opportunities and lower unemployment (Masitenyane, 2019). According to NEDLAC's 2019 report on the future of work in South Africa, 4IR is definite. Hence, manufacturing might proceed without people, and the labor force in South Africa could be replaced by robots and become automated owing to insufficient relevant skills (NEDLAC, 2019). From the literature review, the 4IR technologies adopted by the extractive industry in the quest to reduce the negative impact on the natural environment include the following:

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Robotic Technology

Mining is a dangerous job, whether extracting minerals and metals from the ground or drilling under the sea for oil and gas. Due to the depletion of natural resources, miners must dig and drill deeper to explore and extract resources, thus increasing the risk (Bhowan-Rajah, 2020). To minimize the risk to humans, autonomous mining equipment is being used. Hence, robotic machines can go into places humans cannot, and they can be aborted if the exploration becomes too risky. Robots can be removed from the situation; unlike humans, time is limited; hence, they can lose their lives. However, one primary concern regarding autonomous machines is eliminating human capital within the mining industry. However, the use of autonomous machines does not create unemployment. Instead, it is an opportunity for employees to reskill and upskill. Within the process, new jobs are created. Hence, autonomous machines require maintenance and servicing; therefore, people with the relevant skills are needed to work on robot components (Thompson, 2021). The adoption of semiautonomous drills will result in numerous benefits, including safety, increased productivity, and decreased shift change times (Semiautonomous drill first for our metallurgical coal business, 2018). Another area where autonomous machines are being used is to eliminate air pollution. Robotic trees are being used in certain countries to remove air pollution. One robotic tree is said to be equivalent to 368 natural trees.

9.2

Artificial Intelligence

4IR technologies are being used in the mining industry. Artificial intelligence and machine learning are used in the exploration process to map terrain before commencing mining operations within an area. Artificial intelligence uses pattern matching, predictive analysis, and computer vision systems to identify valuable areas to dig. Artificial intelligence and big data can analyze extensive data to improve predictions of locating better resources. Artificial intelligence, therefore, reduces the error of searching in a location that has no potential. This results in not riddling into the earth unnecessarily while saving substantial financial capital.

9.3

Drones

On the other hand, drones use machine learning-based vision systems that analyze data from imagery. Therefore, drones are being used to provide live-time streaming of all mining operations. Hence, drones can be used to monitor the environment. Artificial intelligence systems can analyze and interpret large volumes of sensor data and provide alerts when an environmental issue occurs. This system can inform

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miners and the communities within the vicinity if they need to vacate the area at any given time. The artificially intelligent system can determine patterns and identify tremors and temperature. Hence, cameras with sensors are installed inside and outside the mines to analyze the impact mining has on the natural environment (Schmelzer, 2019).

9.4

Internet of Things

The Internet of Things (IoT) allows all stakeholders to monitor the levels of air pollution. Algorithms use machine learning and anonymized data from the mobile network. With current weather, traffic, and pollution data, one can monitor pollution and predict pollution levels up to 48 h ahead. The array of things (AoT) is a network of programmable, modular nodes that connects multiple linked devices to form an urban sensor network. This is a device that is placed throughout a city to collect realtime data about the environment and infrastructure of that city. Climate, air quality, and noise are just a few aspects that the AoT can assist the city measure. AoT can also track temperature, identify urban flooding, and offer climatic data on a blockby-block basis. Installing air pollution monitors in various areas will assist in collecting real-time data on the levels of air pollution. If these air pollution monitors collect data, the data can be shared with the public. The public will be more conscious of the products they purchase, thus helping to reduce the negative impact. Air pollution monitors should be linked to smartphones. Hence, a notification can be sent to those individuals with existing respiratory conditions. The concept of reduction, recycling, reuse, and removal can be implemented using 4IR technologies; hence, some technologies can assist in eradicating CO2 emissions from the Earth’s atmosphere (Kane, 2021). The reduction of C02 emissions can be on a larger scale if companies acquire these technologies for use. Edge computing, which is part of the Internet of Things, can help with natural gas leaks. Asset teams, for example, may be made aware of the release right away. They responded immediately before the system informed them of the gas leak issue, rather than waiting for calculations to be complete in a distant computing environment (Perrons, 2021). Hence, sensor technologies have been used to collect data for various purposes for decades. Smart sensors collect and translate physical, biological, and chemical data into a digital representation. They can also use the data they acquire to analyze it, make choices, and transmit and receive communications. Smart sensors may provide real-time insights into the functioning of a company’s infrastructure based on information about equipment’s physical state and operational performance. Smart sensors constitute the primary data source for creating insights via big data analytics since any machine may provide a digital data flow. Smart sensors have potential applications throughout the entire value chain in mining and metals. They may be used to assist other technologies, such as robots, and collect real-time operational data that improve decision-making and efficiency (World Economic Forum, 2017) (Fig. 2).

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Fig. 2 Edge computing at a conceptual level (source: adopted from Perrons, 2021)

9.5

Fiber Optics

The ability of fiber optics to transmit signals at lightning speed is crucial for the extractive industry. Fiber optics allow essential information about operations to be delivered from a mine site to the control center. On the other hand, fiber optics are instrumental in future intelligent mining sustainability strategies. Hence, the future of mining will be waterless, as water is a scarce resource. Thus, the mining industry wants to reduce water usage (fiber optics: mining's unsung hero, 2018).

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South Africa Extractive Industry and CSR

10.1 Anglo-American and CSR The Operational Intelligence Suite was developed by Anglo-American’s Occupational Health and Information Management divisions (OiS). OiS analyzes data flow, manual uploads, and events in real time. The platform’s diagnostic data aid users in making judgments, enabling quick decisions when things go wrong at mining sites in terms of performance, health, and safety (using data analytics to build a safer workplace: the OiS, 2018).

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Anglo-America’s corporate social responsibility includes five categories: (1) education, the support of early childhood development, improving STEM subjects and language skills, educator and student development, improved infrastructure for rural schools, support of special needs learners, and adult basic education programs for employees, contractors, and community members; (2) health, improving the healthcare system for employees, contractors, and communities by providing health care and support as well as the prevention of HIV/AIDS; (3) policy and advocacy, the transformation of the mining industry and the country; (4) thought leadership, including poverty alleviation, improved health care, education, and community development; and (5) sustainable community development, providing skills development, job creation, and entrepreneurship (Our CSI focus areas – South Africa, n.d.).

10.2

BP Southern Africa and CSR

BP Southern Africa’s corporate social responsibility includes: 1. Educational development—improvement of infrastructure and educational programs at underdeveloped schools, BP in partnership with Wits University on the Targeting Talent Programme, which empowers learners in Grades 10, 11, and 12 in developing learning and study skills tailored for university by empowering learners to enter STEM fields of study. Nthuse Foundation is a program that assists students with disabilities in gaining the skills needed to enter the labor market. 2. Skills development—graduate programs designed for students in their final year of study at tertiary institutions as well as those who have graduated and are unemployed, providing graduates with workplace skills and a potential career at BP. Learnerships offer practical work experience to students and a career in the oil and gas industry. 3. Environmental—BP Southern Africa established the Rose Foundation, a nonprofit organization dealing with the acceptable collection, storage, and recycling of used lubricating oil in South Africa. Hence, the foundation tries to reduce the irresponsible dumping and burning of lubricating oil. The Rose Foundation also conducts environmental awareness (BP Environment) (BP Southern Africa, n.d.).

11

Conclusion

Mining, oil, and gas contribute to society and the economy, as natural resources drive economic growth and development while reducing poverty. In addition, the extractive industry contributes negatively to the natural environment and humans. Adopting 4IR technologies can help the extractive industry reduce its carbon footprint while averting environmental catastrophe, simultaneously improving

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productivity and economic growth, and thus ensuring a sustainable future for the extractive industry, its employees, and the planet. Adopting 4IR technologies will assist South Africa in achieving its target set out National Development Plan (NDP). However, conflicts between mining firms, the government, employees, and host communities concerning job development, appropriate salaries, acceptable working conditions, and environmental preservation might continue. Although the 4IR is expected to improve worker health and safety while also lowering mining’s environmental effect, fundamental improvements in the mining sector will not be smooth.

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Tessa Reddy is a lecturer in Marketing and Retail Management. Her research interests include marketing communication, digital marketing and retailing, and the Fourth Industrial Revolution. She is currently pursuing a Doctor of Philosophy degree specializing in marketing at the Durban University of Technology. Stanley Chibuzor Onwubu holds a doctoral degree in dental technology. His research interest and expertise are in the area of nanomaterials, dental materials, biomaterials, and mechanochemistry. His doctoral research study focused on using waste materials for a value-added product. In this, he successfully developed a desensitizing paste for treating dentine hypersensitivity. He has published over 40 peer-reviewed journal publications and book chapters. He has attended numerous conferences both internationally and nationally and has won awards including the top institutional doctoral student publisher 2020. He is an NRF-funded postdoctoral research fellow in the Chemistry Department at the Durban University of Technology. He is also an institutional member of the university COVID-19 response team.

CSR and Community Development: A Focus on Firms in the Extractive Sector in Africa Peter Ansu-Mensah , Kojo Kakra Twum, Gloria Kakrabah-Quarshie Agyapong, and Richard Kwame Nimako

1 Introduction The concept of corporate social responsibility (CSR) has been explained, studied, and understood differently in academia. This is because while some authors have looked at the factors that influence CSR decisions (Hu et al., 2022; Dartey-Baah & Amoako, 2021; Boadi et al., 2020; Feder & Weißenberger, 2019; and Nguyen et al., 2018), others have considered the effect of CSR on community relations (Enuoh et al., 2020; Suley & Yuanqiong, 2019; Kao et al., 2018; Mwangangi et al., 2017; Eweje, 2007). However, in regard to the effect of CSR on community development (CD), it appears that there are few studies and that less attention has been given to it. Originally, CSR’s study was inspired by engagement in social missions as opposed to other related concerns, such as economic concerns (Bian et al., 2020). Thus, CSR refers to the commitments that businesses display toward stakeholders and the entire society who are affected by a company’s policies. While the wellbeing of communities is enhanced, their levels of income are further augmented (Manosmita, 2019). Hence, CSR has become increasingly significant, and it is no wonder that companies spend a substantial amount of money on CSR activities annually (Ansu-Mensah et al., 2021). Extractive multinational corporations perform CSR activities for their host communities in the form of community development (CD). It is notable that several P. Ansu-Mensah (✉) Sunyani Technical University, Sunyani, Ghana e-mail: [email protected] K. K. Twum · R. K. Nimako Presbyterian University, Abetifi Kwahu, Ghana G. K.-Q. Agyapong University of Cape Coast, Cape Coast, Ghana © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_5

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people have a different understanding of what community development (CD) is, that CD can be used in diverse situations, and that other “forms of development” are sought by various inhabitants in communities (Carlon, 2021, 324). CD is a conduit to advance the general quality of life of community residents, which encompasses the social, economic, and environmental dimensions. It is noteworthy that perhaps the practice of CD has been practiced since time immemorial when communities have existed and that CD is not new (Phillips & Pittman, 2009). Indeed, CD is a means by which corporations in the extractive industry embark on a series of activities to improve the livelihood of their impacted communities. Similarly, CD plays an important role between communities and employees in overcoming socioeconomic inequalities (Yuliasari, 2020). The objectives of embarking on CSR range from firm profitability, compliance with regulation, environmental protection and performance, enhancing corporate reputation, attainment of sustainable development goals, and community development. Worldwide, there is a growing attention on the private sector’s contribution to the development of communities (Banks et al., 2016). Therefore, corporations must not only be interested in satisfying the needs of customers, employees, shareholders, and governments but also be concerned about the development of local communities. Consequently, there is an association between CSR and CD, and CSR is very beneficial for host communities and multinational extractive corporations (Kumar & Balakrishnan, 2011). These multinational mining companies should assist and serve the communities in the areas where they operate because they are affected by their mining activities (Li et al., 2022). In so doing, members of the community are committed and involved in decisions, and therefore, the CD is enhanced in the country. One cannot help but agree with Kamlongera (2013) that mining firms cannot exclude communities or their representatives if they are going to have a peaceful coexistence with stakeholders in their areas of engagement to ensure a consensus outcome between the firms and the host communities. Apart from the roles played by governments, religious groups, and traditional authorities, corporate entities equally have a crucial role to play in CD (Adewuyi & Olowookere, 2010). This view is supported by Moon (2007), who finds that firms must use CSR to enhance sustainable CD, specifically in their host communities, to develop their social status and improve their existence. This important role, therefore, means that the objective of firms is not only to attain economic objectives but also to assist stakeholders in the development of communities. The increasing awareness of CSR among stakeholders and the expectations that firms must be seen as championing the cause of CD have made involvement in CSR more compelling. In the view of Adewuyi and Olowookere (2010), the expectations to engage in CSR by firms involved in the extraction of natural resources are even higher due to the negative effect of their activities on the environment and the lives of local communities. In the extractive industry, CSR principles and activities must be extended to include sustainable production and consumption, protection of natural resources, environmental protection, and sustainable CD. This is crucial in resolving the many challenges that arise from the activities of extractive companies in local

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communities. There are reports indicating that mining communities have suffered from pollution and other inherent negative effects due to the activities of companies. Despite the existence of government regulations and standards to manage the negative effect of natural resource explorations, firms should extend some support to local communities affected by the development of mining sites. A common way that firms achieve this objective is to implement CSR initiatives that support the social and economic development of local people. This is even more crucial in developing countries where most people depend on natural resources such as land and water for their livelihood. The overdependence on agriculture by most local communities is largely affected by the activities of mining firms. In response to calls to understand how firms in the extractive industry can contribute to CD, this chapter performs a content analysis of the sustainability reports of oil and mineral companies in Africa to identify how CSR is used to promote CD. Banks et al. (2016) posit that the way private firms are typically involved in development is different from NGOs and donors, yet these initiatives are underresearched. The first part of the chapter explains the nexus between CSR and CD. The second part presents findings of the CSR activities related to CD by firms in the extractive sector in Africa. The final part draws some conclusions and provides some recommendations.

2 CSR and Community Development The classical view of CSR has shifted from a narrow view of philanthropy to the emphasis on business-society relations in the area of contributions made by firms in solving societal problems (Ismail, 2009). Contemporary CSR is explained as “a concept whereby business organizations consider the interest of society by taking responsibility for the impact of their activities on customers, suppliers, employees, shareholders, communities, and other stakeholders as well as their environment” (Ismail, 2009, p.199). From the above definition, the communities in which businesses operate are regarded as a major stakeholder group that must be satisfied with CSR initiatives. This is crucial because the very essence of CSR is to impact the community through initiatives that ensure that society is developed. Moon (2007) posits that firms must ensure that their CSR activity contributes to CD (particularly in their host communities) to augment their social status and competitive edge. Adewuyi and Olowookere (2010) explain that ensuring CD is a major issue since community members are becoming increasingly informed about the adversative effect of business activities on their livelihood and posterity. In the oil-rich Delta region in Nigeria, Idemudia (2014) reports how oil explorations have taken away the livelihood of the local people. It is the expectation that multinational oil companies involved in explorations must compensate local communities for their loss. However, Idemudia (2014) asserts that decades of government desertion and the failure of transnational oil corporations to take their social responsibility seriously have led to the Delta of Nigeria being bedeviled with poverty and conflicts.

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Considering the challenges faced in satisfying communities using CSR, the identification of appropriate CSR is paramount. Idemudia (2014) asserts that firms in the extractive industry face the challenge of identifying the right CSR initiatives and strategies that will guarantee their social license and induce a more positive collaborative relationship. The following steps in the view of Idemudia (2014, p. 161) can be used to develop successful CSR by transnational oil companies: (a) The identification of understanding of different power brokers in host communities. The various power brokers may include community leaders, laggards, and dissidents. This approach is needed to know the stakeholders with authority. (b) Ensure that community engagement involves everybody and not a selected few, such as elites. Community engagement must be open and sustainable. Community engagement can involve the elders, youth, professional occupational groups, women groups, etc. (c) Firms must develop a two-way communication. Communications with community members can be developed using formal and informal communication channels. These communication channels can be regular open community meetings in town halls, suggestion boxes, and public workshops. (d) Embark on a collection of relevant information from members of the community. Apart from using surveys and interviews, firm employees who have close ties with the community can provide vital information. Firms need to understand the community demographics, historical and cultural information, unemployment levels, and local needs. (e) There is a need to regularly examine community perceptions since these perceptions keep changing. Fisher et al. (2009) argue that embarking on CSR without societal input that can be achieved through a closer relationship with internal and external stakeholders may not lead to the company’s advantage. Porter and Kramer (2006) have argued that CSR must target the attainment of social and fiscal objectives that create a win-win situation. A call is, therefore, made for firms to adopt CSR strategic models that emphasize CD, such as asset-based community development (Fisher et al., 2009). McLennan and Banks (2019) posit that firms need to understand the idea of the community and define the communities that are affected by their actions. To do this, firms need to embark on community engagement. A common practice by companies in the extractive industry is the use of geographical limits (Idemudia, 2014). CD refers to initiatives undertaken by the community in partnership with external organizations to empower individuals and groups of people by providing these groups with the skills they need to effect change in their own communities (Ismail, 2009). CD expresses values of opportunity, equality, participation, mutuality, reciprocity, and continuous learning (Ismail, 2009). In the extractive sector, a study by Adewuyi and Olowookere (2010), analyzing the effect of CSR and CD activities by WAPCO, a cement company in Nigeria, found that the company had implemented the following CSR initiatives: publishing social and environmental policies, ensuring good health and safety practices,

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achieving higher environmental performance, instituting good human resource and employment practices, promoting community investment and charitable donations, supporting human rights initiatives, partnering with NGOs, and engaging stakeholders. In response to criticisms by local communities in the Lake Victoria Zone in Tanzania, Barrick, a Canadian gold mining company, responded by coming up with a number of CSR initiatives, including implementing educational programs in partnership with local communities, promoting social entrepreneurship, and implementing health programs (Ismail et al., 2015). In Nigeria, Idemudia (2014) reports that transnational oil companies have adopted a number of CSR practices, including corporate philanthropy, corporate volunteerism, employee volunteerism, and partnerships.

3 The Role of CSR and Community Development The roles of CSR in community development according to Ismail (2009) include: (a) To account for the negative consequences of industrialization CSR is necessary to offset irresponsible corporate actions (Kotchen & Moon, 2012). In this contemporary world, stakeholders are exposed to regular stories in the media about negative safety, health, and environmental impacts arising from the business activities of firms in the extractive sector (Unerman & O’Dwyer, 2007). Due to the actions of firms in the extractive industry, many economically viable activities in host communities, such as farming and fishing, may be affected. Throughout the world, mining and oil exploration have been reported to have affected the environment, thus causing the livelihood of local people to be lost. CSR initiatives such as finding alternative livelihoods for local people through skills training, agricultural initiatives, and educational sponsorships are important. (b) A closer relationship between firms and communities Social responsibility plays a crucial role in creating ties between corporations and local communities. Through CSR initiatives, corporations are able to build peaceful coexistence with local communities. In the extractive industry, CSR can be a way to reduce the tension among stakeholders to satisfy their interests. Conflicts over resources in mineral-endowed communities can be handled through social-related CSR and economic-related CSR. Social-related initiatives, such as the building of schools, health facilities, entertainment facilities, water facilities, etc., may curtail company-community conflicts. It is also expected that corporations must provide resources and infrastructure to mining communities to enhance their welfare. The existence of alternative livelihood projects to sustain the economic life of local communities is crucial in ensuring peaceful coexistence. These forms of CSR (social-related and economic-related) in the view of Boadi et al. (2018) are crucial in building company-community relationships in mining communities in Ghana.

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(c) Promoting talent Firms that have gained a reputation for CSR can be attractive to potential job seekers and will cause an employee to continue working for them. The effect of CSR in promoting talent can be assessed at the firm level and the community level. Employees’ perception of the commitment of a company to CSR will lead to favorable behavior toward the firm. There is also a high level of confidence in the top management of companies where CSR is pursued. It is expected that firms with high CSR performance are likely to also perform better financially. A study by Zainee and Puteh (2020) found that approximately 16% of employee retention is explained by the involvement of firms in CSR. Another study by Srisuphaolarn and Assarut (2019) suggests that CSR activities are signals that potential employees look for in seeking job security and meaningful work. (d) Development and transfer of technology CSR initiatives that are related to empowering communities to use technologies by multinational firms in local communities can lead to the transfer of technology. Through CSR, there is a greater mobility of technology from developed countries to developing economies. A study by Mefford (2019) reports that training in technical skills is a way multinationals can sustain their CSR efforts. The facilities and technologies that are available to multinationals can be transferred to local communities to assist in community development. The result of this is that local people can learn how to use these technologies. (e) Environmental protection In recent times, companies in the extractive industry have made huge investments to reduce their environmental footprint. Companies are beginning to realize that environmental protection is a way to improve the lives of local people. Throughout history, environmental disasters caused by firms in the extractive industry have rendered many local communities inhabitable. Firms’ CSR initiatives seek to reduce the negative impact on the environment. Some environmental projects include tree planting and recycling of waste. (f) Alleviation of poverty CSR in developing countries is mostly pro-poor. CSR initiatives can be adopted internally to reduce poverty among employees and externally among the community. At the community level, Medina-Muñoz and Medina-Muñoz (2020) state that initiatives such as training the local people in skills can help reduce poverty. Community assistance such as donations and volunteerism to help the poor, providing assistance to educational health institutions, and participation in campaigns to end hunger are in order. In the oil sector in the Niger Delta, Medina-Muñoz and Medina-Muñoz (2020) report that CSR initiatives are largely aimed at alleviating poverty.

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4 Cases of CSR to Promote Community Development in Africa This section presents a content analysis of the CSR projects of firms in the extractive industry in Africa. Using sustainability reports, this section identified CSR initiatives that are directed toward community development.

4.1

CSR and Community Development Projects in the Petroleum Sector Kosmos Energy CSR Activities

Kosmos Energy is an American upstream oil company founded in 2003 and based in Dallas, Texas. It is a leading deepwater exploration and production establishment focused on meeting the world’s rising demand for energy. The company’s assets comprise oil production and exploration in proven basins offshore Ghana, Equatorial Guinea, and the US Gulf of Mexico, in addition to world-class gas development offshore in Mauritania and Senegal. The cases of CSR initiatives in Africa related to CD found in the 2018 CSR report of the company are reported (Kosmos Energy, 2018). Area Equatorial Guinea

CSR activity Prodege Project

Description 1. In the opening five (5) years of this project, two-thirds of Equatorial Guinea’s primary school teachers’ were trained in instructional skills. Prototype primary schools were established, while the education information system was restructured. Moreover, the institutional capacity of the Education and Science Ministry was strengthened 2. Altogether, over hundred million US dollars was invested in education from 2006 to 2019. This program will be owned fully by the government by the second half of 2019 and will be ran by an autonomous agency of the government which is responsible for the program’s sustainability and ongoing positive impacts for Equatorial Guinea 3. Providing annual investment programs that focused on providing benefit to coastal community such as provision of solar-powered water wells and electronic water wells 4. Initiating of social investment programs to support oil and gas operation in Equatorial Guinea to provide openings for sturdier harmonization and partnership on societal projects 5. Acquiring partnership with Purdue University to teach the children of Equatorial Guinea on the importance of marine conservation (continued)

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Area

CSR activity Community engagement

Ghana

Kosmos Innovation Center (KIC)

Social investment

The new hydrocarbon province and the Tano Basin

4.1.1

Description 1. Conducting environmental impact assessment and importance of safety around it 2. Training of some Equatoguineans to work as fishing liaison officers and offshore safety to participate in surveys The KIC invests in fledgling entrepreneurs and small enterprises. They empower entrepreneurs to turn their thoughts into viable, self-sustaining businesses. Again, this center works together with small businesses which are very promising in order to assist them to reach their full potential This program by Kosmos focused on social investment of youth entrepreneurship via the KIC, providing clean drinking water, and other small projects at the community level: 1. For the past 7 years, Kosmos Energy has embarked on projects that have provided clean drinking water to Ghanaian communities. In collaboration with Safe Water Network, Kosmos has built water infiltration systems for 20 villages from the Western Region in Ghana. These people are approximately 28,000. It is worth emphasizing that such project was well received and patronized by the communities and this initial achievement of Kosmos encouraged them to extend the water projects to other communities in Ghana 2. In tandem with WaterHealth Ghana, they extended the program to ten new communities outside its operating area in 2017, thereby providing clean drinking water for approximately 130,000 people 3. Generally, the program comprises water purification facility construction, training of operators from local communities, and ensuring sustainability through the execution of a monitoring program 1. Investing in safety trainings that helps sustain performance gains on the environment 2. A mandatory training annually on health, safety, and environmental policies and standards was equally provided

Tullow Oil

Tullow Oil is an independent oil and gas exploration and production company. The group has interests in over 30 exploration and production licenses across 8 countries, and their purpose is to build a better future through responsible oil and gas development, which has been in operation since 1985. Additionally, Tullow is Africa’s foremost autonomous oil and gas, exploration, and production group. They started operations in Ghana in 2006 and contributed to Ghana’s oil industry, especially when the world-class Jubilee Field was discovered in late 2010. This emergence sets Ghana up as one of the important players with regard to West Africa’s energy

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industry. The content of the Sustainability Report in 2019 was examined to identify the CSR initiatives related to CD (Tullow Oil Plc, 2019). Area Ghana

CSR activity Creating employable technicians and engineers in Ghana (2019): building local skills

Driving socioeconomic investment: upgrading aviation infrastructure in Ghana

Local initiatives for community prosperity: Tullow Ghana

Tullow Charity Challenge

Kenya

Training entrepreneurs in Kenya to enable superior business outcomes

Description In conjunction with Takoradi Technical University, Tullow Ghana launched the program “Field Ready” in 2015. The program was designed to provide extremely employable technicians and engineers and aimed to attain full-gender balance among program participants. The course was for 12 months and was taught by facilitators from licensed educational institutions in the country. Indeed, opportunities are provided for graduates in entry- level engineering, technician, and operator roles. It is worth mentioning that both graduates and companies have benefited greatly from the program. Therefore, Ghana is being provided with people who have employable skills, knowledge, and attitudes that industries require In 2019, Tullow Ghana completed construction work at the Takoradi Airport Air Force Base in Ghana, considerably upgrading its ability to support national and commercial aviation and the growth of Ghana’s offshore petroleum industry, while providing an enhanced operational base for their activities in Ghana Tullow Ghana and our local Joint Venture Partners held a free health screening exercise in coastal communities in Ghana’s Western Region, benefiting close to 2000 fishermen and community members Again in 2019, Tullow held its annual Charity Challenge with events organized across four teams— Ghana, East Africa, New Ventures, and Corporate (UK). Tullow colleagues logged exercise and volunteered with local charities to earn points and a share of the $100,000 charity fund for their chosen charities Indigenous people were given training, skills, and knowledge to construct their own businesses. Instilling this spirit of entrepreneurship into the local people has brought in its wake prosperity sharing, and Tullow has a number of programs that support these entrepreneurs. TechnoServe, an international not-forprofit organization, has collaborated with Tullow in Kenya to offer an entrepreneurship module to local business owners. The duration of this course is normally 3 months, and it is done in the Turkana County. After completion, the graduates are offered mentors and are allowed to apply for financial support from the micro and small business fund (continued)

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P. Ansu-Mensah et al. CSR activity Enhancing water infrastructure in Kenya

Description Access to water in drought-afflicted Turkana County in Northern Kenya is the key to delivering food security, reducing disease, and enhancing livelihoods through livestock and agriculture. However, as most water supplies are underground, investment is required to access it. Tullow has therefore funded drilling and rehabilitation of more than 30 boreholes around the county and provided transportation of water to areas under severe water stress, benefiting more than 67,000 people

Corporate Social Initiative Toward Community Development by Mining Companies

The CSR initiatives that are related to community development by mining firms in Africa are presented in this section. The CSR initiatives are sourced from sustainability and CSR reports of petroleum and mining companies in Africa. Sustainability reports related to CD are presented.

4.2.1

Newmont Corporation CSR and Community Development

Newmont, founded in 1921, is the world’s leading gold company and a producer of silver, copper, zinc, and lead (Newmont Corporation, 2020). The company operates in Africa, Australia, and America and is listed on the S&P 500 Index and recognized as principled environmental, social, and governance practices. In this study, the Sustainability Report and the CSR reports related to CD are presented. CSR initiative 20 million US Dollar COVID-19 Global Community Support

Description 20 million US Dollar COVID-19 Global Community Support The COVID-19 Global Community Support Fund was created by Newmont in April 2020. The fund had a seed money of $20 million to support three critical segments of need: labor force and community health, food security, and local economic resilience. The goal of the fund is to assist employees, host communities, and host governments all over the world in combating the effect of the COVID-19 pandemic The company had contributed approximately $11 million by the end of the year, adding to its previous local community contributions and activities. It put $8 million on employee development and training programs. In addition, $7.7 billion in direct economic contributions were distributed Hygiene and cleaning education campaign The Company started hygiene and cleaning education program to teach employees proper hand-washing techniques as well as (continued)

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Newmont Ghana resettlement and land use

2020 local employment performance region site

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Description cough and sneeze etiquette. It also offered personal protective equipment (PPE) to the host communities. External medical specialists were consulted for testing and contact tracing. For suspected COVID-19 cases, treatment protocols were established, which included transportation and transmission engagements with local and state institutions Workforce and community health PPEs and other medical supplies were purchased to assist medical institutions with COVID-19 response needs. Soaps and sanitizers were provided for the employees and communities Local economic resilience A support for local contractors in the form of salary was provided via microcredit initiatives. This help was for the small enterprises to reopen with COVID-19 safety measures ready, and the company created circumstances for recovery and growth. Workers and local contractors who were not able to work owing to the COVID-19 received cash assistance. $10.7 million was spent to assist the host communities, governments, and personnel. The fund allocated 60% of its resources to the workforce and community health pillars, 21% to local economic resilience, and 15% to food security To help diversify local economies and offer job opportunities for community members, the company created the Local Economic Diversification Support (LEDS) initiative The company commissioned market research as part of the project, which highlighted two early economic development opportunities: an EnviroDome greenhouse agriculture project in Akyem and the expanded value chain of the Asutifi Processing and Service Center in the Ahafo sector On the recommendation of the Environmental Protection Agency (EPA), 80 of the 412 residences near the TSF expansion site that was to be resettled were relocated at Ahafo Boundary demarcation was completed in 2019, and the company moved on to a Full Built Assets Survey, farm surveys, and crop compensation assessments. The company will continue to pay out $3.1 million in compensation to affected communities in 2021. Ahafo—watershed management To harmonize expectations for the watershed, the company worked with the Tano Basin Board on the Newmont water stewardship strategy. Under the WASH initiative, it collaborated with the Asutifi North District Assembly to strengthen community water systems and management Akyem—water management The company created a dashboard to better comprehend and convey results, as well as advanced operations to help with excess water management, such as temporary water treatment procurement Local community participants made up 43.7% and 51.5% of Ahafo and Akyem workers, respectively, by the end of 2020, exceeding the annual objective of 35% for both locations (continued)

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CSR initiative

Description

Newmont Ahafo Development Foundation

Akyem met its target of employing at least 50% of its workforce from the local community, proving its longer-term commitment to achieve 50% local employment within 10 years of its operation The company provided extra $300,000 contribution annually in addition to the contribution grounded on the $1 per ounce of gold produced and 1% of net profit Newmont has teamed up with Ghana Government and the Ghana Cocoa Board to devote $15 million into the building and renovation of a 41-kilometer road near Akyem to increase safety and economic activity

4.2.2

AngloGold Ashanti Contributions to Resilient, Self-Sustaining Communities

Globally, the company is ranked third largest gold producer, and it is also the largest in Africa. The company is listed on the Johannesburg, New York, Australia, and Ghana stock exchanges. The 2020 Sustainability Report of the company provides some details about the CSR initiatives that are related to the CD agenda (Anglogold, 2021). Initiative Socioeconomic development

Description The company paid over $1 billion in royalties and taxes to governments last year. It also handed out over $2 billion to workers and local businesses to assist boost the economy around mine sites and beyond COVID-19 To combat the COVID-19 pandemic, the company established a set of predictive leading indicators to help in discovering and assessing possible issue problems in real time It also set up systems to test and treat COVID-19 patients, and developed protocols and guidance documents to ensure suitable alleviation processes were put in position as well as assisted with isolation and quarantine In collaboration with stakeholders, the company provided PPEs, food, medical supplies/equipment, education, awareness, and donations As of January 2021, the company had conducted over 40,000 COVID-19 tests, with a recovery rate of more than 92% among its personnel, and over 80% of the diagnosed cases had shown no symptoms Health projects The company manufactured hand sanitizer for public use. It also donated to the President’s COVID-19 Trust Fund. The Ashanti Regional Health Directorate and the Obuasi Municipal Health Directorate were all supported by the Company’s health foundation. The Company’s malaria team assisted in the disinfection of health centers in the Obuasi Municipality The company launched several community-based projects aimed at preventing COVID-19, HIV, malaria, and chronic illnesses. The (continued)

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Description company’s Iduapriem operation assisted in the establishment of a breast cancer screening center in Tarkwa. A new modernized occupational health center was built to better promote linkages between occupational hygiene and occupational medicine at Iduapriem Community resettlement The Ajopa resettlement project in Iduapriem was completed and handed over, while the Mankessim resettlement project is approaching completion. Sixty-eight (68) houses have been constructed, with 65 homeowners accepting their homes The Company aided women’s economic empowerment by training them in soap production at Tokunaso in 2020. The company also provided the youth with the opportunity to get experience, learn on the job, and develop leadership skills

5 Conclusion Mining companies in Africa based on their CSR reporting have shown commitment in CD. In developing countries such as Africa, CSR initiatives are commonly performed in natural resource-endowed local communities. The literature suggests that CSR is necessary, especially for firms in the extractive sector, since it is required to gain legitimacy and support to operate. Consequently, firms in the extractive sector are aggressively reporting their CSR initiatives using annual reports and sustainability reports. These reports present the initiatives that firms have put in place to ensure that the environment is protected and how the firm ensures the needs of employees and communities are met. CSR initiatives relate to the promotion of health and sanitation. This chapter indicates that firms in the extractive industry in Africa played an important role in the fight against COVID-19. The CSR initiatives included provision of PPEs, donations to individuals and families affected by the pandemic, and providing education on the pandemic. Additionally, investments in other health areas, such as malaria, Ebola, and HIV/AIDS, are a common CSR practice of firms in Africa. Corporate bodies are leading most health-related projects in localities that are close to mining and oil exploration sites in Africa. In addition, the study identified the commitment toward marginalized groups such as abused women and children. Education and training are other important development agenda that are of interest to corporations in Africa. From the content analysis of the CSR reports, firms have invested in education and community skills development. Through educational foundations, corporations have invested in scholarships and the provision of facilities. The reports show that firms have built schools in mining communities and sponsored students. Moreover, to ensure that there are adequate skills to ensure that members of communities get employed or start their own businesses, skills training is a major capacity-building tool used by corporations.

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The promotion of economic activities in communities has been found to be a common CSR initiative by all firms studied. Corporate institutions are interested in providing skills to ensure that individuals can start their own businesses. Since most mining communities are semiurban or rural, informal sector jobs are created. Additionally, some companies set up businesses that are not related to their core business and recruit community members to work. In the area of agriculture, farm plantations are major projects that mining firms invest in to provide employment for the local people. It is also worth noting that economic foundations owned by corporations provide seed capital for local people to start businesses. Due to the devastating effect of mining on social and economic life, some communities are relocated and resettled. The CSR aspect of resettlement means that corporations must go beyond the legal requirement and provide for the needs of the affected people.

5.1

Recommendations

The chapter proffers the following recommendations for practice and future research: (a) A major part of the CSR strategy of corporations must be dedicated to community development. For companies in the extractive industry, the development of the local community is vital to ensure the continued existence of business. To ensure the coexistence of businesses and local people, CSR initiatives can be used to gain the support and legitimacy to operate. The stakeholders in local communities can be satisfied through CSR. Corporations must build their skills and resources related to CSR. Managers must be equipped with people skills and ethical skills. Additionally, resources and partnerships that enable firms to pursue CSR objectives must be attained. (b) It is critical to identify the power of stakeholders and their needs. Stakeholders include opinion leaders, traditional leaders, youth groups, and trade and worker unions. It is crucial to identify those that are opposed to the operations of companies in the locality. For extractive corporate bodies, CSR initiatives must tackle the issues that the firms’ operations affect. (c) CSR programs that affect the very existence and development must be pursued. It is proposed that corporate-community engagement is the best approach to understand the expectations of the community. Similarly, community engagements must be regular since the needs of society keep changing.

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Gloria Kakrabah-Quarshie Agyapong is a Senior Lecturer, and Head of the Department of Marketing and Supply Chain Management, University of Cape Coast, Ghana. She holds a Ph.D. and MBA in Marketing. Her research interests include service quality management, public sector marketing communications, and social media advertising. Richard Kwame Nimako is a Marketing Lecturer and Trainer. His research interests include corporate social responsibility and marketing of public sector organisations. He has published on communicating corporate social responsibility.

Does Corporate Social Responsibility (CSR) Actually Develop Mining Communities? An Examination of CSR Programmes in Kenya’s Mining Sector Willice Abuya

1 Introduction Muthuri and Gilbert (2011) aver that research on corporate social responsibility (CSR) in developing countries remains scarce even with the acceptance of a contextspecific relevance to CSR. Africa’s context is one marked by conflict, environmental degradation, and dire poverty, thus presenting players in the mining sector with the ethical dilemma of prioritizing their overall social responsibilities over profits (De Jongh & Prinsloo, 2005). This is why Visser (2006) calls for more research in African insofar as CSR is concerned. However, the context-specific environments characterized by limited financial infrastructure make a systematic analysis of CSR in much of sub-Saharan Africa difficult (Rampersad & Skinner, 2014)—with only South Africa being a notable exception (Malan, 2005). An analysis of the literature on African CSR covering the period 1995 and 2005 shows that only a paltry 12 of Africa’s 53 countries have published research in high-impact refereed journals. Of these, 57% of all articles focused on South Africa, while only 16% focused on Nigeria, with the rest sharing the remaining 27% (Visser, 2006). One argument on why CSR research in Africa is limited is the fact that most studies have mainly focused on sectors while ignoring country-specific CSR aspects and interpretations. For this reason, CSR in Kenya, as it has in much of Africa and other parts of the developing world, has remained controversial, fuzzy, and subject to varied interpretations/conceptualizations and has remained saddled with problems of operationalization (Cheruiyot and Tarus, 2017). This state of confusion attributed to its CSR relative theoretical underdevelopment and inappropriate contextual application (Cheruiyot and Tarus, 2017).

W. Abuya (✉) Moi University, Kesses, Kenya e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_6

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CSR studies in Africa have thus found itself unnecessarily mired with the analysis of concepts, issues, processes, cultural aspects, contextual factors and antecedents, and corporate human rights, among others (Cheruiyot and Tarus, 2017). CSR studies on the impact of activities on local communities in Africa, especially in the mining sector, are fewer. The paucity of CSR research in Africa is also attributed to the fact that mining activities (as well as the companies involved) have been relatively small in size (and influence) to be worthy of international comparative research. Second, research in CSR has been difficult in Africa, as its governance, legal framework, and institutional structures are usually in flux, with violent conflicts (over scarce resources and usually tribally instigated) prevalent in many corners of the continent. In addition, poor socioeconomic and political conditions make CSR research in Africa particularly difficult (Kühn et al., 2018). Despite these difficulties, scholars have shifted their focus to emerging economies (Morqtis & Slaa, 2016). CSR activities in Kenya have mainly been a function of normative and cultural pressures in Kenyan society, which generally explains the largely philanthropic nature of CSR practices, often employed haphazardly and on an ad hoc basis and usually far removed from the core business of the extractive companies (Muthuri & Gilbert, 2011). Morqtis and Slaa (2016) agree that, traditionally, CSR has been philanthropic in nature, with the activities only recently shifting to a strategic approach. Scholars note that empirical research has revealed that multinational companies with offices in Kenya have more often addressed community, environmental, workplace, and marketplace aspects of CSR than their local counterparts, who have largely concentrated on community-based issues such as HIV/AIDS, health, and education (Morqtis & Slaa, 2016). Evidence points to the willingness of corporate organizations to embrace CSR not only as an altruistic tool but also as an important component of their business strategies, often expressed in their vision and mission statements. This gradual acceptance and appreciation of the ‘good faith’ and intentions of linking it to businesses have also spurred CSR activities on the continent (Olorunjuwon & Sakhile, 2017). Others have argued against CSR. One school of thought argues that engaging in CSR defeats the entire purpose of shareholder primacy theory, as the concept focuses on generating maximum profits for the shareholder (Musikali & Musikali, 2015). Expenses on CSR considered wasteful and unnecessary, as considering the interests of other parties, instead of those of shareholders, constitutes a breach of duty (Friedman, 1970). Opondo (2009) warns that the entry of China into Africa heralds a new phase of not only an unbridled assault on working conditions but also an even greater assault on CSR practices on the continent, more so in Kenya. Newcomb (2020), who asserts that China’s involvement in Kenya (usually disguised as aid and other assistance) is not because of genuine care and interest for the Kenyan people but on their own selfinterest, shares this view. As such, Opondo cautions that the Kenyan government should only enter into agreements with China that ensure mutual benefits for both nations.

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Despite the reservations held by other practitioners (as expressed by Musikali and Musikali, 2015) and the impending threat posed by China’s entry as espoused by Opondo (2009), corporates continue to realize that there are benefits in engaging in CSR, one of which is that it has the potential to boost corporate revenue (Nasieku et al., 2014; Kiran et al., 2015). Therefore, CSR is mandatory for businesses, particularly not by those operating in developing economies (Olorunjuwon & Sakhile, 2017). Without strong and well-enforced policy and legal regulations, corporates are more likely to engage in CSR activities that only promote business at the expense of communities (Abuya, 2018; Campbell, 2007). The near absence of a regulative environment in Kenya in the recent past has only served to encourage the negative behaviour of companies towards CSR activities (Muthuri and Gilbert, 2011). The lack of regulations was attributed to the government’s reluctance to impose regulations for fear of discouraging foreign investment (Mothuri, 2011). Governments must play a critical role in building institutional CSR infrastructures that include and are not limited to public policies and regulations in the context of responsible business behaviour, standards and codes, CSR-oriented multi-stakeholder initiatives, voluntary business initiatives, reporting and verification systems, CSR principles, and CSR business networks (Waddock, 2008). This is the reason why Musikali and Musikali (2015) joined Abuya’s (Abuya, 2018) call for a rethinking of CSR regulation in Kenya’s mining industry. Piper (2012) nonetheless notes that mining is now adapting to Africa’s needs and cites incorporation and regulation of CSR as one of the methods of adaptation. As Imbun (2007) says, mining companies cannot do without the significant other (the community), and he asserts that CSR is one of the most promising methods of ensuring community support for their ventures. The promulgation of the new constitution in 2010 provided the much-needed roadmap towards this regulation. The Bill of Rights was particularly instrumental in offering this guideline. The Bill of Rights spelled out a raft of unalienable rights, which necessitated various amendments. The Mining Act of 2016 (one that replaced the pre-independence Mining Act of 1940, which was viewed by many as archaic and a significant hurdle to investment in Kenya’s mining sector (Nyabira, 2017)) is one such effort in this direction.

2 Kenya Legal Framework and CSR Before we examine the various international regulations on CSR and Kenya’s legal framework, it would be worthwhile to examine recent trends in the development of CSR worldwide. Nasrullah et al. (2014) provide an excellent exploration of these trends. The authors narrate that the recent trends began with the launch of the 1995 Enterprises Against Social Exclusion Manifesto (EASCM), in which companies operating in the European Union (EU) undertook to fight against social exclusion and to use CSR as one of the tools to achieve this aim. This saw CSR placed at the

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top of the EU political agenda in the EU Lisbon summit in 2000. In this meeting, the EU leaders committed to integrating CSR into their strategic goals. In this summit, the EU government made a special appeal to companies to act from a corporate sense of social responsibility regarding best practices on lifelong learning, work organization, equal opportunities, social inclusion, and sustainable development (Nasrullah et al., 2014). The EU thereafter commissioned a green paper that promoted a European Framework for CSR in 2001. More than 250 organizations accepted and endorsed these recommendations and, more importantly, reached a consensus on what CSR practice entails. The European Parliament on its part, in 1998, fronted for the adoption of a code of conduct (entitled ‘European Code of Conduct Regarding the Activities of Transnational Corporations Operating in Development Countries’), which placed the EU Parliament as the first institutional player to engage in CSR development. Among the raft of resolutions arrived at in this document included the provision for creating a multi-stakeholder forum (the European Multi-stakeholder Forum on CSR) to oversee the business side of CSR and spearhead a relook at trade union policies. Other issues touched on the protection of the environment and mitigation of other social effects that affect project-affected persons/communities. Other developments in Europe included the initiation of the 1994 ‘Our Common Concern Campaign’ that saw the Danish government putting CSR into its business agenda. On the other hand, France established the France Study Centre for CSR (FSC-CSR) in 2000 (Nasrullah et al., 2014). It is, however, in the UK, where, for the first time in the world, CSR is a public policy strategy. This happened when in 2002 Prime Minister Tony Blair appointed a minister for CSR in the Ministry of Trade and Industry. Other gains included the mandatory reporting of social and environmental concerns, including CSR in Belgium, Denmark, Sweden, France, and Norway (Nasrullah et al., 2014). Meanwhile, in the USA (US), the government preferred self-regulation as opposed to government oversight. This is how in 1996 the Clinton Administration, after extensive consultations with business enterprises, labour leaders, and members of the nongovernmental organization community, agreed to adopt a set of voluntary CSR guidelines for companies. Some of the voluntary guidelines focus on CSR practices. Nevertheless, certain federal activities that complement the US business’s global corporate responsibility efforts were retained (Nasrullah et al., 2014). Among these were (1) the establishment of the Department of State’s Award for Corporate Excellence through which the government endorses CSR by providing awards to companies and (2) the establishment of a Department of Commerce programme that facilitated CSR by providing training on corporate stewardship (Nasrullah et al., 2014). Elsewhere, things were also changing. In Japan, for instance, the Japan Association of Corporate Executives published a CSR report that would guide the practice in the country. Influenced by the 1953 Bowen report titled ‘social responsibility of the business’, the 2003 report stressed that companies must seek harmony between economy and society and suggested CSR as the best way to pursue this goal (Nasrullah et al., 2014). In 2004, the Japan Business Federation reviewed the 1991

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‘Charter of Corporate Behavior’ to tackle current CSR concerns. The signing of the 1994 Caux Principles for Business (which comprised senior business leaders from Europe, Japan, and North America) included a set of seven general principle guidelines for CSR business decision-making purposes. In developing countries, Nasrullah et al. (2014) observe that in this part of the world, CSR has not been mandatory and that its performance depended largely on a company’s philanthropic nature beyond mere profit-making. Nonetheless, some notable progress on the development of institutional frameworks and public sector policies have been formulated in countries such as Argentina, Slovenia, Brazil, Poland, Mexico, and Hungary. Some progress in this direction in Africa by Kenya is of interest to the authors. This article examines the progress made in Kenya’s CSR institutional framework and policies. The article looks at Kenya’s Mining Policy of 2016, the Kenya Mining Act of 2016, the Petroleum Act of 2019, and the Local Content Bill of 2018 as some of these advances made in Kenya. We will first turn our attention to international protocols. Forstater et al. (2010) argue that a number of standards (and regulatory bodies) are particularly relevant to CSR development in Africa today. These include: • The Equator Principles 1: This framework offers a risk assessment protocol for the social and environmental risk concerns of project finance. The assessment is based on the Social and Environmental Standard of the International Finance Corporation (IFC). • The Extractive Industries Transparency Initiative (EITI) 2: This initiative promotes revenue transparency in the mineral sector. It provides a robust yet flexible methodology for monitoring and reconciling company profits, community loyalty payments, and government revenues at the country level. The process is participatory in nature, as it has oversight by participants from the government, companies, and national civil society. • The Forest Stewardship Council 3: Set up in 1993, this international nongovernmental organization promotes responsible management of the world’s forests. Among its mandates is that of global forest certification that affords consumers the assurance to purchase timber and forest products derived from well-managed forests. • The Global Reporting Initiative 4: Set up in the year 2000, this initiative develops and stewards the adoption of accepted standards and guidelines for public reporting on sustainability matters. • The International Council for Mining and Minerals (ICMM) Sustainable Development Framework 5: This framework provides a set of principles that offer 1

See https://equator-principles.com/app/uploads/The-Equator-Principles_EP4_July2020.pdf. See https://eiti.org/files/documents/eiti_standard_2019_en_a4_web.pdf. 3 See https://fsc.org/en. 4 See https://www.globalreporting.org/how-to-use-the-gri-standards/gri-standards-english-lan guage/. 5 See https://www.iucn.org/sites/dev/files/import/downloads/minicmmstat.pdf. 2

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guidance for sustainable development, reporting, and independent assurance for mining companies. • The Kimberley Process (K.P.) 6: Launched in 2003, this process is in charge of the certification of diamonds to ensure only legitimate supplies reach the market. The process distinguishes ‘blood diamonds’ that illegitimately finances conflict. • The UN Global Compact (UNGC) 7: This agreement established ten broad principles covering environment, labour, human rights, and anti-corruption initiatives, as well as providing guidance, tools, learning, and collaboration networks that assists companies in meeting these principles. • The Voluntary Principles on Security and Human Rights (VPs) 8: Launched in the year 2000, this framework sets out standards that ensure that security forces protecting extractive projects do not intimidate or harm local people. The Africa Mining Vision (AMV) is another guide that is useful in this discussion. The architects of AMV believed that it would lead to ‘transparent, equitable and optimal exploitation of mineral resources to underpin broad-based sustainable growth and socioeconomic development’ (UNECA, 2011:5). Among the tenets of the AVM was the resolution that mining in Africa should foster sustainable development by stressing safe mining, good governance, and one that included the participation of communities and other stakeholders in the development process. It also advocated for a transparent and accountable mineral sector where resource rents are utilized to promote broad economic and social development (African Union Commission, 2011). Cluster 7 of the initiative focused on environmental and social issues from which CSR mandates developed. From this initiative, the International Study Group (ISG) was formulated by the UNECA in September 2007, with a mandate to oversee how mining in Africa could contribute to the continent’s development (Hilson, 2020). Hilson, however, criticizes the initiative pointing out that despite the fanfare that accompanied its launch, today, in many forums such as workshops and/or meetings including those of heads of state or government representatives, this initiative was ignored. He asserts that were it operationalized in its entirety, the AMV could go a long way in tackling Africa’s resource problems. He nonetheless applauds the AMV for ushering in a drive for new mining legislation in many parts of Africa—but he bemoans the realization that the continent remains economically over dependent on the capital-intensive exportbased mineral industry, with an ever expanding but uneconomical informal ASM economy. He concludes that until it is operationalized, the vision remains just that—a vision.

6

See https://www.kimberleyprocess.com/. See https://www.unglobalcompact.org/. 8 See https://www.voluntaryprinciples.org/the-principles/. 7

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3 CSR Regulation in Kenya There are three dominant theories of regulation: public interest theory, private interest theory, and regulatory capture theory. While public interest theory explains how the public is protected against market failure, private interest theory, on the other hand, delves into how regulation as a tool is utilized to transfer wealth to the interest group that holds political power. Meanwhile, regulatory capture theory explains how the regulatee captures the regulators and thereby protects the public interest (Rahim, 2016). This article adopts the standpoint that regulation is important, as it protects the larger public’s interest. In this regard, we will look at (and assess the effectiveness of) the regulatory framework of mining in Kenya’s mining sector. Therefore, this chapter shall analyse Kenya’s Mining Policy of 2016 and examine two pieces of legislation (the Mining Act of 2016 and the Petroleum Act of 2019) and one parliamentary bill (The Local Content Bill, 2007) for this purpose.

3.1

Kenya Mining Policy of 2016 9

The policy does not per se make any direct reference to CSR. Nonetheless, one can observe inferences made about CSR in various sections of the policy. For starters, the guiding principles of the policy include the following: (i) Ensuring intergenerational equity and sustainable utilization of mineral resources so that future generations can benefit from these resources. Targeted CSR programmes can ensure this. (ii) Integrating sound environmental protection, safety, and health concerns in mineral resource development ensures equitable access to and equitable sharing of mineral resources at all levels. CSR programmes that protect the environment could fulfil this environmental concern. CSR programmes are a way of sharing benefits. (iii) Ensuring transparency, accountability, and public participation as spelled out in Kenya’s constitution. As advocated by the EITI, CSR activities can enforce accountability in this sector. The policy objectives (and strategies) include the following: (a) Provide a long-term policy direction and legal framework that resonates with current industry needs, trends, and international best practices. A CSR framework anchored on the Local Content Bill and the Mining and Petroleum Acts. (b) Providing a framework for mobilizing resources and for capacity-building for the sector. CSR training programmes can assist in this aspect.

9

Available at https://www.idlo.int/sites/default/files/pdfs/highlights/Kenya%20Mining%20Policy %20Popular%20Version-LowRes.pdf

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(c) Providing a framework for harmonizing legislations relating to mining and all other associated aspects, such as health, occupational safety, and the environment. This can lead to the formulation of appropriate CSR laws. (d) Providing a framework for equitable sharing of mineral benefits for all stakeholders, such as the national government, county governments, and mining communities. Thus, the implementation of CSR programmes involves the sharing of benefits accruing from extractive enterprises. The above policy thus has the potential to mid-wife CSR legislation. Instructively, it was from this policy that the Mining Act of 2016 was developed.

3.2

Kenya Mining Act of 2016 10

The Mining Act 2016 derives its power from the Kenya Constitution (2010) and the Mining Policy (2016). Articles 62(1) (f) and (3) of the 2010 Constitution of Kenya state that minerals shall vest in and be held by the national government in trust for the people of Kenya. 11 The protection of the environment and natural resources is therefore a function of the national government (Musikali & Musikali, 2015). As with the mining policy, the Mining Act equally does not make specific reference to CSR-only inferences made towards CSR in the document. The following sections provide such inferences: Sections 46 (1) and 47 (1) touch on employment and training, in which extractive industries are expected to ensure skills transfer to citizens. The holder of a mineral right recruits and trains citizens of Kenya in the manner prescribed by the Cabinet Secretary as approved. CSR training programmes fall under this provision. Employment and training are usually one of the demands of local communities, and as such, CSR activities related to training come from this provision. Section 103 provides that the holder of the mineral right should undertake to protect the environment by obtaining an environmental impact assessment and social heritage license (together with designing the associated environmental and social management plans), plus engaging in community investments. Section 117, on the other hand, provides that mineral rights holders must develop community development plans before they proceed with their activities. These sections thus lay the foundation for CSR programmes. Section 153 (9) decrees that the cost of resettlement under Subsection (8) shall be the responsibility of the mineral rights holder. Now, as observed in previous studies (see Hilson, 2002, for instance), land dispossession is one of the major causes of conflict between mining companies and mining communities. As noted in these studies, land alienation remains a major cause of disagreement that plays out 10

Available at http://kenyalaw.org/kl/fileadmin/pdfdownloads/Acts/MiningAct_No12of2016.pdf See https://www.klrc.go.ke/index.php/constitution-of-kenya/117-chapter-five-land-and-environment/part-1-land/229-62-public-land. 11

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throughout the life of the mine. As such and to obtain the social license to mine, mining companies have to appease the affected mining communities; CSR is one such way through which this appeasement can be achieved. This section also holds that mining companies have to adhere to the provisions of the Water Act, which provides that those exploiting the environment must ensure that water is still available to the local community. This provision would thus interest mining companies to see to it that they carry out CSR activities that target the provision of water to communities. Water programmes, as noted in many CSR programmes (including the two case studies that we shall presently look at), top the CSR agenda. Section 183 (5) decrees mining royalties’ distribution as follows: 70% to the national government, 20% to the county government, and 10% to the mining community. 12 Often, mining communities expect a share of the benefits arising from the mining activity, and thus the payment of these royalties lends assurance towards this goal. Although existing in law, no community in Kenya paid any such royalty (for reasons that will soon become clear in Section 4.0 that deals with CSR in Kenya’s mining sector).

3.3

The Petroleum Act of 2019 13

The need for this Act became urgent when oil was discovered in 2012 in the northeastern part of Kenya by Tullow Oil. Its commercial viability is, however, still a subject of debate. The Act was enacted in anticipation of large-scale oil exploitation and as insurance against conflict over oil extraction, as witnessed in Angola, Libya, and Nigeria. Johannes et al. (2015) cautioned about the potential of conflict over this discovery. As with the Mining Act 2016, this Act as well neither has concrete provisions for CSR—the same can nonetheless be inferred from various clauses in the Act. We examine these clauses as follows: Section 6 (1) provides for the Cabinet Secretary to develop a national petroleum strategic plan that will serve as a guide for implementing the national policy on petroleum operations. The government can thus use this provision to bring onboard specific CSR regulations. Sections 50 (1) (b) and (c) provide adherence to internationally acceptable standards in regard to the matter of local content. Local content provides the use of locally obtained resources by multinational firms. Local content in this case of this Act refers to mining concerns addressing the following issues: employment and training, research and development, technology transfer, industrial attachment and apprenticeship, legal services, financial services, insurance services, succession plans for positions not held by Kenyans, consultancy services, construction services,

12 13

See https://portal.miningcadastre.go.ke/Downloads/Mining_Act_2016_Full.pdf; see pg 303. file:///Users/user/Downloads/The%20Petroleum%20Act%202019%20(1).pdf

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hospitality services, transport services, security services, clearing and forwarding services, and inspection services, among others, as may be prescribed by the regulations. 14 Mining firms can use this provision to bring in EITI regulation and other international standards (such as the World Bank social safeguards), which will then allow them to incorporate CSR activities into their programmes. This section also recommends for the employment of locals; hence, mining firms can incorporate this as well as part of their CSR programmes. Section 58 (1)–(3) provides for the sharing of profits derived from petroleum activities as follows: The county government’s share shall be equivalent to 20% of the national government’s share. The local community’s share shall be equivalent to 5% of the national government’s share and shall be payable to a trust fund managed by a board of trustees established by the county government in consultation with the local community. 15 As argued earlier, the payment of royalties would go a long way in appeasing local communities. Meanwhile, Section 59 mandates mining companies to ensure the health and safety of the local community. The mining company can thus take advantage of this clause and develop targeted CSR programmes. The downside of these legal frameworks is that there is no specific provision for enacting laws that would regulate CSR in the mining sector. One can only make inferences to CSR in the Act. No section obligates the company to develop CSR programmes, and even where this suggestion is made, the word used is ‘should’, which implies that this is more of a voluntary exercise than a legal requirement. Even where the law is explicit, the question of implementation would remain—given that Kenya is infamous for no enforcement of existing laws. The above are thus the relevant legal framework used to regulate CSR activities in Kenya. We will nonetheless still look at the Local Content Bill of 2018 to assess what promises it offers in thus far as CSR is concerned.

3.4

The Local Content Bill of 2018 16

This Bill lapsed (twice) in parliament after it failed to muster support beyond the house committee that considers and passes it on for discussion before the full house. As such, we shall only briefly review it. The object of the Bill is to ensure that mining operations utilize local material and local labour. Under Section 22, the Bill provides for the provision of local content plans, which will consist of employment and skills development plans, transfer of technology and research plan, research and development plan, financial reporting plans, and local content performance plans. CSR would be more interested in the bit touching on employment and skills development plans. However, the future of this bill is in doubt after it twice elapsed in parliament.

file:///Users/user/Downloads/The%20Petroleum%20Act%202,019.pdf; see pg 212. See file:///Users/user/Downloads/The%20Petroleum%20Act%202,019.pdf: pg 216. 16 http://www.parliament.go.ke/sites/default/files/2018-11/Local%20content%20Bill.pdf 14 15

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Whispers have it that more powerful stakeholders (read potential petroleum firms) are uncomfortable with the contents of the Bill and hence influenced its stillbirth, twice.

4 CSR Practice in Kenya’s Mining Sector Generally, the mine-related conflict revolves around six core issues, namely, (a) over ‘unfair’ compensational practices (see Hilson, 2002); (b) squabbles over land ownership, that is, who is the real owner of the land, the government of the local community (Akpan, 2005); (c) agitation over environmental degradation arising from mining activities of the extractive companies (Turner & Brownhill, 2004); (d) dissatisfaction over inequitable resource distribution (see Frynas and Wood, 2001); (e) concern over mine-induced poverty (Mensah & Okyere, 2014); and (f) conflict over human rights abuses. Many believe that CSR could be an effective vehicle for minimizing these conflicts (Imbun, 2007). However, as mentioned earlier, CSR suffers from conceptual, definitional, and contextual difficulties—this has handicapped its implementation. The contextual difficulty is of much concern to us. Due to the myriad of problems facing African nations, such as widespread poverty, growing inequality, deficiency in health care, run-down educational systems, widespread HIV/AIDS, and poor governance, CSR in the African context has a wider meaning than merely philanthropic acts (of charitable cheque writing) by corporations operating in Africa (Nasrullah & Rahim, 2014). Consequently, extractive industries often find themselves between a rock (the government) and a hard stone (the community). On many occasions, companies operating in the extractive sector in Africa often negotiate their economic and financial terms with governments, which gives them the legal right to operate— they then have to separately negotiate with host communities for the social license to operate. Companies thus use CSR conveniently as a method to obtain this social license. This is more so in developing economies (such as Kenya) where the government is weak and rarely involves itself directly in informing and consulting communities (Mutsotso, 2021). Hutchins et al. (2007:26-27) point out that CSR activities by extractive companies (and research) revolve around the following themes: (a) societal legitimacy (this is where the desire is simply to obtain a license to operate); (b) responsibility to local communities (this is where the respective companies feel that they have a moral responsibility to uplift the lives of the communities within whom they operate); (c) transparency of reporting, disclosures, and accountability (the latest being the EITI initiative); and (d) protecting the natural environment (for sustainable development). CSR research in Kenya, as in many parts of developing countries, is relatively underdeveloped and relies heavily on case studies with a prominent focus on multinational companies. However, CRS is impactful in Kenya given that most of its citizens are still living in abject poverty and where the government is unable to

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meet many of its citizens’ needs; CSR comes in to fill this gap (Cheruiyot & Tarus, 2016). In sub-Saharan Africa, where governance, legal, and institutional structures are weak, the private sector, through CSR and other activities/programmes, remains one of the important institutions that continue to contribute to the socioeconomic development of these regions (Kühn et al., 2018). Much of the literature on CSR in Kenya has concentrated on the banking sector, which is mainly run by multinational companies (see, for example, Ochoti et al., 2013; Okwembo et al., 2014; and Chepkwony et al., 2015). Other areas of interest have been on sectors prone to social irresponsibility, such as the manufacturing sector, the horticultural sector, human rights, and the tourism sector (Cheruiyot & Tarus, 2016). Very few studies (among the few being that of Muthuri et al., 2012, Abuya, 2016, 2018; Abuya and Odongo, 2020; and Odongo et al., 2019) have examined CSR among mining corporations/communities. Several challenges have been cited as barriers to the effective establishment of CSR practices in Kenya. First, as mentioned earlier, is the lack of government regulations on CSR and the government’s lack of capacity and commitment to enforce these regulations (Muthuri & Gilbert, 2011). This is clear in the legal framework that has just been discussed. The second is the financial incapability of SMEs, which are often the economic driving forces in emerging economies. The majority (of SMEs) often lack adequate financial resources to implement desired CSR activities. Third, there is the lack of an agreed definition and concept of CSR, 17 leading to its narrow interpretation with a focus more on philanthropy than on treating it as part of a business concern (Morqtis & Slaa, 2016). Dahlsrud (2006), in fact, argues that the lack of this agreed-upon definition, which has given rise to over 65 definitions, is a major cause for the lack of development of CSR in every sector. Nasrullah and Rahim (2014) attribute the lack of definition to several reasons. The first is in its interchangeable and overlapping character with other terminologies such as ‘corporate citizenship’, ‘the ethical corporation’, ‘corporate governance’, ‘corporate sustainability’, ‘social responsible investment’, and ‘corporate accountability’; another reason is in the ever-changing and dynamic character of the concept of CSR itself. This lack of stability has led to it to mean different things to different entities at different times in different circumstances. In the absence of regulations, it has adopted its current voluntary nature, which has also led to other challenges. Today, CSR is generally treated as a concept that denotes incidences where companies integrate social and environmental concerns in their business operations and where their interaction with their stakeholders is voluntary (Prieto-Carrón et al., 2006). This voluntary nature has stagnated its progress. CSR reporting in sub-Saharan Africa has also been limited, haphazard, and inconsistent (Kühn et al., 2018), and as such, a systematic study of this concept in Africa has been complex.

17 Dahlsrud (2006) provides an additional 37 definitions. Other definitions are reviewed by Montiel (2008).

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These challenges have led to inertia in the suggested establishment of a Kenya CSR business network. However, Prieto-Carrón et al. (2006) argue that the idea that business and CSR can solve complex organizational and societal problems related to, or associated with, poverty in the Global South ignores the possibility that CSR may do more harm than good. An example of this harm can be observed in Nigeria’s Niger Delta, where the discriminatory manner in which multinationals have implemented CSR activities has led to the fragmentation of communities and the ensuing conflict (Akpan, 2005). As witnessed in other countries, multinational companies tend to engage in CSR activities that maximize their profits and enhance their competitiveness. This is different from the objectives of local companies that are driven more by valueoriented CSR (good and the right thing to do). Motivation for CSR programmes in Kenya is based on a combination of normative (the desire to give back something to society), instrumental (where action is driven by public perception and thus aimed for marketing purposes), and strategic (where engagement in CSR is part of a company’s mission and vision) concerns (Rampersad & Skinner, 2014). Examples of CSR, from a business perspective, include the programmes pursued by Bamburi Cement Ltd., which is concerned with environmental protection (by reducing environmental pollution and working on land reclamation and biodiversity, with their most visible project being the world-famous Haller Park—quarry rehabilitation project) (Rampersad & Skinner, 2014). Another is Tata Chemicals Ltd. (previously known as Magadi Soda Company), which has well-documented CSR strategies that include nurturing amicable relations with the local community and strengthening community participation in local governance and processes (Rampersad & Skinner, 2014). The third is Base Titanium, which has implemented a range of CSR activities in its mining venture in Kwale (Odongo, 2020). This chapter takes a deep dive into examining the CSR activities of two mining companies, namely, Tata Chemicals Magadi (formerly Magadi Soda Company) operating in Lake Magadi and Base Titanium in Kwale. The object is to assess the effectiveness/impact of their respective CSR activities on the local community.

4.1

Tata Chemicals Magadi

As stated in its website, 18 Tata Chemicals Magadi (formerly Magadi Soda Company) was established at Lake Magadi, Kenya, in 1911 and later became a wholly owned subsidiary of the UK-based Brunner Mond PLC. The original Brunner Mond and Company was formed in 1873 and began manufacturing soda ash in the UK in 1874.

18

https://www.tatachemicals.com/Operations/Magadi/About-us-Magadi/Company-profile-Magadi

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It is reported that Brunner Mond combined with three other chemical companies in 1926 to form Imperial Chemical Industries (ICI). In 1991, Brunner Mond Holdings Limited was formed and included the Kenyan soda ash products business from ICI. The soda ash activities of AkzoNobel in the Netherlands were acquired in February 1998. In September 1998, the Soda Ash Investments PLC completed the acquisition of Brunner Mond PLC. Brunner Mond shares were delisted from the London Stock Exchange in September 1998, and the company was subsequently renamed Brunner Mond Group PLC. In December 2005, Tata Chemicals acquired a 100% stake in Brunner Mond, thus bringing Brunner Mond and Magadi Soda into the Tata fold. Tata Chemicals is one of the world’s largest manufacturers of soda ash. Its portfolio includes other inorganic chemicals, agribusinesses (crop nutrition and protection), and household essentials (table salt, food additives, water purifiers, etc.) 19

Missing from this background is the findings by Hughes (2008), who narrates how the Maasai were hoodwinked into signing agreements with the British colonial government, agreements that led to the loss of their land. She mentions that, to date, the Maasai have continued to agitate for the return of their land (or for fair compensation in lieu). The Maasai have with equal determination continued to protest against the degradation of their environment (manifested by the foul pungent smell that emanates from the company chimneys and pollution of their water sources) by the mining project. Kantai (2007) details the Maasai protest in 2004, in which the Maasai demonstrated against the anticipated lease renewal of their alienated lands in Laikipia, Kajiado, Naivasha, Nanyuki, and Ngong (with slogans such as ‘We Demand Our Land Back From the British!’ and ‘100 Years Is Enough!’ to ‘The Laikipia Leases Have Expired Give the Maasai Back Their Land!’), demanding back loyalties and protesting against abuse against the Maasai, among other things. In response to the Maasai petition, those who were demonstrating in Nairobi were severely beaten up by the police, and the then minister of lands (Mr. Amos Kimunya) declared that the leases were not about to expire as alleged, as they had been made out for 999 years (and not 99 as the Maasai incorrectly assumed); he asked them to return in another 900 years. On its website, under sustainability, 20 Tata lists several CSR projects that the company has undertaken under its community development programme. In its CSR agenda, Tata commits to corporate citizenship for which it has developed a community relations policy. 21 The policy promises to share benefits with the community, have open communication, emphasize consultation, and implement projects/ activities guided by the policy. Priority areas have been identified to include water, health, employment, education, transport, and microbusiness (Table 1):

19

https://www.tatachemicals.com/Operations/Magadi/About-us-Magadi/Company-profile-Magadi See https://www.tatachemicals.com/Operations/Magadi/Sustainability-Magadi/Communitymagadi. 21 See https://www.tatachemicals.com/upload/pdf/Corporate_Citizenship.pdf. 20

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Table 1 Tata CSR projects and detailed activities Priority area Water

Health

Education

Microbusines s development

Employment

Infrastructural development Housing

Security Others

Activities 1. Community provided with domestic water via browsers, including three schools, police post, local dispensary over 25 km, and over 60 km by train 2. Set up water purification plant for domestic, animal, and wildlife use 3. Maintenance of Sampu community pipeline 1. Set up a 55-bed capacity hospital to employees and community 2. Waiver of hospital charges in effect 3. Renovated Oloika dispensary and equipped Entasopia Health Center 4. Carry out health awareness campaign/vaccination and HIV/AIDS prevention and awareness 1. Built four schools (including a secondary school) and provides support (learning materials, bursaries, teacher support) to all the seven schools in the division 2. Implemented ICT education by providing solar-powered community information centre (equipped with computers) and provides training as well 3. Implemented a bursary system supporting 20 secondary students annually, four to six university students 1. Allocated business space to locals 2. Provided support to Magadi multipurpose cooperative society 3. Outsourced cleaning services to locals 4. Offer mentorship to locals on business ideas 1. All nonskilled and semiskilled jobs in the salt operations performed by locals 2. 75% of all nonskilled and semiskilled jobs in the salt operations performed by locals 3. Conducts a community work skills upgrade programme 4. Offer of apprentice scheme to local community 5. Offer of salaries above minimum wage 1. Carry out maintenance of 86-km Magadi-Kiserian road, 40-km Magadi-Nkurumani road, and feeder roads in Magadi division 1. Provide accommodation for local community people, leaders, civil servants, nosiness people, and visitors 2. Four ranch groups allocated three houses for its members 1. Promotion of peace campaigns 2. Promotion of community policing 1. Promotion of tourism activities 2. Provide hunger relief assistance (such as providing transport to government and distribution of relief food to locals) during drought seasons 3. Adherence to statutory requirements such as payment of rates/taxes/ royalties, health, and environmental safety 4. Support of other external activities such as rehabilitation of Nairobi River Basin, county tree planting exercise, support to child welfare society, etc.

Source: adopted from https://www.tatachemicals.com/Operations/Magadi/About-us-Magadi/Com pany-profile-Magadi

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Tata maintains that its community development strategic plans are monitored and evaluated (by a CDP team and reviewed by stakeholders and SWOT committee and taskforces) weekly, monthly, quarterly, and yearly. This is done to conform to global standards such as the Global Reporting Initiative (GRI). Disappointingly, however, the current sustainability report available on the company’s website dates back to 2006. 22 Being that these are 2006 figures, one cannot tell the current investment in social provisioning/CSR. Disappointingly, the budget posted on the site is a one-page document that provides no figures. 23 Even the available community development plan is not dated and hence not reliable. 24 This lends credence to Szegedy-Maszák’s (2008) assertion that what usually appears on company websites is often unverifiable and at times actually nonexistent (on the ground). Scholarly examination of Tata CSR activities is very scarce, lending credence that CSR studies in Africa are still in their infancy. One of the few works is that of Muthuri (2007) in which she examined ways through which Magadi Soda company was nurturing corporate citizenship. The author interviewed key informants from MSC, the local administration, and local NGO for insights on how the company was going on about this, and a rosy picture comes out on this. What is missing although is the other side of the story (voices from the community), and as such, verification and effectiveness of the many cited programmes could not be ascertained. Another work is by Muthuri et al. (2009), in which the scholars analysed the usefulness of participation in the design of CSR programmes. Although they did not evaluate the CSR programmes on the ground, they admitted that ‘successful CCI implementation is likely to be realized where there is a clear understanding and appreciation of power relations in emerging corporate-community interaction’ (Muthuri et al., 2009:442). Since most African countries are saddled with the problem of inadequate legal and regulatory mechanisms for CSR (Mbirigenda, 2011), the disconnect between what’s on paper and what’s on the ground will continue to fester. A case in point is the Cerrejón mining project. It was found in this study that the impressive array of programmes/projects listed in company documents had not been implemented and, where completed, were not operational (Szegedy-Maszák’s, 2008). This lack of a transparent project monitoring mechanism is cited as one of the causes of CSR failure (Nwobodo-Anyadiegwu, 2007), and it is argued here that until African governments legislate CSR (and institute mechanism for monitoring), many CSR projects will not see the light of day.

22

Report available at https://www.tatachemicals.com/upload/pdf/5_September_2006_FINAL_ Sustainability%20Report.pdf. Additionally, available on main company webpage: https://www. tatachemicals.com/Operations/Magadi/Sustainability-Magadi/Community-magadi 23 See https://www.tatachemicals.com/upload/pdf/BudgetOutline.pdf. Additionally, available in main company site. Additionally, available on main company webpage: https://www. tatachemicals.com/Operations/Magadi/Sustainability-Magadi/Community-magadi 24 See https://www.tatachemicals.com/upload/pdf/cdp_main_report.pdf. Additionally, available in company main site. Additionally, available on main company webpage: https://www.tatachemicals. com/Operations/Magadi/Sustainability-Magadi/Community-magadi

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Lesrima (2003) examined the impact of CSR programmes run by the then Magadi soda company. The findings showed that the main social amenities provided by Magadi Soda Company were schools, Magadi rail, housing, transport/communication, and social amenities. The respondents, however, complained that they were charged for these services at exorbitant cost at that. It was also found that the number of Maasai working in the company, and especially in the social amenities providing these services, was considerably low. All these factors caused disaffection from the community, leading to conflict between the two parties. The government had to intervene to calm matters. Another study by Gold et al. (2018) critiqued the effectiveness of traditional corporate-driven CSR that responds reactively rather than proactively to community social problems. The study examined Tata Chemicals Magadi as its case study. The study argued that some CSR programmes—even if motivated by the best intentions—may keep communities dependent rather than empower them through capacity-building. The article argued for a participatory approach in which community-driven endeavours take the central stage, in which capacity builds the community and makes them independent. This thinking was tempered by company indignation that it was not the ‘Government of Magadi’ and as such it cannot meet each and every demand emanating from the community. The study concluded that: Reliance on corporate CSR spending that does not foster participatory community development capacity is largely ineffective for delivering essential services and sustainably raising the standards of living of poor communities. At the same time, such corporate-centric CSR represents a considerable financial burden for the company. (Gold et al., 2018: 18)

In effect, in the author’s view, CSR is a no-win game for all (neither for the company nor to the community). Another study by Lemarron et al. (2018), who examined the impact of soda ash mining on the livelihoods of the indigenous Maasai community in Magadi, found that the locals benefited in terms of the provision of water, employment opportunities (in areas such as cleaning, security, and basic clerical jobs), and opportunities to set up small businesses such as whole sales, retail outlets, transport, and food industry and service businesses such as hotels. The company also improved infrastructure such as roads, water, schools, bursaries, and health clinics. The study, however, captured respondents’ indignation over land alienation, which had led to diminished income as they relied on cattle rearing that needed lots of vast land. The company’s activities also led to environmental degradation, which worsened the situation. The mining community was also dissatisfied with the low-paying jobs that they were engaged in, although they had qualified locals who could take up managerial and other professional jobs. Contrary to Muthuri’s observation, the study found that the locals were sidelined in the decision-making process (although they were a major stakeholder). The Company’s corporate social responsibility was found not to have supported the local community in an equal measure, since the company generates (as far as the locals were concerned) more income from their investment. Let us now turn our attention to Base Titanium’s activities in Kwale.

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Base Titanium

The Kwale Titanium project was begun by Tiomin (K), a local subsidiary of Tiomin Inc. of Canada. The mining activity became effective in 2007 when residents were displaced to make way for the mining venture. Due to bad publicity with the resultant financial problems, Tiomin (K) changed its name to Vaaldiam Resources in 2010. It, however, ceded its operations to Base Iron Ltd. of Australia in 2010. The Kwale project has since its inception been a subject of conflict between the mining company on one hand and the local community on the other. For instance, in 2004, seven farmers, acting on behalf of themselves and others, filed a case in court arguing against the ‘unfair’ compensation offer and the legality of the eviction, given that, in fairness, the land belonged to them. The court, however, ruled against them in 2006 citing the powers of the state under the eminent domain and ordered their eviction (Bank Information Centre, 2006). Although the farmers were evicted in April 2007 (Mines and Communities, 2000), they still went ahead and lodged another case in 2008, which temporarily halted the mining activities (Abuya, 2016). The Kenyan titanium project will reputedly comprise 14% of the world’s total and would have a lifespan of more than 14 years at the initial mining site. It is estimated that the project would generate a pretax cash flow of over US$40 M in the first 6 years of operation (Mining Weekly, 2006). The other three deposits, containing titanium resources worth 42 million tonnes of ilmenite, 3.4 million tonnes of rutile, and 3.0 million tonnes of zircon, are to be mined at a later date. Among its current CSR activities, Base Titanium (hereafter referred to as ‘Base’) inherited the CSR activities that Tiomin (K) had either implemented or promised, which included two primary schools, two secondary schools, two dispensaries, one health clinic, two water points (at the resettlement and at the host site), two social halls, and rebuilt demolished mosques and churches (Abuya, 2017). On its website, 25 Base lists additional CSR activities. The impact of these CSRs was examined by Odongo (2020), and the findings are as indicated in Table 2: The study by Odongo (2020) concluded that lack of participation in the type, nature, and speed of delivery of the various CSR projects was the major undoing of the CSR activities. This thus gave rise to claims of unfulfilled promises, discrimination (arising from differences in comparative standards of analysis), and deception. The findings also resonate with Akpan’s (2008:504) assertion that corporate sustainability reports may be replete with stories of successful CSR activities, while, in fact, field excursions may reveal that the various community projects had only spurred communal discontent and may only serve to exacerbate existing communal divides and trigger more intense hostilities. As Xu (2010) noted in his study of the CSR activities of Ok Tedi Mining Company Limited, the company only concentrated its activities in the upper Ok Tedi River (the host community) and ignored the other community living in the lower part of the river although they were equally, if

25

https://basetitanium.com/community/

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Table 2 Base Titanium CSR projects and their impact on Kwale mining community CSR programme Four-wheel drive ambulance Status of project: completed Construction of early childhood development (ECD) centres Status of project: partially completed

Upgrade of Msambweni Hospital to referral Status of project: completed Agricultural and animal husbandry training facilities Status of project: ongoing

Impact as narrated by respondents (in host and resettlement site) That one ambulance is insufficient to cover the whole of Kwale including Msambweni and Likoni The promise had been for the purchase of two The company had only established one of the promised two facilities. ECD was only set up at the host site, eliciting complaints of favouritism and ‘fragmentation’ of the community. Base however contends that it will incorporate these within the existing schools at the resettlement site The upgrading was ongoing. Residents however bemoan that the facility is too far away to benefit them

The residents stated that this had assisted those who had benefitted from this (especially the offer of free quality cotton, sweet potatoes, and finger millet seeds including free fertilizer). The cotton seeds however turned out to be of low quality, and the produce thereafter could not be sold Establishment of health facilities A health centre was established at the host site, while a Status of project: completed clinic was constructed at the resettlement site. Residents at the resettlement site however bemoaned that they had been promised a health centre and not a clinic. The clinic itself has no maternity wing, nor drugs. Establishment of water facilities This was yet to be fully realized. Only two boreholes had been constructed where one was seasonal, while the other was within a school compound and therefore inaccessible. This borehole (at Vumbu) was insufficient to serve the large population. The facility was also not Status of project: partially completed provided at no cost as earlier anticipated (the charge was ksh 2 per jerrycan which they complained was beyond their means) Refurbishment of existing schools This is yet to be accomplished. The resettlement primary Status of project: pending school (Bwiti primary school) was in particular worse state Upgrading of Kenya Medical Training That this had greatly improved services at the facility and College locals had also benefited from the training Status of project: partially completed Improve special needs facilities in host This was yet to be established. The company stated that plans were underway to fulfil this promise as it can’t do and resettlement site everything at once Status of project: pending Construction of maternity wing at The maternity wing had been constructed as promised. Likoni Residents, however, bemoaned that the facility is too far Status of project: completed away to benefit them. The promise was that this would be constructed at the resettlement site. The company however stated that they opted to have it at a site to serve the larger population within the region (continued)

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Table 2 (continued) Impact as narrated by respondents (in host and resettlement site) Not examined in this study The company had promised to provide three fully equipped fishing boats. However, only one had been provided. The residents were also grateful for the establishment of the Savings and Loans Association, which enabled them to acquire loans for investment The company assisted in providing support for certain Provision of agriculture and animal agricultural products which later on turned out to be husbandry services inferior quality that could not be sold. The husbandry bit Status of project: ongoing is yet to actualize Scholarships for tertiary and second- This was implemented. However, the residents stated that ary students the support was not continuous and that ‘outsiders’ also Status of project: ongoing benefited from the programme. There were also complains that the programme had benefited those in the host site at the expense of others. Those opposed to the project were also denied this assistance Healthcare campaigns on TB and The residents complained that this was only carried out in polio the host site. The activities were also few and scattered Status of project: ongoing and of little overall impact Support for PMTCT programmes The residents, however, complained that this was only Status of project: ongoing carried out in the host site Tarmacking of feeder roads This was yet to be done. Some upgrading works had, Status of project: pending however, been made to the Mvumoni/Bwiti road. Other roads such as that of Kiruku-Mrima were in a very sorry state. The road from the mining site to the Likoni port (Kiruku-Kikoneni) had notably been tarmacked, eliciting complaints that the company was only working on projects that benefited it Extending piped water to homesteads This was yet to be fulfilled. The company indicated that Status of project: pending plans were underway Support for government polio, TB The residents however complained that this was only campaigns, and mosquito net distribeing carried out in the host site bution Status of project: ongoing Support for seven county health units That some limited support had been made, although spread at host site, at resettlement site, mainly done at the host site, eliciting complaints of and at favouritism Likoni port Status of project: partially completed Assist government in training and Not examined in the study logistical needs Special needs facilities This had only been implemented at the resettlement site Status of project: partially completed but not at the host site, eliciting complaints of discriminatory behaviour. Even at the resettlement site, there were complaints that some schools were supported while others were not, and where implemented, the standards were not the same CSR programme Establishment of blood bank in Kwale Support to NGOs and CBOs and youth enterprises Status of project: partially completed

(continued)

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Table 2 (continued) CSR programme Employment Status of project: partially completed

Inherited CSR programmes Two primary schools Status of project: pending Two secondary schools Status of project: completed Two dispensaries Status of project: partially completed Installation of electricity to households Status of project: pending One health clinic at host site Status of project: completed Water supply at host and resettlement sites Status of project: partially completed Two social halls Status of project: partially completed

Impact as narrated by respondents (in host and resettlement site) Residents complained that only relatives to those working for the company, or those in the company good books, or those coming outside the county were being employed. Base refuted this charge The residents bitterly complained about this Although constructed, the schools were not equipped and, as such, were yet to be functional Only one constructed at the promised resettlement site. Other sentiments expressed above The residents bitterly complained about this unfulfilled promise Although completed, the question of availability of drugs still remained The residents bitterly complained over this

Only one constructed at the resettlement site. Residents although complained that it had no electricity nor PA system or furniture. Even the site at the resettlement site was unreasonable as Kiruku had more population than Bwiti where it was constructed The residents were resolute that this must be fulfilled at some point

Rebuilding demolished churches and mosques Status of project: pending Payment of royalties to the community The company explained that they were still defining who Status of project: pending the ‘community’ entailed Source: Abuya (2017) and Odongo (2020)

not more, affected by the company’s activities (as the company’s toxic waste dumped into the river system turned them into project-affected persons (PAP)). The observation of unfulfilled promises reminds us of Szegedy-Maszák’s (2008) observation of the usual noted contradiction between CSR policy and practice. An example is the earlier noted provision of bursaries, where only those who consistently attain a certain grade (which as per the residents was relatively high going by the educational standards in the region) were the ones awarded the bursary, thereby rendering the policy ineffective. The author also noted disconnect between the array of programmes listed in company documents/websites and what is actually on the ground. In the case of Base, the various projects appear to be few, scattered, uncoordinated, and discriminatory in nature, thus running contrary to the promises made. Unfortunately, CSR activities divide communing and stock conflict and are thus generally not helpful to the community. Even more worrisome is the fact that

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the documents (Community Development Agreements) outlining CSR programmes to be implemented by the company and purportedly deposited with the government are not available on the Ministry’s website (the link to the document returns a ‘page not found’ response). 26 The suggestion made here is that mining companies should concentrate on a few impactful, participatory arrived at activities rather than have a wide array of activities that fail to make any meaningful impact on the ground. It may be for this reason that Kapelus (2002) terms CSR activities as primarily greenwash programmes to hoodwink stakeholders.

5 Conclusion The foregoing discussion demonstrates that the CSR programmes pursued by Tata Chemicals Magadi and Base have not been successful. This echoes Visser (2011), who claims that CSR—as a business, governance, and ethics system—has failed. He explains: A doctor judges his/her success by whether the patient is getting healthier or sicker. Similarly, we should judge the success of CSR by whether our communities and ecosystems are getting better or worse. In addition, while at the microlevel—in terms of specific CSR projects and practices—we can show many improvements, at the macrolevel, almost every indicator of our social, environmental and ethical health is in decline. (Visser, 2011:27)

Visser (ditto) argues that modern CSR practices (that he terms CSR 1.0) have failed because of what he terms the ‘triple curse of modern CSR’. Curse 1 (incremental CSR) is where CSR has adopted a quality management model that results in incremental improvements that, however, do not match the scale and urgency of the problems experienced by communities on the ground. Curse 2 (what he labels peripheral CSR) is where CSR is largely restricted to the largest companies rather than integrated across businesses. Curse 3 (uneconomic CSR) is the realization that CSR does not always make economic sense, as the short-term markets still reward companies that externalise costs, not those that alleviate the suffering of the local populace. The three curses require CSR 2.0 (which he refers to as systematic CSR). Visser describes CSR 2.0 as that which focuses on tackling the root causes of unsustainable and irresponsible actions and, through institution of innovative business models; revolutionizing of processes, products, and services; and lobbying for progressive national and international policies, aims at changing the traditional way through which things have previously been carried out (Visser, 2011: 29). Hence, while previous CSR focused on the microlevel, systemic CSR focuses on understanding the interconnections between the microlevel, mesolevel, and macrolevel systems (of society and ecosystems).

26 See https://www.petroleumandmining.go.ke/general-documents and click on any of the CDA links.

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This is akin to what Muthuri (2012: 14) calls for in her quest for a multidimensional approach to community development (within mining communities): Suppose it is accepted that a multidimensional approach is critical for sustainable community development. In that case, the goal of sustainable community development becomes (a) improved socioeconomic and cultural conditions of host communities, (b) capacitybuilding and self-help in host communities, and (c) community empowerment. The purpose of corporate social action then is to respond to problems of low levels of education, material deprivation, vulnerability and exposure to risk, and voicelessness and powerlessness, all of which stifle the creation, development, and maintenance of human, economic, ecological, and social capitals in the local communities.

As observed in this chapter, company-community conflicts arise when there is a divergence of interest and values between company and community interests (Idemudia, 2007). Hence, the interconnections of the macrolevel system and a multidimensional approach to community needs are what CSR interventions aim to achieve. This will be successfully achieved if regulations are in place. On their part, Banks et al. (2016) contend that work should focus on understanding donor/corporate-recipient/community relations. They argue that relationships between communities and companies are central to how communities respond to CSR initiatives. They insist that there is a need to move beyond focusing on the material flows that connect individuals/communities to companies—money and infrastructure, for example—to analysing forms and local perceptions of these relationships. Odongo (2020) looked at this (how CSR affects corporate-community relations) and concluded that local communities can see through projects disguised as CSR activities while they are in fact business initiatives aimed at uplifting profit margins. This realization in turn sours relations between the two parties. CSR regulation would put to rest these grey areas. Even with regulations, Banks et al. (2016) advocate that CSR activities be designed as ‘gifts’ (in the manner explained by Mauss 27), where gift-giving in traditional societies was more than just the exchange of single commodities but pursued on the basis of the relationship that it opens. In this exchange, the receiver is expected to reciprocate, and vice versa. In mining communities, this type of CSR will develop into mutual respect leading to an accommodative relationship that will result in both parties benefiting from the enterprise (which is what CSR 2.0 advocates for)—the alternative to this is dependency! Wopara (2016) also acknowledges that CSR can be used as a mechanism for community development but cautions that it should just be the ‘icing on a cake’: It should be an added advantage to complement government and community efforts towards development and should not be misconstrued as the overall answer to community development. This chapter thus concludes that without a clear and definite policy and legal framework, CSR programmes in Kenya’s mining sector will continue to serve the interests of corporate bodies. The evidence adduced in this chapter, coupled with the

27

See Mauss, Marcel, 1954. The Gift. Cohen and West, London.

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foregoing discussion, illustrates that the many CSR programmes highlighted by corporates on their websites only serve as smoke screens tactfully aimed at deceiving other interested parties that they are not only there to make profits. We therefore agree with Visser (2011), who claims that CSR—as a business, governance, and ethics system—has failed, and as such, it is time to switch to systematic CSR 2.0 (which would then operate under some clear legal framework), as this focuses on identifying and tackling the root causes of present-day unsustainability and irresponsible corporate behaviour. In its current form and as practiced, especially in developing countries, CSR therefore does not actually develop mining communities.

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Piper, D. (2012). Beyond CSR: How mining is adapting to Africa's need. Australia's Paydirt, 1, 198. Prieto-Carrón, M., Lund-Thomsen, P., Chan, A., Muro, A., & Bhushan, C. (2006). Critical perspectives on CSR and development: What we know, what we do not know, and what we need to know. International Affairs, 82, 5. Rahim, M. M. (2016). Improving social responsibility in RMG industries through a new governance approach in laws. Journal of Business Ethics. https://doi.org/10.1007/s10551-016-3131-9 Rampersad, R., & Skinner, C. (2014). Examining the practice of corporate social responsibility (CSR) in sub-Saharan Africa. Corporate Ownership and Control, 12, 1. Szegedy-Maszák, I. (2008). Corporate social responsibility, the example of the mining project Cerrejón and its relation with the indigenous group Wayúu in Colombia. Vniversitas Bogota (Colombia), No.117. Turner, E. T., & Brownhill, L. S. (2004). Why woman are at war with Chevron: Nigeria subsistence struggles against the international oil industry. Journal of Asian and African Studies, 39. UNECA (United Nations Economic Commission for Africa). 2011. Minerals and Africa's Development: The International Study Group Report on Africa's Mineral Regimes. Addis Ababa: United Nations Economic Commission for Africa (UNECA). Visser, W. (2011). CSR 2.0: Transforming the role of business in society. Social Space. Available at: https://ink.library.smu.edu.sg/lien_research/87 - accessed 5/1/22. Visser, W. (2006). Revisiting Carroll's CSR pyramid. In E. R. Predersen & M. Huniche (Eds.), Corporate citizenship in developing countries. The Copenhagen Centre. Waddock, S. (2008). Building a new institutional infrastructure for corporate responsibility. Academy of Management Perspectives, 22, 3. Wopara, G. R. (2016). Corporate social responsibility as a mechanism of community development: A study of the Nigeria liquefied natural gas Limited's CSR for the bonny kingdom, Niger Delta, Nigeria. Journal of Corporate Responsibility and Leadership, 3, 1. Xu, S. K. (2010). Conceptual dimension, perception and practice of Chinese corporate social responsibility. Reform of Economic System, 6. Willice Abuya is a Senior Lecturer in the Department of Sociology at Moi University. He has research interest in sociology of mining, including corporate social responsibility, resource management, and policy. He has several publications in refereed journals. His most recent publication is ‘Gender and mining in sub-Saharan Africa’ (2022) in Yakovleva, N., and Nickless, E. (eds.), the Extractive Industries and Sustainable Development, Routledge, London—in press. His current research project is collaborative project (with the University of Geneva, Switzerland; International Institute on Law and Society, Peru; and Ateneo de Davao University, Philippines) entitled ‘Violence Against Environmental Defenders in Mining’.

Corporate Social Responsibility and Human Rights Issues in Nigeria’s Post-amnesty Niger Delta Adiat A. Abiodun

1 Introduction Corporate social responsibility (CSR) has become a standard practice employed to address human rights concerns in the business environment by corporate organizations in extractive and nonextractive industries. In developed countries, industries view CSR as a social service due to the community because industries are considered social actors in that environment. However, in the developing countries of Africa, there has been little or no commitment to CSR by organizations in the extractive industries, especially the oil industry. CSR, from its conception, has been described as a new form of societal governance that seeks to advance the relationship between the state and society (Midttun, 2005). It represents a move from confrontation between the state and the market to collaboration with increasing stakeholder participation (Idemudia, 2010). This suggests that CSR today is about rethinking the interrelationship between the state, business, and civil society (Marrewijk, 2003). It has been represented as a mix of the liberal model with a welfare state orientation. This implies an improved output for the business and an enhanced standard of living for the host community. The rethinking of the relationship between business and the state has resulted in the pervasive expectation that companies should be accountable for their activities in the communities where they operate (Rowe et al., 2014). Consequently, oil multinational corporations (MNCs) in Nigeria’s Niger Delta region have initiated policy frameworks that require their CSR strategies to manage the relationship between them and their host communities (Idemudi & Osayande, 2016). There are diverse views among scholars about the impact of oil MNC strategies on development in oil-producing communities. While some such as Akpan (2006) and Alabi and Ntukekpo (2012) argued that CSR policies have no A. A. Abiodun (✉) Center for Distance for Distance Learning, Obafemi Awolowo University, Ile-Ife, Nigeria © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_7

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significant positive impact on communities, others such as Ite (2007) and Lompo and Trani (2013) argued that CSR policies have made significant contributions to the development of host communities. These diverse views demonstrate the complexity of the nexus between CSR practices and human rights issues in the oil extractive industries of the Niger Delta. Against this background, this article explores the evolution of the concept of corporate social responsibility in human rights discourse on the Niger Delta vis-à-vis the activities of oil multinational corporations. With the aid of in-depth interviews carried out on purposively selected respondents and secondary materials, the article investigates the factors militating against the implementation of CSR policies by the oil MNCs operating in the region. The chapter’s main argument is that little or no implementation of CSR policies by oil MNCs in the region is a major cause of increased volatility in the area. This is because it emboldens more youths to engage in rights violation protests, which engenders more insecurity in the area. Hence, the paper concluded that a practical and greater commitment to CSR strategies by oil companies is an investment and a measure that can improve the human rights profile in the region for a sustainable business environment.

2 Corporate Social Responsibility: Conceptual Discourse The concept of corporate social responsibility (CSR) generally refers to the social responsibility of corporate organizations in society or in their theatre of operations. The initial conception of the concept of CSR was targeted at the roles of managers and their impact on society. Scholars generally define the concept of CSR as business firms’ positive impact on society, which transcends a confined focus on profit augmentation by firms (McWilliams, 2015). As a noblesse oblige, it has experienced a great transformation since its evolution in the 1950s (Mintzberg, 1986). The concept has been used in different ways, depending on the context of its discourse. For instance, it has been discussed politically by public representatives, scholastically by professors, and empirically by businessmen; it has also been given economical, aesthetical, sociological, philosophical, and biological interpretations (Elbing, 1970). This implies that its discourse spans all fields of human endeavor. Its primary focus has been on the social role of corporate organizations in their business environment. Galvaet et al. describe it as a means of ensuring a company’s sustainability not only from an economic standpoint but also with a keen consideration of environmental and social viewpoints. Kapur (2020) defines CSR as the deliberate absorption of social and environmental concerns in business activities in order to have a serene business environment. According to these definitions, CSR enables corporate organizations to be more sensitive to human rights concerns in their operational environment. The concept has been viewed from a philanthropic perspective, making the initiative to be perceived as a privilege and not a right for the host community.

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The idea of CSR in the corporate discourse is anchored on the belief that business organizations have more to do in society than just making profit and obeying the law (Carroll, 2015). Since its emergence in academic discourse, scholars have expressed divergent views about the concept and its usage in managing the relationship between business organizations, the government, and the host community. Writing from a multistakeholder perspective, Carroll (1979) argued that CSR is in the longrun interest of corporate organizations and other concerned stakeholders, which include the state and the host community. Specifically, he argued that: The degradation of society or the environment will be detrimental to firms, and what firms do today is to alleviate or slow degradation, resulting in more success and, therefore, superior long-term financial performance. (Carroll, 1979)

This view on the impact of CSR by Carrol and other scholars implies that CSR is not just in the interest of the people but is a mutual interest for all. In the short run, it takes care of the people’s interest in the host community by helping to provide for their immediate needs. In the long run, it enhances environmental sustainability and improves financial performance. Banerjee (2008) argued that despite the emancipatory rhetoric about CSR discourse, corporate social responsibility is an ideological movement that aims to validate and enhance the powers of large business corporations. This implies that CSR utility is not mutual but partial to serving the interest of large business organizations. From an alternate perspective, Welford (2002) examines CSR’s relevance within the context of environmental and social rights issues. Specifically, he argued for a discourse of CSR within human rights. This is against the views in previous discourse where CSR has been viewed as a philanthropic activity from the corporate organizations to their hosts. Welford (2002:4) further argued that countries and companies should commit themselves to fully implementing human rights in all activities in their operational environment. Arguing from a slightly different perspective, Ramasastry (2015) noted the need to replace the discourse on CSR with business and social rights. She further explained that BHR is contextually and conceptually different from CSR in its aim and ambition. However, BHR can emulate positive examples from CSR to enable states to motivate business organizations to promote human rights in their operations (Ramasastry, 2015:237). This discourse about CSR is centered on two major perspectives. The first perceives CSR as a philanthropic activity undertaken in the overall interest of the corporate organizations. The second, which is more radical, views CSR as an extension of the quest for human rights protection by corporate organizations in their operational environment. However, this second perspective is more pertinent to developing countries with a high level of poverty and low commitment by corporate organizations to developing a CSR strategy. Viser (2008) argued that there is a need to develop a CSR model for developing countries to understand the driving force of CSR in those countries. Specifically, he argued that CSR in developing countries is underresearched, considering the magnitude of the developmental crisis in these developing countries.

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3 CSR and Its Relevance in the Niger Delta Context The Niger Delta region is a conglomerate of creeks of the River Niger, situated centrally in the Gulf of Guinea on the Atlantic Ocean in Nigeria (Hogan, 2013). It comprises 9 states out of the 36 states that make up the federal republic of Nigeria. These states include Rivers, Bayelsa, Cross River, Delta, Imo, Edo, Akwa Ibom, Abia, and Ondo. The area is populated by approximately 31 million people with more than 40 ethnic groups, which include the Bini, Efik, Esan, Ibibio, Igbo, Annang, Yoruba, Oron, Ijaw, Ikwerre, Itsekiri, Isoko, Urhobo, Ukwuani, Kalabari, Okrika, and Ogoni. The various tribes of the region speak approximately 250 different dialects (Congressional Research Service Report, 2008). According to Sesay and Simbine (2006), the region is best known for the sustenance of Nigeria’s economy in terms of oil exploration and exploitation. The discovery of crude oil and its eventual exploration is a major driver of oil MNCs in the Niger Delta and Nigeria at large. The Shell Petroleum Development Company (SPDC) from the early 1960s was the first to start oil exploration in the region. From this period, oil exploration in the Niger Delta became a global venture as the abundance of crude oil in the region attracted many oil MNCs through foreign direct investment. Oil exploration activities by oil companies such as SPDC, Chevron, ExxonMobil, and many others in the region elicited much hope. However, the different years of oil exploration in the region have only resulted in massive pollution of the environment with different variants of human security concerns. This is because the ecological devastation instigated by oil production activities of the oil companies has rendered worthless the main occupation of the people, which was farming and fishing. Consequently, the people of the Niger Delta have been deprived of their stake of the wealth on which the entire Nigerian federation depends, while they benefit only from compensation for incidents of oil pollution (Bagaji et al., 2011). Since the middle of the 1990s, Nigeria has been witnessing uprisings that have metamorphosed into armed violence directed against the federal government and oil-producing companies because of the environmental degradation and unfavorable oil politics in the region (Omotola, 2009). Specifically, the inhabitants of the region have had to grapple with environmental malaise, such as oil spills from pipelines and gas flaring (Omeje, 2006). These incidences of environmental degradation have resulted in the pollution of land, water, and air. This has done extensive damage to farming and fishing, which are the major occupations of the people in the region. The degradation of the environment by the activities of the Oil MNCs in the region forms the basis of several protests in the area. These protests that started in the 1960s became more violent in the 1990s, and they were responded to by the government with the use of military force. This was necessitated by the attacks of the indigenous people on oil installations and the kidnapping of oil expatriates in the region. In the early and mid-1960s, an insurgent group led by Isaac Adaka Boro was curbed by the federal military government for its declaration of independence for the Niger Delta Republic. In the mid-1990s, the Movement for the Survival of the Ogoni

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People (MOSOP), headed by Ken Saro-Wiwa, also responded violently, while SaroWiwa and his eight other colleagues were hanged in 1996. This violent response by the federal government further deepened the chasm between the oil companies, the federal government, and the oil-producing communities. Consequently, the international condemnation of the killing of the Ogoni nine can be described as a precursor to the initiation of CSR strategies by the oil MNCs and the federal government in the region (Emeseh, 2009).

4 Oil Companies and CSR Strategies in the Niger Delta The challenges of development in the Niger Delta region of Nigeria range from oil-related environmental problems to non-oil-related environmental threats. There are also environmental problems in the region that are not oil-related. However, discourse on developmental issues in the region has focused on the activities of oil companies and their negative effects on development in the area. Specifically, the pollution of farmlands and waterways has been described as the cause of poverty, unemployment, and environmental degradation in the region (Amnesty International, 2009; Olaifa & Osuagwu, 2018). In response to these damaging activities of the oil companies and subsequent protests, the indigenous people compel the development of corporate social responsibility strategies by the oil MNCs for good public relations with their host communities (Edafejrhaye and Alao, 2019). While oil exploration in the Niger Delta started in the late 1950s, it was only in the 1990s that significant attention was given to developing CSR strategies by the oil MNCs operating in the region (Emeseh, 2009). From this period onward, various oil companies operating in the Niger Delta region, as part of their operational procedure, have developed CSR strategies in conducting their operations with their host communities. Table 1 is a synopsis of the CSR strategies and activities of the major oil companies operating in the Niger Delta region. It also includes the year they started their oil exploration activities in the region. The information presented in the table shows that most of the oil companies have CSR strategies that they have developed in managing their relations with their host environments. However, the comprehensiveness of the level of implementation differs among the various oil corporations operating in the region. While the formulation of these strategies appears to be apposite, their implementation and assessment of their impact have elicited mixed reactions from scholars and practitioners alike and from the indigenous people of the region.

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Table 1 Oil companies in the Niger Delta and their CSR strategy Oil company Shell Petroleum Development Company Chevron Nigeria Limited Belema Oil

ExxonMobil Total Nigeria Nigerian Agip Oil Company Aiteo

Year of Strategy operation Cradle-to-Career Scholarship Program, Shell LiveWIRE 1956 (empowerment program), youth skills development Economic development, peace building, capacity building 1961 Education, employment, entrepreneurial and vocational trainings, provision of core public utility (hospital and medical facilities, water, and electricity) Education, health, economic empowerment, and local capacity development Skills acquisition, enterprise development, infrastructural development, and Nigerian content development Educational support, improved access to reliable and affordable energy, agricultural development, infrastructural development, and capacity building Charity, educational support

2012

1955 1962 1962

1999

Field Report

5 CSR and Development in the Niger Delta in the Post-amnesty Era There is a contentious debate about the impact of the CSR strategies adopted by oil MNCs on development in the Niger Delta region. Explicitly, scholars have expressed diverse views about the impact of these policies on host communities. Akpan (2006) and Alabi and Ntukekpo (2012) argued that CSR policies have no significant positive impact on community development. Others such as Ite (2007) and Lompo and Trani (2013) argued that CSR policies have made some significant contributions to the development of host communities. These diverse views demonstrate the complexity of the nexus between CSR practices and human rights issues in the oil extractive industries of the Niger Delta. Akpan (2006), in his analysis of the CSR practices of the Oil MNCs operating in Nigeria, argued that the Oil MNCs and their CSR strategies harmed the community development in the region. From a similar perspective, Dinkpa (2016) argued that CSR initiatives by corporate organizations and organizations in the Niger Delta do not impact community development. Specifically, the menace of corruption in the administration of the CSR initiatives of oil corporations has worsened the crises between oil companies and host communities (Dinkpa, 2016). On the other hand, Uduji and Okolo-Obasi (2017) argued that there is a positive correlation between the CSR initiatives of oil MNCs and agricultural development in host communities. The nexus between CSR strategy and development in host communities has also been viewed from a gender perspective. According to Oko-Obasi et al. (2020) and Okolo-Obasi et al. (2021), the CSR initiative has failed to enhance gender diversity and promote economic opportunities for women. This implies that the relative success attributed to the CSR strategies of

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Table 2 Human development index tiers HDI tiers Extremely high HDI High HDI Medium HDI Low HDI

HDI scores 0.8–1.0 0.7–0.79 0.55–7.0 Below 0.5

Adapted from the UNDP Human Development Report (2019)

oil corporations has not been able to ensure gender equality, as it has favored men more. The human development index report as presented by the UNDP is divided into four categories in the ranking of states and substate actors. The different categories are presented in Table 2: As shown in Table 3, all the states of the Niger Delta fall within the category of the medium- level human development index. The implication of this is that the states in the region, on average, have a long and healthy life, average literacy levels, and a decent standard of living. This is compared to other states in Nigeria that have extremely low HDIs. However, a major problem with this statistic is that it did not capture the whole reality as it exists in the Niger Delta. The Niger Delta can be divided into two worlds within the same geographical area in terms of development. In metropolitan cities such as Port Harcourt in Rivers State, Warri in Delta State, Calabar in Cross River State, Yenagoa in Bayelsa State, and Benin in Edo State, the HDI can be described as average because these cities are the center of economic activities in the region. In most of these cities, oil exploration activities do not occur, except in the interior part (creeks). However, the average HDI level is nonexistent in most of the local areas where oil exploration activities occur. Life in most rural communities is characterized by a dearth of basic amenities such as shelter, potable water, electricity, and elementary schools. The implication is that the CSR strategies of oil corporations have not had a significant impact on development in the local communities. This is in cognizance of the government’s social responsibility to develop these areas. Table 3 Human development index of the Niger Delta states S/N 1 2 3 4 5 6 7 8 9

State Delta Bayelsa Imo Rivers Abia Ondo Akwa Ibom Edo Cross River

Human development index 0.667 0.655 0.653 0.653 0.650 0.615 0.613 0.632 0.619

United Nations Human Development Report

Comparable countries Tajikistan Bhutan Bhutan Bhutan Bhutan Laos Laos Bangladesh Federated States of Micronesia

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6 CSR Programs and Implementation Conundrum in the Niger Delta Despite the successes that have been attributed to the success of the CSR strategies by the oil MNCs operating in the Niger Delta region, the implementation of their CSR initiatives has been fraught with several challenges, which have had an impact on the peace and security in the region. The identified challenges discussed in this section are based on in-depth interviews with relevant stakeholders in the region in some selected communities. These include Odi and Nembe in Bayelsa State, Kula and Omoku in Rivers State, and Ogulagha and Gbaramatu in Delta State. While most of the oil corporations in the Niger Delta have developed a CSR strategy in their operational environments, proper implementation of these policies to meet the demands of the people has been fraught with copious challenges. Some of these challenges were identified by the respondents in the interviews conducted with them, and they are presented in Table 4 on the next page. The challenge of implementing CSR strategies by oil corporations varies from one community to another. This is because the oil communities’ performance in their host communities is not the same. While some such as Aiteo, Chevron, and Belema Oil are relatively satisfactory, others such as SPDC and Agip Oil have been accused of gross neglect of their corporate social responsibility. As captured by a respondent who is an indigene of Omoku Community in Rivers State, it was stated that: Agip Nigeria Oil Limited has been very notorious in its operation, and it does not implement its CSR initiatives. It has entirely forsaken the host community and the landlords of the land where its oil operations are carried out. (Interview, 2021)

Specifically, Agip does not give scholarships to the youths in the community, and it also does not provide empowerment skills for them despite the agreements that the Italian oil company has signed. Additionally, in the Ogulagha and Gbaramatu

Table 4 Challenges of implementation of CSR strategies by oil corporations S/N i

Challenges identified Enormous community expectations

ii

Dearth of enabling business environment Differing CSR perception by the oil companies and the host communities

iii

iv

Bad governance/corruption

v

Inadequate attention to community development by the government

Field Report

Implications Dearth of basic social needs and vast environmental degradation and economic insecurity Prevalence of high level of insecurity such as cultism, kidnapping, militancy, and sea piracy CSR as a philanthropic activity by the oil corporations and CSR as human right entitlement by the communities Misappropriation and embezzlement of funds meant for community development by government officials and oil corporations Inability of government to fulfill its social responsibility to the community

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communities in Delta State, oil companies such as SPDC, NPDC, and Neconde Energy have been criticized for their inability to properly implement CSR policies in their oil exploration activities in the region. The oil companies have been accused of not providing employment opportunities for the people and that their persistent environmental degradation has increased the level of hunger in the community (Interview, 2021). A major reason for this improper implementation of CSR strategies is the different perceptions of oil communities and oil corporations about CSR policies. Most oil corporations perceive the economic and environmental needs of their host communities as part of the social responsibilities of the government, while they perceive their role as philanthropic (Onyeka & Okorie, 2020). However, oil corporations such as AITEO and Chevron have been engaging in these philanthropic activities to meet people’s basic material needs. A major problem with this philanthropic view of CSR is that it does not solve the real problems of the Niger Delta people, and in some cases, it represents a mere cosmetic approach to development in the region. Given the role of the oil multinationals in the region, CSR implementation should not be viewed from a philanthropic perspective but from the standpoint of human rights. This inapt view of CSR is mainly responsible for the poor or no implementation of strategies in the region. As a consequence, the CSR strategies of oil companies are not able to stem insecurity or improve the real development of their host communities. Environmental rights remain a major problem in oil-producing communities across the region.

7 Conclusion This study explored the evolution of the concept of corporate social responsibility in human rights discourse in the Niger Delta vis-à-vis the activities of oil multinational corporations. It also investigated the factors militating against implementing CSR policies by the oil MNCs operating in the region. The study revealed that while oil companies in the region have been operating in the country since the mid-1950s, it was only in the 1990s that they started incorporating CSR strategies into their operations in their host communities. The initiatives, as revealed in the study, were necessitated by flagrant human rights violations by the Nigerian military government and the oil MNCs and the international condemnation of the violation of the rights. The study also revealed that the implementation of CSR strategies in the Niger Delta region is fraught with copious challenges. These include enormous community expectations, a dearth of enabling business environment, bad governance and corruption, inadequate attention to community development by the government, and differing CSR perceptions by oil companies and host communities. However, the issue of the perception of CSR by oil companies and host communities is discussed as the main barrier to implementing CSR in the region. The poor or lack of implementation of CSR strategies in the region has had dire consequences for security and development in the area. This is because it emboldens more youths to engage in rights violation protests, which engenders more insecurity in the area.

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Hence, the paper concluded that a practical and greater commitment to CSR by oil companies is an investment and a measure that can improve the human rights profile in the region for a sustainable business environment.

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Marrewijk, M. (2003). Concepts and definitions of CSR and corporate sustainability. Between Agency and Communion, 44. McWilliams, A.(2015). Corporate social responsibility. In Wiley Encyclopedia of Management. Midttun, A. (2005). Policy making and the role of government in realigning business, government and civil society: Emerging embedded relational governance beyond neo- liberal and welfare state models. The International Journal of Business Society, 5(3), 159–174. Mintzberg, H. (1986). The case for corporate social responsibility. Journal of Business Strategy, 4. Oko-Obasi, E. N., Uduji, J. I., & Asongu, S. A. (2020). The impact of corporate social responsibility interventions on female education development in the rural Niger Delta region of Nigeria. Progress in Development Studies, 20(1), 45–64. Okolo-Obasi, E. N., Uduji, J. I., & Asongu, S. A. (2021). Strengthening women's participation in the traditional enterprises of sub-Saharan Africa: The role of corporate social responsibility initiatives in Niger delta, Nigeria. African Development Review, 32, 578–590. Olaifa, E., & Osuagwu, E. S. (2018). Effects of oil spills on fish production in The Niger Delta. PLoS One, 13(10), 1–14. Omeje, K. (2006). Petrobusiness and security threats in the Niger Delta, Nigeria. Current Sociology, 54, 3. Omotola, J. S. (2009). Liberation movements and rising violence in The Niger Delta: The new contentious site of oil and environmental politics. Studies in Conflict & Terrorism, 33, 1. Onyeka, M., & Okorie, C. U. (2020). Implementation of corporate social responsibility by oil companies in The Niger Delta Region of Nigeria: Myth or reality. African Research Review, 14(1), 119–132. Ramasastry, A. (2015). Corporate social responsibility versus business and human rights: Bridging the gap between responsibility and accountability. Journal of Human Rights, 14, 237–259. Rowe, A. L., Nowak, M., & Quaddus, M. (2014). Stakeholder engagement and sustainable corporate community investment. Business Strategy and the Environment, 23(7), 461–474. Sesay, A., & Simbine, A. (Eds.). (2006). Small arms and light weapons proliferation and collection in Niger Delta, Nigeria. College Press and Publishers. Uduji, J. I., & Okolo-Obasi, E. N. (2017). Multinational oil firms' CSR initiatives in Nigeria: the need of rural farmers in host communities. Journal of International Development. United Nations Development Program, (2019). List of Nigerian states by Human Development Index, Human Development Report 2019—"Human Development Indices and Indicators""(http://hdr.undp.org/sites/default/files/hdr2019overview-english.pdf).html Viser, W. (2008). Corporate social responsibility in developing countries. In The Oxford handbook of corporate social responsibility. https://doi.org/10.1093/oxfordhb/9780199211593.003.0021 Welford, R. (2002). Globalization, corporate social responsibility, and human rights. Corporate Social Responsibility and Environmental Management, 9, 1–7. Adiat A. Abiodun is a Nigerian and an academic instructor at the Center for Distance Learning Obafemi Awolowo University, Ile-Ife, Osun State, Nigeria. He is a graduate of Political Science (BSc) from Obafemi Awolowo University. He also bagged Master of Science and Doctorate degree in Internatioanl Relations from the same instituion in 2016 and 2021 respectively. He is a West Africa Peace and Security Network and American 2015 Political Social Science Association member. He is very passionate about teaching and writing and also loves travelling.

The Role of Corporate Social Responsibility in Building Social Cohesion for the Sustainability of Diamond Mining Towns Nonofo Mokwakwa and France Maphosa

1 Introduction Mining has contributed immensely to the development of Botswana, from being one of the poorest countries in Africa at its independence in 1966 to upper middleincome status. Minerals are a finite resource. This means that all mining operations will eventually come to an end at some point. Diamond mining in Botswana has passed its peak, with extraction at the Orapa Mine expected to end in 2047 (Debswana, 2020). With the end of diamond mining in sight and the costs of mining increasing as operations move beyond open cast, there is a need to consider the future of diamond mining towns when mining activities end. This chapter explores corporate social responsibility in the three main diamond mining towns of Botswana and how mining companies use corporate social responsibility to build the social cohesion necessary to foster community resilience and sustainability. Corporate social responsibility (CSR) has become an established practice in many business corporations globally. There is a growing realization of the need for strong partnerships between the government and the business community to achieve national development objectives. Special attention has been given to the extractive industry, partially due to the often controversial nature of many mining investments and the social and environmental problems that often accompany mining activities (Littlewood, 2015:242). Consumers are also increasingly interested in supporting companies that are socially and environmentally ethical in their business practices. The new generation of investors is increasingly interested in investigating the social, N. Mokwakwa (✉) Department of Sociology, University of Botswana, Gaborone, Botswana F. Maphosa University of Botswana, Gaborone, Botswana e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_8

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environmental, and ethical dimensions of a company, leading to socially responsible investing (Jenkins & Yakovleva, 2006:276). There are many policy responses to mining’s potentially adverse impacts on development, and each country adopts a model that is suitable for its needs and environment. The adopted model reflects the nature of the state, and it shapes the regulatory framework, institutions, and the state’s relationship with the private sector in delivering sustainable development. The role of the state under these various models defines that of the private sector and the importance of corporate social responsibility (CSR) in mining and development (Wilcox, 2015:9). Through Vision 2036 and successive national development plans, Botswana has adopted an economic position that puts the private sector at the forefront of development. The strategies emphasize sustainable development driven by nonmining economic activities. Botswana’s mining regulatory framework is a semidirected model under which both the state and the private sector have an important role in development. This model is best demonstrated by the Debswana mining joint venture (Wilcox, 2015:9). This is different from the market-directed model usually advocated for by international financial institutions such as the World Bank. The market-directed model is characterized by self-regulation. The attainment of the National Vision requires the cooperation of government, the private sector, the civil society, and individuals (Vision 2036, 2016:10). CSR in the extractive industry often emphasizes the mitigation of environmental damage or influencing economic outcomes. To that end, policy-makers and industries do not usually pay much attention to social issues that are equally important in achieving sustainable development. Social cohesion is one such factor that most CSR initiatives do not address. This is despite being a critical element in the achievement of sustainable development and building a resilient community and society. A socially cohesive society is positively self-reinforcing by continuously strengthening the positive values and norms needed to collectively persevere even in the toughest of times. It is therefore logical that all CSR initiatives should have social cohesion as part of their goal, especially those aimed at ensuring the sustainable existence of mining towns beyond the life of a mine. The closure of mines does not have to lead to the closure of the mining towns. Mining companies should promote social cohesion in CSR policies to create conditions that would allow mining communities to continue to exist beyond the lives of the mines.

2 Mining in Botswana Diamond mining in Botswana is now a mature industry, having started nearly 50 years ago. As in any mature mining sector, there are issues of depletion of mineral reserves and rising production costs as mines get older and deeper (MFED, 2019:6). For example, open-pit diamond mining has come to an end at Letlhakane, and large investments are required to widen and deepen open pits at

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Orapa and Jwaneng (MFED, 2019:6). The government and other stakeholders are beginning to think about life beyond minerals for both the nation as a whole and the particular mining towns whose economic and social systems have been anchored around mining. Scholars such as Gewbu (2006) have explored mining’s contribution to urban development and its influence on settlement patterns in Botswana. Recently, there has been some literature on the impact of mining on social policy. Ntsabane et al. (2010) examined both economic and environmental impacts of mining. Others such as Nthoi-Molefe (2021) and Mokwakwa (2021) have gone beyond just understanding the economic contributions of mining in Botswana. The Government of Botswana is aware and concerned about the limited life of diamond mining and the economic and social implications. This is evidenced by the adoption of the Botswana Excellence Strategy in 2012, a strategy for economic diversification and sustainable growth (MFED, 2012:10). Social and economic concerns have been heightened by the closure of the Selebi Phikwe copper-nickel mine and the social consequences of the closure. Botswana has therefore already experienced social and economic consequences of the closure of the BCL mine in Selebi Phikwe on the mining town and its community.

3 Methodology This chapter is based on the study of the corporate social responsibility of the three main diamond mining towns of Botswana and how mining companies use corporate social responsibility to build the social cohesion necessary to build community resilience. The focus on diamond mining towns was influenced by the significance of the industry in the economy and the fact that most of the mining towns in Botswana are diamond mining towns. This was a desk study, and the evidence presented is based on the analysis of public company documents and other literature. Company websites and online publications provided valuable information. This was important in an industry that is characterized by very limited information available in the public domain. The study relied on self-reported documents that are also meant to shape perceptions about the company among its stakeholders. It is possible that the information that is published by the mining companies in these subjects could be selective and primarily a public relations exercise rather than objective information, whose dissemination is motivated by the need to be accountable to stakeholders. The secrecy around the industry has also resulted in limited information available for analysis. As a result of these limitations, the study also used other sources to close some of the information gaps and supplement what was acquired from company publications, which included annual reports and community reports.

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4 Development of Diamond Mining in Botswana The diamond mining industry has been critical to Botswana’s socioeconomic development, constituting a significant portion of its export revenue for decades since its independence in 1966 (Wilcox, 2015:8). Mining exploration began in the late 1950s. It was, however, not until 1967 that geologists from De Beers found a small amount of diamonds in the Motloutse River (Debswana, 2020). Around the same period, large computations of garnets and ilmenite were also found in the Mopipi Pan (Kovacs Kowalke, 2009:26). Exploration continued further into central Botswana, leading to the discovery of the Orapa diamond pipe. In 1971, De Beers opened the Orapa mine, and in 1975, he opened the Letlhakane Mine (Kovacs Kowalke, 2009:27). In 1976, the company announced the discovery of another major diamond pipe at Jwaneng (Debswana, 2018). The Jwaneng mine, which is the world’s richest diamond mine by value, was established in 1978 (Wilcox, 2015:93). Debswana Diamond Company (Pty) Limited (Debswana) was established in 1969 and is one of the world’s largest diamond producers by value and volume. The company operates four diamond mines: Jwaneng, Orapa, Letlhakane, and Damtshaa Mines (the latter three are grouped under the acronym OLDM) (Debswana, 2020:2). Debswana’s operations have a significant impact on Botswana, as it is the country’s largest mining company, the largest supplier of rough diamonds to the De Beers globally, and the largest private-sector employer (Wilcox, 2015:9). Debswana has more than 5000 employees and 6000 contractors working at its operations (Debswana, 2020:2). The Government of Botswana is a 50% shareholder in Debswana, with De Beers being the other 50% shareholder (Kumar, 2016:310). The Government of Botswana is a 15% shareholder in De Beers, with other 85% shareholders being Anglo American (Debswana, 2020:2). The Botswanan government’s ownership model allows the state to have much influence on how Debswana approaches its role in development, including the company’s CSR model. In addition to ownership, the Debswana Board consists of some key government representatives. Government representatives on the board include the permanent secretary to the president and other key top government officials, including the Bank of Botswana governor and attorney general (Debswana, 2020:10). The Debswana board composition represents government intent and the level of importance of the company in the company’s development agenda (Wilcox, 2015:95).

5 Mining Towns in Botswana The existence of mining towns in Botswana predates the discovery of diamonds. Modern mining towns in Botswana first surfaced over a century ago when gold was discovered in Francistown during the 1950s and the early 1960s (Gwebu, 2012:612). The discovery of diamonds by De Beers at Orapa in 1967 marked a new phase of a mineral-led economy (Debswana, 2020).

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According to Kovacs Kowalke (2009:27), mining towns slowly began to develop around the first three diamond mines. The three diamond mining towns are Jwaneng, Orapa, and Letlhakane, all serving diamond mines owned by Debswana Diamond Company. In the case of the Jwaneng mine, the small town of Jwaneng was established out of the profit of the mine. Both Jwaneng and Orapa are made up of mainly migrant workers (Abi, 2006: 162). According to Gwebu (2006:427), during the first decade of the diamond discovery, the mining centers attracted large populations from their rural hinterlands. The annual growth rate of mining centers declined from a peak during the 1971/1981 intercensal period, when they had mainstream migration from the rest of Botswana. Letlhakane is what can be called a de facto mining town due to its coincidental location in an area that would later be mined. According to Kuyek and Coumans (2003), if the mine is near or in a populated area, then the existing communities and the region they are in become de facto “mining towns.” The coincidence usually helps the town to grow, benefiting from the economic spillovers and infrastructure provided by the mine. A closed mining town allows the company to manage security issues easily, especially for minerals such as diamonds, where security is a key concern. However, the same can be understood to give the mining company many powers that have the potential to limit the future sustainability of such towns. Closed mining towns can allow a mining company to position itself as a provider of much-needed resources that the town could not obtain elsewhere. This has the effect of undermining the ability and autonomy of the community by reinforcing their dependency on the company (Jenkins, 2004:26). Restricted access means that the residents do not have both social and material attachments to the town, as they cannot own land, hence limiting social cohesion. Individuals have no incentive to invest socially and establish long-lasting bonds, as the environment reminds them that they are only there for employment and cannot establish roots. Upon retirement, most employees return to their areas of origin (Gwebu, 2012: 618). Botswana’s mining towns are run on welfare capitalist lines by mining companies, primarily DeBeers (Gwebu, 2012:611). The provision of housing is different across the four diamond mining towns. In Orapa, housing is provided by Debswana on property that the company owns, whereas Jwaneng is an open mining town that offers a mix of company-owned housing and private property leased by the mine (mostly for contract workers). However, mineworkers commonly live in privately owned accommodations rather than those provided by Debswana (Wilcox, 2015: 116). In general, migrants continue to maintain their links with their home areas through remittances, investments, and periodic participation in the cultural affairs of their home areas (Gwebu, 2012: 618). This leaves mining towns with a population that does not see itself as part of the community in their mining towns. That lack of attachment and sense of belonging is a key aspect that mining companies should address to increase the level of social cohesion in mining towns. In most cases, mining operations often exist side by side with indigenous people (Jenkins & Yakovleva, 2006:275). In Botswana, mineral deposits have usually been

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discovered in remote areas used for cattle posts and arable fields, as was the case in Jwaneng, Letlhakane, and Selebi Phikwe. After mineral discovery, local residents are often requested to relocate to pave the way for mining operations. This disrupts the basic rights and freedoms as well as the social and cultural life of residents (Gwebu, 2012:616). The relocation of the Basarwa people from the Central Kalahari Game Reserve in 1983 for diamond exploration, for example, compelled them to switch from hunting and gathering to pastoral and arable farming. Historically, mining towns have been the epitome of economic and social class demarcation within society. All the mining towns have private schools that are owned by the mine, recreational clubs requiring membership, and private hospitals for employees. Settles in mining towns are usually structured by income status as management, and other high earners usually have their side of town, and the housing pyramid flows from top to bottom. Housing for the different income brackets is usually provided by the Botswana Housing Corporation; these houses are usually for rent and cannot be altered. Jwaneng is one of the towns beginning to face a housing challenge, as the populations of the towns and surrounding areas have grown well beyond their planned levels (Gwebu, 2012:611). It is important that mining companies respond to some of these structural problems of housing, access to services and the organizations of mining towns by economic status to increase unity, and a sense of belonging for all members of society. This is critical to building a cohesive community with shared aspirations for the future. Such a community becomes resilient and adaptive to change, allowing the mining towns to flourish beyond the life of the mine. The ideal situation would be that the implementation of mine closure plans should be implemented at the same mining companies starting their mineral exploitation. This will ensure the continuity of both economic and social life in mining towns during and after mining operations have ceased. The responsibility of the mining company will be to make the requisite social and economic investments that encourage and catalyze the development of the mining town in such a way that it will be sustainable beyond the lifespan of mining operations. The government is responsible for providing the policy, regulatory, and legal frameworks that will support and encourage mining companies to take up their responsibility.

6 The Experience of Ghost Towns The experience of ghost towns in Namibia offers lessons for Botswana and the region on how to better plan and manage mining towns. According to Helmuth (2009:7), the experiences of Kolmanskop, Pomona, Bogenfels, and Elizabeth Bay, which turned into “ghost towns” after mining closures, show that mine closures can destroy a local economy. Most of these company towns located in remote and underpopulated parts of the country were established for the sole purpose of serving the mine. Company towns, which are communities owned and administered by mining companies, have been an accepted part of the mining landscape in Namibia

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(Littlewood, 2015:246). Examples of such diamond mining communities include Kolmanskop and Oranjemund, Arandis, Rosh Pinah, and Uis, among other mining towns. In the case of Oranjemund, the diamond mining company Namdeb has funded feasibility surveys examining alternative economic activities. It has also provided training, support, and loans for local businesses and continues to subsidize local education and health provision (Littlewood, 2015:248). When these CSR activities are viewed in isolation, they suggest a significant commitment and contribution on the part of the mining companies to the sustainability and development of these communities. However, the analysis of such interventions must be balanced with the role the companies have played in creating these communities and their long-term sustainability challenges. Historic relationships between mining companies and such communities have been characterized by unsustainability (Littlewood, 2015:248). The mining companies place little consideration on what will happen beyond their operations but rather focus on the immediate needs of the company, which was to provide a stable environment and work force for its operations. In Namibia, when it is no longer profitable, mining companies hand over company towns to the state, and the mine infrastructure and other oversized buildings become a liability instead of an asset in the face of lost revenue from taxes and other income (Littlewood, 2015:247). As the population dwindles, all businesses and relevant institutions close, leaving the infrastructure abandoned. The social environment in the community where the mine is operating often worsens with closure. Social violence, increased drug and alcohol use, depressed expectations, power struggles, more extreme social hierarchy, and paralysis of normal ways of making decisions are common (Helmuth, 2009:44). The environment eventually becomes unsuitable for family life, and people move away. All mining activities eventually come to an end, but that should not mean the end of a mining town or the community that has been sustaining the mining activities. The economic and social structure of a mining town equally has the ability to destroy a community. This can affect the future sustainability of the community and society that is artificially put together based on a hieratical economic structure and relationships predetermined by their role in the mining company. These are not social ties that can stand the test of time and build community values that will sustain a town beyond the flow of salaries and other forms of income to the residents. Social cohesion then becomes a strong social tool that can help increase the chances of success within such communities.

7 Social Cohesion Social cohesion is a desirable characteristic of society that is generally considered to bring about unity and stability within any society or community. Despite this recognition, very little is understood about this concept, and therefore, its full potential, especially in ensuring the sustainability of mining towns, has not been

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realized. In single-industry and resource- dependent towns, high labor turnover and transience act as barriers to forming social ties and friendships (Desjardins et al., 2002:18). It has also been suggested that shift work makes community involvement difficult (Desjardins et al., 2002:19). Social cohesion is achieved through social interaction; such social interaction provides the basis for the development of bonds among individuals and is produced through interactions in daily life (Desjardins et al., 2002:18). Beckley (1994) defined social cohesion in the context of shared values in a geographical place, where a sense of community is achieved with a sense of shared values, cooperation, and interaction. Reimer (2002, 13) builds on this notion of shared values and focuses on cooperation by defining social cohesion as the extent of collective response by society to achieve shared development outcomes and to deal with the economic, social, political, environmental stresses and other developmental challenges. Social cohesion can thus be understood to be a social tool or resource that society can utilize to achieve current and future objectives (Desjardins et al., 2002:18). Routine social interaction among community members provides the foundation for building trust and relationships, which are key to establishing partnerships and networks (Desjardins et al., 2002:2). A mining town that seeks to build social cohesion has to be family-friendly, providing the appropriate infrastructure, services, and support that promote the same. Children tend to draw parents into relationships with other parents and within community organizations (Robinson & Wilkinson, 1995:146). Women become friendly in quite an instrumental way, helping one another through various exchanges, and in the process, they build a real sense of community (Desjardins et al., 2002:18). Home equity, home ownership status, and the length of time one has owned one’s home are all positively and significantly related to one’s attachment to a community (Robinson & Wilkinson, 1995:146). Mining towns that allow employees to own their homes cultivate a sense of belonging among the residents, and this has a positive effect on other development outcomes, including health. Good health relates positively to neighborhood attachment; a possible reason is that people who experience poor subjective health may have less energy and motivation to participate with other people in the community (Robinson & Wilkinson, 1995:146). Other variables that are conceptually related to community cohesion are group membership, hours spent volunteering, and whether spouse or children were reported to like living in the community (Robinson & Wilkinson, 1995:146). There is no doubt that relationships between key stakeholders, such as mining companies, governmental departments, the business community, the local community, civil organizations, and NGOs, are paramount in terms of addressing social and economic challenges that accompany most mining towns being not designed and managed with a deliberate goal of achieving social cohesion. The same applies to most CSR programs being implemented by mining companies to improve the lives of mining communities. Social cohesion can be achieved through a number of ways, including the design of the town at its inception, the development of policy, and the strategic decisions that facilitate the cultivation of unity, trust, reciprocity, solidarity, and other social norms that bring society together.

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Mining towns that deliberately encourage social cohesion physically design their cities to concentrate services and other social amenities at the center to deliberately channel community members and force interaction. Moreover, the street and building layout are designed to encourage casual encounters. In Botswana, mining towns are isolated, forcing migrant workers to leave behind their families. This has led to the breakdown of the family unit that is the root of African culture. The migration of mostly men and boys to areas of work leads to their disconnection from women, children, and other family members that have to be left behind (Kovacs Kowalke, 2009:19). Debswana has been involved in social issues of national interest, such as the fight against gender-based violence (GBV). The OLDM has been tackling the scourge of GBV with robust mitigation measures. This includes an anti-GBV campaign in Orapa and other parts of the Boteti region; the campaign is dubbed “Re Shakgetse/ We are livid” (Debswana, 2021:10). Such initiatives have a direct impact on building social bonds and helping society work toward a common goal, contributing to the strengthening of social cohesion. The interventions were not designed with the sole purpose of increasing social cohesion.

8 Corporate Social Responsibility Corporate social responsibility (CSR) represents a powerful tool through which businesses can play a direct role in sustainable development. It aligns very well with global commitments such as SDGs and other development agendas that seek to strengthen the multisectoral approach to achieving sustainable development. CSR, however, has its critics who see the practice as rarely going beyond business as usual and is often used as a cover for business practices with negative implications for communities and the environment (Littlewood, 2015:241). It is argued that CSR is a public relations exercise at best and at worst, “greenwash” for irresponsible behavior. At its broadest, CSR can be defined as the overall contribution of business to sustainable development (Torres Solís & Moroka, 2011:87). The World Business Council for Sustainable Development (WBCSD) has defined corporate social responsibility as the commitment by businesses to contribute to sustainable economic development, working with employees, their families, the local community, and society at large to improve the quality of life (Torres Solís & Moroka, 2011:87). The European Commission defines CSR as “essentially a concept whereby companies decide voluntarily to contribute to a better society and a cleaner environment” (Hamann & Kapelus, 2004:85). CSR is a difficult concept to pinpoint. It overlaps with other concepts such as corporate citizenship, sustainable business, and business ethics and is highly contextual not only in terms of its corporate environment but also in terms of its national environment (Torres Solís & Moroka, 2011:88). Concepts such as business ethics, philanthropy, corporate social responsibility (CSR), corporate citizenship, and stakeholder management have increasingly been conflated both in theory and in practice (Maphosa & Maunganidze, 2021:2). In the extraction

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sector, CSR programs most commonly target the areas of health and education and often involve building local schools and clinics in mining communities (Wilcox, 2015:21). The evolving CSR agenda is driven by a global shift in the way the role of business is perceived. In the context of globalization and the challenges of sustainable development, business is increasingly seen as a crucial element in the process of social transformation for the benefit of society in general, as well as the business itself (Hamann, 2003: 238). The objective of CSR is to align corporate policies and practices with sustainable development to ensure companies’ reputation and their access to capital, land, and markets (Hamann & Kapelus, 2004:85). Sustainable development in the corporate mining context requires a commitment to continuous environmental and socioeconomic improvement, from mineral exploration, through operation, to closure (Jenkins & Yakovleva, 2006, 272). For CSR to be effective, it must be mainstreamed in the strategies of mining companies and integrated into the core activities and decision-making of a company (Maphosa & Maunganidze, 2021). This requires embracing economic, social, and environmental aspects of sustainability in a holistic manner. Hence, sustainability needs to be seen as a key concern by top management (Hamann, 2003:239). In Botswana, mining companies are increasingly paying more attention to CSR. Debswana’s Orapa Today, Boteti Tomorrow (OTBT) program was conceived in 2011 and comprises the following two components: • Orapa Today has the goal of making Orapa a great place to live and work in. • Boteti Tomorrow aims to build an alternative economy in the Boteti Sub District that will sustain the community beyond the projected end of the life of the mine in 2047. The initiatives in the OTBT program were identified in collaboration with various departments of the Government of Botswana to ensure that these align with government priorities. The program has four components: game park expansion, business park, diamond museum, and technical college/university (Debswana, 2020:72). According to Debswana (2020), the game park expansion project expanded the Orapa Game Park to create a corridor linking Orapa and Makgadikgadi Pans. The initiative uses diamond mining as a catalyst for community-led tourism activity in Boteti, improving community resilience postmining activity, and forms part of OLDM’s socioeconomic mine closure plans. The Adrian Gale Diamond Museum and Game Park are two attractions that have been linked as a combined tourist package available to the high volume of tourists traveling to the Makgadikgadi area. These initiatives are part of the broader sustainable development and management of cultural and natural heritage in the Boteti region. The Orapa Business Park initiative is currently at the concept stage, and there are plans to develop a business park to stimulate economic activity in the area. The technical university project aims to develop the current training facility, which is a national benchmark in technical training, into a technical university or institute of technology. The project is currently at the feasibility stage (Debswana, 2020:72).

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9 Corporate Social Responsibility of the Mining Sector in Botswana Large-scale mining in Botswana has a positive legacy; the companies have provided the much- needed jobs, government revenues, business for linking industries and social investment in skills development, housing, health facilities, and infrastructural development such as roads (Abi, 2006:161). In an effort to enhance corporate governance practices in the country, Botswana introduced the Botswana Corporate Governance Code (BCGC) in 2013 (Mbekomize & Nametsegang, 2019:52). According to Broomes (2009:3), mining companies in Botswana have since embraced CSR and are prepared to plan and incorporate social and environmental initiatives into their core business. Debswana is particularly impressive since it has developed and started implementing a decentralized corporate social investment strategy. In so doing, the company is demonstrating a willingness to go beyond the business as the usual approach of merely creating jobs and providing foreign direct investment (FDI). Whatever the Debswana Mining Company does or does not do, it has a significant impact on the economy and society in general. This is due to the position the company and industry play in the country’s economy and development trajectory. This fundamental importance attracts the interest of observers on how this firm is dealing with its corporate social responsibility (Torres Solís & Moroka, 2011:87). While Debswana, which is a private company, has continued to focus on its core business, the Government of Botswana has used its regulatory role to integrate the company’s mining activities and corporate social investment programs into national development plans (Wilcox, 2015:10). For the past 10 years, the Debswana corporate social investment budget has been P15 million (Debswana, 2020:71). Debswana’s CSR is regarded as an investment; hence, it is titled “corporate social investment” (CSI). This notion of investment implies the recognition of the mutual benefit deriving from CSR activities, benefiting both the benefactor and the beneficiary (Broomes, 2009:46). Debswana has highlighted that its CSI program prioritizes interventions that encourage self-sufficiency after mine closures. This is achieved by focusing on projects that build local capacity and skills, with a particular focus on business and entrepreneurial skills (Wilcox, 2015:112). The Orapa Today, Boteti Tomorrow project is one project that demonstrates an intention by Debswana to ensure the sustainable existence of third mining communities beyond mining activities in the Boteti region. The project is aimed at diversifying the economy of the Boteti region beyond the life of OLDM (Debswana, 2021:8). It is expected that the planned initiatives will ultimately transform the region’s tourism economy and have a multiplier effect, with sustainable income generation for generations to come (Debswana, 2021:8). The Orapa Game Park is strategically positioned as part of OLDM’s mine closure strategy, and conservation education is being undertaken with surrounding communities so they are equipped and ready to effectively manage the park when it is eventually handed over to them (Debswana, 2021:13). Debswana CSI programs are

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designed to address issues of equity, allowing access to economic opportunities by prioritizing education and health (Wilcox, 2015:112). Debswana’s CSR objectives include ensuring that the impacts of their mining activities are not limited to maximizing revenues and that the company’s main target are its employees, environment, communities, and nation. The company has in the past stated that there is community involvement in its operations and decisions through its corporate social responsibility and social investment initiatives, supporting health and environmental systems in operation, including AIDS management systems, private schools, and two major district referral hospitals (Kumar, 2016: 310). The Debswana Company Hospital not only gives health-care service to its employees and their immediate families but also extends the health-care service to the surrounding community (Torres Solís & Moroka, 2011, 2003:94). Research has shown that in Namibia and other countries, company towns with high-quality health and education facilities were able to attract and retain skilled employees (Littlewood, 2015:246). Debswana Diamond Company is a private company and does not publish its financial statements. The company publishes the Report to Stakeholders (RTS), a report providing an overview of the company’s activities and performance (Debswana, 2020:2). Debswana’s Orapa, Letlhakane, and Damtshaa Mines (OLDM) produced a community report in 2021. The report provides insights into the activities of the mining company beyond its operations. According to the Debswana OLDM Community report (2021:3), the Tomagano Community Report serves to share crucial information on sustainable development performance with OLDM stakeholders, allowing affected parties, internally and externally, to inform their position on issues and policies that affect them and our areas of operation. The Debswana RTS is aligned with the Global Reporting Initiative (GRI) Sustainability Reporting Standards (Debswana, 2020:5). It includes information regarding the company’s mines as well as the subsidiaries and investments. Reporting is especially important for the mining industry, which has a long history of social and environmental transgressions that have devastated the lives of communities.

9.1

Debswana’s CSR in Health

Mining operations and related activities present health challenges. Some communicable diseases, notably AIDS and tuberculosis, are associated with mining (Gwebu, 2012:616). Debswana has extensive support for health care in its mining communities, addressing health as a major barrier to economic participation (Wilcox, 2015: 118). Debswana was awarded a Pan-African Health Finalist Award for providing Masa (the government’s antiretroviral therapy) through mines hospitals in Jwaneng, Orapa, and Letlhakane to the communities around its areas of operations. The company spent over a P3 million (US$488,695) on the building and extension of Boitekanelo Clinic, which provides services such as the expanded immunization

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program, mother and child welfare clinics, prevention of mother-to-child transmission, and antenatal tuberculosis (Broomes, 2009:49). The mine funded the construction of a maternity ward in Letlhakane village to the tune of P5.3 m and completed the extension of Moremaoto Clinic at the end of October 2019, and OLDM is renovating the Orapa Hospital (Debswana, 2021:8). The Orapa Hospital is also fully funded by Debswana and serves the Boteti region as a whole (Wilcox, 2015: 121). The Orapa Hospital is a large referral facility that covers the entire Boteti region and beyond. Debswana also fully funds the Jwaneng Mine Hospital, with an annual budget of P 64 million, and the hospital acts both as a mine hospital and as a district referral hospital for the region (Debswana, 2021:8). The cost of recruiting and retraining new staff in a highly specialized industry is higher than providing treatment to already trained and productive employees (Kovacs Kowalke, 2009:7). Debswana has also understood that providing free ART is simply a good business since healthy individuals are able to remain productive and continue supporting their families (Wilcox, 2015:120). Debswana was the first mining company in the world to offer free HRT to HIV- positive employees, and nearly two decades later, this program continues to be a great source of pride (Debswana, 2020:14). Since 2001, Debswana has provided free ART to HIV-positive employees and their spouses and children of company employees, where it could be provided in a responsible and sustainable manner (Wilcox, 2015: 120). In 2020, there were 1260 employees and dependents registered on the program and viral suppression rates of 99% (Debswana, 2020:14). As part of promoting sustainable communities through access to health care, there was a project to construct a COVID-19 Isolation Centre in Mmatshumo, which was a joint initiative by Debswana OLDM, Boteti District Health Management Team (DHMT), and other partners (Debswana, 2021:8). Another community-oriented health project was the P15 million (US$2.44 million) desalination project in Orapa, through which unsalted water is made available to residents of the Boteti region for the first time in 40 years. Orapa Mine will provide technical expertise to ensure the sustainability of the project (Broomes, 2009:49). Debswana, Orapa, and Letlhakane Mines also funded the Letlhakane Link Road, the double sealed road from Letlhakane village to the Francistown-Orapa road that was constructed at a total cost of P22 million, and it benefited both the Orapa and Letlhakane communities (Torres Torres Solís & Moroka, 2011, 2003:94).

10

Conclusion

As Neil et al. (1992: 22) have argued, “mine closure should not be looked at as a problem, as the closure of mines is a foregone conclusion, a natural conclusion of the process of exploiting a finite resource.” Forward planning could help circumvent certain problems associated with mine closures and their impact on the sustainability of mining towns. Research has shown that policies must involve forward planning

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on the part of both the community and company alike and that these must be based on an appreciation of the long-term potential of a community. Diamond mining companies do not seem to recognize social cohesion as a variable that can contribute to the successful existence of mining towns beyond mine operations. This has resulted in the CSR interventions not being designed to deliberately deliver on that among other objectives. Evidence has shown that there is clear consideration by the diamond mining industry in Botswana about the sustainability of diamond mining towns in Botswana. There is a need for the government to develop specific or prescriptive provisions in the Botswana legislation and guidelines on how mining companies should develop and implement their mine closure plans. These plans must go beyond land rehabilitation and other environmental plans to include social and economic issues such as the sustainable existence of mining communities beyond the life of the mine. Communities should be part of the process to develop mining plans to facilitate implementation and monitoring. They are the ones that will deal with the negative implications of postmine operations. The government needs to relook the reporting requirements of all companies with respect to their ethical conduct. This is especially important for the mining industry, which has a large impact on the lives of communities and the environment. It is not enough that such powerful companies produce stakeholder reports that are limited in scope. Not enough is reported on social issues that include the future sustainability of mining towns and the deliberate establishment of the required social conditions to improve chances of success. These include the deliberate building of social cohesion among society in mining towns and communities through CSR, among other approaches. Debswana is currently financing schools and health facilities it has established. The sustainability of this investment beyond Debswana operations remains in question. There is a need to build autonomy from mine operation in some of the institutions as part of the design and operational model such that the investment can be sustainable. This research also provides insights for policy in highlighting some of the limits of current CSR interventions in Botswana, potentially necessitating further state intervention.

References Abi, K. (2006, September). Challenges faced by large mines in Botswana in the development and execution of mine closure plans. In Proceedings of the First International Seminar on Mine Closure (pp. 161–168). Australian Centre for Geomechanics. Beckley, T. M. (1994). Community stability and the relationship between economic and social wellbeing in forest dependent communities. University of Alberta. Broomes, V. (2009). Triple wins from foreign direct investment-potential for commonwealth countries to maximize economic and community benefits from inward investment negotiations (case studies of Belize and Botswana). Commonwealth Policy Studies Unit.

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Debswana. (2018). Report to Stakeholders 2018: Sustained performance, Gaborone. Debswana (2020). Report for stakeholders, Debswana. Debswana (2021). Tomagano community report, OLDM. Desjardins, S., Halseth, G., Leblanc, P., & Ryser, L. (2002). Services, social cohesion, and social capital: A literature review. Canadian Rural Restructuring. Gewbu, T. D. (2006). Towards a theoretical exploration of the differential urbanisation model in Sub-Saharan Africa: The Botswana Case. Tijdschrift voor economische en sociale geografie, 97 (4), 418–433. Gwebu, T. D. (2012). Botswana’s mining parth to urbanisation and poverty alleviation. Journal of Contemporary African Studies, 30(4), 611–630. Hamann, R. (2003). Mining companies' role in sustainable development: The 'why' and 'how' of corporate social responsibility from a business perspective. Development Southern Africa, 20(2), 237–254. Hamann, R., & Kapelus, P. (2004). Corporate social responsibility in mining in southern Africa: Fair accountability or just greenwash? Development, 47(3), 85–92. Helmuth, A. (2009). Economic diversification of a mining town: A case study of Oranjemund (Doctoral dissertation, Rhodes University). Jenkins, H. (2004). Corporate social responsibility and the mining industry: Conflicts and constructs. Corporate Social Responsibility and Environmental Management, 11(1), 23–34. Jenkins, H., & Yakovleva, N. (2006). Corporate social responsibility in the mining industry: Exploring trends in social and environmental disclosure. Journal of Cleaner Production, 14(3–4), 271–284. Kovacs Kowalke, E. M. C. (2009). Glare of the Diamond; Botswana Why AIDS Corporate Social Responsibility Initiatives are not successful. Kumar, R. (2016). Corporate social responsibility in southern Africa. International Journal of Research in Social Sciences, 6(2), 306–317. Kuyek, J., & Coumans, C. (2003). No rock unturned: Revitalzing the economies of mining dependent communities. Mining Watch Canada. Littlewood, D. (2015). Corporate social responsibility, mining and sustainable development in Namibia: Critical reflections through a relational lens. Development Southern Africa, 32(2), 240–257. Maphosa, F., & Maunganidze, L. (2021). Corporate citizenship. Springer International Publishing. Mbekomize, C. J., & Nametsegang, L. W. D. A. (2019). The impact of corporate governance on corporate social responsibility disclosures: Evidence from Botswana Stock Exchange. MFED. (2012). Botswana excellence strategy: A strategy for economic diversification and sustainable growth. Government of Botswana. MFED. (2019). Macroeconomic outline for the mid-term review of National Development Plan 11. Government of Botswana. Mokwakwa, N. (2021). Corporate social responsibility in a diamond-mining company in Botswana. In Corporate Citizenship (pp. 227–254). Palgrave Macmillan, Cham. Neil, C., Tykkylainen, M., & Branbury, J. (1992). Coping with closure: An international comparison of mine town experiences. Nthoi-Molefe, O. (2021). Corporate social investment through sustainable cultural heritage resources management: The case of a mining company in Botswana. In Corporate Citizenship (pp. 191–225). Palgrave Macmillan, Cham. Ntsabane, I. P., Darkoh, M. B. K., Gwebu, T. D., & Totolo, O. (2010). Development of Jwaneng mine: Economic impacts and environmental implications. Botswana Journal of Southern African Studies, 24, 159–179. Reimer, B. (2002). Understanding and measuring social capital and social cohesion. The New Rural Economy. http://nre.concordia.ca/nre_reports.htm

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Robinson, D., & Wilkinson, D. (1995). Sense of community in a remote mining town: Validating a neighborhood cohesion scale. American Journal of Community Psychology, 23(1), 137–148. Torres Solís, J. R., & Moroka, K. (2011). Innovative corporate social responsibility in Botswana. The Debswana mining company study case. Contaduría y administración, 233, 91–104. Vision 2036. (2016). Achieving prosperity for all. Government of Botswana. Wilcox, J. N. (2015). Mining regulation and development in Botswana: the case study of the Debswana mining joint venture.

Nonofo Mokwakwa holds a Bachelor of Commerce degree in Economics and a Master of Arts in Development Studies and is currently a PhD candidate at the University of Botswana. He has been working in the area of research and monitoring and evaluation for the past 10 years. He is one of the founding members of the Botswana Association of Monitoring and Evaluation and is currently an executive committee member of the association. He was part of the team that crafted Botswana’s Vision 2036, which is Botswana’s long-term development strategy. He is currently part of the team developing Botswana’s national monitoring and evaluation. France Maphosa is a professor of Sociology and Coordinator of Graduate Studies at the University of Botswana. He has also worked at the National University of Lesotho and the University of Zimbabwe where he was head of the Department of Sociology for 6 years. He also briefly worked for the Biomedical Research and Training Institute (BRTI), Zimbabwe, and the Zimbabwe Young Men’s Christian Association as a research consultant and executive director, respectively. His research interests include migration and transnationalism, the sociology of entrepreneurship, corporate social responsibility, urban and rural livelihoods, labor studies, and alternative dispute resolution.

Implications of Bikita Minerals’ Corporate Social Responsibility on Environmental Rights of Mining Communities in Bikita District, Zimbabwe Mutanda Gideon Walter and Chazireni Evans

1 Introduction The legal framework guiding mining activities in developing countries concentrates on mineral extraction, paying little attention to the impact of mining on the ‘mute’ stakeholder (nature), ‘present’ and ‘absent’ (future) communities (Mandina et al., 2014; Murombo, 2016). This scenario is not only the cause of poverty and conflicts but also constitutes an assault on the environmental rights (ER) of nature and poor communities living around mines (ZELA, 2011). The 1972 Stockholm Declaration adopts an eco-anthropocentric approach to ERs by incorporating nonhumans as ER holders whose rights should be defended (UNEP, 2017). Sambo (2012) further argues that since the natural environment includes human beings, the definitions of environmental justice and rights that concentrate on human welfare without due consideration for nature are not only inadequate but inaccurate. The recognition of ERs is key to the achievement of the brown environmental agenda (human health and well-being) and the protection and conservation of natural resources (green environmental agenda), thus pointing to the ecocentric and anthropocentric nature of ERs (ZELA, 2011). The responsibility of recognizing and promoting ERs (rights of nature and rights to nature) is not for the state only but should also be shared by nonstate actors (UNEP, 2017) since operations of corporations impact ERs in significant ways (Lakra, 2014). Nonstate actors such as mining companies in most developing countries have been criticized for acting in an irresponsible manner, socially and environmentally (Siawor-Robertson & Awaworyi, 2015). To offset these criticisms,

M. G. Walter (✉) · C. Evans Department of Physics, Geography and Environmental Science, Great Zimbabwe University, Masvingo, Zimbabwe e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_9

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business entities are, however, coming to the realization that they have a duty to consider not only financial but also social obligations to promote rights of nature and rights to nature through right-based CSR programmes (Certanec, 2019). This study adopted Letnar-Cernic’s (2011) definition of CSR as the continued commitment of a firm to respect fundamental human rights, protect the environment, pursue economic development and cater to the interests of a wider stakeholder group. Stakeholders broadly refer to all parties who affect or are affected by corporate actions, i.e. investors, customers, employees, local community and ‘mute’ stakeholders’ (Nwoba & Michael, 2016). The diversity in the interests of the stakeholders means firms have diverse CSR with four levels of responsibilities to achieve. These are economic responsibility important to business success, legal responsibility to comply with laws and regulations, ethical obligation of business to promote social harmony and philanthropic responsibility to provide resources for the improvement of affected communities (Tembo, 2018). The multiplicity of the aforementioned corporate responsibilities is a pointer to the various stakeholders that a firm should serve. This study is therefore based on Freeman’s stakeholder theory, which states that a firm’s existence is not merely to satisfy shareholders’ interests but also the interests of a broad range of players who are affected by the firm’s operations (Abdulkadir, 2021). While firms have an obligation toward a wider stakeholder group, this paper is interested in exploring how BML’s CSR impacts the ERs of the ‘mute’ stakeholder and local communities. Enterprises are subject to rights and have environmental responsibilities as enunciated by various international and national laws. Firms should not only fulfil their legal and environmental obligations in their business operations but should also go beyond legal compliance (Yankson, 2010). However, CSR must first comply with the law to go beyond the law (Buhmann, 2006). Implicit in the aforementioned statement is the fact that firms have a legal obligation to integrate social and environmental concerns into their CSR programmes and even go beyond it in case the legal framework is not comprehensive. Zimbabwe has fragmented legal frameworks (EMA Act, EIA policy) and constitutional provisions (section 73) that can guide CSR programmes for mining companies. ERs are facing gross violations and relegation to the periphery in enforcement and resource allocation by state and nonstate actors despite the equality and indivisibility of all human rights (ZELA, 2011). Since Zimbabwe’s mining industry is targeting achieving a US$12 billion mining economy by 2025 and becoming an upper middle-class economy by 2030, with the promotion of human rights as one key priority, it is important to ascertain the extent to which mining entities’ CSR advances the often neglected, subordinated, ‘third-generation rights’ (ER). Extractive industries are said to be at the forefront of practicing CSR, as they are at the forefront of assaulting the ‘twin’ ER (ibid). To understand the practical implications of CSR, it would be wise to focus on industries at the forefront of CSR (Ranangen, 2013) and assault the ‘twin’ ERs. While Ramasastry (2015) describes the link between CSR and human rights as ‘two close cousins’, very few studies have examined the implications of CSR programmes on ERs. Thus, it is still uncertain whether mining firms’ CSR initiatives have contributed effectively and adequately to

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the promotion of ecocentric and anthropocentric ERs in mining areas. To understand the firms’ contribution to the advancement of the dual ERs in Bikita district, Zimbabwe, this study seeks to track BML’s environmental history; analyse BML’s inclusion of environmental issues in its mission statements, values and newsletters; and explore the contribution of its CSR initiatives to ecocentric and anthropocentric ER.

2 International Legal and Policy Framework Regulating CSR One of Carroll’s four levels of corporate responsibility is the firm’s obligation to comply with laws and regulations. The view that CSR is legally bound fits well with Letnar-Cernic’s (2011) definition of CSR, which stresses the need for businesses to respect fundamental human rights, ensure the rule of law and protect the environment and local communities. According to IUCN (2016), environmental rule of law is premised on key elements: (i) compliance with environmental laws, (ii) respect for all human rights, (iii) obligation to protect nature (Principle 1), (iv) right to nature and right of nature (Principle 2) and (v) right of humanity to the safe and sustainable environment (Principle 3) (IUCN). In simpler terms, the aforementioned definition of CSR and environmental rule of law points to the following critical issue: CSR should operate in the context of environmental laws if ‘twin’ ERs are to be promoted. While the Stockholm Declaration set the foundation for an ecocentric approach to ERs, the Rio Declaration went a step further to adopt both ecocentric and anthropocentric approaches to ERs by stating that humanity is entitled to a healthy life in harmony with nature (UNEP, 2017). Although the aforementioned ‘soft laws’ have explicit implications for firms to promote broad-based ERs, there are also international laws guiding firms’ operations that believe in CSR as an important part of the framework part of the enforcement of environmental law and achievement of the environmental rule of law (emphasis added) (Irwansyah et al., 2016). The United Nations Global Compact (UNGC), Caux Round Table and Global Sullivan principles for business principles prescribe firms’ CSR to focus on the promotion of all human rights (including access to healthy environments) and environmental protection (Abdulkadir, 2021). The International Organization for Standardization (ISO) system, especially ISO 26000 (social responsibility standard) and ISO 14000 (environmental standard), are used to manage business actions so that they comply with or go beyond legal requirements if they are to become socially and environmentally responsible (Tembo, 2018). The ISO 26000 standard identifies three of the seven firms’ social activities as human rights, the environment and community participation (Verchagina et al., 2021). In the same vein, the China Chamber of Commerce of Metals, Minerals and Chemicals (CCCMC) developed CSR guidelines for Chinese outbound mining firms: compliance with the host country’s legal framework, promotion of rights of

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stakeholders and provision of a safe environment to surrounding communities, among other things (CCCMC, n.d.). These international frameworks recognize CSR as a double-edged sword that can promote the brown and green environmental agenda and ecocentric and anthropocentric ERs. Thus, firms can only incorporate environmental issues and human rights related to the environment into their CSR activities by complying with legal frameworks enshrined with environmental issues and ERs.

3 Legal Framework on CSR Relating to the Extractive Sector and ERs in Africa While the abovementioned international laws and principles are ‘soft’ laws, they paved the way for the promulgation of legally binding national charters with eco-anthropocentric ERs (UNEP, 2017). Section 20 of the 1999 Constitution of Nigeria makes environmental protection a state objective (Akinsulore, 2016). The clause explicitly mentions ecocentric ERs by obligating states to protect nature, which implicitly leads to the enjoyment of anthropocentric ERs. The late Nigerian environment activist Ken Saro-Wiwa once said that the environment is humanity’s first right such that without a clean, liveable and sustainable environment, humanity cannot claim other rights (UNEP, 2017). According to Du Plessis (2015), sections 24 and 95(1) and articles 42 and 73 of South Africa, Namibia, Kenya and Zimbabwe’s constitutions respectively adopted constitutional ERs that are eco-anthropocentric in nature. The first sentence of section 73 of Zimbabwe’s constitution (every person has the right to an environment that is not harmful to their health or well-being) adopts a human-centred approach to ERs (De Gobbi, 2020). A provision that follows section 73(1b) then focuses on ecocentric rights (rights of nature), although these rights subsequently benefit the ‘present’ and ‘absent’ stakeholders, thereby reinforcing the mutual nature of eco-anthropocentric rights. The two-pronged nature of section 73 means that the protection of ERs is not only aimed at human access to and control over the natural environment but also with an obligation to protect the natural environment (ibid). The last provision of section 73 obligates the state to take reasonable legislative and other measures to achieve the progressive realization of the rights in this section. Stating the term ‘environmental rights’ in plural form might mean two different things. Connelly et al. (2012) state that everything hinges on interpretation. It might be a pointer to the existence of multiple ERs, i.e. rights of humanity to nature and rights of nature to exist. The provision might also go beyond substantive ERs to include implicit ERs or extensions of substantive ERs such as the right to housing, water, sanitation, health and food since they are interrelated to and mutually reinforcing of one another (UNEP, 2017). Mulenga (2019) further argues that the clause ‘an environment not harmful to health’ has a wide latitude of interpretation that may include education facilities, housing, food, working environment, health-care services, water and

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sanitation. Edifying on this observation, Tamuno (2012) argues that using the indirect human rights approach, rights such as the right to health care, life, water and sanitation and housing can be used to partially fulfil communities’ ERs. In addition to a constitutional provision (section 73) on ERs, Zimbabwe has fragmented pieces of legislation (EMA Act, Environmental Impact Assessment (EIA) policy and Effluent and Solid Waste Disposal Regulations) that have provisions with the potential to trigger corporate social environmental responsibility (CSER) (ZELA, 2011). They have sections that focus on ERs, the need to carry out EIA and mitigate firms’ externalities that threaten the ‘triple bottom line’ components (social, economic and environmental issues) during a project’s life cycle (Tembo, 2018). The EMA Act as the chief environmental law adopts an eco-anthropocentric approach to ERs. Section 4(2) of the EMA Act calls on development projects (including mines) to adopt the ‘Triple-P concept’ (people, planet, profit) in their operations by making efforts to prevent, minimize or remedy environmental degradation and adverse health effects to promote ERs and achieve sustainable development. However, these frameworks are nonmandatory in nature and do not directly compel corporate organizations to consider the human rights dimension of CSR.

4 African Firms’ Compliance with CSER Regulations While mining activities contribute to negative externalities and gross violation of communities’ ERs, CSR constitutes an opportunity for mining companies to be compliant with environmental laws and promote assaulted ERs (ZELA, 2011). In most developing countries, mining companies have continually been accused of being socially and environmentally irresponsible. A study on the perception of locals on CSR for Chinese International Construction Companies (CICCs) in Africa revealed that these firms rank highly in terms of respecting national laws and customs, although they had the lowest ranking on environmental protection leading to conflicts in many countries (Seriki, 2020). What is ironic about the study of CICCs’ CSR programmes is that they are ranked highly in terms of respecting national laws but lowly on environmental protection, of which the country has a legislative framework promoting environmental protection. The differential accord of respect to the country’s national laws is a pointer to the firms’ double standards and ‘inferiorization’ of some statutes, especially environmental laws promoting eco-anthropocentric ERs. The Dangote Group of Companies in Nigeria has been accused of being more involved in corporate philanthropy than contemporary CSR (Akinsulore, 2016). The conglomerate’s capture of some state institutions and its scanty and poorly defined CSR policy are some of the factors cited for its CSR initiatives being more focused on economic and philanthropic responsibilities at the expense of the legal obligation to comply with environmental laws promoting broad-based ERs. Mining firms in Ebonyi State, Nigeria, have been accused by host communities of contributing to

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water scarcity, water and air contamination and pollution-related diseases, but they have not provided host communities with health information and facilities (Nwoba & Michael, 2016). The mines’ activities affect the community’s substantive ER (due to lack of a healthy environment), procedural ER (through lack of information on environmental impacts) and heightened ER (by worsening the vulnerability of the already vulnerable rural community). The violation of eco-anthropocentric ERs by Nigerian ‘big’ firms has been attributed to a weak constitution with no explicit ERs except section 20 of the constitution, which makes environmental protection a state objective but not a right. Although the protection of the environment is essential for the fulfilment of other rights, Akinsulore (2016) argues that section 20 falls under the provisions of fundamental objectives of state policy, which are generally not enforceable and nonjusticiable in case of violation of such provision. Murombo (2013) reports that many South African mining companies, such as Nkomati Anthracite and CoAl Africa, opened the Madedeni and Vele mines, respectively, without all the necessary licences, e.g. water use licences and environmental authorizations. Local communities in Prieska, South Africa, had to use UK courts to sue a UK multinational company (Cape plc) for the firm’s environmental malpractice, which resulted in three deadly diseases (asbestosis, lung cancer and mesothelioma) (Abuya, 2018). The court case was won in the UK, an indictment of local laws and Africa at large for being weak enough to protect the rights of nature and its citizens against the assault of ER by multinational companies. It is therefore inaccurate to regard CSR as going beyond legal obligation when some mines even fail to comply with available environmental legislation. CSR programmes for most mining firms in SA and Nigeria suggest that they are adopting the ‘constrained profit-making view’ of CSR, which states that the purpose of the company is to maximize profits. Edifying on this observation, Murombo (2013) states that regulating institutions of mining in developing countries are focused on facilitating extraction with little regard to the impact of mining on the green and brown environmental agenda. In Ghana, mining firms such as Gold Fields Ghana Ltd. (GFG), AngloGold Ashanti (AGA) and Newmont Ghana Gold Limited’s Ahafo mine’s (NGGL) CSR initiatives were one-sided, as their focus was on human-centred ERs. These firms provided local communities with modern school facilities and furniture, teachers’ and nurses’ quarters, clinics and drugs, toilets and urinals, digging wells, water and sanitation facilities and drainage repairs (Siawor-Robertson & Awaworyi, 2015; Yankson, 2010). AGA went a step further to launch the Malaria Control Programme and piggery project to address the problem of malaria and food insecurity, respectively, in Obuasi municipality. For all CSR programmes mentioned above, only malaria control and water and sanitation services directly promoted substantive ERs of the community, while other programmes (such as piggery and upgrading of health and school facilities) indirectly actualized the same rights. The rights to food, health, housing, quality education and an adequate standard of living are regarded as extensions of substantive ERs. However, none of the CSR initiatives addressed the direct impacts of mining firms on the natural environment and local people’s ER or provided them with procedural means to actualize affected substantive ER despite

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mines being at the forefront of assaulting the ‘twin’ ERs. The lack of CSR that is aimed at protecting the rights of nature and rights to nature in Ghana is due to the lack of comprehensive CSR policies or laws guiding the programmes. Zimbabwe has a constitutional provision and some legal environmental frameworks that have provisions with the potential to trigger CSR programmes of firms that are ecocentric-anthropocentric in nature. However, the starting point for firms is to domesticate these legal frameworks by embedding environmental issues in their business philosophies (corporate vision, mission statement and values). These are the first pointers to whom the organization regards as its important stakeholder among the wider group of stakeholders. A study of Zimbabwean companies by Maphosa (1997) revealed that out of the 45 firms that were contacted, seven did not send their mission statements citing various issues ranging from lack of it to work in progress and administrative issues. Analysis of the mission statements received revealed that social issues such as customer and shareholder interests dominated in the statements of all firms, while environmental and community interests were adopted by almost half of the firms (ibid). The lack of mission statements by some firms and the low ranking of environmental issues in mission statements of other firms justify the call by Tembo (2018) that the vision and mission for the extractive sector must recognize sections 73 and 4(1) of Zimbabwe’s constitution and EMA Act, respectively, that protect the natural environment and adjacent communities’ ERs. However, Mbada Diamonds in Marange has been in the limelight of threatening the ‘Triple-P concept’ through the implementation of CSR, which disregards national environmental regulatory frameworks and its failure to embed environmental issues in its corporate annual reports, vision and mission statement (ibid). The disregard of ERs is worsened by the direct involvement of the government in diamond mining and its partnerships with the private sector where the government has interests (Mathende & Nhapi, 2017). Formal mining in Chiadzwa began without the required EIA, which led to environmental degradation, human displacement and lack of fulfilment of some promises with a bearing on anthropocentric ERs. While some mining firms operating in Chiadzwa are of Chinese origin, their lack of commitment to spending resources on sustainable CSR programmes is a betrayal of the CCCMC guidelines on social responsibility: compliance with the host country’s legal framework, environmental protection and provision of healthy environments to mining communities. Mutoko communities are up in arms with granite mining companies to reap huge profits but ruin the environment, causing noise pollution and cracking houses due to blasting (ibid). Destruction of the local environment affects communities’ other rights (right to food, water, housing, life and an adequate standard of living), whose fulfilment is dependent on access to clean and safe resources. The assault on environmental rights reveals shortcomings by the EMA to control mining companies operating without EIA certification and account for their externalities, inadequate environmental audits, inadequate monitoring of EIA certificate renewal, failure to monitor discharge and emissions in mines and lack of deterrent measures against environmental offenders (Auditor-General, 2015).

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Unki mine’s 2013 newsletter lists only 2 out of 16 CSR projects implemented in 2012 as targeting environmental education (procedural ERs), community water and sanitation (substantive ERs) (Mandina et al., 2014), while none sought to advance ecocentric ERs. Muruviwa et al. (2018) further reported that Zimplats in MhondoroNgezi invested a great deal of money in the promotion of human-centred ERs (emphasis added) through the drilling of boreholes, construction and renovation of dilapidated schools, medical facilities and donation of medical equipment to existing clinics. Borehole drilling had an explicit impact on communities’ right to a safe and clean environment (water), which subsequently promoted the right to an adequate standard of living and life through minimized diseases associated with intake of contaminated water. Other initiatives targeting the health sector implicitly affected communities’ right to a safe and healthy environment. A healthy environment is not only the absence of disease but a condition when households have a sense of security cultivated by the availability and accessibility of well-furnished medical facilities that provide adequate medical attention. Such an environment is important for mining communities given the destructive nature of mining activities on environmental resources (water and air) upon which mining communities regularly depend. However, Kaseke et al. (2015) are of the view that judging by CSR initiatives being launched by Zimbabwe’s mining firms, local communities are losing more than what they gain as CSR should go beyond employment creation and provision of community development projects but include environmental protection and rehabilitation projects. This is an indictment of Unki Mine and Zimplats for implementing one-sided CSR programme that side-lines the other ‘P’ (planet) part of the ‘TripleP concept’.

5 Materials and Methods This study was carried out in Bikita district, Zimbabwe. It adopted a qualitative research approach, and a case study was used to explore the implications of BML’s CSR projects on human- and nature- centred ERs. A case study was used because it helped to explore a programme (CSR programme) in depth, and it also allowed the collection of much data for triangulation using tools such as interviews and secondary data, i.e. newspaper articles and company websites. Officials from mining companies also provided secondary materials such as newsletters and documents on CSR projects being undertaken by the firm. This study used availability sampling to select members for interviews from BML’s mining communities and nearby schools as the major beneficiaries of BML’s CRS projects. Availability sampling was chosen because members from these mining communities were not available in their homesteads as they engaged in different livelihood platforms (e.g. marketing of vim). Data from interviews and secondary documents were presented as paraphrases or quotations and tables. Views from respondents were also triangulated with scholarly work from the literature review.

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6 Results and Discussion The following sections are a presentation of the different CSR programmes conducted by BML and how these programmes influenced access to broad-based ERs. Findings from this research are presented in the thematic form: BML’s environmental history, the inclusion of environmental issues in the business philosophy, CSR programmes relating to environmental protection and human-centred ERs.

7 BML’s History on Environmental Issues Although there are international and national legal frameworks guiding firms’ operations and CSR programmes to consider environmental issues as a ‘core business’, the mining industry has taken a ‘devil may care about its impacts, thereby violating the ERs of mining communities’ (Jenkins & Obara, 2008). Maguwu (2017) reports that BML epitomizes everything that is wrong with Zimbabwe’s extractive sector, as evidenced by secretive operations, poor social responsibility and complaints of health problems caused by the dust from dump sites. A report by ZELA (2021) further implicates BML for violating ecocentric-anthropocentric ERs through soil pollution, water pollution and water shortages for the local community. The Centre for Natural Resource Governance (CNRG) (2016) and Kunambura (2016) carried out reports where BML was said to be facing closure by the government mainly on allegations of destroying the natural environment and turning the picturesque landscape into visually unpleasing open pits. The Business and Human Rights Resource Centre (BHRR), reported that BML’s surrounding community was accusing the mine of disregarding environmental regulations by discharging toxic chemicals in rivers and replacing the natural landscape with artificial hills (mine dumps), creating a barren landscape and quarry dust from mine dumps. These allegations of environmental neglect warrant an investigation of the inclusion of environmental issues into the company’s business philosophy and CSR programmes.

8 Inclusion of Environmental Issues in BML’s Business Philosophy A business philosophy is an operational blueprint for a firm that can be in the form of the firm’s vision, mission statement, values and goals. According to Maphosa (1997), the business philosophy, especially the mission statement, defines what the organization stands for and values that shape corporate decisions and act as a framework within which those decisions can be implemented and evaluated. A search for BML’s business philosophy on its website yielded nothing although

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Table 1 BML’s business philosophy Order 1 2 3 4

Type of philosophy Vision Mission statement Core values Corporate goals and objectives

Social issues *Shareholder interests *Market interests *Market interests *worker interests *Worker interests *community interests *Environmental issues *shareholder interests *Market interests

Fig. 1 BML’s website section on CSR. (https://bikitaminerals.com/)

these were obtained from the firm’s hard copies detailing its corporate responsibilities. The involvement of a firm in social issues is a product of its business philosophy, especially its vision, mission statement and corporate values. While a business is supposed to serve the interests of the wider stakeholder community, the company’s vision, mission statement and values can indicate stakeholders who are at the ‘heart’ of an organization. Table 1 gives brief insight into BML’s operational blueprints in hierarchical order. Environmental issues and community interests were only mentioned once in the lowest (fourth) tier (corporate goals) of the business philosophy, while shareholder and customer interests were mentioned twice and thrice, respectively, in the first- (vision) and second-tier (mission statement) philosophies. The consideration of shareholder and customer interests at higher levels of the business philosophy is an indication that these stakeholders were ‘more equal’ than the natural environment and local communities. In addition to the relegation of environmental issues to the lowest level of the business philosophy, the firms’ website component on ‘social responsibility does not mention activities on corporate social environmental responsibility (Fig. 1), while the ‘environment’ section gives only a general statement that the firm is compliant with environmental legislation (Fig. 2). Only one downloadable and detailed newsletter was available on the website, but it lacks detail on CSER.

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Fig. 2 BML’s website section on environment. (https://bikitaminerals.com/)

Scanty information on environmental issues on the firm’s website and their consideration just once and in the lowest level of the firm’s philosophy corroborate the view by ZELA (2011) that ERs are seen as subordinate to other interests (rights) and are ranked as third-generation rights.

9 BML’s CSR Programmes Relating to the Protection of Natural Environment While the firm’s website, business philosophy, many media and civil society reports painted a gloomy picture of BML’s operations on the rights of nature and rights to nature, Ziyambi (2018) carried a positive report of the firm being engaged in recycling of waste water, backfilling of mining holes, mining of old dumps and planting of trees on plugged pits. The firm took environmental issues as a ‘core business’ by integrating them into the company’s operations. Edifying on this observation, Mapira (2017) observes that BML is among some of the mines that are providing environmental education (EE) and encouraging the formation of environmental clubs to mining communities. BML’s CSR report (2019) further states that the firm donated funds for the conservation of endangered rhino species in Devuli and Save Valley conservancies, thereby contributing to ecological sustainability. Financial donations toward the conservation of wildlife in these conservancies advance the ERs of the ‘mute’, ‘absent’ stakeholder and intergenerational equity at the expense of intragenerational equity and ERs of ‘present’ stakeholders due to the high cost ‘entrance’ fee and nonconsumptive nature of the protected area (PA). The irony is that the privately owned conservancies cover part of Bikita district, but local communities cannot afford the ‘entrance fees’ being charged, thereby limiting their rights to local environmental resources being financially supported by a firm exploiting local mineral resources. Therefore, any meaningful CSR programme should strike a balance between the rights of the ‘now’ and ‘future’

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person, rights of nature and rights to nature if the programme is to promote holistic sustainable development.

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CSR Programmes Relating to Environmental Rights of BML’s Mining Community

BML’s website and newsletters provide details of the firm’s CSR programmes. While the firm embarked on many CSR initiatives, Table 2 gives a summary of CSR initiatives that advanced the ERs of local communities, including the academic community. CRC (2016) defines the term ‘environment’ from (school) children’s rights context as to where a child lives, learns and plays. Section 4(1–2) of Zimbabwe’s EMA Act identifies firms as juristic persons obligated to advance everyone’s (including school children) ERs through other measures. While everything hinges on interpretation, the term ‘other measures’ might refer to CSR projects that improve the learning environment. In compliance with this statutory obligation, BML launched CSR projects that constructed and renovated the school plant, i.e. physical structures and furnishings, staff accommodation sports fields, mock traffic centres, play centres and outdoor learning facilities (Table 2) for many Bikita district schools. Riding on CRC’s (2016) definition of the word ‘environment’ from the children’s rights context, it is plausible to infer that most CSR projects in the education sector promoted substantive ERs through the provision of safe, spacious learning and working environments that catered to learners’ physical and emotional needs. A teacher at Bikita Primary School reported: This ECD center is the first of its kind in the district. ECD learners previously used the community hall, which was dilapidated and dangerous for the children. We used to discourage our ECD students from coming to school or dismissing them early when it is windy or raining. . .it’s now a thing of the past. Table 2 CSR programmes relating to ERs of the academic community Funded project School Bikita Primary *Teachers’ housing *Six classrooms, furniture and fittings *Early Child Development (ECD) centre and toilet block *Play centre and mock traffic centre *Electrification Mangondo, Marinda Primary, Mandindi High *Laboratory refurbishment and apparatus Bikita Fashu High *New sports field *New borehole *Feeding programme Rusunguko, Beardmore, Marinda and Bikita Primary *Water reticulation system Domboshawa Primary Source. BML’s CSR report (2019)

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Along this continuum, another teacher further revealed the following: The mine has our students at heart. . .it funded the construction of a ‘mock traffic center’ to help us teach our students about traffic regulations and as part of orientation for new students.

Based on the above views and information in Table 2, one can infer that BML is doing well in promoting learners’ rights related to their environment both inside and outside the classroom environment. While the refurbishment, construction and furnishing of learning facilities catered for the substantive ER to safe learning environments, the construction of a mock traffic centre promoted access to procedural and heightened ER for school children. The provision of information on safe road usage was a procedural means to promote substantive rights of school children, i.e. the prevention of accidents from mine and highway vehicles as Bikita Primary was built close to the mine and Masvingo-Mutare highway. CSR programmes advancing human-centred ERs in the education sector are an acknowledgment of Sampson’s (2012) observation that many imperceptible environmental risks that violate learners’ ER remain in the school’s outdoor or indoor environment. Through the firm’s CSR initiatives targeting the school plant, many schools now have a picturesque outlook that is meeting the physical and emotional needs of learners. Edifying on this observation, Kingsley (2019) articulates that the provision of wellfurnished school with age-appropriate and safe structures, sufficient learning space and an inspiring school environment satisfies the physical and emotional needs of students, which positively impacts students’ academic performance. Scrutiny of Table 3 suggests that BML launched a school feeding scheme, provided local communities with mealie meals and district ambulances and funded

Table 3 CSR targeting the local community Project *District ambulance *Housing, offices, water and utility *Clinic construction and staff housing *Water and sanitation system Feeding programme

Beneficiaries District residents Police, nurses, CIO

Mealie meal

Chief Marozva’s subjects Affected communities

Cyclone Idai responsebuilding material Covid-19 response (PPEs)

Uyerera/Domboshawa residents Learners

Local authorities and schools

Source. BML’s CSR report (2019)

Place Bikita Rural Hospital Msarasara, Glenclova camp (Bikita district) Uyerera/Domboshawa Clinic Rusunguko, Beardmore, Marinda and Bikita Primary Chief Marozva Chieftaincy Bikita district District council, local schools

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the construction of new clinics, water and sanitation systems and accommodations for government workers. The aforementioned CSR programmes availed socioeconomic resources that were important in meeting the so-called second-generation rights (rights to food, health care, water and sanitation, housing, life and an adequate standard of living) of both mining and nonmining communities in the district. The provision of these socioeconomic resources went beyond actualizing communities’ socioeconomic rights to include substantive ERs since access to the former rights partly fulfils the latter rights. BML’s school feeding scheme and food donation to Chief Marozva’s residents might be interpreted as an overt means to address the ‘burden’ of colonially instigated environmental justice imposed on the community through the forced acquisition of their agricultural land leaving them with uneconomic pieces of land. This then compromised residents’ access to ERs and justice due to a shortage of land, which is an important natural capital for farming communities. While BML implicitly addressed the loss of land through food provision, Siawor-Robertson and Awaworyi (2015) observe that NGGL in Ghana undertook an explicit initiative of compensating farmers who lost land to the mine with two acres of farming land. Initiatives by BML and NGGL are an acknowledgement by these mining firms that their activities lead to an assault on ERs by taking away communities’ right to sufficient land, making it difficult to turn land into a sustainable livelihood. Figure 2 further shows that BML undertook disaster response initiatives such as the provision of building material and PPEs to Bikita district communities affected by Cyclone Idai and Covid-19, respectively. Cyclone Idai responses helped affected communities reconstruct houses, thereby fulfilling affected people’s right to housing and partly the right to a healthy environment (housing). The provision of PPE to the local authority and nearby schools ensured that public spaces (offices and schools) were safe for residents and learners. It, therefore, shows that the right to housing, health, life and an adequate standard of living cannot be enjoyed if the human-made environments (houses and public spaces) are unsafe to residents, an indication of the indivisibility of rights. While the provision of water, sanitation facilities and accommodations to government workers may be fulfilling the anthropocentric ERs of Bikita residents, many of these CSR projects did not benefit the local communities affected by the mine’s operations. Instead, the majority of the beneficiaries were distant communities and public workers (police, CIO, etc.) not directly affected by the mine’s operations. This can be interpreted as a ploy to counter a backlash from the media and civil society groups accusing the firm of illicit financial flows, disrespecting indigenization and environmental policies. Edifying on this observation, Laisani et al. (2016) report that most of the CSR initiatives launched in developing countries and Zimbabwe, in particular, are mere public relations exercises meant to market the firm or have a good image in the ‘eyes’ of politicians.

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Conclusions and Recommendations

BML invested in many CSR projects that addressed fundamental problems facing its mining community, although many of the initiatives were not addressing problems linked to the mine’s impact on the man-made and natural environment. While the mine is upbeat about its ‘CSR’ projects, its newsletters, website and business philosophy seem to relegate environmental issues to the periphery at the expense of ecocentric-anthropocentric ERs. The firms’ CSR seems to focus on community problems that are extrinsic to the firm’s activities and challenges facing nonmining communities, including government workers in the district. Whether it was an act of commission or omission, the firm’s newsletters and CSR reports do not include initiatives that explicitly dwelt with impacts emanating from its operations. This is despite ZELA’s (2011) argument that Zimbabwe has pieces of environmental legislation that have provisions that may trigger CSR activities and offer an opportunity for mining firms to promote the brown and green environmental agenda. It is thus recommended that there is an urgent need for the government to promulgate a comprehensive piece of legislation that differentiates CSR from philanthropy and spells out CSER programmes if ERs are to receive attention equal to the so-called first- and second-generation rights. The promulgation of legislation on CSER should be followed by awareness among mining communities. Civil society should conscientious mining communities on pieces of legislation with aspects that relate to CSER if the firm’s CSR projects are to be holistically evaluated. Furthermore, mining firms should make public information on impact mitigation in their newsletters and reports since mitigation is an aspect of CSR programmes as given in the EIA policy. Statutory bodies such as ZHRC should have a mix of experts on environmental issues, human rights and social sciences if both ecocentric and anthropocentric ERs are to be treated as equal to other rights.

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Mutanda Gideon Walter is a lecturer in the Department of Physics, Geography and Environmental Science at Great Zimbabwe University, Masvingo, Zimbabwe. He completed his Ph.D. in Geography and Environmental Science, MSc in Natural Resources Management and Environmental Sustainability, BSc Hons in Geography and Environmental Science, B.A. General (Geography and Religious Education), Postgraduate Diploma in GIS and Remote Sensing, Postgraduate Diploma in Education, Diploma in Human Resources Management and Certificate in GIS and Remote Sensing. His research interests are agrarian reform, environmental citizenship, environmental governance and environmental justice. Chazireni Evans is a senior lecturer in the Department of Physics, Geography and Environmental Science at Great Zimbabwe University, Masvingo, Zimbabwe. He completed his Ph.D. in Geography, MA in Geography, B.A. Hons in Geography, B.A. General (Geography and Economics) and Postgraduate Diploma in Education. Dr Chazireni is interested in researching on health geography, population geography and economic geography

Corporate Social Responsibility and the Challenges of the Regulatory Environment in the Tanzanian Mining Sector Willy Maliganya, Kenneth M. K. Bengesi, Max M. Mbota, and Gideon Bulengela

1 Introduction Mining is acknowledged as an important sector of the economy for improving the livelihoods of people in many developing countries. In sub-Saharan Africa alone, the extractive industry has predominantly become a major contributor to economic development (Bryceson & Geenen, 2016). According to the National Bureau of Statistics (NBS) (2011) report, Tanzania is endowed with a huge reserve of mineral resources that contribute greatly to its development. Between 2002 and 2012, the country’s economy grew by 7% per annum partly due to mining activities. The contribution of mining to the gross domestic product (GDP) similarly increased from 3.0 in 2008 to 3.3 in 2013. Mining also accounted for 89% of the value of mineral exports (NBS, 2011). Despite the impressive growth of the mining sector in Tanzania, critics argue that the sector has failed to deliver the expected economic results, in particular (Kahyarara, 2015). Instead of being beneficial, mining activities tend to drain the local communities. While the benefits of mineral resources in the transformation of developed economies are eminent, the situation is contrary in developing countries.

W. Maliganya (✉) Department of Leadership, Ethics and Governance, Mwalimu Nyerere Memorial Academy, Dar es Salaam, Tanzania K. M. K. Bengesi Department of Policy Planning and Management, College of Social Sciences and Humanities, Sokoine University of Agriculture, Morogoro, Tanzania e-mail: [email protected] M. M. Mbota · G. Bulengela Department of Social Studies, Mwalimu Nyerere Memorial Academy, Dar es Salaam, Tanzania © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_10

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Mining is also one of the sources of environmental degradation. Critics argue that the environmental and social impacts associated with large-scale mining (LSM) have not effectively been addressed. Moreover, the decisions on mineral projects have been made with little or no consultation with local communities whose livelihoods are affected. Consequently, communities in most mining sites continually complain that they do not enjoy the benefits of mineral exploitation and are deprived of considerable portions of their land to benefit LSM companies without fair compensation. This gives some credence to the resource-curse theory, which suggests that resource-rich countries tend to perform worse in terms of sustainable economic growth than resource-poor countries (Kronenberg, 2004). It is increasingly becoming clear that with appropriate legal and regulatory frameworks, investments in mining can have a greater likelihood of economic returns. However, the challenge is how to develop policy options for making development-supportive investments. According to the African Union (2009), the vast endowment of Africa with mineral resources has raised hope that its people will experience rapid economic growth if the resources are appropriately exploited. Therefore, criticism raised over the global mining industry has awakened mining companies to address the needs of their shareholders and stakeholders as part of their corporate social responsibility (CSR). As such, companies are required to adopt various CSR policies and projects in their areas of operations to improve community livelihoods. Despite the wide acceptance of a context-specific relevance to CSR, there is an overwhelming argument regarding the dominance of research interest in the developed world and very little attention in developing countries (Msosa, 2019). Similarly, whereas several studies have examined the impact of the mining industry on economic performance (Kabote & Niboye, 2013), very few have attempted to systematically examine the efficacy of CSR as an important development tool. As a result, it is not yet clear whether CSR initiatives have effectively contributed to social transformation in mining areas. It is argued that a contextually relevant CSR agenda is essential for interrogating CSR roles in the African mining sector in addressing the developmental challenges in the region (Msosa, 2019). What is lacking is sufficiently grounded and systematically accumulated empirical evidence. Equally important, the reasons why CSR practices in the context of developing countries such as Tanzania are not performing well remain unclear. This chapter discusses CSR practices in the mining sector and their role in sustainable development at the local level in Tanzania. The chapter explores the CSR practices in the Tanzanian context, analyzes the policy environment for CSR practices in the Tanzanian mining sector, examines the performance of implemented CSR initiatives on sustainable development, and finally identifies the existing challenges and way forward toward the realization of CSR benefits. This chapter will make a useful contribution to the CSR development nexus literature in the context of the mining sector in Africa and fill the existing gap concerning the achievement of CSR practices in the mining sector for developing countries. The rest of the chapter is organized as follows: Section 2 presents the methodology. Sections 3 and 4 discuss the theoretical review on CSR practices in the mining sector and CSR in the

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Tanzanian context, respectively. The policy environment for CSR practice in the mining sector and the performance of CSR initiatives in the Tanzanian mining sector are discussed in Sects. 5 and 6, respectively. Section 7 presents the challenges facing CSR practices in the Tanzanian mining sector, while Sect. 8 evaluates the way forward on CSR practices in the Tanzanian mining sector. The final concluding remarks are presented in Sect. 9.

2 Methodology This chapter is a result of research efforts built upon the achievements of the government toward foreign direct investment, resulting in the need for CSR. The choice of study locations was those areas with the operations of LSM companies that were yet to be in the middle of conflicts with host communities in Tanzania. The host communities realized that despite the contributions to social services, the mining companies had caused severe environmental pollution of water, air, land, and noise. The most reported conflicts were the goldfields around the Buzwagi Gold Mine in the Shinyanga Region and around the Geita goldfields in the Geita Region within Tanzania. A qualitative research approach was applied where interviews, observations, and focus group discussions were applied in data collection from the local communities of Buzwagi and Geita. A total of ten interviews and ten focus group discussions were conducted. Additionally, the desk document review method was applied to collect secondary data. Sources of secondary data were policies and legal provisions, that is, Mining Policy, Mining Act No. 14 of 2010, Environmental Management Act No. 20 of 2004, Written Laws (Miscellaneous Amendments Acts No. 1, 2, and 3 of 2017), Land Policy, Environmental Management Policy, and Water Policy (Woodroffe et al., 2017) (Table 1). The purpose of the methodology focused on examining CSR status given the government’s effort in creating an enabling environment for direct foreign investment within the mining sector of Tanzania (Rutenge, 2016). The content analysis Table 1 Secondary data summary of policies and acts reviewed S/N 1 2 3 4 5 6 7 8 9 10

Theme The Written Laws (Miscellaneous Amendments Acts No. 1, 2, and 3) The National Gas Policy The Mining Act No. 14 The Mineral Policy The Environmental Management Act No. 20 The National Water Policy The Land Act No. 4 and Village Land Act No. 5 The National Forest Policy The National Land Policy The National Environmental Policy

Year 2017 2013 2010 2009 2004 2002 1999 1998 1995 1997

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technique was applied to analyze interviews and FGDs. The process entailed the transcription of interviews and coding the script segments, after which themes were identified and compared to find similarities and differences, interpretations of the themes were drawn up, and a conclusion was reached.

3 Theoretical Review of the CSR Practices in the Mining Sector This chapter is anchored on the theoretical foundations based on the integration of governance mechanisms in the context of sustainability, limited to economic performance, environmental performance, and enhanced community benefits. The theoretical base has been framed around how the policy environment in the governance of LSM companies could promote the practice of CSR for sustainable community development programs. In this regard, the theoretical grounds of these theories have been developed to enable the assessment of the performance of mining companies’ CSR practice in terms of abiding by the regulatory framework for enhanced local livelihoods in Tanzania. Mainly, the operations of mining companies are governed by the policy, legal, and regulatory frameworks that provide directives on how to accommodate the interests of the host countries as well as for the local communities affected by such operations. Governance in the context of the mining sector has been regarded as an area of serious concern throughout because of the conflicts among stakeholders of diverse interests who seem to lack an agreeable platform for decision-making (Kahyarara, 2015). Numerous theories, such as the sustainable livelihoods framework, capability theory, and stakeholder and institutional theories, have been proposed on the subject of natural resource governance for sustainable local community development in the context of the CSR practice of LSM. However, for this chapter, the sustainable livelihoods framework (SLF), stakeholders, and institutional theories have been used. These theories have been considered important for capturing issues on how natural resource exploitation can well be aligned toward improved local livelihoods and thus poverty reduction through enhanced CSR good practices, as expounded by the present theories (Owen & Kemp, 2013).

3.1

The Sustainable Livelihood Framework

The SLF, although applied as a theory, is useful for analyzing livelihoods and adding value to the whole essence of what CSR stands for. This framework originates from Chambers and Conway (1992) in the context of development sociology. This suggests that principal assets are an important aspect in the examination of livelihoods. This theory states that human capital is concerned mainly with manpower,

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natural capital is concerned with resources such as mineral resources, financial capital is concerned with income, social capital is concerned with social networks, and cultural capital is concerned with indigenous knowledge. This framework is a useful analytical tool and means researchers and practitioners can use it to understand and explain livelihoods. However, the weakness of this framework is that missing symbolic capital as livelihood is not only about meeting basic needs; it also has a sense of dignity and honor. Therefore, this study will employ sustainable livelihood theory because it remains helpful with an assumption that it properly addresses the variables of livelihoods of the study. The chapter focuses on assets and income as two indicators of assessing the livelihoods of contracted and noncontracted artisanal gold miners about institutional setup, which are key issues of concern in this regard.

3.2

Stakeholder Theory

According to stakeholder theory (ST), companies have a social responsibility that requires them to consider the interests of all parties affected by their actions. The theory uses six internationally accepted key governance principles of discipline, transparency, accountability, independence, fairness, and social responsibility and argues that these should be for all stakeholders, not only shareholders (FernandezFeijoo et al., 2014). Based on ST’s assumptions, the relevance and practicality of stakeholder theory for the study is that it provides a framework upon which mining companies are judged in terms of the value they place on governance, CSR, and sustainability practices. Therefore, since this chapter examines CSR and the challenges of the regulatory environment on community livelihoods, the use of stakeholder theory provides a better understanding of how mining activities affect livelihoods based on governance principles.

3.3

The Institutional Theory

Institutional theory (IT) is the dominant theory of occupational-based institutions, as it provides a powerful explanation for the conditions that regulate livelihood activities. It evolved in the 1970s and 1980s within the context of sociology as a response to this discipline in searching for an understanding of the elements that support successful and sustained organizational performance (Scott, 1995). In efforts to better understand how LSM companies comply with the regulatory framework for sustainable CSR practices, the use of IT has been regarded as an essential framework for this study on social sustainability. IT addresses processes by which social and political structures, including rules, norms, and routines, become established as authoritative guidelines for behavior that governs societal interactions. The theory maintains that authoritative guidelines for behavior are created and adopted over a

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given time (Scott, 1995). Therefore, for organizations such as mining companies to survive and thrive, they must conform to the rules and belief systems prevailing in the environment. Institutional theory is, therefore, a policy- making mechanism that emphasizes that formal and legal aspects of government directives should be followed or complied with. In view of this chapter, this theory is ideal, as most of what is happening in the mining sector in Tanzania in terms of CSR practices is regulated based on the rules, norms, and values of the country.

4 Corporate Social Responsibility in the Tanzanian Context Corporate social responsibility is a framework underpinning companies’ economic, environmental, and social responsibility to a wider set of stakeholders and the general public in their operating environments (Carroll, 2016). Seen as part of CSR, the social license to operate (SLO) is a term used in this context for the trust and approval of local stakeholders enabling companies to operate locally (Owen & Kemp, 2013). However, SLOs are normally not legally binding but are reflected and maintained by stakeholder engagement at the local level. As a result of this increased role, CSR initiatives have become widespread in the extractive industry, including in East Africa. While CSR proponents hold that corporations can create shared wealth and promote long-term sustainable development, opponents state that CSR is intended to guarantee corporations the SLO and allow the continuation of business practices (Carroll, 2016). In Tanzania, CSR has widely been understood as philanthropy in the sense of doing something good with part of the profits (Kahyarara, 2015). However, in the contemporary global business environment, CSR is generally seen as sustainable business performance in terms of generating profit in a socially and environmentally responsible manner. This also has to do with community involvement and development and other aspects, such as human rights, environmentally friendly production methods, and fair operating practices. In the 1990s, major legislative reforms were implemented by the Tanzanian government to integrate its economy into the global market. This led to the propagation of new laws and regulations that contained, inter alia, provisions requiring public accountability, responsibility, transparency, and enhanced corporate disclosures. These laws and regulations also sought to address and promote the issues of environmental protection and management (Lauwo, 2011). For example, in 1997, in line with Agenda 21 of the Rio Declaration (which required a cross-sectoral integration of policies, plans, and programs for the effective management of the environment), the National Environmental Policy (NEP) of 1997 was introduced in Tanzania. The National Environmental Policy of 1997 requires companies to ensure sustainable and equitable use of resources without degrading the environment. However, the reality has left much to be desired. Following global environmental concerns in 2002, the Tanzanian government replaced the National Environment Management Council (NEMC) Act of 1983 with the enacted Environmental

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Management (EM) Act No. 20 of 2004, which requires companies to control and prevent pollution, manage waste products, and provide restoration plans (Lauwo, 2011). The same Act requires mining companies to rehabilitate the environment a year after ceasing operations. However, these legal requirements have not been implemented partly due to a lack of institutional capacity to enforce and monitor compliance. The penalties for violation of such laws have remained relatively low, since companies may perceive that it is cheaper to pay penalties than internalize the environmental costs (Lauwo, 2011). For this reason, environmental reforms may have little impact.

5 The Policy Environment for CSR Practices in the Tanzanian Mining Sector There has been a strong local desire to encourage and maintain ethical business practices, public accountability, transparency, and good governance in Tanzania since its independence in 1961. Consequently, the Tanzanian government has attempted to pass new laws and regulations to promote public accountability and good governance and foster good CSR practices (Mmuya, 2000). However, as the postindependence codes of conduct retained most of the features from the former colonial regime, Tanzania’s ability to promote CSR reporting and protect the public interest has remained limited. For example, the Companies Act 1932–CAP 212, which laid down requirements for addressing governance issues in the colonial government, remained in force for many years postindependence Tanzania and was not amended until 2002 (Lauwo, 2011). Although the Act required directors to improve corporate disclosure and act in good faith to promote the best interests of the company, stakeholder interests have remained subordinate to the financial interests of shareholders. In 1967, President Nyerere’s government enacted new codes of conduct, enshrined in the 1967 Arusha Declaration, to promote socioeconomic development, public accountability, responsibility, good governance, and corporate responsibility. In the 1990s, Tanzania implemented several legislative reforms advocated by the World Bank and the IMF to improve public accountability, good governance, and transparency (Lugoe, 2012). Despite these developments, evidence from the mining sector shows that poor working conditions, social unrest, pollution, and environmental degradation have remained endemic. This questions the effectiveness of local laws and regulations to control CSR practices and promote public accountability, responsibility, and transparency in Tanzania. Currently, Mining Act No. 14 of 2010 is the main legislation that governs all mining activities in Tanzania (NBS, 2011). The policy aims to improve the economic environment to sustain local and international private investments in the sector and strengthen the legal and regulatory framework for the sector. While the mineral policy provides the framework for sustainable exploitation of the country’s mineral wealth, the sector’s contribution is

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still minimal and has led to several conflicts as communities and small-scale miners have been forced off concessions and paid inadequate compensation. Aligned with the provisions above, Tanzania has become a member of the Extractive Industries Transparency Initiative, which requires transparency and accountability around extractive industry revenue. Its membership was further renewed from 2011 to 2013, provided it made meaningful progress, but further action was required to ensure compliance. Although the legal mining framework in Tanzania is well developed, implementation and enforcement seem to be weak. It is, therefore, necessary to make some changes to enhance its effectiveness for sustainable mineral resource use. Similarly, the role of the government is to look after the collective interest of its citizens and work with mining companies to create an enabling environment for responsible business conduct. This will be made possible when aligned with measures to improve the policy framework. This information provides avenues for theoretical and practical improvements, as there are still existing gaps between policy, rules, and regulations and their actual practice on the ground.

6 The Performance of CSR Initiatives in the Tanzanian Mining Sector Social accountability has been perceived as one of the important components of CSR practices regarding compliance by mining companies with Tanzania’s regulatory framework. Localized social accountability is regarded as crucial, especially if mining companies behave in a socially responsible manner. This entails creating an enabling environment that enables local communities to practice their role in it (Rutenge, 2016). Thus, mining companies have been perceived as legally bound to be socially responsible in compliance with various aspects that affect the local communities close to mining operation areas. To realize social accountability, the mining policy of Tanzania recognizes that LSM could lead to the relocation of communities and disruption of their livelihoods. One of the basic gains of mining operations is the compensations and financial flows of revenue from the mining company that in essence act as a catalyst for change and poverty reduction in communities (Venables, 2016). People who resettled to make way for LSM development are vulnerable to displacement and resettlement. The Tanzania Mining Act No. 14 of 2010 is the major framework that guides all mining activities, including compensation (Woodroffe et al., 2017). Section 14 (4d) of Land Act No. 4 of 1999 requires the provision of fair and prompt compensation before relocating communities. The Act also aims to ensure that involuntary resettlement is avoided or locals should secure sufficient investment resources (Woodroffe et al., 2017). As a general rule, the aim of compensation should be to improve the livelihoods of those affected by mining-induced displacement. The main consideration during

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compensation is productivity. According to the natural governance charter, effective governance of resources requires minimizing the costs for affected communities while enhancing the benefits. In addition, where these costs can be eliminated, the government should arrange for adequate compensation. The Tanzania Mining Policy recognizes that where relocation is inevitable, the government is responsible for valuing the land and property items of affected communities, and investors must pay for compensation, relocation, and resettlement (Woodroffe et al., 2017). However, there is a need to ensure that there is transparency in compensation procedures, proper valuations of land and other property items, adequate compensation rates, and prompt payment of compensation (Maliganya & Bengesi, 2018). On compensation, Kumi (2014) reveals that the nature of compensation to which an owner or lawful occupier may be entitled may include, without limitation to the cost of resettlement, the annual land rent and work the holder has carried out on the land and improvement. However, many concerns have been raised that the provision fails to consider the livelihood restoration of caretakers or squatters in the project area who are normally hard hit by the project impacts. According to the World Bank (2015), local people lack the skills to negotiate their interests effectively and as such bear the high cost of the depletion of their natural resources without the benefits of economic development, thus threatening their livelihoods. The economic security of mining operations is considered one of the components that need to be protected for sustainable development. The sustainable extraction of resources can enhance responsibility for social concerns while contributing to the realization of economic gains. Most mining companies in Tanzania have embraced corporate social reporting. For example, the Barrick Gold Company publishes substantial information about community relations and investment. Like other MMCs, the Barrick Gold Company has expressed its commitment to making a positive difference in the communities where it operates (Barrick Gold Corporation, 2005). In its 2005 report, Bulyanhulu Gold Mine stated that the company had spent US$ 275,000 (Tshs. 302.5 million) on supporting the local Bugarama secondary school and donated US$15,000 (Tshs. 16.5 million) to the District Council to support a government food relief initiative. At least US$186,000 (Tshs. 2 04.6 million) was spent in 2006 on upgrading a clinic in the district (Lauwo, 2011). Similarly, AngloGold Ashanti considers itself an integral part of the communities where it operates and a key instigator of economic development in the communities. The company also claims that it ensures that communities in the mining area are kept informed and are involved in developments that affect them throughout the life cycle of the company’s operations (Lange, 2006). Despite the several mining operations in the country, there have been some outcries regarding the emanating economic benefits. A study by Kitula (2006) in Geita District, Tanzania, found that only 8.1% of respondents in nonmining areas benefit from direct mining activities as a source of employment. In the 1980s, the Tanzanian government amended mineral policies for the sole purpose of creating a favorable investment climate for foreign mining companies. As a result, several small-scale miners and farmers lost their mine sites and agricultural and grazing lands. The long-term implications of such displacement include accelerated food

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insecurity for landless classes, increased poverty, and intensified environmental degradation. Maliganya and Renatus (2017) also revealed that the returns from the Geita Gold Mines (GGM) to the communities in Geita District have persistently been minimal. Similarly, the payments and royalties made by multinational corporations (MNCs) to governments have for some time not been fairly aligned to host countries’ demands. Moreover, pollution has been one of the global concerns of mining operations. Section 4 (1) of the Environmental Management Act No. 20 of 2004 provides for the right to clean and ensure a safe and healthy environment. Section 106 (1) similarly provides for pollution prevention and control (Woodroffe et al., 2017). Despite these elaborative provisions in the regulatory framework, waste management remains the key environmental effect of mining activities. Consequently, the use of natural resources in Tanzania has largely been characterized by unsustainable use patterns, with poor benefits the least from such resources (World Bank, 2015). Experience shows that extensive land clearance and open pits result in the destruction of vegetation, biodiversity of natural water, and restricted farming. As such, people in LSM areas are likely to be engulfed by poverty. Recent decades have witnessed a global push in research on postmining landscape restoration through physical and biological restoration and combination of both. Environmental restoration is described as the process of assisting the recovery of an ecosystem that has been degraded, damaged, or destroyed. The ultimate goal of the reclaimed land has always been not in favor of the community in the affected areas. While Tanzania has currently made considerable efforts toward improved governance of its mining sector and mining activities, efforts to restore the destroyed environment have been reflected much more in the literature than practically (Woodroffe et al., 2017). Therefore, there is a need for an integrated approach regarding the framework that could sustain the environment to provide directives for further uses by the community in this regard.

7 Challenges Facing CSR Practices in the Tanzanian Mining Sector While Tanzania’s Mining Policy does present some opportunities to be realized, its ability to ensure the achievement of the desired opportunities remains limited. Consequently, several challenges still exist in the sector that need attention if the mining sector is to contribute sustainably to the wider society. Therefore, this section highlights the challenges with greater emphasis on aspects related to land acquisition and resettlement as well as on the potential of artisanal and small-scale miners (ASM). The challenge is how to align the extraction and exploitation of resources and improve the livelihoods of communities for inclusive and sustainable development. As such, the costs and benefits of LSM operations to local communities have become an important subject (Nwapi, 2016). The Tanzania Mining Act of 2010

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acknowledges the role of CSR in promoting sustainable development by considering environmental protection and benefits to the community. However, one critical challenge that still exists in this context is the lack of legally binding frameworks that explicitly refer to CSR practices. Despite the impressive growth of the mining sector in Tanzania in the last ten years, critics propound that the sector has failed to deliver the expected windfalls to the rest of the economy (Kahyarara, 2015). The environmental and social impacts associated with LSM, including planning for mine closure, have not appropriately been addressed. Likewise, decisions on mineral projects have been made, with little and sometimes no consultation with local communities that are negatively affected in terms of their livelihoods. Although Tanzania embarked on comprehensive social and economic reforms to improve the policy and legal frameworks regarding mineral resources management, there are still some inadequacies (Kahyarara, 2015). The Tanzania Mining Act No. 14 of 2010 calls for the promotion of localization and economic linkages for a wider impact, but this has not been achieved in practice. Similarly, the Mining Policy of 2009 aimed to promote mining activities, enhance local content, reduce poverty, enhance the social and economic infrastructure, increase foreign earnings and government revenue, and encourage environmental safety and protection. However, the practice of achieving these objectives has remained elusive. While it is clear that the local content provisions are covered in the policy framework (Maliganya, 2020), it is surprisingly not fully elaborated in the Act. Although the government has established a local content policy for the nascent oil and gas sector, a local content policy in the mining sector is still underdeveloped, and there is no specific local content legislation properly governing mining investments. The Act does not impose any conditions regarding development objectives such as training and employment and sourcing of local goods and services. Tanzania has several legislations regarding land ownership and rights. The Tanzania Investment Act, No. 26 of 1997 stipulates that it shall be unlawful for any person to be deprived of his property without the authority of law, which makes provisions for fair and adequate compensation (Woodroffe et al., 2017). However, land acquisition and ownership are reported as problematic challenges of the mining industry under which landowners lose their land without or inadequate compensation. This is because valuation methods rarely capture either market value or the true costs of replacing lost assets (Kabote & Niboye, 2013). While this type of land acquisition is legally justifiable in Tanzania, it goes contrary to the right to adequate and prompt compensation to the affected, as provided in the provisions of Land Act No. 4 of 1999 and Village Land Act No. 5 of 1999. As a result, land laws do not provide adequate protection to rural communities affected by mining operations due to weak tenure rights over the land. Although ASM activities are numerous in Tanzania, the regulatory framework is largely rhetoric and lacks serious reinforcement. Previous studies have shown that the government and mining companies forcibly remove ASM and local communities to allow mining operations without adequate compensation (Kabote & Niboye, 2013). This suggests that resettlement programs are conducted without informed

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consent, causing persistent conflicts between local communities and LSM companies (Acuna, 2015). This implies that there has been a mismatch between policy statements, legal provisions, and reality on the ground. While Tanzania’s 2009 mineral policy strongly stresses the need to rationalize ASM into organized operations to ensure gainful employment, the investment environment has been a persistent challenge. Indeed, the regulatory environment in some cases has tended to give large-scale investors largely foreign firms more avenues to operate in the sector.

8 The Way Forward It is generally agreed that mining has a great potential to be a key growth sector in Tanzania, given the country’s vast and rich mineral resources base. The regulatory environment and the sociopolitical environment can determine the extent to which mining companies adhere to their CSR policies and initiatives, as they affect the characteristics of CSR policies and initiatives implemented by mining companies. In this way, policymakers should encourage the adoption, implementation, and compliance of CSR by mining companies for sustainable development. The Tanzania Mining Policy aims to provide clear guidance to investors toward enhancing the sustainable exploitation of mineral resources. Despite the advancements in the legal and regulatory framework, the sector has yet to fully contribute to the creation of equitable and sustainable development. The ineffectiveness of the regulatory framework largely stems from incapacities in monitoring compliance with legislative requirements. While there have been legal and policy provisions requiring that the sector be linked with the wider economy, the available literature blames the weaknesses of the legal and policy frameworks (Maliganya, 2020). There is a need to adopt models of resource exploitation that are equitable, participatory, and inclusive. Environmental impact assessment is a critical component of sustainable mining activities in the country. To date, numerous studies have highlighted several weaknesses, including inadequate or lack of accountability in enforcing the Environmental Management Act and a lack of meaningful stakeholder participation in decision-making. Some of the key challenges identified in this regard include a lack of financial resources for effective regulation and monitoring and a lack of local governance. Evidence suggests that the prerequisites of a successful mineral policy include a transparent legal and regulatory framework; competitive, stable, and strong institutions to implement them; and a sound environmental management system. It is increasingly becoming clear that civil societies’ involvement in the enforcement of environmental laws and rights is essential. The assumption is that the involvement of these stakeholders may increase the chances of enhancing accountability and transparency in the monitoring process of LSM operations. The Tanzanian government has recognized the importance of supporting the ASM. However, the efforts and support have often catered to the interest of LSM

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companies. One effect of this has been to exacerbate tensions and conflicts between the large-scale and small-scale sectors. If this challenge is not well addressed, it may lead to a far-reaching impact not only at the national level but also on the communities in proximity to LSM operations. There is a need to formalize the ASM sector, including by registering and organizing unregulated mining. While foreign mining companies consider Tanzania to be a favorable investment environment, there is a need to spell out the interests and rights of local communities to minimize the existing conflicts. Such efforts will include strengthening the legal, regulatory, and institutional framework governing the mining sector to include increased royalties and a mandatory minimum percentage of state ownership regarding mineral resource exploitation in the country.

9 Concluding Remarks This chapter has examined the performance of CSR practices in Tanzania’s mining sector for enhancing sustainable development. The chapter demonstrates that the adoption of CSR strategies in the mining sector has been shaped by broader norms. However, evidence shows that there is a mismatch between policy statements, legal provisions, and the reality on the ground. Consequently, this chapter argues that the establishment of CSR initiatives to share benefits from mining investments with local communities is a major step toward a comprehensive approach to addressing rural development in mining areas. The regulatory environment for Tanzania has also been inadequately supporting the principles of sustainable development in practical terms. Although mining companies may comply with mining legislation, they fail to contribute to socioeconomic development because the laws in the host countries are said to insufficiently support it and do not provide clearly defined benchmarks or set standards to be achieved. With this, mining companies tend to rely on strategies that are not legally binding. Unless these challenges are effectively addressed, a significant expansion of the mining sector may not lead to sustainable socioeconomic development, particularly at the local level. In terms of theoretical implications, the critical contribution of this chapter is reflected based on the application of the theories to illustrate the prevailing situation of local communities’ livelihoods in the vicinity of LSM operations in Tanzania’s mining sector using the Buzwagi and Geita goldfields. This chapter was motivated by a total of two theories (i.e., stakeholder and institutional theories) in explaining the relationship between the LSM sector and CSR. Whereas the SLF guided the study in examining the contribution of LSM companies to local livelihoods, the two theories were useful in examining gold mining companies’ compliance with Tanzania’s mining regulatory framework, engagement of local communities in mining operations, and improvement of local people’s capabilities. However, the situation on the ground is contrary to the expectations of the impacted communities. Some communities have been uprooted from having direct links to the natural

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resources they depend on for their survival as they have been relocated. LSM operations have led to environmental pollution (air, sound, and water), thus affecting ecological systems that in turn affect the health of the impacted communities. Although mining produces natural capital that ignites economic growth and generates employment opportunities among local communities, this in practice is not reflected much in terms of its achievement. Although mining companies can increase their productivity by investing in infrastructure and utilizing human resources and other resources, the achievement of these benefits from the sector remains low compared to expectations. That is why stakeholder theory emphasizes companies’ social responsibility by considering the interests of all parties affected by their mining operations. It is well known that, when well managed, the mining sector can create jobs, stimulate the transfer of technologies and knowledge, and generate valuable foreign exchange earnings. That is why CSR remains a strategy for controlling LSM operations by bringing awareness to human dignity and quality of life in the mining sector. The CSR arrangement ensures that LSM operations remain beneficial to the impacted communities in terms of adherence to the established regulatory framework. Generally, due to some institutional challenges and negligence in some ways, the mining companies’ operations did not benefit the communities as expected. CSR is composed of several elements and tends to vary from one country to another. That is why, to understand CSR, a set of theories along with SLF have been applied in this chapter.

10

Recommendations for Improving CSR in the Tanzanian Mining Sector

To ensure CSR operations in the Tanzanian mining sector, the authors recommend the following: First, the government should establish a legally binding framework that explicitly refers to CSR practices. Second, there is a need to have a transparent process in CSR operations known by the host the communities residing in the vicinity of the mining sites at the center of the decision- making process. Last, the involvement of civil societies is crucial for enhanced transparency and sound CSR operations.

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Dr. Willy Maliganya is a Tanzanian active researcher, lecturer, consultant, and author at the Mwalimu Nyerere Memorial Academy. He works under the Department of Leadership, Ethics and Governance. He holds a PhD and MA degrees in Development Studies from Sokoine University of Agriculture, Tanzania and BA with Education (Hons) majoring in Political Science, Public Administration, and History from the University of Dar es Salaam, Tanzania. His research interests are in natural resource governance, climate change, and gender- and development-related studies for improved local livelihoods. He has also worked as a researcher on issues related to community livelihoods in the context of large-scale mining operations. In doing so, he has published several research papers in local and international journals for the sake of knowledge sharing and provision of solutions to challenges facing the extractive sectors in Africa and Tanzania in particular. Besides, he has also attended several scientific conferences and authored several books for the sake of sharing knowledge to people.

Professor Kenneth M.K. Bengesi holds a PhD in Strategic Entrepreneurship and Business Management, Postgraduate Diploma in Economics and Management Sciences, M.Sc. in Agriculture biased in Soil Science and Land Management, and B.Sc. in Agriculture biased in Crop Science and Production. Currently, he is the Director General of the Sugar Board of Tanzania. Before he was appointed for this position, he worked as the College Principal of the College of Social Sciences and Humanities and as the Deputy Director of the Institute of Development Studies of the Sokoine University of Agriculture. Professor Bengesi during his academic life has supervised more than 125 Masters and PhD students in areas related to Strategic Entrepreneurship and Business Management, Strategic Investment, Impact of Multinational Corporation in Development, Business Innovation, Business Failure and Turnaround Strategies, Corporate Social Responsibility, Succession Planning and Performance of Small Businesses, and Public Private Partnership (PPP). Professor Bengesi has published intensively in both national and international journals and has managed a number of research projects as a project leader. As a researcher, Professor Bengesi was a principal investigator and a member of a consortium steering committee of the GLOBAL VALUE project, the largest funded European Union project under the Seventh Research Framework Programme. The GLOBAL VALUE project developed an innovative framework for assessing impacts of multinational corporations (MNCs) on issues related to the Millennium Declaration, sustainable development, human rights, transparency, and anti-corruption. Professor Bengesi was also a co-coordinator of an innovation hub and a component leader of research leadership and management of the SACIDS African Centre of Excellence (SACIDS-ACE) funded by the World Bank based at the Sokoine University of Agriculture.

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Max M. Mbota is a Tanzanian sociologist and anthropologist, and currently pursuing a doctoral project on the mining sector in Tanzania. He earned a BA (Hons) and an MA in Sociology and Anthropology from the University of Dar es Salaam, where he also worked as a tutorial assistant before joining the Mwalimu Nyerere Memorial Academy in 2006 as a lecturer. He facilitates research methodology. From 2008 to 2016, he worked as one of the bureau members in the Department of Research and Consultancy (DRC) and the Department of Social Sciences at the same time. He has also worked as one of the editorial teams of the Kivukoni Journal of the Mwalimu Nyerere Memorial Academy since 2014. In terms of research and consultancy, he has huge experience and has been working as a consultant with Waridi Consult Company Limited, in collaboration with senior consultants in the extractive mineral industry of Tanzania since 2006. He conducted scoping studies across the country, including Environmental Impact Assessments (ESIA), Environmental Management Plans (EMP), and Socio-economic Baseline Surveys on communities near gold, uranium, diamond, copper, and nickel mining operations. Dr. Gideon Bulengela is a trained sociologist/social anthropologist with MA (Sociology and Anthropology) and PhD in Aquatic Science from the University of Dar es Salaam, Tanzania. He works as a lecturer and researcher in the Department of Social Studies, Mwalimu Nyerere Memorial Academy. His area of expertise is society and natural resources, fisheries’ governance, and fishers’ local knowledge and qualitative research. Gideon has conducted several researches on natural resource governance. He has published several articles in international journals.

Whistleblowing Measures and Its Implications in the Nigerian Extractive Industry Onyeka Nwoha

1 Introduction Corporate social responsibility (CSR) is a comprehensive business philosophy that requires businesses to adopt wider and broader level of accountability and responsibility to meet the expectations of the community where these businesses carry out their operations (Amodu, 2017). It can be argued that CSR represents a perspective that is globally known and has become increasingly important as stakeholders have communicated that corporations are expected to do more than make profits. A huge motivation for the development of the business case for CSR was in response to Milton Friedman’s continuing arguments that businesses must focus on long-term profits. The implication of the arguments was that if businesses adopt CSR, then they would be rewarded economically and financially in the long run from a corporate financial perspective (Carroll, 2015). Corporations adopt CSR initiatives to build trust with host communities and mitigate the negative social and environmental impacts of their operations in these communities. Examples of CSR approaches include investing in healthcare, education and water supply and ensuring adequate compensation for any damages that occur during the activities of the corporations (Akporiaye, 2020). It has been contended that CSR is integral to the operations of multinational corporations (MNCs) in the extractive industry in developing countries, and by so doing, businesses should be committed to behaving ethically and contributing to the economic development of the community and society at large through the adoption of CSR approaches (Edoho, 2008).

O. Nwoha (✉) Nottingham Trent University, Nottingham, UK e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_11

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This connotes that in the extractive industry, CSR would entail balancing the demands of the community and the importance of protecting the environment with the objective of making profits. In the Nigerian extractive industry, there has been discourse about whether CSR has outlived its usefulness and the need to consider the adoption of other means such as corporate accountability to ensure that MNCs are held accountable for their activities in host communities (Egbon et al., 2018). The clamour for MNCs to be held accountable for their actions through corporate accountability initiatives has gained momentum. This is because the emphasis has always been on CSR which is voluntary with no resultant legal consequences for infractions as it allows for discretion for MNCs when considering their roles and the impact of their corporate activities in the community and environment. This preference for the adoption of corporate accountability is premised on the disclosure of information and the concept of transparency. The aim is to increase MNCs’ answerability and obligations to those affected by their activities through the use of strategies, policies and laws by which corporate accountability can be demanded of the MNCs (Odoeme, 2013). This chapter is divided into five parts including the introduction. The second part of the chapter discusses the utility of the current laws on transparency in the extractive sector with a focus on the Nigerian Extractive Industry Transparency Initiative (NEITI). Also, in this part of the chapter, weaknesses in the present framework on transparency and accountability regime in the extractive sector will also be dissected. The third part of the chapter discusses whistleblowing and how it has played a major role in promoting accountability and transparency in different sectors. The fourth part of the chapter discusses various strategies that can be used to implement whistleblowing measures in the extractive industry in Nigeria. Part four of the chapter will also suggest that due to the weaknesses of the transparency and accountability regime in the extractive sector in Nigeria, a standalone whistleblowing framework should be enacted. Arguably, like other sectors of the Nigerian economy, a standalone whistleblowing protection framework that will promote access to environmental information will have positive impacts on transparency and accountability in the extractive sector in Nigeria. The fifth part concludes the chapter.

2 Existing Transparency Initiatives in the Extractive Sector in Nigeria The extractive sector (which also includes oil and gas) in Nigeria amounts to a significant aspect of the Nigerian economy. Nigeria is the largest oil producer in Africa and has the largest natural gas reserves in the region (EIA Website, 2020). It was the fourth largest exporter of liquefied natural gas (LNG) in the world in 2018 (EIA Website, 2020). Notwithstanding that Nigeria is one of the largest oil producer in Africa, oil and gas production have been afflicted with a plethora of issues

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including armed violence, ineffective regulatory framework and the fluctuating oil prices, amongst other issues. Furthermore, the Nigerian economy is a monoeconomy (predominantly oil and gas based), and this has led to the neglect of other sectors of the economy including agriculture which hitherto was the mainstay of the Nigerian economy (Ako & Ekhator, 2016). The Nigerian oil and gas industry is largely located in the Niger Delta region of Nigeria. After more than 60 years of oil exploration in Nigeria, the Niger Delta environment and people have been at the receiving end of the negative externalities arising from exploration activities associated with the oil and gas industry. This has culminated in the severe environmental degradation, human rights violations by multinational companies and widespread environmental pollution in the Niger Delta region of Nigeria (Ebeku, 2008). To mitigate the failings in the extractive sector of Nigeria, different accountability and transparency measures have been developed in the country. One of the major accountability mechanisms in the Nigerian extractive sector is the Nigerian Extractive Industry Transparency Initiative (NEITI) which was launched in 2004 as part of the government’s transparency and anti-corruption efforts. The NEITI Act localises the Extractive Industries Transparency Initiative (EITI) in Nigeria. The aim of the EITI is to ‘promote understanding of natural resource management, strengthen public and corporate governance and accountability, and provide the data to inform policymaking and multistakeholder dialogue in the extractive sector’ (EITI Website). Notwithstanding that there are a multiplicity of laws and policies promoting transparency and accountability in the extractive sector in Nigeria, the industry remains afflicted with institutional challenges not limited to corruption, violence, lack of political will by government and its agencies to implement laws and absence of a standalone whistleblowing law in the extractive sector. To mitigate the challenges afflicting the extractive industry in Nigeria, this chapter suggests that a standalone whistleblowing framework should be established for the extractive industry. There are some existing transparency initiatives that were implemented in the Nigerian extractive sector to promote corporate accountability and transparency of corporations involved in the extractive sector in Nigeria. This part of the chapter focuses on the NEITI Act. The Nigerian Extractive Industry Transparency Initiative (NEITI) was launched in 2004 as part of the government’s transparency and anti-corruption efforts (Olujobi, 2021). According to section 2 of the NEITI Act, this law aims to encourage and guarantee due diligence in the payments made by extractive firms in Nigeria to the government of Nigeria. The NEITI Act explicitly provides for the involvement of civil society in its activities, and this is said to be one of the important contributions of the law to promoting transparency and accountability in the extractive sector in Nigeria (Ako & Ekhator, 2016). It was projected that the adoption of the NEITI would promote the disclosure of relevant information by the government and corporations involved in the extractive sector and enable stakeholders to hold them accountable which would encourage transparency and accountability in the sector (Ejiogu et al., 2019; Ejiogu et al., 2021).

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The NEITI’s reliance on audits is said to be one of the strategies that can be used to promote transparency in the extractive sector in Nigeria (Bassey, 2020; Ako & Ekhator, 2016). There have been divergent academic views on whether audits have had any positive impacts on the extractive sector. Some scholars believe that NEITI audits have had little or no impacts; others have argued that without audits, the extractive sector in Nigeria would have been in a worse state (Bassey, 2020; Lawrence & Victor, 2016). For example, Okeiyi (2016) argues that NEITI has had positive impacts on the extractive industry in Nigeria by promoting transparency and enhances the way the different stakeholders interact with each other (Hamad, 2020). On the other hand, the NEITI has released different audit reports on the payment of revenues by oil companies to the Nigerian government. However, corruption is still rife in the extractive industry in Nigeria (Bassey, 2020; Ejiogu et al., 2021). Little or no prosecution has been made by the government in respect of the companies and individuals that are answerable for the discrepancies in the revenue payments in the extractive sector (Aigbovo & Atsegbua, 2013; Hamad, 2020). Furthermore, a major weakness in the NEITI framework in Nigeria is the absence of a whistleblowing policy (Abutudu & Garuba, 2011). This is against the backdrop of the different corruption scandals that have been exposed within the NEITI and whistleblowers were said to be at risk (Bassey, 2020). This lack of a whistleblowing policy in the NEITI framework brings to the fore the need for the development of a standalone law or policy to protect whistleblowers in the extractive industry in Nigeria. Another major challenge in the extractive sector in Nigeria is the opacity of environmental information (Etemire, 2014). This is evident in the oil spill management/investigation and the report of the incidence of oil spills in the country (Amnesty, 2009). For example, there are contrary views on the amount of oil spills occurring in Nigeria, and most of the information is provided by the multinational corporations operating in Nigeria (Azubuike & Songi, 2020; Amnesty, 2013). Furthermore, the Nigerian government via its oil spill management agency – National Oil Spill Detection and Response Agency (NOSDRA) – also provides information on oil spills in Nigeria. This is done via the Nigerian Oil Monitor website, and this website provides information on the oil spills monitoring and management in Nigeria. On the other hand, many scholars including Ekhator (2020) and Watts and Zalik (2020, p. 791) have argued that in respect of the Nigerian Oil Monitor website (2020): But most notable upon a review of a review of the information is the poor quality of the official and publicly available data, and the substantial discrepancies that exist between different sources (for example between company data on spills the NOSDRA data and other Nigerian official such as the Department of Petroleum Resources (DPR) and the NNPC. Discrepancies of the order of 15–20% emerge in even a cursory comparison of NOSDRA and SPDC reportage of spill events.

In the extractive sector in Nigeria, with regard to oil spills, there are contradictory information or data by the MNCs and the several government agencies on the amounts of oil spills happening in the Niger Delta (Ekhator, 2020; Watts & Zalik, 2020). This is worsened by the regulatory framework of the extractive industry

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where the Nigerian government is a regulator, part-owner and major player in the industry (Ekhator, 2016; Brown, 2021). According to Brown (2021, p. 101), ‘This has been identified as one of the reasons for the lax regulatory regime in the petroleum sector in Nigeria’. The Nigerian judiciary have also highlighted the opaque nature of environmental information in the extractive industry. In Shell v Isaiah (1997), Justice Onalaja stated that: A vital consideration in the oil spillage cases is the extent of the oil spillage. The pattern of defence of the appellant has been to withhold from the court the report of the oil spillage carried out by their employees. In Tiebo’s case supra, the appellant’s report of the oil spillage was similarly withheld from the court. . . (Ako & Ekhator, 2016, p. 195)

3 A Case for Whistleblowing as an Accountability Measure Whistleblowing is a controversial yet topical matter that has existed for decades globally. Whistleblowing has also attracted considerable attention in the press, business and academic circles (Teo & Caspersz, 2011, p. 237). Consumer activist Ralph Nader is credited with having coined the term ‘whistleblower’ in the early 1970s (Miceli & Near, 2013, p. 435). Transparency International defines whistleblowing as a disclosure or reporting of wrongdoing related to illegal, corrupt and fraudulent activities in public and private organisations, which threaten public interest to individuals or regulatory authorities to effect action (Transparency International, 2013). A ‘whistleblower’ is a former or current employee who makes a legitimate disclosure about any wrongdoing (illegal or unethical conduct or activity) that is about to occur, has occurred or is occurring. Examples of wrongdoing include commission of a criminal offence, danger to the health and safety of individuals, bribery, abuse of power and authority, corruption, kleptocracy, misappropriation of funds, cronyism, money laundering and favour brokering. As a result, the person who discloses or reports the above-mentioned wrongdoings is considered a whistleblower. Whistleblowers have emerged as a vital component of corporate governance by virtue of their position and access to privileged information about wrongdoing within the workplace and in the society. As such, whistleblowing is now being amongst the most effective means of exposing and remedying illegal and unethical activities in the public and private sectors (Dixon, 2016). Whistleblowing regulation may be in the form of specific provisions in different laws, standalone laws, sectoral laws or mandatory internal whistleblowing procedure for corporations (Fasterling & Lewis, 2014, p. 72). Most countries have adopted specific whistleblower protections and others have approached it through labour laws or public sector employment rules, while only a handful of countries have adopted comprehensive whistleblowing legislation (Vandekerckhove, 2009). The existence of any type of comprehensive regulation signifies the recognition by the government that whistleblowing promotes good corporate governance and is core to

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the growth of the corporation. There is a common relationship between whistleblowing and the culture of a corporation. The reason for this assertion is simple; whistleblowing is a form of accountability measure and employees often witness wrongdoing in their corporation but may choose to keep silent. Their silence may not be of their own volition but rather due to the fear of retaliatory measures and absence of effective protection. Internationally, there has been encouragement for the support of whistleblowing particularly in dealing with the area of good governance and corruption. Effective whistleblowing protection mechanisms are a key part of corporate governance. This is because whistleblowing can be used as a valuable tool to promote corporate accountability in the corporate governance strategy of an organisation. Furthermore, the increasing global encouragement for the reporting of corporate wrongdoing has led to changes in the way organisations operate, particularly in how they promote transparency and ethical culture within the workplace. Regulation of whistleblowing and the protection of whistleblowers has an impact on corporate transparency, accountability and culture. In disclosing wrongdoing in both public and private sectors, workers may be uncertain of how to properly raise their concerns using the right disclosure channels. The presence of a regulatory framework by way of a whistleblower protection legislation plays an important role in solving this dilemma. This is because an effective whistleblower protection framework paves the way for good corporate governance by providing the modes and channels of making disclosures including protection from retaliatory measures. This in turn creates an avenue for an organisational culture that promotes transparency and accountability (OECD, 2016). Whistleblowing is a process that needs to be critically examined before, during and after a legitimate disclosure has been made. When it is viewed as a process, it then requires an effective regulation that provides clarity on the type of wrongdoing that can be disclosed about, channels of disclosure, investigation of wrongdoing, procedures to encourage legitimate disclosures and protection from retaliatory measures. The presence of a robust whistleblowing regulatory framework that is statutory may encourage potential whistleblowers to report legitimate concerns and help to maintain a safe environment. Again, in whistleblowing protection, it is relevant to note that when drafting a legislation to regulate whistleblowing, there is need for clarity as to the big and small picture that is sought to be achieved. There must be an awareness on how the law which will always be something of a command-and-control instrument can avoid doing harm while being as effective as possible in securing the desired result (Nwoha, 2021). Although retaliation for making legitimate disclosures is a global problem and not cultural to a specific jurisdiction, there is also a need to consider other factors, for instance, the social, legal and economic realities in the country which influence people’s behaviour when faced with addressing any type of wrongdoing. The decision to legitimately make a disclosure presents a peculiar problem from different standpoints. There is a moral standpoint that potential whistleblowers are faced with when trying to decide whether to prioritise public interest and there is

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a legal standpoint of how legislative measures will effectively protect them from retaliation and address the wrongdoing that has been disclosed. The Nigerian extractive industry has been riddled with cases of corruption and non-conformation to best practices which has been to the detriment of stakeholders in this industry (Okafor et al., 2020). The next part of the chapter explores how whistleblowing measures can be used to promote transparency and accountability in the Nigerian extractive industry.

4 Implementing Whistleblowing Measures in the Nigerian Extractive Industry This part highlights some of the relevant laws in the extractive sector and if they have any impact on promoting accountability and transparency. Also, this section investigates if the range of laws in the extractive sector have had any impact on the opacity of environmental information in Nigeria. In Nigeria, there is no whistleblowing law; thus, individuals and civil society groups cannot provide confidential (environmental) information publicly (Ekhator, 2013; Ekhator, 2014). This is mainly due to the fear of retaliation and lack of protection for coming forward with legitimate disclosures about wrongdoing. For example, in 2013 a whistleblower who exposed a series of (alleged) corrupt activities by the Minister of Aviation was threatened with prosecution because according to a senior government official, the whistleblower’s action was tantamount to a criminal offence (Saharareporters, 2013). Furthermore, many of the laws regulating the extractive industry in Nigeria have little or no provisions for protecting whistleblowers (Ekhator, 2014). For example, section 1 of the Harmful Waste (Special Criminal Provisions) Act (2004) prohibits the illegal dumping of hazardous wastes in Nigeria. Unfortunately, this law provides no protection for whistleblowers who report incidence of hazardous dumping by companies in the extractive industry (Ekhator, 2014). If an employee raises an alarm about hazardous dumping of waste, such an employee has no protection under the law in the Nigerian extractive industry, and the ‘employee can be dismissed and many of the existing laws provides no remedy for such an employee’ (Ekhator, 2014, p. 201). Thus, there is the general absence of whistleblower protection under Nigerian laws (including the extractive industry). The Nigerian government has developed some whistleblowing provisions in some laws and guidelines, and this has been especially evident in the corporate sector of the Nigerian economy. Furthermore, different iterations of the Whistleblower Protection Bill have come before the National Assembly in Nigeria and to date, the bill is yet to be passed into law. Different stakeholders including civil society organisations (CSOs) and activists are in favour of the enactment of a whistleblowing law in Nigeria (Vanguard Newspaper, 2021).

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Additionally, the Nigerian constitution ensures the right to freedom of the press and freedom of expression in the country. Section 39(1) of the 1999 constitution states that ‘everybody shall be entitled to freedom of expression, including freedom to hold opinions and to receive and impart ideas and information without interference’. However, this section has been stridently criticised on the basis that ‘it neither creates an explicit right to access information, nor does it impose a state duty to communicate information’ (Orji, 2012, p. 89). It should be noted that the Nigerian constitution does not provide for whistleblowing protection in the country. In 2011, the Freedom of Information (FOI) Act was enacted to allay the failings in access to public information in Nigeria (Odinkalu, 2011; Ekhator, 2014; Onakoya, 2013). Based on section 1 of the FOI Act, Nigerians have the right to be granted access or seek information within the purview of government agencies or public officers. Furthermore, individuals wishing for such information can file a legal action to compel compliance by the government agencies (institutions) or public officer (Ekhator, 2014). Furthermore, it should be noted that FOI Act protects whistleblowers in the public sector and the private sector is excluded from the applicability of the FOI. However, scholars including Etemire (2014, p. 159) have argued that FOI Act does not differentiate ‘environmental information from other types of information held by public authorities in Nigeria’. On the other hand, scholars including Ekhator (2014) and Nwapi et al. (2021) have argued that FOI Act can be a strategy that can be used to improve the opacity of environmental information in the extractive industry in Nigeria. For example, FOI law has been used by the Socio-Economic Rights and Accountability Project (a Nigerian-based NGO) as one strategy to pressure the federal government to enforce the decisions of the ECOWAS Court of Justice on the Nigerian government regulatory failures in the Niger Delta (Premium Times, 2013; Ekhator, 2014). SERAP in collaboration with Amnesty International filed a freedom of information request requesting information on the actions the government is taking to fully execute the judgement by the ECOWAS Court of Justice (Premium Times, 2013). Unfortunately to date, the Nigerian government is yet to respond to the Freedom of Information from SERAP, and many of the ECCJ decisions (involving the Nigerian government) are yet to be implemented in Nigeria (Vanguard, 2022). Nevertheless, it can be argued that FOI law has improved access to public information by citizens in Nigeria; however, access to environmental information remains difficult (Orji, 2012). Another drawback of the FOI Act is that most of the environmental information is held by private companies, especially MNCs in Nigeria (Ekhator, 2014). For example, oil MNCs frequently refuse to provide information on oil spills in Nigeria (Watts & Zalik, 2020). However, information provided by oil MNCs sometimes conflicts with other sources of information (Ekhator, 2014; Ekhator, 2020; Watts & Zalik, 2020).

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Case for a Standalone Whistleblowing Protection Law and Policy in the Extractive Industry in Nigeria

In the decades of multinational oil corporations’ operations in Nigeria, there has been series of issues relating to corporate accountability and transparency, and this has posed challenges in implementing effective measures for regulating the activities of these multinational corporations in Nigeria. Karl argues that the factors that contribute to high levels of corruption in resource-rich developing countries is the lack of political will of the government in these developing countries to effectively combat the illicit activities of multinational corporations operating in host states (Karl, 2003). It can also be suggested that the activities of these multinational corporations can undermine attempts made by the government to encourage transparency and accountability in the extractive sector. It can be argued that the implementation of whistleblowing measures may be an effective way to combat these issues in the Nigerian oil and gas sector. The lack of statutory protection for whistleblowers in the Nigeria is blatant, and it is contended that whistleblowers will continue to face retaliatory actions without a legal framework in place. The Nigerian Labour law does not also acknowledge whistleblowing or the fact that an employee can be unfairly dismissed for making a legitimate disclosure about a wrongdoing in their workplace (Idubor, 2000). Nigeria is long overdue for a robust whistleblowing regulation preferably in the form of a legislative tool like a whistleblower protection legislation. The approach of Nigerian policy makers to enact a whistleblowing protection law leaves more to be desired because a few years ago, there was a high momentum for implementing a federal whistleblowing policy. This clearly shows a lack of political will to move forward with implementing a whistleblower protection legislation to statutorily provide protection for whistleblowers that are courageous enough to come forward with legitimate disclosures. In December 2016, the Federal Ministry of Finance (FMF) introduced a whistleblower policy to encourage disclosure on certain areas like misappropriation and theft of public funds, bribery, diversion of funds and fraudulent activities. The policy also stipulated those legitimate disclosures would be rewarded with 2.5%–5% of the value of the recovered funds from any disclosure made (Eme & Oji, 2021). While this policy has been somewhat effective with several discoveries made that has led to the recovery of looted funds, it is however a temporary solution to a much bigger problem. This move to offer financial reward is like the approach taken by the United States under the False Claims Act and the Dodd-Frank Act which makes provision for financial reward to encourage whistleblowers to come forward with information about the matters covered under the policy. In following the footsteps of the US Dodd-Frank Act, the whistleblowing policy provides conditions for accepting disclosures in return for financial awards by stipulating that to qualify for any financial reward, the whistleblower must provide information that is not already available to the federal government or information that was not available in a public source. This means that to receive any financial award under this

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whistleblowing policy, the actual recovery of the public asset or funds must be a wrongdoing personally witnessed by the whistleblower (Ogbomo, 2019). The Federal Ministry of Finance (FMF) whistleblowing policy defines a whistleblower as an individual who legitimately makes disclosures in the public interest to the federal government through the Federal Ministry of Finance about an illegal activity or wrongdoing that has occurred, is occurring or is about to occur. The FMF in implementing the whistleblowing policy included a broad range of illegal and illicit activities under which reporting persons can make disclosures about using the reporting channels provided under the policy. These activities include information on misappropriation of public funds and assets which also covers properties or vehicles acquired using public funds, disclosures on fraud and financial malpractice, disclosures on bribes which also covers active and passive bribery, corrupt activities, theft, diversion of government revenues, conversion of funds for personal use, fraudulent and unapproved payments and procurement fraud which includes taking kickbacks and over-invoicing for government contract (Ogbu, 2017). Furthermore, the FMF’s whistleblowing policy categorises a reporting person as any individual with legitimate information about the illegal and illicit activities covered. This includes internal stakeholders which cover employees in government institutions and inter-government stakeholders which also include government agencies, institutional stakeholders and members of the public (Ogbu, 2017). However, the FMF whistleblowing policy has several shortcomings. First, it does not have any statutory backing; there is no legislative tool in place to legally stipulate the framework of the policy, and there is also no legislation that adequately provides for the protection of whistleblowers in the event that their identities are disclosed. More importantly, there is no statutory framework to mandate the federal government to pay the whistleblowers the stipulated amount if the federal government back tracks from upholding their end of the policy by withholding the financial reward (Egboh & Akobundu, 2020). Perhaps while attempts are being made to implement a federal whistleblowing protection legislation, it is suggested that a whistleblowing policy for the Nigerian extractive industry be implemented to encourage transparency and the legitimate disclosures of unethical and illegal practices by government officials and multinational corporations operating in the Nigerian extractive sector. This might be a possible solution for engaging stakeholders to come forward to make legitimate disclosures in the public interest. Civil society organisations have been instrumental in attempts made to combat illicit practices and environmental degradation in the Nigerian extractive industry (Lemaître, 2018; Ako & Ekhator, 2016). Civil society organisations have played critical roles in the regulation and support for whistleblowing frameworks to effectively provide protection to whistleblowers in organisations. Some noteworthy contributions from these international organisations include publishing best practices for implementing whistleblowing frameworks, assessing and reviewing the whistleblowing frameworks in countries globally, sensitising members of the society about the importance of whistleblowing, collaborating with governments to implement whistleblowing regulatory frameworks and

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providing legal assistance to whistleblowers that have faced detrimental actions as a result of their whistleblowing disclosures(Transparency International, 2013). Civil society organisations create a positive image for whistleblowing in any jurisdiction and should be involved in any attempt to provide a whistleblowing regulatory framework that will encourage whistleblowers to come forward with disclosures (Mansbach, 2007). Whistleblowers need to feel safe and confident that the reporting channels they use will protect their interest and champion their concerns. Civil society organisations have proven to make a positive impact for decades. Particularly, civil society organisations in Nigeria have played a key role in providing support for whistleblowers. Furthermore, it stands to reason that the presence of a whistleblowing policy in the Nigerian extractive industry will motivate the disclosure of the adverse impact of the operations of multinational corporations in the environment. This can also be an avenue for policy regulators in Nigeria to ensure that multinational corporations are transparent and accountable in their environmental operations (AFRICMIL, 2018). This chapter argues that there should be standalone whistleblowing law or policy in the Nigerian extractive industry. This will improve access to environmental information and protect whistleblowers in the extractive industry. Arguably due to the lack of whistleblowing regime, weak regulatory framework and the power dynamics in favour of MNCs, whistleblowers are scared to report any negative disclosures in the extractive industry (Olujobi, 2022). Therefore, a whistleblowing law or policy will enhance or improve transparency and can be a tool to fight the scourge of corruption in the extractive industry in Nigeria. This chapter suggests that a standalone law akin to information-centred regulation or law should be enacted in the extractive sector in Nigeria (Ekhator, 2014). Kleindorfer and Orts (1996, p. 6; Gunningham, 2009, p. 198; Ekhator, 2014) define information-centred regulation as ‘regulation which provides to affected stakeholders information on the operations of regulated entities, usually with the expectation that such stakeholders will then exert pressure on those entities to comply with regulations in a manner which serves the interests of stakeholders’. The information-centred regulatory model is typified by the US Emergency Planning and Community-Right-to-Know Act (EPCRA) which was passed in 1986 because of the Bhopal disaster in India and explosion at a Union Carbide facility in West Virginia, USA (Purifoy, 2013, p. 377; Gunningham, 2009; Ekhator, 2014).The EPCRA has been said to be effective and the inspiration for analogous initiatives in other parts of the world and the Global Reporting Initiative (Gunningham, 2009; Ekhator, 2014). Perhaps, the protection of whistleblowers bill might be enacted soon in Nigeria, and it may spread to the extractive sector. This chapter argues that a whistleblowing promotion law will act as an anticorruption tool and one of the strategies that can be used to promote accountability and transparency in the extractive sector in Nigeria.

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5 Conclusion Nigeria has grappled with significant issues of corporate accountability and transparency for decades, particularly in the Nigerian extractive industry. Despite attempts from the government to implement measures to encourage transparency and accountability, these issues are still yet to be resolved in the jurisdiction, albeit the Federal Ministry of Finance whistleblowing policy played a huge impact in exposing some of these acts with the discoveries that were made from whistleblowing disclosures. Hence, the need for a statutory framework for whistleblower protection should be of utmost importance to law makers irrespective of the challenges faced. It is also posited that if effectively enacted, the whistleblower protection law can be a useful tool in leading to the discovery of illicit acts in the public and private sectors and possibly stopping these acts of wrongdoing timeously (Lanrewaju & Dare, 2018). Again, this will depend on the zeal of reporting and investigating authorities to follow through with properly investigating these whistleblowing disclosures. However, the implementation of whistleblowing laws or policies will enhance the CSR initiatives of MNCs operating in the extractive sector in Nigeria.

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Teo, H., & Caspersz, D. (2011). Dissenting discourse: Exploring alternatives to the whistleblowing/ silence dichotomy. Journal of Business Ethics, 104(2), 237. Transparency International. (2013). International Principles for Whistleblower Legislation; Best practices for laws to protect whistleblowers and support whistleblowing in the public interest. Vandekerckhove, W. (2009). European whistleblower protection: Tiers or tears? http://ssrn.com/ abstract=1793130 Vanguard Newspaper Nigeria. (2021). NGOs wants whistle blowers protection bill passed. https:// www.vanguardngr.com/2021/11/ngo-wants-whistle-blowers-protection-bill-passed/ Vanguard Newspaper Nigeria. (2022, April 3). Obey ECOWAS Judgment, end prosecutions for ‘insulting public officials’. SERAP tells Buhari. Amnesty, SERAP demand FOI on implementation of ECOWAS court ruling on Niger Delta - Premium Times Nigeria (premiumtimesng.com) Watts, M., & Zalik, A. (2020). Consistently unreliable: Oil spill data and transparency discourse. The Extractive Industries and Society, 7(3), 790–795. Dr Onyeka Nwoha is a lecturer in law at the Nottingham Law School, Nottingham Trent University, United Kingdom. She was previously an associate lecturer in law at De Montfort University. She holds a Master of Laws (LLM) in International Corporate and Commercial Law from the University of York and a PhD in Law from the University of Leicester. Onyeka has also been called to the Nigerian Bar as a Barrister and Solicitor of the Supreme Court of Nigeria. Her main research areas include whistleblowing protection and regulation, company law and corporate governance.

Connivance in Criminality: Corruption and Corporate Social Responsibility in Nigeria’s Oil Sector Halimatu Muhammad Bande

1 Introduction Any discourse on issues of corruption in Nigeria must invariably begin with a historical profile of the country. Nigeria, a West African state regarded as the Giant of Africa and the most populous Black Country on earth, is arguably one of the most notorious countries in regard to corruption. With more than 200 million people belonging to more than 250 ethnic groups who speak approximately 500 different languages, Nigeria is one of the most heterogeneous states on earth. Despite its heterogeneity, however, the country has historically managed to, and in some instances, has struggled to, overcome turbulent political trajectories in its colonial and postcolonial eras. Structurally, Nigeria is a federation of 36 states, with Abuja serving as the Federal Capital Territory (FCT). The component states are further divided into 774 local government areas for the sake of administrative effectiveness and efficiency. In accordance with the principles of federalism, Nigeria operates a federal constitution that is noticeable for its rigidity. Officially called the 1999 Constitution of the Federal Republic of Nigeria, it provides for the principles of separation of powers and checks and balances between and among the three arms of government, namely, the executive, legislature, and judiciary. The executive is headed by a president who serves as both the head of government and head of state. The National Assembly is the official name of Nigeria’s legislature and is divided into upper and lower chambers, i.e., the Senate and House of Representatives, respectively. The Senate has 109 members and is headed by a Senate President, while the House of Representatives has 360 members and is headed by a Speaker. The two

H. M. Bande (✉) Federal University, Birnin Kebbi, Nigeria e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_12

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chambers are responsible for making laws for the whole country. Responsibility for law interpretation in Nigeria is saddled with the judiciary, which is made up of lower courts such as Shari'a, Customary, and Magistrate courts and higher courts such as Courts of Appeal and Supreme Court. While these arms are established to administer and promote justice, they have arguably been the protectors, sustainers, and promoters of corruption in Nigeria. The cases of corruption have in recent times been rampant in Nigeria’s transnational corporations (TNCs) vis-à-vis the discharge of their corporate social responsibility (CSR) in host communities. Of course, the Niger Delta region may instantly come to mind in this context. Over the years, oil TNCs that operate in the Nigerian Niger Delta region have increasingly embraced CSR as a community development strategy due to the rising conflicts and corrupt activities that characterized the relationship between TNCs and the oil-producing communities. These conflicts are due to the degradation of the ecology of the host communities by the activities of the oil-producing companies and the undue regard for the socioeconomic development of the area. The use of the instrumentality of CSR to play a crucial role in the sustainable and socioeconomic development challenges of host communities is not borne out of a genuine concern for developing host communities and mitigating the effect of their activities on the local economy; instead, it promotes the traditional business values of profit-seeking and securing a social license to operate (Dandago & Arugu, 2014). Generally, corporate social responsibility (CSR) is seen as a commitment by businesses to contribute to sustainable development and improve the quality of life in the workplace and society (Lanton, 2001, p. 595; World Business Council for Sustainable Development, 2002). This commitment is better demonstrated in regions such as the Niger Delta, where the activities of oil-producing companies cause environmental degradation, pollution, and other setbacks in their pursuit of profit maximization. The local communities pay dearly for hosting those companies as they suffer considerable economic and social damages, suggesting the need for adequate compensation from the Nigerian government and the oil TNCs. However, the financial records of the major oil TNCs operating in oil-producing regions demonstrated the rise in budgetary allocation to CSR projects, which sharply contradicts the reality on the ground. For instance, in 2006 alone, Shell spent $59 million and paid $114 million to the Niger Delta Development Commission (NDDC) (Aaron & Patrick, 2008). If the money had been used judiciously for projects that are long term in nature, based on the sustainable development needs of the region, the projects could have amounted to marked improvement in the welfare of the people and progress of the Niger Delta (Nweke, 2014). It has been argued that the CSR projects of oil TNCs are primarily informed by short-term exigency rather than the long-term development needs of the host communities due to the intensity of corrupt practices among the various stakeholders within the region (Allen & Eze, 2019). This is substantiated by the argument put forward by Frynas (2012) that the Nigerian Niger Delta region is littered with unfinished projects, designed as health centers, schools, inconsumable water projects, or unequipped building structures. This truly reflects the general situation in the Nigerian Niger Delta region because records show that the region is replete with

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overhead tanks of incomplete or poorly completed and dysfunctional water projects initiated by oil TNCs as part of CSR strategy to bring about much needed sustainable development and socioeconomic development to host communities (Dandago & Arugu, 2014). Therefore, there is a general consensus that CSR as a community development strategy in the Nigerian Niger Delta region has failed, going by the level of underdevelopment in the oil-producing communities and the attendant incident of violent conflict that still persists in the region. To dive into the major discourse of the subject matter, the study is divided into four sections. Aside from the introduction above, section one focuses on corporate social responsibility and its theoretical underpinnings, section two is centered on CSR in the oil sector in Nigeria, section three examines CSR and corruption in the oil sector, and section four concludes the study.

2 Corporate Social Responsibility (CSR): Theoretical Underpinning Theoretically, the idea of corporate social responsibility (CSR) is open to several notions, and it is perceived in different ways by different people. At the initial stages of the evolution of CSR, it was distinguished as an organization’s duty to extend its economic responsibilities into ethical, social, and legal obligations and philanthropies (Bravo et al., 2011). Kottler and Lee (2005) support the view that CSR is an organization’s commitment to improving community well-being through discretionary or voluntary business practices and contributions of corporate resources. Thus, from this perspective, CSR is more concerned about philanthropic responsibility, that is, voluntary contributions to uplift the people’s living standard, particularly within the immediate community, than about profitability, ethics, or compliance with appropriate legal provisions. Prior to the above description, Carroll (1991) has classified CSR into four components: economic, legal, ethical, and philanthropic responsibilities, with economic responsibilities forming the foundation of the CSR pyramid and the philanthropic responsibilities occupying the topmost level of the pyramid, which involve being a good corporate citizen and participation in initiatives or programs that promote human welfare or goodwill. In a related term, Darsono (2009) posited that an organization as a rational actor is highly committed to CSR when it adopts and defends stakeholder-friendly values and norms and interlinks them with organizational processes to maximize their positive impacts and minimize their negative impacts on all stakeholders. Thus, the main focus of CSR is to determine the responsibilities of companies within the social landscape. This is done by addressing business ethics, environmental concerns, corporate governance, and many others. Advocates of CSR are keen to point out that organizations have responsibilities that exceed the production of goods, services, and profit making and that socially responsible organizations can contribute to resolving critical social and environmental predicaments. It is worth noting that

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CSR is operationalized in diverse ways, including protecting the environment, fostering the community, providing services to disabled customers, ensuring employee diversity, upholding effective occupational health and safety standards, fairness to suppliers and customers, periodically auditing CSR compliance and reporting the outcome to the public, and publishing only honest information (Musa et al., 2013). Proponents of CSR argue that firms with high levels of engagement in socially responsible activities have the advantage of being viewed as better managed and are, therefore, less risky (Moore, 2001, p. 306). They further suggest that economic performance is enhanced due to such businesses avoiding expensive fines, reducing waste, and recruiting higher caliber employees. To benefit from these advantages, oil TNCs operating in the Nigerian Niger Delta region should engage in high levels of socially responsible activities to assist the local communities in achieving sustainable development. However, there are counterarguments against CSR. Advocates of such opinion affirm that CSR collapses the market by diverting businesses from their primary role of profit generation (Henderson, 2001). They posited that the profitmaking role of businesses should be the determinant of their responsibilities and that the only social responsibility of businesses should be compliance with the law. Generally, CSR can be explained as the deliberate efforts by a business organization to maximize its positive impacts and minimize its negative consequences on society. Therefore, CSR policies in the Niger Delta region, whose environment has been degraded due to the harmful effect of the oil industry, are aimed at mitigating the devastating impact on the environment to engender sustainable and socioeconomic development in the local economy. According to Aaron and Patrick (2008), there are two schools of thought in a long-standing debate on CSR. First is the stakeholder theory. The argument is that business owes its stakeholders a social responsibility beyond producing goods and services and profit-seeking. Indeed, proponents of this view are quick to point out that even on a scale of profitability, corporate involvement in good works can improve a company’s value in the stock market. Stakeholder theory is a notion of organizational management and business ethics that focuses on issues of morals and values in managing an organization. It was initially proposed and elaborated by Freeman (1984). It identifies and patterns the groups that are stakeholders of a corporation and describes and suggests devices by which a corporation’s management can accord proper matter to the interests of those groups. The theory, however, argues that there are other parties (including governments, political groups, trade associations, communities, financiers, suppliers, employees, and customers) encompassed in the aims and aspirations of the firm (Fassin, 2012). Sometimes even competitors are counted as stakeholders, their eminence resulting from their ability to determine and shape the firm and its other ethically justifiable stakeholders (Ranangen, 2017). Furthermore, stakeholder theory asserts that a company should create and distribute value to many stakeholders depending on the support and cooperation of the stakeholders themselves. The survival of a company is conditional on the benefits the stakeholders receive from the company, and it is the full responsibility of the

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company to provide these benefits (Freeman et al., 2006). Stakeholder theory encourages businesses to heed all their stakeholders. This implies fair treatment, consideration, and respect for all the firm’s stakeholders. This theory urges and fosters transparency between the company and its stakeholders (Frooman, 1999; Frooman & Murrell, 2005; Freeman et al., 2006; Elijido-Ten et al., 2010). The second school of thought is the stockholder view, a counterargument popularized by Friedman (1970). According to this view, business has no place in social responsibility. Indeed, it contends that corporate involvement in philanthropy not only distorts the market but also robs shareholders of their wealth. Arguing further, Friedman (1970) explained that the only social responsibility of business is to increase its profit. According to him, there is one and only one social responsibility of a business to use its resources and engage in activities designed to increase its profit so long as it stays within the rules of the game, which is to say, engage in open and free competition without deception or fraud. Therefore, the debate rages on, one as a perspective that seeks to promote shareholders’ interest and, on the other hand, a perspective that justifies and rationalizes CSR as a proactive strategy for promoting corporate morality and good corporate citizenship (Blowfield, 2007). However, the truth is that businesses do not operate in a vacuum; they operate within a social context to which they can ill-afford to be irresponsive. In a nutshell, in conflict-prone zones such as the Nigerian Niger Delta area, oil TNCs have shown much enthusiasm for social responsibility, primarily to secure the social license to operate peacefully in the area (Aaron & Patrick, 2008). Oil TNCs are becoming more sensitive to environmental issues, sustainable development, and socioeconomic development of their host communities. This is informed by the increasing pressure put on them by the host communities (Dandago & Arugu, 2014). Therefore, it can be argued that conflict results when business enterprises fail to accommodate societal goals alongside their corporate goals, such as the situation in the Niger Delta region.

3 Corporate Social Responsibility (CSR) in the Oil Sector in Nigeria Generally, the Nigerian economy relies on the revenue generated from oil MNCs in the Niger Delta region; as such, the region has become a theatre of incessant violent conflicts and corrupt practices (Ekhator, 2014). Some of the negative consequences of the MNCs in the oil sector in Nigeria include gas flaring, oil spills, environmental pollution, negative social impacts, and conflict. As a result of these negative impacts, the MNCs operating in the oil sector in Nigeria have engaged in a series of initiatives to mitigate these consequences and enhance community development in the Niger Delta (Egbon et al., 2018). Many oil MNCs in Nigeria, such as Shell, Chevron, and other TNCs, are involved in a myriad of CSR initiatives in the Niger Delta and other parts of the country. These initiatives in Nigeria may include building schools, hospitals, and markets and the

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provision of pipe-borne water, among other initiatives. However, the extent to which CSR initiatives have contributed to bridging developmental gaps in the region is highly controversial. Despite various CSR mechanisms by oil companies in Nigeria, oil-producing communities have received a proportionately low amount of benefit compared to the high social and environmental costs of extractive activities (Lisk et al., 2013). Many communities in the Niger Delta still suffer from various ills, including gas flaring, oil spillage, and violence despite the minimal contributions of CSR to oil-producing communities in the region. Arguably, the Shell Petroleum Development Company (SPDC) and other oil companies have adopted various CSR strategies. The strategies adopted include philanthropic projects and scholarship awards, cash payments, agricultural projects, schools, healthcare centers, and roads. However, several problems suggested that these measures were inadequate over the long term. For instance, the approach to CSR adopted by the SPDC and other oil companies seems to be predicated on the primacy of business objectives and focused on fulfilling only the most minimal ethical obligations. Underlying this approach is the assumption that the economic goals of the business are incompatible with the developmental aspirations of the local communities. Based on this premise, CSR practices vary from legal compliance and providing the moral minimum (DesJardins, 2006). Reliance on this narrowly defined business focus prevented oil companies from taking proactive steps in designing and implementing CSR programs. Therefore, despite millions of dollars invested in community help projects, observers and the communities perceived CSR practices in the Niger Delta as cosmetic attempts to act in a socially responsible manner or as actions taken only to protect the companies’ reputations (Ite, 2004). Similarly, CSR projects were not designed to address urgent economic, environmental, and social problems. For example, SPDC’s gifts of schools and healthcare facilities were presented as one-time offers instead of as sustainable projects (Ite, 2004). The continuation of gas flaring, despite calls for reduction, is another example (Federal Republic of Nigeria, 2006, cited in Ogula, 2012). Although oil companies have attributed the slow progress to the costs of implementing alternative systems, continued gas flaring suggests a lack of urgency concerning a severe environmental problem. Ad hoc implementation of CSR projects and the failure of the Nigerian government to respond to the needs of the region left the burden of dealing with the negative consequences of oil extraction on the communities (Evuleocha, 2005; Idemudia & Ite, 2006). Furthermore, the integration of community development and self-help projects in CSR strategy in the Niger Delta did not occur until the mid-1990s. The evidence suggests that early attempts at community help projects and infrastructure development were reactive (Ite, 2004). The oil companies integrated CSR into corporate strategies only when hostility against the companies intensified. Additionally, the lack of a coordinated strategic approach to implementing CSR produced uneven inconsistent results that had little impact on the people of the Niger Delta (Idemudia & Ite, 2006). The millions of dollars spent on scholarships, schools, and agricultural extension projects have had no impact on poverty alleviation or the region’s socioeconomic development. The absence of a comprehensive emergency response plan

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to address oil spills in the region illustrates this point. The oil companies’ response to such environmental disasters rarely extends beyond the villages near communities downstream where farmlands and rivers have been equally ruined. The oil companies have also made little effort to extend CSR projects to the region’s poorest and most ecologically devastated communities (Evuleocha, 2005). CSR is making tremendous progress in local community initiatives in the Niger Delta and other parts of Nigeria. The CSR initiatives of oil MNCs have enhanced access to basic capabilities such as shelter, water, and electricity but have also weakened human development (Lompo & Trani, 2013). Therefore, CSR has positively affected some of the people and communities close to oil production sites, but inequalities remain entrenched in such communities (Aaron, 2011). On a general note, CSR practice in the oil sector in Nigeria is voluntary and is part of corporate strategy. This is evident in SPDC’s shift in CSR policy from community development (CD) to sustainable community development (SCD). The new SCD strategy improves company-community relations in the Niger Delta (SPDC, 2004, 2005). SPDC’s new approach emphasized strategic partnerships with the government, international development agencies, and communities. To demonstrate commitment to SCD, SPDC, in partnership with NNPC, allocates large sums of money annually to build roads, water, healthcare, education, and other programs. ChevronTexaco, ExxonMobil, and other oil companies have embraced the use of the global memorandum of understanding (GMOUs) to provide development projects in return for a peaceful and secure operating environment (Amnesty International, 2005). Many MNCs now utilize the memorandum of understanding (MOUs) realizing CSR in the Niger Delta. Thus, companies are engaged in CSR initiatives to obtain a social license to operate in their respective communities. The MOU is a bilateral or multilateral agreement between two and more parties. It expresses a convergence of will between the parties, indicating an intended common line of action. In this case, there is an agreement between the MNC and the community on implementing a set of CSR programs within a given time frame. However, it could be emphasized that MOU and GMOU models entered into between MNCs and communities are not legally binding contracts (Ekhator, 2016, p. 26). Even though MOUs and GMOUs are not sacrosanct, Niger Delta communities consider them to be binding, and oil MNCs are expected to enforce them. Thus, many Niger Delta communities and NGOs affirm that MOUs should be considered contracts, for example, as an intention to create binding commitments on the part of oil MNCs toward the inhabitants of oil-producing communities. Thus, this nonapplicability of MOUs and GMOUs has led to many corrupt activities and conflicts in some communities in the Niger Delta (Ekhator & Omisore, 2021).

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4 Corporate Social Responsibility and Corruption in Oil Sector It is evident that corporate social responsibility (CSR) as a business strategy appears to have taken root in Nigeria’s oil sector. This may be due to the increasing conflict that has characterized relations between oil transnational corporations (TNCs) and host communities in the Niger Delta region over the past years. It can be argued that oil TNCs in providing social amenities to host communities is not a result of genuine interest in developing them but in promoting traditional business values of profit seeking and securing a social license to operate (Dandago & Arugu, 2014). Despite such a phenomenal rise in community development spending, there is a near consensus that CSR has failed to engender socioeconomic development in the region (Christian Aid, 2004). Various explanations have been advanced for the inability of CSR initiatives to bring sustainable development to the Niger Delta. Prominent among them are corrupt activities that led to the nonparticipatory character of the people to blame the oil TNCs for projects that the communities do not need. In addition, the sustainability of the projects has been questioned and as official corruption, where company officials connive contractors to approve poorly executed, abandoned, or nonexistent projects (Dandago & Arugu, 2014). However, an important dimension of community expectation was transparency in community-company engagements. Unfortunately, a lack of transparency and honesty in CSR commitments is a major obstacle to peaceful community-company relations. Over time, the oil companies have not been sincere to the host communities. Only because of the recent restiveness are some oil companies coming around to perform their social responsibility (Mbalisi & Okorie, 2020). As argued earlier, corruption is deeply entrenched in almost every sector in Nigeria, not just the Niger Delta region or the TNCs. The successful poor rankings of the country by international organizations in regard to corruption is a testimony to this claim (Table 1). Corruption and dishonesty have destructive consequences for both communities and oil companies. Some oil TNCs pay compensation to community leaders without the knowledge of other community members. These community representatives often keep cash payments from the oil companies for themselves and ensure that only the privileged children receive scholarships (Mbalisi & Okorie, 2020). This scenario depicts an atmosphere of greed, secret deals, and betrayal of trust. Although the influence of politics and corruption in community-company relations can be acknowledged, corruption among the political and economic elite is hardly a justification to absolve the oil companies of social responsibility (Mbalisi & Okorie, 2020). In Nigeria, several oil MNCs, such as Shell Company, which pioneered CSR practices, have been accused of spending more money on bribes and corruption than community development projects. In turn, local contractors who are often traditional leaders take their percentages before passing a share of the benefit of the oil money to their own supporters and so on down the chain. Every elite in each oil-producing

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Table 1 Nigeria’s global corruption rankings, 1996–2021 Date 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

No. of ranking 85 99 90 91 102 133 145 158 163 1.79 180 180 178 182 176 177 174 168 176 180 180 180 180 180

Nigeria position 81st 98th 90th 90th 101st 132nd 144th 152nd 142nd 147th 127th 130th 134th 143rd 139th 144th 136th 136th 136th 148th 144th 146th 148th 154th

CPI score 1.9 1.6 1.2 1.0 1.6 1.4 1.6 1.9 2.2 2.2 2.7 2.5 2.4 2.4 2.7 2.5 2.7 2.6 2.8 2.7 2.7 2.6 2.5 2.4

Source: Various issues of Transparency International Annual Reports on Corruption

community thus becomes rich and is prepared to tolerate the inconveniences of oil company presence, such as environmental pollution, for continued financial gain (Human Rights Watch, 1999). This made oil companies accuse of divide and rule strategies, paying perceived troublemakers and creating elite groups in their host communities to have their way and not effectively execute their corporate social responsibilities (Mbalisi & Okorie, 2020). This leads to either executing projects that do not conform to the approved specification or abandonment of projects. Corroborating this claim, Christian Aid (2004), cited in Melanie (2009, p. 19), revealed that “corporate development work has had some good results but failed, incomplete and unsustainable projects have become Delta landmarks. White elephant-empty clinics and schools lacking staff are visible throughout the region.” Thus, development projects in the oil-producing communities in the Niger Delta region have either been diverted or abandoned, often resulting from corruption. For example, Naanem and Tolani (2014) disclosed that 581 CSR projects undertaken by Shell between 1992 and 2006, representing more than 22% of the projects they

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surveyed, either failed or were not completed. Therefore, this practice is the source of grouse in the region against Shell and other TNCs and is often used to substantiate claims of neglect and justify the hacking of pipelines for self-help. The Nigerian government has made a concerted effort to enhance CSR practices. This could be ensuring an enabling environment that enhances sustainable economic growth and development, the pursuit of an active distributional and social policy, or the provision of motivation that enhances appropriate ecological behavior. Unfortunately, the government has failed to achieve these objectives, thus bringing about the absence of an enabling environment and undermining the basis for morals in CSR practice in Nigeria. Efforts made by the various oil MNCs are made negligible in the face of enormous community expectations because of the government’s failure on its part to meet its fair share of responsibility (Ite, 2004). This is a particular concern about community development in oil-producing communities. There have been instances of government inability to ensure effective enforcement of CSR policy in the Niger Delta region, which has brought about the low impact of the enormous investments in the oil MNCs’ community development projects and has generally been substituting for government developmental responsibility instead of complementing. Lack of enabling CSR environment by the federal government in setting minimum standards that the oil MNCs are expected to observe and providing incentives for CSR practices and the poor regulations for CSR initiatives in Nigeria mean that the oil MNCs are left to set their standards. This has brought about the breaking of environmental laws by the oil MNCs. An example is the opting for gas flaring by the oil MNCs because the minimal fine paid per barrel of gas burned is far cheaper than the alternative of pollution control (Mamudu et al., 2021). Additionally, even if the oil multinationals are found guilty of breaking environmental laws, they face no danger as corrupt practices tend to solve the problems or pittance fees as compensation tends to work magic (Cason, 2003). In terms of the moral basis for CSR practices in Nigeria, the failure of the Nigerian government in community development undermines the moral case for businesses to engage in CSR practices and, as such, makes it untenable for the government to accuse corporations of moral bankruptcy when they fail to meet their CSR obligations. This was substantiated by Okafor (2003), who questioned how the Nigerian government could regulate oil companies if they could not control their corruption. He further asked how the government could regulate corporate conduct over deliverables that fall within its traditional roles, and it had failed to do so. Thus, the government’s failure to curb corrupt activities in Nigeria’s oil sector has provided conditions that serve as inertia to the practice of CSR by oil companies in the Niger Delta region. This could be substantiated in a squabble for the funding of NDDC (Niger Delta Development Commission). By law, the federal government is expected to contribute 15% of the country’s oil revenue to the NDDC. However, in reality, the government only contributes 10%. Additionally, the individual state governments are required by law to contribute a certain percentage to NDDC, but up to this moment, they have not. As a result, it is practically impossible for the

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federal government and the individual state governments to accuse the oil MNCs of not meeting their share of the responsibility to the NDDC (Mamudu et al., 2021).

5 Conclusion Corporate social responsibility projects carried out by the oil TNCs operating in Nigeria cannot bring about the much-needed sustainable development in the Niger Delta and other oil-producing communities. This is because of CSR projects done for short-term interest and goals of oil TNCs, which do not lift the people out of absolute poverty and deprivation amid plenty. If the conflicts in the Niger Delta region are signs of dissatisfaction by the communities in the region with the insufficiency of the oil TNCs’ CSR projects, then it is clear that the billions of naira spent by the TNCs on CSR annually have failed to deliver on dousing the tensions in the region. Thus, there is a need for a paradigm shift from the present modus operandis of the CSR projects and other practices by the oil TNCs and the Nigerian government. Therefore, what the communities need are practical long-term projects that would satisfy the needs of the present generation without compromising the needs of future generations. This now calls for CSR projects that would ensure the social security and redemption of the people from poverty, deprivation, and ignorance. However, poverty alleviation is attained when the corrupt community leaders are identified and avoided while executing people-oriented and sustainable development CSR projects by the oil TNCs in the Niger Delta and other oil-producing communities in Nigeria.

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Lisk, F., Besada, H., & Martin, P. (2013). Regulating extraction in the global south: Towards a framework for accountability. Background research paper submitted to the high-level panel on the post-2015 development agenda. https://www.post2015hlp.org/wp-content/uploads/docs/ Lisk-Besada-Martin_Regulating-Extraction-in-the-Global-South-Toward-a-Framework-forAccountability-_FINALFINAL.pdf Lompo, K., & Trani, J. F. (2013). Does corporate social responsibility contribute to human development in developing countries? Evidence from Nigeria. Journal of Human Development and Capabilities, 14(2), 241–265. Mamudu, A., et al. (2021). Recent trends in corporate social responsibilities in Nigeria-A case study of major oil firms in the Niger delta region. Scientific African, 13, e00928. Mbalisi, O. F., & Okorie, C. U. (2020). Implementation of corporate social responsibility by oil companies in the Niger Delta region of Nigeria: Myth or reality. African Research Review: An International Multidisciplinary Journal, 14(1), 119–132. Melanie, Z. M. A. (2009). Oil companies in Nigeria: Still fueling violent conflict or contributing to governance. A paper presented to ECPR Joint Sessions in Lisbon, Portugal from April 14 to19, 2009. Moore, G. (2001). Corporate social and financial performance: An investigation in the U. K. Supermarket Industry. Journal of Business Ethics, 42, 299–315. Musa, A., Yusuf, Y., McArdle, L., & Banjoko, G. (2013). Corporate social responsibility in Nigeria’s oil and gas industry: the perspective of the industry. International Journal Process Management and Benchmarking, 3(2), 101. Naanem, B., & Tolani, P. (2014). Private gain, public disaster: Social context of illegal bunkering and artisanal refining in the Niger Delta. Niger Delta Environment and Relief Foundation (NIDEREF). Nweke, K. (2014). The politics of sustainable development in the Niger Delta region of Nigeria: An appraisal of the role of the state and multinational corporations, 1993–2008. OIDA International Journal of Sustainable Development, 07(12), 95. Ogula, D. (2012). Corporate social responsibility: Case study of community expectations and the administrative systems, Niger Delta. Qualitative Report, 17(37), 1–27. https://doi.org/10.46743/ 2160-3715/2012.1731 Okafor, L. (2003). Enhancing business-community relations: The role of volunteers in promoting global corporate citizenship. National Research Report. New Academy of Business, and United Nations Volunteers. Ranangen, H. (2017). Stakeholder management theory meets CSR practice in Swedish mining. Mineral Economics, 30, 15–29. https://doi.org/10.1007/s13563-016-0098-z Shell Petroleum Development Company of Nigeria. (2004). People and the environment. Annual Report. Shell Petroleum Development Company of Nigeria. (2005). People and the environment. Annual Report, pp. 20–30. World Business Council for Sustainable Development. (2002). http://wbcsd.org/DocRoot/10 NYLirijYoHBDflunP5/csr2002.pdf

Dr Halimatu Muhammad Bande teaches at the Department of Business Administration, Federal University, Birnin Kebbi, Kebbi State, Nigeria. She holds a Bachelor, Masters, and PhD in Business Administration from Usmanu Danfodiyo University, Sokoto. She also holds a Postgraduate Diploma in Education. Dr Bande earlier worked at Waziri Umaru Federal Polytechnic as a lecturer in the Department of Business Administration and Management Studies before joining the services of FUBK. While at the Polytechnic, she served in many committees, at different capacities, including being the Head of the Department of Preliminary Studies and Coordinator of Gender Issues. Mrs. Bande is a member of various professional bodies, among which are the Nigerian Institute of Management (NIM) and Teachers Registration Council of Nigeria (TRCN). Dr Halima Muhammad Bande has attended a number of local and international conferences and presented

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papers and is well published in local and international journals. Her areas of research interests include strategic management, entrepreneurship, corporate social responsibility, public sector management, and business ethics. Mrs. Bande is currently the Head of Department, Business Administration. Former Deputy Dean of Student Affairs, Chair Faculty of Social and Management Sciences Examination Misconduct Committee, Chair of University Bus Service Committee, and member of University Ethics Committee, among others.

An Adaptive Approach to Reconceptualizing Corporate Social Responsibility and Corruption in Nigeria’s Oil-Rich Niger Delta Ikpenmosa Uhumuavbi

1 Introduction Reconceptualizing CSR and corruption have largely been influenced by twists and turns in its meaning. Ideological differences have characterized the unsuccessful attempts at defining these concepts. This study proposes and applies the two-step three-element test in providing a synchronized definition of both concepts at their nature. In this research, an analysis of the different definitions of CSR and corruption is provided in Sect. 2. Section 3 will provide a description of the two-step threeelement test, while Sect. 4 reflects on the Nigerian legalized approach using the two-step three-element test. Section 5 concludes and provides recommendations.

2 Corporate Social Responsibility and Corruption in Context 2.1

Definitional Clarity on CSR

Fashioning a definition for CSR has been challenging, partly due to the choices that inform its design and conception. Across history, the factor-based approaches conceived to shape the nature of CSR designs have instead blurred the understanding of its true nature. This is evident in the incoherent definitions derived from various outcome-based definitional strategies and the calamitous failures of CSR programmes. The first definitional strategy is based on the application of institutional I. Uhumuavbi (✉) School of Law, University of Bolton, Bolton, UK © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_13

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ideologies or conceptual thinking to CSR designs. The second adopts and applies factor-based implementation or defines CSR from a power relations standpoint.

2.1.1

Ideological–Conceptual Definition

Definitions of CSR in this phase were largely shaped by corporate choices within economic, social, and political contexts deeply influencing the variations in the current erroneous understanding of CSR (Matten & Moon, 2008). Throughout history, several faulty definitional attempts anchored on this ideological application have been initiated by individuals, groups, and organizations in various sectors and industries. The first serious definitional attempts are traced to the 1950s, when Bowen defined the concept based on social responsibility owed to those directly affected by company operations (Bowen, 1953). This was due to the power imbalance between corporations and communities (Latapí Agudelo et al., 2019). On the other hand, Carroll led the other group of authors who approached this from a conceptual standpoint (Carroll, 1991; Carrol, 1999). He highlighted four different responsibilities of CSR to include: 1. Stakeholder concept (which explores the influence of stakeholders such as employees, buyers, shareholders, suppliers, the local community, the government, and society) 2. Corporate accountability (which means corporate accountability to society) 3. Voluntary concept (which means a company’s legal, economic, and moral obligation to society to ensure the long-term well-being of that society) 4. Proactive concept (which extends to management capabilities that ensure sustainable development in a proactive rather than reactive manner) According to him, these forms of CSR responsibilities are operational through the following social activities: 1. Strategic philanthropy (achieving strategic objectives while meeting CSR) 2. Charity marketing (achieving competitive advantage through client-focused promotions infused with social causes) 3. Corporate social marketing (encouraging health and well-being by initiating, funding, and supporting behavioral changes through several HSE initiatives) These views shaped CSR across multinational dimensions due to the increased power of multinational corporations.

2.1.2

Factor-Based and Power Relations Definitions

The factor-based approach was shaped by various international initiatives on economic growth, sustainability, firm performance, profit maximization, and social investments.

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The second set of definitions in this sense is from a power relations standpoint (Matten & Moon, 2008). Simon’s model on affirmative and negative obligation, Ketola’s model on the interplay of relational ideas, and the stakeholder model all point to different ideals shaped by power relations within institutional settings (Clarkson, 1995; Ketola, 2008; Simon et al., 1972). It is a choice of power relations in obligations and ideals. Drawing the same thread into political thinking, CSR is explored from a power relations standpoint, and they identified institutional frameworks as power structures that shape business systems, which in turn affect the nature, application, and outcomes of CSR in countries. They drew strong parallels between the institutional approach to understanding CSR and the agency approach. While the agencyoriented analytical approach considers the position of the agent only in the governing of organizations (Aguilera & Jackson, 2003; Matten & Moon, 2008), the institutional approach allows CSR to be explored and compared within their national, cultural, and institutional contexts. Additionally, institutional theory captures the relations among stakeholders as a critical part of understanding the reality and linkages between CSR and society. By institution, they mean not only the forms of organization of government and corporations but also norms, incentives, and rules that stimulate predictable patterns of multinational relationships, behaviors, and communications (Aaronson, 2002; Matten & Moon, 2008; Perrini, 2005; Peters, 2005; Silberhorn & Warren, 2007). Accordingly, CSR sits within the “wider responsibility systems in which business, governmental, legal, and social actors operate according to some measure of mutual responsiveness, interdependency, choice, and capacity” (Matten & Moon, 2008). Another difficult feature in all the definitional attempts made is that they seem to emanate from Anglo-American and European scholarship. This is based on continents’ unique corporate choices in relation to historical, political, economic, and sociocultural contexts (Frynas, 2009; Latapí Agudelo et al., 2019). While European notions of CSR are centered on socially obligated philanthropy, the United States adopted an explicit CSR approach anchored on discretionary agency. It is argued that both approaches have failed in developing countries (Frynas, 2009). Therefore, Frynas cautioned against the superimposition of Western conceptions of CSR on the developing world but instead fashion an all-embracing method to the understanding of CSR that also accommodates the unique experiences of the developing world (Blowfield & Frynas, 2005; Frynas, 2009). The authors advanced a tripartite responsibility in the definition and framing of CSR. These are (a) responsibility to society and the natural environment, (b) responsibility for the behavior of those they share business relations with, and (c) responsibility to relations with wider society. While the above analysis invokes some preliminary elucidation into the true nature of CSR, it failed to clarify whether this should be couched in the form of legal responsibility within the framework of public interest tests and standards of public opinion. Some authors pushed for a legal regime for the enforcement of CSR in African countries as a solution to the power asymmetry (Ekhator & IyiolaOmisore, 2021; Nzegwu & Uhumuavbi, 2022). It is, however, doubtful how a legalized framework will address the fundamental misalignment in the universal

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definition of CSR as a concept. Questions of legalization of CSR will certainly throw up discussions around the attitude of legal systems to their legal norms (Uhumuavbi, 2018). While several developing countries have grappled with rule of law issues, the legalization of CSR could obstruct the power balance between MNOC, host governments, and host communities to a level where government may capitalize on its enforcement powers and the unrest generated in host communities to negotiate additional powers and control over the MNOC. This situation could undermine the CSR conception, design, and implementation. In addition, poor legal frameworks and delayed implementation of legalization attempts have been largely traced to the absence of conceptual clarity on CSR and the tensions in power relations. This presents significant difficulty in knowing how to legislate and what to control. The issue of unequal bargaining power between the MNOC, host governments, and host communities needs to be resolved through a balanced system of power relations. Any form of power asymmetry predisposes the system to exploitation and corrupt enrichment. A concept such as CSR with significant financial involvement in its development and implementation will certainly attract diversions and misappropriation of resources where loopholes are present in CSR designs. Therefore, a contextrelative analysis to establish the original cause of gaps in CSR design leading to project failures is imperative.

2.1.3

Providing an Alternative Definitional Framing for CSR

Overall, the approaches described in the sections above gave important contributions toward defining the concept of CSR, but they all present certain drawbacks. Understanding CSR is an integrated and complex process that requires mapping knowledge, information, and power relations through an accountability matrix. In this study, the three-element test (see Sect. 3 and Fig. 1) is identified as such a matrix, and it is applied here to revise the definition of CSR. The views replete in academic journals that CSR lacks a universal definition are misconceived. As seen in the analysis above, academics and industry practitioners conflate forms of CSR and varied application of CSR frameworks and strategies with the true nature of the concept. It is expected that a concept with such wide and varied application across all industries that are in themselves diverse will suffer unanimity in understanding. Those who seek a universal definition of CSR should concentrate on its true nature rather than the forms or points of application. Therefore, a condensed analysis of the nature of CSR and an in-depth examination of the plethora of definitional attempts discussed above point to CSR as simply a relational form of company obligation or discretionary agency to society implemented through direct and indirect means. By relational obligation, CSR is understood as relationships of rights and duties moderated by legal norms (laws) and social norms (public interest and public opinion). “Direct,” as used in the definition, connotes direct action in society. “Indirect” action means impacting society through stakeholders. This relational obligation or discretionary agency takes different flavors as embodied in the unique conceptions of social responsibilities in CSR designs. Therefore, any

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Fig. 1 Accountability tool for assessing CSR designs

fundamental definition of CSR based on its true nature must possess and capture these three elements: 1. Mandatory reciprocal legal or social responsibility in a context-relational manner while drawing on public interest tests and standards of public opinion 2. Power relations among stakeholders in a context-relational manner drawing on public interest tests and standards of public opinion 3. CSR factors in a context-relational manner drawing on public interest tests and standards of public opinion The goal is to analyze these elements collectively to identify the source of definitional tensions and incoherence and the original cause of corruption in CSR designs leading to project failures.

2.2 2.2.1

Definitional Clarity on Corruption Characterization of Corruption

The definition of corruption has been illusive and lacking in universal appeal. Academics, policymakers, and the NGO sector use definitions that suit their operations. Corruption requires a significant contextual expression of its meaning. The general definition as the “misuse of entrusted public resources or power for private gain” simply undermines the basic elements that constitute corruption itself. The term “misuse” is least understood when examined for the purpose of analysis. Since this definition of corruption based on “misuse” is levied at the point of application, it should require standards to measure compliance. The absence of acceptable

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universal standards remains a huge challenge in anti-corruption programming. Brook’s definition of corruption based on individual actions failed (Brooks, 1909). Kurer’s position on the conception of corruption from a political system standpoint is supported by Heidenheimer drawing on Aristotelian times (Heidenheimer, 2002). This has informed the Transparency International definition of “misuse” (Transparency International, n.d.). In addition, the public–private dichotomy in the conception of corruption ignores the different sets of norms that inform human conduct.

2.2.2

Difficulties in Defining Corruption

The difficulties in defining corruption are also traced to the discordant analytical frameworks informing the definition of the concept and its anti-corruption programs. First, Zimelis identifies the contradiction between the revisionist and structuralist viewpoints on the merit of corruption against the unanimous academic viewpoint against corruption (Huntington, 1968; Leff, 1964; Zimelis, 2020). The key argument of structuralists is its demerits and impact on economic variables. The revisionist, however, argues that even if corruption connotes derogation from norms, its distributive effect equitably addresses various forms of asymmetries created by power imbalance and public–private dichotomies. Second, the practice of defining corruption with features undermines the understanding of the nature of the concept. This is a situation where the action of the occupants of the public office exploiting the same for private gain is captured (Kurer, 2001). Through this definition, several typologies emerged based on the behavioral tenets of public officers: bribery, extortion, patrimonialism, nepotism, and theft (Langseth, 2016). Therefore, the definition based on the “public–private” paradigm seeks to understand the concept within that unidirectional prism. Third, we define corruption based on illicit activities without clear, consistent, and coherent metrics for measuring these activities. The ever-changing phenomenon constantly escapes new and emerging measurement tools applied in different societies. Amundsen explored corruption from a political context (Amundsen, 2019). The Transparency International Corruption Perception Index measures the perception of resident and nonresident business executives by adopting 13 surveys in 10 key institutions in countries. This approach has been criticized as flawed, biased, and unrepresentative (Charron, 2016; Zimelis, 2020). Fourth, another metric regarding data on corruption convictions as symptomatic of occurrences of corrupt behavior may reflect the efficiency and effectiveness of the criminal justice system rather than a clear representation of corrupt activities in the country. Successful conviction does not consider the varied definitions of corruption in these countries that have informed the legal frameworks. It is also important to indicate that low conviction may not necessarily be symptomatic of lax or permissive anti-corruption activities but rather a result of effective anti-corruption strategies (Cordis & Milyo, 2016). Finally, the mismatch in the micro- and macroanalysis of corruption as evident in historical literature on this subject further distorts its meaning and definition. Zimelis argues that the nature of corruption can be better

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understood where micro- and macrolevel analyses are better integrated (Zimelis, 2020). Microanalysis focuses on human agency or behavior as a key catalyst and consequence for corrupt activities (Ward, 1989). It further explores the idea of incentives influencing behavioral patterns through “moral” and “economic rational choice” analytical approaches. The moralist conceptualizes corruption as a product of a “bad guy” (Johnston, 1982). The bad guy is assessed theoretically to mean a person lacking in full behavioral development and inadequately resourced in terms of education, information, and character (Johnston, 2005). The rational choice approach, on the other hand, sees the agent’s incentivized self-serving actions as a product of societal acceptance through high opportunities and low penalty regimes created for that conduct (Zimelis, 2020). In the context of this theory, conflict results where the principal (the custodian of public interest) is at cross purposes with the agent (entity predisposed to the corrupt transactions) where the benefits for corrupt activities supersede the cost. Because members of the public as principals lack the necessary wherewithal to hold public officers as agents to account, the power imbalance weighs heavily in favor of the agents (Marquette & Peiffer, 2015). This theory assumes that corruption occurs purely as a resident within the agent category while painting the principal as a victim. Therefore, all anti-corruption efforts are geared toward reducing agents’ power through various forms of legislative and institutional arrangements. This includes anti-corruption legislation seeking to reduce the discretion of public officers through systems of accountability, transparency, and checks and balances. The development of codes and policies to stamp out corruption is followed by institutional designs developed to regulate, control, and enforce anti-corruption legislation and policies. This approach assumes the existence of upright principals imbued with social, political, economic, and social trust. In contradistinction to the principal–agency theory is the collective action approach wrapped with the logical frames of institutional analysis. This analytical approach (also known as structuralism) posits that the institutional framework and incentives accommodated within a country shape an agent’s behavior (Johnston, 1982). The institutional approach encapsulates principal–agency, revisionist, culturalist, and modernist theories (Huntington, 1968; Zimelis, 2020). The argument here is that the level of corruption is the product of the institutionalizing frame and development phase. Evolving societies with weak institutional frames are predisposed to more corrupt activities because corruption exploits weakness within the institutional structures. In this view, corruption contributes to the growth of societies by addressing institutional weakness and gaps (Merton, 1968; Zimelis, 2020). In addition, the cultural dimension to the debate and extent to which institutional culture influences corrupt actions, the extent to which national culture influences institutional culture, and the extent to which individual subculture influences national and institutional culture require relational determinations.

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Providing an Alternative Definition of Corruption

For this study, corruption is defined as the relational capacity to appropriate collective public interests. The word capacity is important to distinguish the nature of corruption from the actions (corrupt activities). Therefore, a system that directly, indirectly, or inadvertently provides the capacity to appropriate the collective public interest is corrupt. Moreover, a clear separation of the capacity to appropriate, which constitutes the true nature of corruption, from the activities resulting from that capacity is important to gain clarity on the definition of corruption. To provide a standard for understanding this definition, Scott’s demarcating criteria (Scott & Murphy, 1972) are adopted because of rational alignment with the context of relativist and African communalist philosophies popularly known as “Ubuntu.” These criteria are legal norms, public interest, and public opinion. Therefore, establishing the relational effects of these three criteria in the understanding of capacity to appropriate the collective public interest is critical to avoiding a narrow legalistic definition of corruption. This also means further elucidation of the meaning of the public interest in relation to legal norms and standards of public opinion is imperative. Warren sees the public interest as a system that guarantees openness, publicity, and inclusiveness (Warren, 2004). That is, the idea of a system imposed institutional and communal relationships. Thus, viewing this from a collective action analytical framework, the public interest could mean the agent sacrificing his interest for the principal or vice versa. Consensus on corruption converges on two attributes: bribery and the lopsided distribution of rights and duties. Therefore, the institutional and individual capacity to appropriate the collective public interest through bribery and distributive inequities becomes relevant. The idea of corruption is about individual and institutional capacity to deny others of their entitlements, inefficient and ineffective allocation of public interests, abuse of position, and distributive injustice. Key participants in the creation and development of corruption operate through a set of behaviors that maximize the conduct in furtherance of their personal interests. Therefore, a public interest accountability tool is required as a control measure.

3 Analysis of the Commonalities and Contradictions in the Framing of CSR and Corruption The distinctive features of corruption and CSR deduced from the definitional frameworks and analysis include the unpredictability of factors informing the definition of the concepts, unanimity in the existence of power relations, institutions as platforms for activities and operations, a set of consistent behaviors or values, and the definitional framing of both concepts based on points of application rather than the nature of the concept. For the contradictions, they are expressed within the commonalities to include first conflicting models of CSR designs. Second, the definitional frames of CSR are influenced by a corporation’s rational economic

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choice and moralist arguments. These divergent conceptions require a public interest accountability tool to ensure balance.

3.1

Conceiving the Three-Element Test as a Public Interest Accountability Tool

The three-element public interest accountability tool is distilled from the relativist, nonrelativist, and communalist epistemic tools. This context-relational epistemic tool uses social norms and assessment standards to explore relationships from relativist, contextual, and communalist lenses in the search for truth. Figure 1 captures the mechanics of the tool in assessing CSR designs. The threestep process is as follows: First, as illustrated in Fig. 2, a relativist tool is adopted to assess the coherence of the CSR design using criteria captured in the first set of three-element tests (legal responsibility, power relations, and CSR factors). If the design is coherent, specific epistemic system criteria identified in the second set of three-element tests (legal responsibility, social responsibility, and standard of public opinion) are used to assess compatibility with public interest (Harman, 1975; Nozick, 2001). These second set criteria are embodied by African Communalism known as “Ubuntu.”

Fig. 2 The decision-making process of the three-element public interest accountability tool

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These public interest community standards captured within African social conventions; social values; epistemic, ethical, and aesthetic norms; societal history; experiences; judgment; and worldview are built on interdependence and coagency (Ikuenobe, 2016; Venter, 2004). If a CSR design fails the public interest test, it is likely to be exploited by corrupt activities, and it should be redesigned and re-evaluated against the same tests. Second, it adopts nonrelativist (contextual relativism) to attribute corruption to its original cause and place within CSR design (Willaschek, 2009) through a system in public interest incompatibility tests. This public interest incompatibility test is assessed against the interdependency test to determine compatibility with Ubuntu. Thus, the degree to which the host community is embedded in CSR design to achieve interdependency between the host community and the oil company is a measure of compatibility with the public interest. Third, the original cause of corruption is established by assessing human or institutional actions to elicit whether they are products of free will (original cause) and therefore incompatible with the public interest. A bad CSR design as a product of a failed public interest test is deemed to have emanated from the actions of a human or institution who (1) possesses standard ability, (2) is capable of practical judgment, and (3) is able to act according to that judgment (Harman, 1975; Nozick, 2001). It is immaterial whether this is an agent-inducing or agent-involving event. This is also without prejudice to whether the agent is an object or has principal responsibility for attributing the criteria.

4 CSR and Corruption in the Oil-Rich Niger Delta 4.1

CSR and Corruption in Context

In Africa, social responsibilities are framed by companies as community relations (Alabi & Ntukekpo, 2012; Ekeocha, 2001). Ekeocha sees CSR as “a series of mutually beneficial business partnerships with one or more stakeholders which enhance the company’s reputation as a corporate citizen” (Ekeocha, 2001). Regrettably, host communities in the Niger Delta claim that multinational oil companies failed to meet these obligations. Oil companies on the other hand, identify Nigeria’s specific macroeconomic constraints, influence peddling in the inclusion of connected persons as beneficiaries in CSR programs, poor human resource quality within host communities, poor social behavior of staff, poor implementation of technical and managerial ideas by teams, poor inclusion of CSR in legal, regulatory, and developmental initiatives of host government, and lack of responsibility for poor performance as sources of corruption (Frynas, 2009).

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Lopsided Structure of CSR in Nigeria and Consequences

Nigeria’s oil industry has been controlled by the federal government and oil companies as stakeholders. This has left host communities isolated and excluded from the decision-making processes. The state governments only have the role of land provision and access to 13% of the financial resources derived from proceeds from the sale of oil. Otherwise, the federal government controls the oil resources, taxes, and royalties directly without reference to the host communities. It also negotiates, grants concessions, licenses, and leases to oil companies. This has given rise to various joint venture agreements, partnerships, and production sharing contracts between the federal government and oil companies in relation to oil exploration, production, and marketing. This makes the federal government the sole shareholder in the oil industry on behalf of Nigeria. On the part of oil companies, there are various stakeholder categories. According to Frynas (2009), there are firstgeneration oil companies that are multinationals with control and dominance as first movers. The second-generation MNOCs are those that operate in spaces not covered by the first-generation MNOCs. The third-generation MNOCs are domestic private oil companies. These companies are actively engaged in defined spaces in agreement with the federal government. However, the host communities, which consist of producing communities, terminal communities, and transit communities, are completely left out of the decision-making and participatory process. Their views are not captured in the governance of the oil industry. Instead, they are left to pick up environmental degradation, pollution, ecological disasters, social ostracization, political marginalization, and developmental challenges. These have given rise to conflicts, crimes (kidnapping, oil theft, criminal damage of oil facilities), and militancy as ways to vent their dissatisfaction. It is argued that this level of marginalization is a function of the inherent gaps in legal and institutional design and their misalignment with the political and cultural structures in these communities. The skewed political, economic, and environmental incentives produce conflict and corruption that the Willink Commission tried to resolve in 1958 (Willink Commission, 1958) but has since been jettisoned by successive governments. The experience of CSR designs by MNOCs has produced the same result. This has been traced to corruption within the design at the government institutional level, the oil companies, and their manner of engaging power structures in host communities.

4.2.1

Oil Companies’ CSR Models

The Shell Petroleum Development Company adopted a sustainable community development (SCD) design to interact and build productive relationships with Niger Delta communities through economic empowerment, increased security, and reduced conflict. This program failed to achieve the needed objectives, as staff members were fingered in corrupt activities related to projects (Frynas, 2009). The

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company had previously adopted direct intervention in infrastructural development but also failed. It then partnered with international agencies such as the USAID and NGOs to implement projects on its behalf but was unsuccessful due to institutional corruption and operational constraints in the country and host communities (Frynas, 2009). For ExxonMobil, the CSR goal is one of ethics, health, and safety of employees, the community, and contractors. The company adopted community development as its CSR model with philanthropy and social investment as its key strategies. This was prompted by the low infrastructural development in the host community and the need to partner with the community in sustainable community development, capacity building, and infrastructural development. In 2002, the company changed its CSR model from community development through the provision of social infrastructure to economic empowerment and capacity building (Mamudu et al., 2008). These changes were initiated in direct response to the behaviors of host communities, change in government policy with the introduction of NDDC, and the government’s sustainable community development program anchored on capacity development and wealth creation. Through a system of program implementation partnership (PIP), where PIP delivered programs on behalf of the company, the company engaged in agriculture and entrepreneurial skills acquisition activities. The company, Mobil Producing Nigeria (MPN), partnered with GBF (an NGO) to implement these across communities in the oil-producing areas. These companycentered CSR designs and implementations failed because they lacked the public interest elements in their designs, as the input and participation of host communities were absent.

4.3

Restructuring of CSR in Nigeria: A Legalized Approach as a Response to CSR and Corruption

The newly enacted Petroleum Industry Act (PIA) of 2021 (Federal Republic of Nigeria, 2021) is the most far-reaching attempt at formalizing CSR in Nigeria. The core objective of Chap. 3 of the Act is to address the challenges of noninclusion of host communities through legal recognition as a stakeholder group in the industry. 1. Mandatory Reciprocal Responsibility This Act created governance structures with reciprocal rights and duties. The Commission/Authority, which is the government, is empowered to set up the Host Communities Development Trust (HCDT) and obtain the Settlor (oil companies) to fund it in return for tax incentives. The Settlor also loses licenses for the failure to comply. Host communities can access development from utilization only if they guarantee peace in their communities. 2. CSR Factors The Host Communities CSR Factors are expressly captured in the Act under the objective at the HCDT. They include infrastructural development, economic empowerment, opportunities, educational development, healthcare development,

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environmental protection, enhanced security, investment, and other developmental purposes. These have been structured to align with the objectives of Chap. 3 on Host Communities in the Act. In addition, the Act also provides that CSR factors to be adopted in host communities will be based on needs assessment from social, environmental, and economic perspectives. 3. Power Relations Three stakeholder groups (government, oil companies, and host communities) are legally recognized by the Act to which five structures have been developed for effective power relations. They are the (1) Commission/Authority, (2) Settlor, (3) Board of Trustees (BOT), (4) Host Communities Management Committees (MC), and (5) Host Communities Advisory Committee (AC). The Commission is empowered to set up the HCDT, set out the grounds for fund utilization, and supervise its distribution. Pursuant to setting up on the HCDT by Commission, the Settlor incorporates HCDT and in consultation with Host Communities institutes a BOT and appoints its operators. The Settlor shall also appoint members of BOT subject to approval of the Commission after consultation with host communities sourcing “persons of high integrity and professional standing” from the host communities. The Settlor manages to develop a host community development plan based on a matrix. The matrix that is developed by the Settlor shall contain specific development initiatives, specific project details, objectives, management, and reporting to the Commission. The BOT shall supervise funds and project administration, determine CSR factors, and set up the Management Committee (MC). The MC shall determine funds to be allocated by BOT based on Settlor’s matrix. As part of its function, the MC shall set up the Advisory Committee (AC) with the decision of AC subject to BOT approval. The membership of the AC shall be determined by the MC, and the AC is expected to nominate members to the MC and highlight areas of development to the MC based on needs assessment. This needs assessment informs the project plan and the funds disbursement to be monitored by the Settlor and supervised by the BOT. While this framework adopted mandatory reciprocal legal responsibilities between the government, the oil companies, and host communities, it failed the public interest test and fell short of standards of public opinion. This is evident in the systematic relegation of the host communities to nonexecutive advisory roles in the advisory committee without any stipulation on the binding effect of such advice on the BOT. The insertion of nebulous terms in the legislation such as “... in consultation with host communities...,” “...high integrity and professional standing. . .,” and “. . .needs assessment. . .” suggests gaps in legislation that could be exploited by corruption.

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Determination of Causality and Analysis Using the Three-Element Test

First, this study advances three elements in the definition and conceptualization of CSR to address inherent gaps and failures. They are (a) mandatory reciprocal legal or social responsibility, (b) power relations among stakeholders, and (c) CSR factors, all of which are captured in a context-relational manner and draw on public interest tests and standards of public opinion. (a) For mandatory reciprocal responsibility, the PIA identified the government, oil companies, and host communities as mutually responsible within the legalized CSR regime. While the government puts the governance structures in place and the oil companies fund it and enjoy tax incentives, the host communities guarantee peace as a condition for continued entitlement to the developmental benefits of the fund. What is, however, missing is the public interest test on the extent to which these reciprocal responsibilities can alter the attitude of public and private institutions toward legal compliance. (b) For power relations among stakeholders, the PIA clearly identified the government, oil companies, and host communities as critical stakeholders. While the composition of the government and oil companies’ stakeholder maps are clear, that of the host communities is not determined within the context of the Act. This gap could be exploited for the misappropriation and misapplication of funds. Although the PIA recognizes the host communities as legal stakeholders, the political marginalization and distributive injustice suffered by this group over time have found their way into this legislation. First, the role of host communities either at the level of setting up the governance structures or appointment of officers into BOT, MC, and AC is purely consultative without any guarantees that views elicited will be adopted. Second, since the host communities have little say in the appointment of members in BOT and insignificant voting power, they have no voice in the room where key decisions are made on issues that bother on host communities’ development and utilization of trust funds. The fact that oil companies predominantly determine the membership of BOT and the procedure for their emergence with slight inputs from government is a gap that could be exploited by corruption – Section 242(3). One expected the Act to stipulate the number of executive BOT members to be drawn from host communities in relation to the total number of members of the BOT and the mode of appointment. It is usually expected that a good proportion of committee members are drawn from the BOT’s executive membership to serve in respective committees. The relegation of host communities to a nonexecutive advisory role in the AC excludes the host communities from the duties and functions of the BOT – Section 243 (a–e). Even more curious is the fact that the MC being put together by the BOT where host communities essentially have no voice is empowered to constitute the AC. The host communities are allowed only one nonexecutive member in the MC to be appointed through a nebulous criterion of “high integrity and professional standing” – Section 247(2) (a–b). This is yet

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another gap opened to be exploited by corruption – Section 249(1). To further drive home this point, the modalities for choosing the nine members from the host communities as members of AC are not stipulated in the Act. This means that individuals could be handpicked for these roles at the expense of the due process. Third, at the level of decision-making, any decision of the AC is subject to the approval of the same BOT where the host communities are largely unrepresented – Section 249(3). Fourth, in terms of needs assessment translating into a community development plan, the current design implies that the needs of host communities will be assessed without host communities in the room where these decisions are made – Sections 235(6); 251(1), (2), (3) (a–c). Fifth, the numbers and qualifications of members of the BOT, MC, and AC and modes of appointment are not captured within the Act. This is a huge concern as the Act provides for an HCDT constitution and what it must contain, without stipulating the procedure for enacting the constitution itself. There are risks that the constitution is prepared without inputs from major stakeholder groups, including the host communities. Sixth, the fact that the oil companies and the BOT determine the allocation of funds to host communities based on a matrix, the host communities could be at the mercy of an unrepresentative BOT and prejudiced oil companies in delivering a matrix that serve their best interest. Seventh, the provisions in the Act for preservation, investment, and accountability of HCDT funds are meaningless without adequate checks and balances to the powers of the government and oil companies in this stakeholder’s power map. It essentially means the same old game between the government and the oil companies against the interests of host communities. (c) For CSR Factors, the PIA clearly stipulates these in Section 239(3) (a–i). It is, however, unclear whether these are products of already conducted needs assessments, the results of public interest tests, or public opinion surveys. To prescribe CSR factors without a context-relational analysis exposes a system to hasty generalization on host communities needs as a pretext for funds disbursement. Funds accessed without clearly defined needs are misappropriated and misapplied. Second, this study adopts a context-relative and communalist approach in unearthing the original cause of corruption in relation to CSR. Questions around the attitude of Nigerians to the legal norm are traced to the fundamental grundnorm, which is the Constitution of 1999 (Federal Republic of Nigeria, 1999). This document was imposed on the people by military fiat without accountability to public interest tests and standards of public opinion. While the fundamental objective and directive principles of state policy embody the philosophical disposition of the country in relation to corruption – Section 16(1) (2) (b–c); 14(2)(c), (3), (4) of the Constitution of 1999 – it is submitted that the nonjusticiability of this provision pursuant to Section 6(6)(c) of the same Constitution provides a fundamental legal basis for corrupt behavior. This nonjusticiability removes it from accountability to public interest tests and standards of public opinion. The resulting effect is a cultural context that is shaped on the back of a fundamentally flawed legal design with gaps open for

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exploitation by corrupt behavior. Company-specific CSR designs and the current legal design have risen on the back of a cultural context that expresses nonaccountability to public interest tests and standards of public opinion. Therefore, it is submitted that gaps in legal designs and CSR designs constitute the original cause of corruption where those who framed these designs are incapable of practical judgment. It is further submitted that where human actions capable of practical judgment are implicated in designs, then the laws and CSR designs are exploited to gain advantages and dominate the power relations matrix at the expense of the public interest and standards of public opinion.

5 Conclusion and Recommendations This study commenced by raising questions about whether corruption in CSR design is externally influenced or internally induced. This dilemma triggered an assessment of the definitional framing of the concept to reveal the three fundamental elements of a good CSR design. They are: (a) Mandatory reciprocal legal or social responsibility captured in a contextrelational manner and drawing on public interest tests and standards of public opinion (b) Power relations among stakeholders in a context-relational manner and drawing on public interest tests and standards of public opinion (c) CSR factors in a context-relational manner and drawing on public interest tests and standards of public opinion An analysis of the legalized CSR design in the Petroleum Industry Act of 2021 failed the interdependency test, and it is therefore incompatible with the public interest on the following grounds: (1) on the question of reciprocal legal responsibility, there is no legally defined basis within the act for the host communities to challenge the actions of the settlor (oil companies) or government relating to marginalization. The nonjusticiability of Chap. 2 of the Constitution of 1999 also makes any possible legal challenge difficult. (2) For power relations, the host communities are at the bottom of the pile without significant voice in the decision-making process. Power is steeped in favor of the oil companies. (3) The CSR factors are based on needs assessment, which the host communities lack the capacity to influence given their poor representation and voting power in the BOT. This means that those members who are likely to enjoy some semblance of power to BOT, MC, or even AC appointments and access to CSR factors will be based on clientelism. Therefore, this study submits that the original cause of corruption is an unaccountable corporate ideology that influences CSR design elements: legal responsibility, power relations, and CSR factors. The solution to isolating corruption from the CSR design elements is to continuously assess the design using the three-element test.

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Extending the Frontier of Agitations: Corporate Social Responsibility and Resource Control in Nigeria Halimatu Muhammad Bande

1 Introduction Agitation for resource control is not a new phenomenon in Nigeria. After abolishing the slave trade in 1807, local traders were said to have engaged in resource control struggles to participate actively in the palm oil trade. Moreover, even before the formal establishment of colonial rule in Nigeria, there was an internal rivalry among the Europeans themselves in the Niger Delta due to the economic potential of a region abundantly blessed with natural resources. After the famous Berlin Conference of 1885 that handed the area of West Africa that would later be called Nigeria to Britain, the first major clash between Britain and an African state under her protection was recorded in the Oil Rivers protectorate (Crowder, 1968). Within the larger Nigeria, the natives (nationalists) took it upon themselves to agitate for the inclusion of Nigerians into the governance of their affairs and by implication the control of their resources. This was partly necessitated by the exploitative nature of colonial rule. As Rodney (1972, p. 26) put it: Mistaken interpretations of the causes of underdevelopment usually stem either from prejudiced thinking or from the error of believing that one can learn the answers by looking inside the underdeveloped economy. The proper explanation lies in seeking out the relationship between Africa and certain developed countries and recognizing that it is a relationship of exploitation.

The series of constitutional development witnessed in colonial Nigeria from Clifford (1922) to Richard (1946) through Macpherson (1951) and Lyttleton (1954) were arguably the resultant effects of nationalist agitations and struggles. Whether one talks about the direct rule system in southern Nigeria or the indirect rule H. M. Bande (✉) Federal University, Birnin Kebbi, Nigeria e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_14

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in the northern part of the country, the British centrally planned colonial administration in the metropolis. However, Richard’s Constitution of 1946 introduced regionalism into colonial Nigeria by creating three regions, i.e., the Northern, Western, and Eastern regions. This recognition of Nigeria as a country with three regions had positive implications for political respect for both the ownership rights of control of resources by respective regions of the country and the elimination of tensions due to resource agitations in different parts of the country. However, the 1946 Constitution scarcely applied these implications to practice. Therefore, the 1954 Littleton’s Constitution fully recognized these implications and eventually gave exclusive rights to the regions to own and control their resources. Accordingly, while the Western region owned and controlled their cocoa sales and products, the Northern region owned their groundnut pyramid, and the Eastern region owned their palm produce, under the constitution under discussion, each of these regions only paid taxes from these products to the government at the center in a show of full ownership and control of their own resources (Ude, 2019). With the incomes generated through the exports of these products, each region could execute developmental projects. According to Nnoli (1978) cited in Lukpata (2013, p. 1): Motivated by this right of control, Sir Ahmadu Bello, the Premier of Northern Nigeria, set up a Groundnut Marketing Board through which he utilized all the accruing revenue from the export of groundnuts to the United Kingdom. The then regional government built the Ahmadu Bello University, the Bank of the North, etc. The Palm Produce Marketing Board empowered Dr. Michael Okpara government in the Eastern Region as it had control of the revenue accruing from the export of palm produce to the United Kingdom, the funding of African Continental Bank and University of Nigeria Nsuka, among others. Chief Obafemi Awolowo set up the Cocoa Marketing Board and utilized the accruing revenue from the export of Cocoa to the United Kingdom in setting up the first Television network in the country and in funding a free primary education policy in the Western region.

The discovery of oil in 1957 did not only coincide with the fall in prices of the foregoing commodities; it coincided with the global boom in crude oil prices. Thus, oil became the rallying point of national attention at the expense of other sectors from that period to date. Again, for the most part, the newly found oil began to create tension between the federal government, the resource-producing communities and the Niger Delta states, and the multinational corporations mining in the region (Ude, 2019). These tensions eventually culminated in the collapse of the first republic with the military takeover of government. In 1969, the Petroleum Act enacted by the military successfully brought regional development to a standstill. The Act introduced a new dimension to the resource control quagmire as it provided for central control and ownership of oil exploration (both onshore and offshore) by the federal government. The enforcement of the Petroleum Act of 1969 was a point breaker in the cohesion of communities and stated in their ability to cooperate and mobilize resources for development, hence the control and subjugation of the communities by the federal government. In other words, regions and communities were sidelined in the derivation of accruing revenue only to be given that which the federal government felt was significant. The consequence of this centralization in derivation and revenue sharing was that the

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communities, which hitherto were economically independent, became dependent on federal allocation (Chibueze, 2011). In the opinion of Campbell and Page (2018, p. 53): As oil became a quick and easy source of enormous revenue, successive governments failed to pursue policies and projects designed to ensure the sustainable development of the formal nonoil economy. Instead, they wasted billions of dollars on short-term spending sprees, government patronage and self-enrichment schemes. Oil revenues became a national cake to be shared as soon as it was sliced.

The 1978 Land Use Act only exacerbated the existing tensions as far as resource control is concerned. The Act vested the ownership of all lands within Nigeria to the state and federal governments. The consequence was the automatic strangulation of all relevant federating units (regions, states, and communities) while placing the regional powers on the central government. The problem of resource control was compounded by the 1991 Constitution in that it made provision for all oil and mineral resources in the country to come under the control of the federal government (Chibueze, 2011). In all the foregoing, notwithstanding, the local communities were never ambivalent toward the forfeiture of their rights to ownership and control of resources. Various agitations were recorded in the process. However, specifically, the period from the 1970s through the 1980s witnessed an awakening of the local consciousness to environmental pollution and degradation, particularly in the Niger Delta communities (Raji et al., 2013). This agitation sometimes takes violent dimensions that threaten the continued existence of the country. As Saro-Wiwa (1994, p. 64) stresses: The notion that the oil bearing areas can provide the country’s revenue and yet be denied a proper share of that revenue because it is perceived that the area’s inhabitants are few is immoral, unnatural, and ungodly. Why should the people on oil-bearing land be tortured? Why are they entitled to but 1.5% of their resources? Why has this money not been paid as and when due? Where is the interest the money has generated over the last 10 years? The peoples of Rivers and Bendel states, in particular, are very heavy on the conscience of Nigeria.

In essence, from the colonial period to the present, agitation for resource control has remained the most contentious issue in Nigeria’s fiscal relations (Dickson & Asna, 2016; Abbas & Wakili, 2018). In more recent times, the agitations have been turned into militancy, as seen in pipeline vandalization, piracy, kidnapping of oil workers, etc. The federal government has put forward many measures to comfort agitators, reduce tension, and contain the situation but to no avail. As usual, government responses are marred by corruption and mismanagement, which explains their ineffectiveness. As this paper will establish, the effective and efficient discharge of corporate social responsibility by business organizations is an alternative program worth pursuing by the government to deal with the situation.

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2 Overview of Nigeria’s Federal System Federalism has been variously defined to the extent that any attempt to develop a universally accepted definition of the term is considered an exercise in futility. This is partly because their immediate environment and context influence scholarly definitions of the concept. This, notwithstanding, federalism is a constitutional mechanism for dividing power between different levels of government so that federating units can enjoy substantial, constitutionally guaranteed autonomy over other areas. Thus, federalism combines partial self-government with partial shared government (Elazer, 1987, cited in Bulmer, 2012). Federal systems are usually adopted in culturally diverse or territorially large countries (Bulmer, 2012). As Africa’s most populous country with more than 250 ethnic groups, Nigeria is a typical example of a federal state. As enshrined in the country’s constitution, Nigeria is a federation of 36 states with 774 local government areas. The constitution also divides state power into exclusive, concurrent, and residual legislative lists for administrative efficiency. The items in the exclusive list including currency, foreign relations, security, ownership of mineral resources, etc. are exclusively reserved for the federal government. Functions in the concurrent legislative list are performed by both the federal and state governments. This includes agriculture, provision of education, healthcare services, and infrastructural facilities, among others. Items not mentioned in the exclusive and concurrent list are regarded as residual functions performed by local government. Nigeria’s federalism operates under a presidential system of government (as practiced in the United States) where the president is both the head of state and head of government. However, under the principle of presidentialism, there is a separation of power in Nigeria. The legislature, executive, and judiciary exercise political power. As in other states, the major functions of the legislature in Nigeria are lawmaking, even though they perform other functions, such as screening and confirmation of presidential nominees. The law made by the legislature is to be implemented by the executive under which the country’s civil service operates. The judiciary is made up of judges, lawyers, and other legal officials whose primary role is rule adjudication and interpretation. More importantly, the essence of separation of power in Nigeria is (like other countries) to ensure checks and balances between and among the three arms of government. To ensure and promote justice and national unity, Nigeria’s constitution aspires to respect and uphold federal character in governance. According to the Constitution itself: The federal character of Nigeria refers to the distinctive desire of the people of Nigeria to promote national unity, foster national loyalty and give every citizen of Nigeria a sense of belonging to the nation, as expressed in Sections 14 (3) and (4) of this Constitution.

Put differently, the Constitution cautions that the country’s governance at the federal, state, and local government levels shall reflect the composition of Nigeria and its diversity in terms of language, religion, and ethnicity. Accordingly, there shall be no predominance of persons from a few ethnic groups, the concentration of

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projects in a particular region to exclude others, and any other unnecessary favor for a particular group. Unfortunately, Nigeria is notorious for violating federal character in its postindependence political history. This, more often than not, serves as a source of tensions and agitations that often make the country’s democratic and federalist principles a mirage, to say the least. Campbell and Page (2018, p. 87) articulated this view as follows: Nigerian Federalism is quite flawed and more aspirational than real in many ways. In practice, it reflects Nigeria’s social and economic organization into competing patronage/ clientele networks and the concentration of power in the presidency and among the governors, a characteristic of other oil states. Power flows from the top down, from the patron to the client, not from the bottom up. Hence, state governors may be part of the president’s network, while state assembly members may be part of the governor’s network, which ultimately makes them part of the president’s network. The people of Nigeria are largely detached from the process. The detachment also accounts in part for the slow development of a sense of national identity.

Ultimately, while federalism has helped some countries settle conflicts or improve governance, the reverse could occur in Nigeria, as it exacerbates existing differences, sometimes leading to deeper conflicts, tensions, and agitations. This could be seen in ethnic, regional, and religious conflicts, attempts at secession and various agitations for state creations, devolution of power, and, more importantly, resource control inherent in Nigeria’s current narratives.

3 The Business of Resource Control A starting point is to note that scholars have no agreement as to the actual meaning of resource control. While one group conceives it as the total takeover of the resources located in the resource-producing states by the people of those states, the other view it to mean that the stakeholders in the resource-bearing areas should manage a greater proportion of the resources found in those areas. This implies that scholars and even agitators define the concept primarily from different and individualistic perspectives (Dickson & Asua, 2016). Itse (1995) and Ike (2001) described resource control as the power and rights of a community or state to generate income by way or means of taxation of human and nonhuman substances within a given environment. Such powers and rights to initiate taxation processes are, however, limited by law, especially in a federal system of government where the powers of the central government are superior to those of the subordinate and constituent states. In systems such as Nigerian federalism, there are certain taxes that constituent states do not have the legal right to collect. Such taxes are legally left for the central government to collect and coordinate. This is evidently stated as follows: The entire property and control of all petroleum in, under or upon any lands within Nigeria, its territorial waters or which forms part of its continental shelf and the Exclusive Economic

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Zone, is vested in the government of the federation. (Petroleum Industrial Law, 2012, Section 2)

However, in such federal systems, the derivation principle empowers constituent states and subordinate governments to obtain some benefits from the income generated to the state from their lands. The basic principle of resource control is the ability of a state government to exploit the natural resources of a state to the benefit of all (especially in a democratic state), such that every citizen, bonded by the state’s sovereignty and allegiance to the state, has a benefit from the state’s resources (Omojuwa, 2001; Dibua, 2006). Resource control can be broadly defined as controlling and managing resources by the state or local government from whose jurisdiction the resources are extracted. The state or local government would manage the resources from their territories under federal guidelines and then remit the prescribed percentage to the federal center. Advocates of resource control insist that in any true federalism, powers are shared between the federating units and the central government so that each government has its apparatus for the conduct of its affairs. They stress that in any true federalism, the oil, gas, or other minerals found in any state belong to that state (Ebegbulem, 2011). This generalization was, however, questioned by Kolawole (2021) when he declared that while it is true that in most federations, states own the oil in their territories – but that is not the whole story. In Canada, oil provinces are in control of their resources. However, because very few provinces have oil (Alberta and Saskatchewan), the federal government has an “equalization fund” from which other provinces receive grants for fiscal balancing. Conversely, in Mexico, the federal government is in total charge of all oil revenue. Whether or not they have oil, Mexican states receive a flat 20% as allocation. Municipalities, where oil production and shipping take place, receive an extra 3.17% as compensation for the environmental challenges. This is in line with Nigerian federalism, where the current revenue allocation formula gives 52.68% to the federal government, 26.72% to the states, and 20.60% to the local government, while 13% derivation revenue goes to the oil-producing states (Richard & Eme, 2015). In essence, resource control means “the right of mineral exploration, exploitation and the management of resources by the communities where these resources are, including marketing of the proceeds from their land or water” (Tochukwu, 2002, cited in Wakili and Abbas (2018, p. 6). The struggle for resource control is one of the major drivers of conflict worldwide. From Iraq to Syria through Libya and Nigeria, the possession of resources has become a curse in many communities across the globe, as it leads to interethnic and group conflicts with adverse socioeconomic fatalities. In Nigeria, the business of resource control manifests itself in intense agitations and struggles that characterize the country’s six geopolitical zones. For example, in all of these regions, there are agitations for state creation that sometimes culminate in secessionist attempts, as in the case of Biafran states. At the root of these agitations is the failure of governance at all levels to improve people’s

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socioeconomic conditions. The groups engaged in agitation, according to Wakili and Abbas (2018, p. 15), include the following: The Oodua Poeple Congress (OPC) in the West, Movement for the Survival of Ogoni People (MOSOP) in the South-South, Movement for the Actualization of Sovereign State of Biafra (MASSOB) in the South-East, and Arewa Consultative Forum (ACF) in the North, among others.

They remain nothing but arrowheads of their different social and political cleavages. Over the years, other issues that have been presented and defended by these sociopolitical groups include the rotational presidency, claims and counterclaims of marginalization, local government financial autonomy, sovereign national conference, and adopting unicameral legislature in place of the bicameral at the national level, among others. While each of Nigeria’s geopolitical zones has its distinct resources and one type of agitation or another, nowhere has the agitation for resource control become so intense, often confrontational, than the oil-rich Niger Delta. For instance, in the Niger Delta region of Nigeria, there are the Movement for the Survival of the Ogoni People, Ijaw Youth Council, Committee of Oil Producing Areas, the Ogoni Bill of Rights, the Ikwerre Charter of Demands, the Movement for the Emancipation of Niger Delta, etc. (Shebbs & Njoku, 2016). The activities of these groups are geared toward influencing the resource control of their region. They often claim that, since the resources are domiciled in their land, they own them, and they have every right of decision regarding its exploration and usage. Most of the time, their agitations are reflected and attended, as could be seen in the establishment of NDDC in 2010 by the federal government of Nigeria when they make strict demands from the government by issuing threats to the government. Similarly, the federal government under President Umaru Musa Yar’adua introduced the Presidential Amnesty program, which gave training opportunities for Niger Delta indigenes. Furthermore, the Nigerian government has launched a series of programs, such as the YOUWIN Niger Delta program, to enhance the living standards of the community people in the Niger Delta. Unfortunately, all these political events are not satisfying the people. The Niger Delta people criticize the influences of any ruling government who benefits from oil sales and the oil business. They criticize the way in which excess crude oil funds are used and the embezzlement of funds by individual politicians. As a result, the derivation principle is not fully appreciated by oil-bearing communities (Shebbs & Njoku, 2016). The Niger Delta region has one of the largest oil deposits in the world. As an oildependent economy, Nigeria has historically made billions of dollars from crude oil extracted from Niger Delta communities. However, this has not translated into socioeconomic development in the region. People of the region, in the words of Egbegbulem (2011, p. 226): [. . .] remain in abject poverty and deprivation as they lack basic things of life like water and electricity. Life in the creeks of the Niger Delta is anything but prosperous. It is a region where time seems to have stood still and where people live in the most meagre of existence, leaving them bitter and angry from not having benefitted from the black gold that makes Nigeria Africa the largest producer.

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Therefore, the central question of the Niger Delta region is why should oil revenue be shared with communities where oil is not being produced even when producers are in a deplorable condition? Consequently, these communities have questioned the existing revenue sharing formula, as it concentrates much of Nigeria’s resources in the federal government at the expense of states. Moreover, while some of these communities demand the outright cancellation of the existing sharing formula, others are no longer interested in staying under the federal republic. According to Wakili and Abbas (2018, p. 8): The advancement by the indigenous people of the Niger Delta, individually or in groups who organize peaceful movements or violent struggles, is claimed to have been addressing fundamental developmental challenges in the region characterised by neglect, poverty, environmental degradation, and poor infrastructure, among others in the region. However, while this struggle is considered legitimate, the methodology adopted over the years has taken extreme dimensions by militant groups in the region, thereby threatening the nation’s peace and security.

This is evident in the kidnap of people, destruction of property, and murder that take place in the oil communities and are carried out by the militants. Often, it has been recorded that the victims of these militants have no individual issues with the militants who oppress them or have direct involvement with the resource control system of the country; rather, they fell victim to the insurgence of man’s cruelty. The government most often truncates the groups’ effort by either buying up the leadership of these groups or arresting and prosecuting them; this is often the case when bribery and incentives do not work. To fault the government’s grid, community groups make use of force and radical means to press their actions and intentions to reality. In most cases, civil society organizations (CSO), nongovernmental organizations (NGOs), and prominent personalities who are residents of the oil area come up to champion agitations on their individual capacities to attract government attention. Given this, the Northerners have consistently kicked against the southern agitation seeing any attempt to allow states to control their resources as a recipe for disintegration. The Northerners thus argue that resource allocation should be based on other socioeconomic parameters, such as population size and landmass, rather than the region’s resource endowment and generative abilities. Therefore, emphasis is placed on the federal government’s control and centralization of resources and, more particularly, oil revenue, which Nigeria currently depends on (Chibueze, 2011). The Northerners thus believe that oil is a gift from God to every part of the country, which He locates in certain areas and therefore has to be shared equally. They even view the Niger Delta as wanting to entrench their communities to the detriment of larger Nigeria.

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4 Corporate Social Responsibility and Resource Control Corporate social responsibility (CSR) could be very effective in addressing agitations related to resource control in Nigeria. As conceptualized in some quarters, corporate social responsibility is the deliberate and sustained system of ensuring mutual benefits or a win–win situation for an organization and all its stakeholders as opposed to focusing only on shareholders’ interests. The stakeholders of an organization include the community, interest groups, government, regulatory bodies, and international bodies such as the United Nations and its agencies. It is a concept that underlines the thrust of good corporate citizenship (Wole & Kunle, 2020). Some scholars believe that corporate social responsibility has transformed into sustainability. Sustainability to these scholars represents corporate social responsibility activities that will ensure the sustainable or continuous being of the society (Hawkins, 2006). Corporate social responsibility is also a practice of investing part of the profit of an organization in the development of its environment so that those who bear the brunt of their operations will benefit. In the contemporary world, business organizations’ success depends on how positively they can influence people’s lives within their environment (Ademolekun & Ekundayo, 2001) cited in Wole and Kunle (2020). As a concept, CSR was first introduced in 1954 in Howard R. Bowen’s book entitled Social Responsibilities of the Businessman, where the author, according to Amadi and Abdullah (2012), argued that managers have an ethical duty to consider the wider social impact of their decisions and warned that corporations that fail to encourage broad social contracts should cease to be regarded as being legitimate. Developmental challenges such as poverty, unemployment, environmental pollution, illiteracy, poor health facilities, and decayed infrastructure are the characteristic features of developing countries such as Nigeria. These challenges have over the years been compounded by poor governance at all levels. The consequence is (in accordance with frustration–aggression theory) a high rate of criminality and violence rampant across societies. The militancy that characterizes the Niger Delta, for example, is a direct result of alienation, neglect, and frustration communities have suffered over decades. Despite its abundant natural resources, a major aspect of the region is its general state of underdevelopment, underemployment, extreme poverty, and lack of proper and adequate infrastructure. Failed and abandoned development projects meant to improve people’s material living conditions characterize the rural areas of the region, while economic and social rights to an adequate standard of living remain unfulfilled (Maxted, 2006). The United Nations Development Programme (UNDP) describes the region as suffering from administrative neglect, as the majority of the people of the region do not have access to clean water or healthcare (UNDP Report, 2006). The people in the Niger Delta region are deprived of basic democratic dividends, which they deserve, such as welfare, security, social amenities, etc. Approximately 73% of the people lack access to safe drinking water, almost 70% of households lack

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electricity, approximately 94% of the population lacks access to telephones, and less than 40% are enrolled in primary school (Ibeanu, 2006). The rural communities complain of the hardship they pass through as a result of the oil spillages that take place in the area following the exploration of oil by the oil companies, but the government gives deaf ear to them. However, by the nature and structure of Nigeria’s derivation principle, there should not be a problem with resource allocation if the principle is duly applied. In contrast, the proceeds from oil are not transferred for effective utility to regional development. Political leaders show little concern for people’s welfare. Despite environmental degradation, which has assaulted the natural value of the oil area, the government and political leaders keep calm about it. This is one of the contributing causes of the conflict in the Niger Delta region. It is pertinent to note that when resources are discovered but wrongly utilized, then there is a more critical consequence. This is mostly occasioned by cases where government exploits resources from lands without visible benefits replicating in the land from which the resources were taken. This is further proven by IFRA (2005) that, in most oil communities, conflicts and crises are witnessed because: [...] an unrestrained exploitation of natural resources is done at the expense of local oil communities which do not benefit enough from salaries, mineral rents or oil royalties. They suffer from environmental degradation of their homeland”, all because of bad governance and poor planning.

As a result of these abnormalities, the communities in the Niger Delta region urgently need intervention from business organizations through corporate social responsibility. While multinational corporations (MNCs) have historically been involved in community development programs in the Niger Delta, the government at all levels and political elites in Nigeria continue to blame those for the poor state of the region, socially, economically, and environmentally. Such a culture of blame often incites the community member into believing that the MNCs are massively exploiting them while giving too little or nothing to them in the form of development. This has occasioned community protests, agitations, and conflicts (Amadi & Abdullah, 2012). In the Niger Delta area, oil rents are paid to the federal government directly by the oil companies that domicile their businesses in the community. While the oil companies do some domestic welfare services, they expect the federal government to sort out the general welfare of the oil communities and oil landlords with the rents paid to them. The federal government takes the entire rent from oil and shares it between the federal, state, and local governments by what is known historically as the derivation principle. This has led to serious agitations by different groups within the region to take absolute control of their resources. Therefore, CSR is an alternative to addressing various agitations in the Niger Delta region and beyond. Specifically, the various activities, programs, and projects that a business organization can undertake to earn the title of a socially responsible company capable of dousing tensions and agitations include the following: (i) Constructing roads and bridges and building public schools in towns and various communities

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(ii) On the part of the companies, providing employee welfare through giving them good pay and other fringe benefits, including housing and other medical facilities (iii) Providing parks, garages, and recreation centers for public use (iv) Providing healthcare facilities and making efforts to protect the environment (v) Funding research projects and encouraging the endowment of professional chairs in the universities (vi) Sponsoring sporting activities nationally and internationally (vii) Contributing to welfare and security in communities, villages, and towns (viii) Doing something to stem the tide of social ills, such as piracy, armed robbery, kidnapping, ritual killing etc. (Amadi & Abdullah, 2012) To cite a few examples, the Mobil Oil Company was said to have endeared itself to the general public in Lagos when it constructed a strategic road from Ajegunle Boundary (Apapa) to the major road linking Apapa Wharf. The road has since changed its name from “Malu Road” to Mobil Road to the joy and approval of the general public (Obi, 2011). Similarly, in fulfilling Shell obligations as enshrined in its General Business Principles, the company pays all taxes and royalties to Nigeria’s Federation Account, contributing 3% of its annual budget to Niger Delta Development Commission (NDDC), an interventionist agency saddled with the responsibility of ensuring sustainable development of the region. In addition, Shell, as the first MNC situated in the region, developed a social investment scheme through which it intervenes in the provision of infrastructure and services to uplift and better the lives of people in the region. The scheme focuses on enterprise development (Shell LiveWIRE, which is Shell’s flagship youth enterprise development program that provides training and finance to young people between the ages of 18 and 35 to start or expand their own businesses), university scholarships, school infrastructural development, community health insurance schemes, healthcare infrastructural development, access to energy, and provision of social infrastructure, such as water construction of market stalls, roads, sanitation, and community centers (Shell, 2018, 2019). Additionally, Shell’s 2017 Sustainability Report reveals that Shell contributed $109.9 million to NDDC in 2017. These amounts may be huge, as quoted, but the question remains whether the investments were able to cater to the welfare and livelihood needs of the people of the Niger Delta. Expectedly, all the funds released by Shell and other MNCs for the social investment scheme and other community development programs should translate into the expected results. Unfortunately, it is disheartening to know that despite the huge amounts released by oil companies, these impacts are not felt in the region; rather, the region is characterized by people in a penury, degraded environment, insecurity, illegal oil bunkering and refining, unemployment, high illiteracy rate, poor healthcare services, poor sanitary conditions, lack of drinkable water, etc. This made the region a clear definition of the paradox of poverty in the midst of plenty. This paradox generates allegations of various degrees on multinational oil companies over the implementation of their various socially responsible development initiatives (Mbalisi & Okorie, 2020).

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Some of the MNCs have been accused of encouraging corruption within the region where they spent more money on bribes than on community development projects. Local contractors, often traditional leaders, in turn take their own percentages before passing a share of the benefit of the oil money to their own supporters and so on down the chain. Each elite in the oil-producing community thus becomes rich and is prepared to tolerate the inconveniences of oil company presence, such as environmental pollution, for the sake of continued financial gain (Human Right Watch, 1999). These narratives brought a nightmare into the Niger Delta region of Nigeria, as socioeconomic development expected to be achieved through oil wealth was exchanged for environmental degradation and consequently the loss of livelihood sources of the oil communities. This triggered a crisis between the host communities and MNCs as well as the federal government of Nigeria (Idama, 2017). In essence, many researchers have recognized the significance of CSR for business organizations and MNCs operating in developing countries, especially the desire to attract foreign direct investment and jobs as a development strategy. It is argued in some quarters that developing countries recognize that MNC investment provides imminent economic benefits and a crucial foundation for economic prosperity. With economic prosperity, agitation for resource control and other causes will be greatly, if not entirely, contained.

5 Conclusion: Dousing the Tension Through CSR This paper maintains that agitation for resource control is historically a characteristic of Nigerian politics. The agitation centered on the need for broader inclusion of communities in the control and management of resources found in their terrain, and it is more often instigated by the poor standards of living of the agitators. While the agitations are genuine and justifiable to some extent, it is ironic that the government has failed to address its immediate and remote causes over the years. However, this is not to say that the government has entirely kept itself aloof from the plight of resource-bearing communities. The government has set various special development commissions to address these challenges. Nevertheless, commissions such as the Oil Mineral Producing Areas Development Commission (OMPADEC) and the Niger Delta Development Commission (NDDC) have not bequeathed significant improvement in the welfare of the Niger Delta people due to corruption and mismanagement of resources occasioned by the composition of the commission, which allows for financial misappropriation. Therefore, it is feared that the people’s conditions (in the region) will continue to worsen unless drastic measures are taken. In this regard, amid its failure, the government can alternatively arrest the situation in resource-producing communities through legislation that will mandate the oil companies and other businesses to discharge their corporate social responsibility effectively. Until recently, many developing and underdeveloped countries have not yet introduced any law or enactment to implement and practice CRS by the

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entire corporate world. According to Ungunwanyi and Ekene, “there is no law in place to the Nigerian government that forces companies to practice CRS, foreign and local companies lack the necessary drive to effectively carry out CRS because they are not mandated by law.” In other words, the implementation of CRS is not regulated in Nigeria. Therefore, the present situation in the country calls for a more active approach from the government to implement CSR meticulously. If discharged effectively by focusing on the programs and projects identified in this paper, such as job creation, provision of infrastructural facilities, environmental sanitation, provision of scholarship, poverty alleviation, etc., CSR has the great potential of addressing tensions and agitations that characterize resource-producing communities in the Nigerian Niger Delta region and beyond.

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IFRA. (2005). The Niger Delta: Territorial control, ethnic rivalries and management of oil and natural resources. Lukpata, I. V. (2013). Resource control in Nigeria: The current controversies. IOSR Journal of Economics and Finance (IOSR-JEF), 1(6), 01. Maxted, J. (2006). Exploitation of energy resources in Africa and the consequences for minority rights. Journal of Developing Societies, 22, 29. Mbalisi, O. F., & Okorie, C. U. (2020). Implementation of corporate social responsibility by oil companies in the Niger Delta region of Nigeria: Myth or reality African research review. An International Multidisciplinary Journal, Ethiopia, 14(1), 119–132. Obi, N. J. (2011). Corporate social responsibility: How socially responsibility are business organization today? International Journal of Science, 3(6). Omojuwa. (2001). Resource control and federalism. Heinemann Books. Petroleum Industrial Law. (2012). Ownership and control of petroleum resources. Section 2, p. 13. Federal Government of Nigeria Printing Press, Abuja, Nigeria. Raji, A., et al. (2013). The politics of resource control in Nigeria example of Niger Delta region, 1990s–2010. Kuwait Chapter of Arabian Journal of Business and Management Review, 3(2), 1. Richard, A. O., & Eme, O. I. (2015). State governors and revenue allocation formula in Nigeria: A case of the fourth republic. International Journal of Accounting Research, 2(7), 14. Rodney, W. (1972). How Europe under developed Africa. Panaf Publishing. Kolawole, S. (2021). True federalism and other fallacies. https://www.thecable.ng/true-federalismand-other-fallacies/amp Saro-wiwa, K. (1994). A month and a day: A detention diary. Spectrum Books Limited. Shebbs, E. U., & Njoku, R. (2016). Resource control in Nigeria—Issues of politics, conflict and legality as challenge to development of the Niger Delta region. Journal of Good Governance and Sustainable Development in Africa, 3(3), 32–45. Shell. (2018). Our activities in Nigeria: Shell sustainability report 2017. Shell. Shell. (2019). Shell in Nigeria: Social investment. Shell. Ude, D. U. (2019). A critical history of resource control in Nigeria. International Journal of Development Strategies in Humanities, Management and Social Sciences, 9, 1. UNDP. (2006). Niger Delta human development report. Wakili, G., & Abbas, I. A. (2018). Agitation for restructuring and resource control in Nigeria’s federalism: Issues, perspectives and the way forward. Journal of Politics and International Affairs, 6(1). Wole, A., & Kunle, D. (2020). Corporate social responsibilities practices in Nigeria: An exploration of selected private sector organizations. CJSMS, 5(1). Dr Halimatu Muhammad Bande teaches at the Department of Business Administration, Federal University, Birnin Kebbi, Kebbi State, Nigeria. She holds Bachelor, Masters, and PhD in Business Administration from Usmanu Danfodiyo University, Sokoto. She also holds a Postgraduate Diploma in Education. Dr Bande earlier worked at Waziri Umaru Federal Polytechnic as a lecturer in the Department of Business Administration and Management Studies before joining the services of FUBK. While at the Polytechnic, she served in many committees, at different capacities, including being the Head of the Department of Preliminary Studies and Coordinator of Gender Issues. Mrs. Bande is a member of various professional bodies, among which are the Nigerian Institute of Management (NIM) and Teachers Registration Council of Nigeria (TRCN). Dr Halima Muhammad Bande has attended a number of local and international conferences and presented papers and is well published in local and international journals. Her areas of research interests include strategic management, entrepreneurship, corporate social responsibility, public sector management, and business ethics. Mrs. Bande is currently the Head, Business Administration, former Deputy Dean of Student Affairs, Chair Faculty of Social and Management Sciences Examination Misconduct Committee, Chair of University Bus Service Committee, and member of University Ethics Committee, among others.

Corporate Social Responsibility in the Extractive Industries in Nigeria: The Role of Public Administrators Wasiu Abiodun Makinde

1 Introduction Corporate social responsibility (CSR) has become a well-known concept among business owners, researchers, academics, and government officials (public administrators). The concept asserts a voluntary contribution to the sustainable development of communities hosting different organizations, whether private or public. Corporate social responsibility (CSR) advocated for a mutual relationship of the organization with various stakeholders. The social responsibility of organizations toward society is not new and can be traced back to several centuries. Agudelo, Johannsdottir, and Davidsdottir (2019) traced that the social responsibility of organizations or corporations began to appear in the literature through discussions of authors on the specific social responsibilities of companies in the 1930s and 1940s. The decades that followed experienced social expectations toward corporate behavior that resulted in corporate social responsibility (CSR). Moreover, there has been controversy historically about corporate social responsibility (CSR). Freeman and Dmytriyev (2017) provided evidence of the so-called champions of free markets led by Professor Milton Friedman of the University of Chicago, who argued that corporate social responsibility (CSR) was essentially a bad idea, violating the right of the business owners through the use of corporate resources to solve social problems. He argued that these steal shareholders’ resources should have used their resources privately. Despite this controversy, corporate social responsibility (CSR) has been adopted and developed in the literature of management and business ethics, often as a counterpoint to Friedman’s ideology. There is an increasing focus on the need for both private business and

W. A. Makinde (✉) Department of Public Administration, The Federal Polytechnic, Ilaro, Ilaro, Ogun State, Nigeria e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_15

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public sector organizations to take concrete and proactive steps in corporate social responsibility (CSR). Organizations operate in a dynamic, uncertain, and complex environment that considers the interest of their external public in day-to-day operations. Tomazevic (2019) stated that effective corporate social responsibility (CSR) is a fundamental avenue to creating good relationships with host communities through the provision of social services in the area of environmental protection and management, health and safety, community development, education, youth and women empowerment, and general development. However, the emergence of modern public administration shifted administrative responsibilities and responsiveness. The changing role of public managers through New Public Management reforms and New Public Governance paradigms has challenged untested assumptions in public sector organizations. Through the new regimes, public administration changed the orientation and behavior of public managers and public sector employees. They are to ensure customers’ responsiveness or orientation in public service delivery, showing some sign of social responsibilities. Additionally, public administration regulates and controls private sector organizations in social responsibilities (Jurkowska-Gomulka, Kurczewska & Bilan, 2021). The era of New Public Management and New Public Governance, with its rules and idea of bringing methods of operation of public administration closer to business methods, changes public sector organization’s vision to include implementation of corporate social responsibility (CSR) activities within their host communities. This positioned public administration as not the only regulatory actor in the implementation of corporate social responsibility (CSR) but also as a provider of different activities of corporate social responsibility (CSR) to the host communities (Albareda, Lozano & Ysa, 2007). The Niger Delta region of Nigeria is a region with rich oil and gas resources that contribute to the country’s highest revenue generation. Multinational companies and organizations licensed by the federal government under its public administrative agency (Department of Petroleum Resources) drill oil in the region and contribute to the degradation of the region through contamination of water, lands, and air, resulting in varying difficulties in fishing and farming activities. These environmental challenges attracted hostilities to the companies by members of host communities (Uduji & Okolo-Obasi, 2018). Moreover, the responsibilities for implementing the project on corporate social responsibility (CSR) are not solely in the hands of multinational companies, as public administrative authorities and their officials have roles and duties. Public administrators, as major stakeholders, especially in organizations in extractive industries, have specific roles to play in ensuring the implementation of corporate social responsibility (CSR). This chapter will shed light on the roles of public administrators or the relationship that public administrators have with corporate social responsibility (CSR) in extractive industries using the case of the Niger Delta region in Nigeria. Drawing on theoretical and empirical research, the chapter explores the role of public bureaucracies in influencing corporate behaviors to the benefit of host communities of extractive industries in the Niger Delta region of Nigeria (Uduji, Okolo-Obasi & Asongu, 2019; Uduji & OkoloObasi, 2018).

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2 Corporate Social Responsibility The definition of corporate social responsibility (CSR) has been a subject of debate among scholars. Although controversial, this concept has captured the attention and interest of various stakeholders, including business managers, government agencies and administrators, researchers, academics, consumers, and even ordinary citizens. Sari, Zauhar, Rozikin, and Riyadi (2021) quoted McGuire that they believed that corporations or organizations have legal and economic obligations and certain responsibilities to society beyond the production of goods and services leading to social responsibilities. Therefore, the corporation must pay special attention to political issues, education, security, social welfare, employee happiness, environmental hazards, and other social problems, especially those of the immediate environment. Supporting the argument, Gorg, Hanley, Hoffman, and Seric (2016) and Tomazevic (2019) argued that corporate social responsibility (CSR) organizations accept responsibility for societal interest, which aims to influence the host communities and other stakeholders in their operations. It is seen as achieving commercial success in ways that honor ethical values and respect people, the natural environments, and the communities. According to Sudrajat and Sikki (2020), CSR means that organizations that are either private- or public-owned have a duty that extends beyond their responsibilities to investors, the society, or the community of operation and beyond. Helmig, Spraul, and Ingenhoff (2016) subscribed that corporate social responsibility (CSR) is a business imperative and research focus arguing to support pressures or organizations to act in a socially responsible manner. Similarly, Fox, Ward, and Howard (2002) quoted the World Business Council for Sustainable Development (WBCSD), which argued that corporate social responsibility (CSR) is a commitment of organizations, public or private, to contribute toward sustainable economic, social, and environmental development, working with their personnel, families, the local community, and society at large for a better quality of life. Corporate social responsibility (CSR) is perceived as a duty to constitute the groups in a society other than stakeholders and beyond that stated by law or union contract. Jurkowska-Gomulka, Kurczewska, and Bilan (2021) quoted the European Commission, which described corporate social responsibility (CSR) as the responsibility for the impact of decisions made by the organization and their activities on society and the environment through ethical behavior and transparency that contribute to sustainable development. These include the welfare and health of society, considering stakeholders’ expectations, consistent with international norms of behavior and compliance with prevailing applicable laws integrated throughout the organization. BeBe and Bing (2016) describe corporate social responsibility (CSR) as the more to provide a tool for organizations to support and solve social problems and benefit the society of operation to fulfill commitments. It is the commitment of managers in both private and public organizations to protect and improve societal and environmental health. It also addresses the ethical, commercial, legal, and other expectations from society to the business and their decision to fairly balance the

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claim of all the key stakeholders. Sari et al. (2021) further stated that corporate social responsibility (CSR) is a series of efforts to increase the capacity of communities and corporations to create solidarity as a basis for dynamic, mutually beneficial social relationships while still considering and supporting environmental sustainability in the long term. The United Nations defines corporate social responsibility (CSR) as the process by which the efforts of the people themselves are united with those of governmental authorities to improve the social, cultural, and economic condition of communities, to integrate these communities into the life of the nations, and to enable them to contribute to national development. Additionally, Mathende and Nhapi (2017) describe corporate social responsibility (CSR) as a management concept that focuses on companies integrating environmental and social concerns in their everyday business operations and interactions with stakeholders to ensure the achievement of a balance between economic, social, and environmental imperatives as well as meeting the expectations of stakeholders. Uduji, Okolo-Obasi, and Asongu (2019) argued that corporate social responsibility (CSR) is a shared belief within the organization about the right course of action that will provide the social, environmental, economic, and other externalities’ impact of the organization on stakeholders. Moreover, Albareda, Lozano, and Ysa (2007) argued that CSR is a concept that encourages companies to voluntarily contribute to a better society and cleaner environment and enhance their relationship with stakeholders. Deus, Seles, Viera, and Battistelle (2019) argued that the pressure from the globalization of nongovernmental organizations (NGOs) resulted in corporate social responsibility (CSR) becoming part of the debate on sustainability within organizations. They argued further that corporate social responsibility (CSR) focused on economic, environmental, and social benefits as part of the pillars of sustainable development as defined by the United Nations Conference on Environment and Development in 1992. However, the International Organization for Standardization through ISO 26000 provides a noncertificate standard that aims to assist an organization in contributing to sustainable development, as they (companies) cannot assume the role of government in social welfare. The standard is governed by principles that fall within seven core subjects: I. Organizational Governance: Organization should have a governance system and practices that consider principles of social responsibility. Strategies, targets, and objectives should be established under a vision of commitment to social responsibility, balancing the immediate and future needs of the organization and its stakeholders. Involvement of all levels of workers by balancing the level of responsibility, authority, and capacity of the organization’s decision-makers (Garcia-Sanchez & Garcia-Sanchez, 2020). II. Human Right: Respect the Universal Decalration of Human Rights and fundamental labor rights prescribed by the International Labour Organization (ILO). In a proactive perspective, the government should make it feasible to fulfill economic, social, and cultural rights, adapt goods and services to the

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purchasing power of the poor, and facilitate community access to education (Pavlynshyn, Ustymenko, Babiuk, Kaida & Shkrebets, 2021). The Environment: Manage the environment by taking responsibility for the environmental impacts caused by organizational activities. Obey legislation and implement effective environmental management. Employ operational practices, approaches, principles, and strategies to prevent pollution; minimize waste, emissions, and effluents; and optimize natural resources. This contributes to preserving the environment’s biodiversity, mitigating climate change, and restoring natural habitats (Subramaniam, Kansal & Babu, 2015). Labor Practices: Compliance with basic labor standards, principles, and rights established by the International Labour Organization (ILO) contributes to ensuring that companies or organizations do not engage in abuse and unfair competition. Work in the organization must be performed by men and women legally recognized as employed or self-employed. Organizations should follow the laws established by their countries, regardless of the requirement or support offered by governments. Additionally, an organization’s practices or code of conduct must be consistent with the Universal Declaration of Human Rights and International Labor Standards (De Sinay, Araujo, Sinay & Dalbem, 2019). Fair Operating Practices: Positive results can be obtained by exercising leadership and promoting the adoption of social responsibility. Organizations must implement anti-corruption policies and practices, training and raising awareness among their employees, suppliers, representatives, and outsourcers to eradicate bribery and report a violation of its policies. The organization’s policies must be transparent, and practices should influence activities toward social responsibilities. Community Involvements and Development: Organizations should recognize religious, cultural, historical, traditional, and community needs in interacting with them. They should consider themselves as part of the community, preventing and solving some community problems. Organizations should formulate policies, implement and evaluate development programs, and act with the competent authority or humanitarian organizations in unexpected disasters, crises, and catastrophes. Even the United Nations Millennium Declaration emphasizes that development should be driven and guided by public policy, and the process depends on the contributions of all organizations. Therefore, community involvement will help contribute to achieving sustainable development goals. Consumer Issues: Organizations should always provide accurate information; apply fair, transparent, and useful contractual processes; employ fair marketing practices; promote sustainable consumption; and invest in the design of products and services that provide access to all. Additionally, organizations must seek to minimize risks arising from using products and services, using design, manufacturing, provision of information, distribution, support services, and protecting consumer privacy (Deus et al., 2019).

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In the same vein, the International Organization for Standardization quoted in Deus et al. (2019) and Jurkowska-Gomulka et al. (2021) defines corporate social responsibility (CSR) as the responsibility of organizations for the impact of their decisions and activities on society and the environment through transparent and ethical behavior that contributes to sustainable development. These include the welfare and health of society, compliance with applicable laws, and international norms and behaviors. Chukwuma and Agbim (2021) describe corporate social responsibility (CSR) as a way to achieve commercial success by honoring ethical values and representing people, communities, and the natural environment. Corporate social responsibility (CSR) is beyond merely accepting and recognizing social responsibility as a social philosophy but integrating corporate social responsibility (CSR) activities into organizations’ and individuals’ mentality, attitudes, decisionmaking processes, and culture. Szocs and Schlegelmilch (2020) argued for a move away from a voluntary corporate social responsibility (CSR) toward an impactoriented corporate social responsibility (CSR) embedded in the corporate DNA to achieve an integrated corporate social strategy instead of separate corporate social responsibility (CSR) activities. Freeman and Dmytriyev (2017) describe corporate social responsibility (CSR) as an organization’s obligation to be accountable to its stakeholders in all its operations and activities. It can be viewed as all efforts of an organization or corporate institutions incorporated into its business model, contributing to the sustainability and welfare of its immediate environment. Hoi, Wu, and Zhang (2013) argued that corporate social responsibility (CSR) is corporate actions affecting all of the firm’s stakeholders, including communities, employees, customers, government and its agencies, shareholders, investors, and creditors, among others, in areas of education, health, employee relations, human rights, diversity, security, and the environment. Hole, Pawar-Hole, and Bendale (2020) corroborate that corporate social responsibility (CSR) policies help in the process of evaluating and reporting responsive projects and those of organizational programs. Waheed and Yang (2018) argued that corporate social responsibility (CSR) is an organizational self-regulation and internal policy that is recognized alternatively as corporate sustainability, corporate conscience, sustainable business, corporate citizenship, and responsible business. They further argued that there are two core dimensions of corporate social responsibility (CSR) activities: external corporate social responsibility (CSR), which is concerned with the outside operations of the corporation, and internal corporate social responsibility (CSR), which is concerned with the internal operations. Calvo and Calvo (2019) described corporate social responsibility (CSR) as the commitment of businesses to contribute to sustainable economic development, working with employees, their families, the local community, and society for the improvement of quality of life. Anser, Zhang, and Kanwal (2018) provided a more precise description of corporate social responsibility (CSR) by identifying the organization’s obligations toward society, differentiating the organization’s responsibilities from the social responsibilities of governments and mere profit-making. Therefore, they define corporate social responsibility (CSR) as the social responsibility that includes the legal, ethical, economic, and discretional

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expectations that society has from organizations at a given point in time. Sharma (2019) provided a similar analysis that organizations that manage a good relationship with their stakeholders in society will garner more economic success over the years through their influence. The above is similar to the submission of Jimenez-Parra, Alonso- Martinez, and Godos-Diez (2018) that corporate social responsibility (CSR) is rooted in organizational, institutional, or individual considerations. At an organizational level, it stated specific corporate variables or factors influencing corporate social responsibility (CSR) initiative, which can be organizational size, structure, or settings. At an institutional level are some determinants of corporate social responsibility (CSR), such as existing regulations and policies and the country’s sociocultural values. Moreover, at an individual level, management and employee values are included.

3 Theoretical Bases of Argument The theoretical bases of argument for the role of public administrators in corporate social responsibility in extractive industries are institutional theory and stakeholder theory. Institutional theory asserts that institutions within an environment can strongly influence the developmental activities of formal structures. Institutions are social constructs described as formal rules, cognitive schema, routine reproduction processes, and cultural frameworks for granted. Institutional theory is a theoretical framework for analyzing organizational and other social phenomena by viewing the social world as significantly comprising institutions, enduring practices, rules, and structures that set conditions for actions (Motilewa, Worlu, Agboola, and Olokundun, 2016). Therefore, private and public organizations, nongovernmental organizations, and other independent organizations that are institutional determinants monitor the social behavior of organizations and practices of corporate social responsibility (CSR) in various countries (Szocs & Schlegelmilch, 2020). Stakeholder as a concept was first used in an internal memorandum in 1963 at the Stanford Research Institute. As a theory, the publication of Hein Kross and Klaus Schwab in 1971 originated stakeholder theory, where they argued that the management of a modern business must serve not only stakeholders but also all stakeholders to achieve long-term growth and prosperity. The relationship between stakeholder theory and corporate social responsibility (CSR) has been categorized as a natural fit (Helmig, Sprail & Ingenhoff, 2016). Stakeholders are persons or groups that can affect or be affected by pursuing the organization’s objectives. These persons or groups have various and sometimes incongruent interests but are motivated to participate in organizational activities. Stakeholder theory argues that an organization is an open, flexible system or nexus of actors, that is, stakeholders. Stakeholder theory is a theory of business ethics and organizational management that accounts for multiple constituencies impacted by business entities such as suppliers, creditors, government agencies, local communities, employees, and investors (Fox, Ward & Howard, 2002; Garcia-Sanchez & Garcia-Sanchez, 2020).

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Additionally, stakeholder theory asserts that organizational stakeholders include customers, creditors, employees, investors, and, most importantly, host communities. Therefore, the organization’s performance, success, and sustainability depend on how well it can manage its relationship with stakeholders. Stakeholder theory argues that the interests of stakeholders must be pursued single-mindedly. The relevance of theories to the role of public administrators in corporate social responsibility (CSR) in extractive industries in Nigeria is that various institutions of government, such as Nigeria Extractive Industries Transparency Initiative (NEITI), among others, will shape activities on the corporate social responsibility (CSR) of those organizations involved in the extraction of mineral resources. In the same vein, governmental institutions or agencies are part of the stakeholders that organizations must maintain a mutual relationship, especially related to extractive industries carrying out activities that might affect citizens’ health and welfare (Szocs & Schlegelmilch, 2020).

4 Corporate Social Responsibility in Extractive Industries in Nigeria Extractive industries participating in the extraction of mineral resources for local production of goods and services and importation contributed to the socioeconomic development of any nation. However, their activities degraded the environment and contributed to environmental hazards, climate change, and health challenges to inhabitants and increased the government budget on social services (Helmig et al., 2016). Therefore, the government’s interest in those organizations’ activities, especially related to their social responsibilities, is justified. Rachel and Stephen (2020) stated that the state’s role in extractive industries can be examined from the key lens of the development state. In Nigeria, the Niger Delta region, which is well known for oil exploration, is the best case study to describe how companies operationalize corporate social responsibility (CSR). Chukwuma and Agbim (2021) stated that transnational oil companies actively shaped the ensuring debates around corporate social responsibility (CSR) and responding to external stakeholder pressures. Transnational companies exploring oil often adopted new strategies that attempted to address the weakness of previous corporate social responsibility (CSR) strategies, defining what constitutes their social responsibility strategies and shaping the nature of the debate around what constitutes their social responsibility in the region. Additionally, extractive industries in the region have been learning interorganizational strategy, which is crucial to the successive improvement of corporate social responsibility (CSR). There are also subtle variations in the corporate social responsibility (CSR) strategies adopted by the different transnational companies in the region. The transnational company adopted slightly different strategies based on the continent of origin and whether oil is onshore or offshore. For example, ExxonMobil’s approach to corporate social

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responsibility (CSR) has been largely passive due to its focus on mainly offshore oil, largely managed internally with a slight partnership with nongovernmental organizations (NGOs) to deliver social responsibility to host communities. However, a collaborative approach, a shift away from unilateral management of Total and Shell corporate social responsibility (CSR), has been identified in host communities (Chukwuma & Agbim, 2021). Uduji et al. (2019) stated that the Nigerian conception of corporate social responsibility (CSR) is widely different from the Western conception. They suggested that corporate social responsibility (CSR) in Nigeria should address the peculiarity of the socioeconomic development challenges of the country in areas of health, education, poverty alleviation, environmental degradation, infrastructural deficit, and security, among others. They further stated that the absence of government action in providing amenities for its citizens accentuates the role of multinationals in corporate social responsibility (CSR). These call for flexibility in corporate social responsibility (CSR) policy and practices by multinational companies operating in the Niger Delta region of Nigeria. The importance of corporate social responsibility (CSR) in the Niger Delta cannot be overemphasized. Corporate social responsibility (CSR) is necessary for the Niger Delta region of Nigeria due to the myriad of environmental devastation, impoverishment and socioeconomic dislocation, long history of multifaceted developmental problems, and neglect resulting from oil exploration. Social responsibilities are when hospitals and health centers are established, schools are built, and the companies employ qualified members of the communities. These levels of social responsibility will serve as contributing factors to the development of the region and the country (Tomazevic, 2019). Multinational organizations positively influence developing countries primarily through corporate social responsibility (CSR) initiatives focusing on cooperation with civil society and sustainable development. Ite (2004) stated that some multinational companies, particularly Shell, have now placed themselves in a leadership position among multinational companies in Nigeria by moving beyond simplistic notions of license to operate. Shell has recognized the need for cultural change and a more sophisticated attitude to environmental responsibility and human rights. Shell has also adopted and promoted the multistakeholder and partnership approach to poverty alleviation in the Niger Delta. It has successfully succeeded in attracting further foreign direct investment and international organizations to the Niger Delta. Additionally, Shell has assumed more responsibility for major socioeconomic development initiatives within the Niger Delta since 1995 and has done a better job in corporate social responsibility (CSR) than many Nigerian government development agencies. These have positioned Shell as a quasi-government and humanitarian organization in the Niger Delta, which is more visible than the Nigerian government in some communities. Shell has emphasized social accountability and transparency in its operations within the Niger Delta region of Nigeria (Uduji, et al. 2019; Amaeshi, Adegbite & Rajwani, 2016).

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5 Public Administration in Nigeria From Woodrow Wilson’s definition, the act of public administration implies the detailed and systematic application or execution of public policies and programs. Moreover, the implementation of public policies depends primarily on the successful management of ministries, departments, and agencies within the public sector. Hughes (2003) quoted Rosenbloom that the use of managerial, legal, and political theories and processes to fulfill executive, legislative, and judiciary governmental mandates to provide service and regulatory functions for society is called public administration. In Nigeria, the public administration system is designed along the federal system of government being practiced. The central government is saddled with the responsibility of performing functions as prescribed by the exclusive legislative list of the constitution alone and performing in conjunction with the state or regional governments, those functions stated in the concurrent legislative list of the constitution, and the residual legislative list functions being performed by both the state and local government. However, extraction of minerals of any kind was classified under the exclusive legislative list of the constitution, giving the federal government sole responsibility to legislate and perform functions relating to the extraction of mineral resources within the territorial region of Nigeria. Those functions include licensing of companies involved in extractions, regulation of their extraction activities, and formulation of laws for environmental protection and regulations for corporate social responsibility (CSR). Despite the changes in the structure of governance around the world, with the introduction of New Public Management reforms in public administration, which advocated for a private sector management style of management in the public sector, public administrators’ activities in extractive industries in Nigeria cannot be overemphasized. New Public Management techniques may strengthen public administrators’ activities in the management of extractive industries, not only as regulators but also as providers of services, which will ameliorate the negative effect of the extraction of mineral resources on host communities (Sudrajat & Sikki, 2020).

6 Public Administration and CSR in Extractive Industries: A Case of Nigeria Corporate social responsibility (CSR) is an idea that corporate bodies or organizations should function in a broader social context, mainly as voluntary contributors to sustainable development, and has become a local, national, regional, and global concept. Currently, the social responsibility of the organization is expected of customers, contractors, trading partners, and public authorities (Pavlyshyn et al., 2021). In recent times, socioeconomic crises and challenges of sustainable development have resulted in compulsory ethical behavior by individuals, especially corporate bodies carrying out one form of business or the other in an environment. This

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circumstance has resulted in corporate social responsibility (CSR) being taken as a compulsory rather than a voluntary activity. Corporate social responsibility (CSR) has become a strong legal and moral duty even though it has received the attention of the public sector. Therefore, in addition to the context of investment activities, business actors were also required to show their responsibility toward community development by government regulations (Anser et al., 2018; Calvo & Calvo, 2019; Deus et al., 2019). The public administration, says Jurkowska-Gomulka, Kurczewska, and Bilan (2021), focused on corporate social responsibility (CSR) due to a reform movement called New Public Management. New Public Management in Public Administration postulates that public organizations’ operation methods should be brought closer to business methods. With this, public administration is acting as a regulatory agency or organization for corporate social responsibility (CSR) by private organizations and part of the providers of social responsibility. As a matter of importance, the Post New Public Management era advocated alternative models, network governance, and collaborative governance, which will shift the focus of public administration to environmental, social, and economic sustainability. Sari et al. (2021) argued that public administration, which is primarily public policy implementation and analysis, has shifted from a monocratic, hierarchical, and rule-based administration. Public policy theory is now a multidimensional approach that focuses on citizens’ welfare with the participation of private parties and civil society. This multidimensional approach to public policy is a supporting factor in managing corporate social responsibility (CSR). Sudrajat and Sikki (2020) stated that public administration is the management and organization of man and material to achieve the purpose of government. It also involves arrangements regarding the program for corporate social responsibility (CSR) within the state. Public administration’s focus on public values through accountability, transparency, and fairness and customer orientation in the era of New Public Management is a drive for boosting corporate social responsibility (CSR). The new approach to value-based activities in public administration has resulted in applying consensus orientation, participation, inclusiveness, and equity in public governance, which is directly tantamount to corporate social responsibility (CSR). Therefore, corporate social responsibility (CSR) is strictly associated with sustainable development in public administration. Public administration can be more productive and competitive when the public sector organizations are socially responsible and maintain committed organizational relationships between the organization and its employees. BeBe and Bing (2016) argued that social responsibility is the move to provide benefits to society and a tool for organizations to support and solve social issues. It is the commitment of managers to improve and protect environmental and societal health. For public organizations to be socially responsible, they must be concerned with organizational ethics, transparency, and commitment to public image and community. JurkowskaGomulka et al. (2021) argued that the gate for corporate social responsibility (CSR) in public administration was opened by the New Public Management rules, which advocate bringing the methods of operation of public administration closer to business methods. With such an idea or reform, the vision of public sector

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organization allows the implementation of corporate social responsibility (CSR) activities since they cannot and should not function in isolation from the host communities and the environmental and social challenges that arise in it. Through these, the public administration and its organizations are regulatory bodies for implementing corporate social responsibility (CSR) and are providers. They argued further that the Post-New Public Management era, usually referred to as the new public governance era, the new Weberian state, network governance, or digital era governance, requires a holistic approach and the participation of all stakeholders in decision-making and activities that will lead to sustainable development. Moreover, the focus on public values through accountability, impartiality, fairness, fair income distribution, consensus orientation, inclusive participation, and equity in modern public governance changes the involvement or activities of public administration in corporate social responsibility (CSR) in all sectors, including extractive industries. Apart from the future of multinational companies involved in Nigeria’s extractive industries that depend on corporate social responsibility (CSR) to the host communities, public administrative agencies also face agitations due to environmental degradation and climate change (Uduji et al., 2019). Rachel and Stephen (2020) argued that development state success depends on advancement in human capabilities and not just economic growth. This is possible through coherent state and nonstate apparatuses that can deliver collective goals of healthcare, poverty and inequality reduction, quality education, and environmental sustainability. Nigeria has reformed its public administration from the traditional public administration of Weber’s bureaucracy to the era of New Public Management. New Public Management is part of a plural state, considering private participation in citizen welfare. However, Nigeria is still struggling to implement most of the New Public Management principles. This span to all sectors of the economy, especially the extractive industries, is the focus of this chapter. Environmental degradation has been an issue of concern over decades in Nigeria, yet it is unresolved despite government political campaigns by almost all regimes. The Niger Delta region of the country suffers the most. Most multinational companies extracting crude oil have not done enough in the area of corporate social responsibility (CSR). Through its public administration system, the government complemented the problem due to its failure in regulatory activities and control (Tomazevic, 2019). In fact, Uduji and Okolo-Obasi (2018) stated that companies could efficiently operate in the Niger Delta region if adequate corporate social responsibility (CSR) programs were effectively implemented across the region. Corporate social responsibility (CSR) has been given increasing attention in the Niger Delta region by companies operating there. They argued further that the tendency to limit social investments to immediate host communities and not neighboring communities is also affected by the negative externalities of oil extraction or to emphasize the provision of social infrastructure over environmental protection in their corporate social responsibility (CSR) strategies. Hence, different strategies of corporate social responsibility (CSR) are adopted by different oil companies, but collaborative approaches to corporate social responsibility (CSR) continue to increase and become dominant in the region.

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Public administrators play critical roles in corporate social responsibility (CSR), especially within the extractive industries in Nigeria. Those roles are, but are not limited to: (i) Formulation of Regulatory Law in Extractive Industries: Formulation of laws or policy is the sole responsibility of legislators in all forms of government. However, in modern government, public bureaucracies or public administrators are involved in formulating public policies or laws that they will implement. They are in a better position to provide professional advice based on the experience that will improve the provision of corporate social responsibility (CSR) among organizations operating in extractive industries in Nigeria. They provide suggestions for laws or public policies based on field reports and observations based on factors impeding the effectiveness of corporate social responsibility (CSR) in extractive industries in Nigeria (Addison & Roe, 2018). (ii) Partnering Transnational Oil Company for Environmental Protection: Public administrators, through their public agencies or institutions, partner with multinational companies involved in the exploration of oil in the Niger Delta region of Nigeria to provide projects that will improve citizens’ standard of living region. Modern public administration under New Public Management and New Public Governance advocated for partnerships between the government, its agency, and the private sector to provide services to citizens (Albareda et al., 2007). (iii) Directly Providing Reliefs for Host Communities in Emergency: In case of emergency, public administrators and their agencies do provide goods that will ameliorate the negative effect of disaster in the region. Providing relief material for the host communities is a duty to support whatever private organizations are involved in exploring oil due to their activities that caused a disaster (Uduji, et al., 2019). (iv) Sanctioning Erring Transnational Company: Public institutions, through public bureaucrats, sanction transnational oil companies involved in exploration activities in the Niger Delta region of Nigeria. Public administrators involved in implementing policies relating to corporate social responsibility (CSR) can also sanction those organizations that fail to carry out their activities as stipulated by the law (Uduji & Okolo-Obasi, 2018). (v) Implementation of Policies on Corporate Social Responsibility: Public administrators are the main actors in implementing public policies related to corporate social responsibility (CSR) in extractive industries in Nigeria and other nations of the world. They are career officials of the government who are trained in implementing public policies or laws. Additionally, there is a need to incorporate the corporate social responsibility (CSR) concept in the policy paper of the public administration’s functions, providing for the inclusion of citizens in decision-making processes to the greatest extent possible. The spirit of corporate social responsibility (CSR) can also be seen in raising the effectiveness of New Public Management and New Public Governance and gradually involving citizens’ participation as stakeholders and as a method of obtaining additional

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analysis, opinions, or arguments helpful in optimizing the activities undertaken (Chukwuma & Agbim, 2021). As part of Nigeria’s effort toward corporate social responsibility (CSR) in the Niger Delta region, the Niger Delta Development Commission (NDDC) was established in 2000 through an Act of the National Assembly to replace the old Oil Mineral Producing Areas Development Commission (OMPADEC) that was established in 1993 to improve the standard of living of oil-producing regions. The Niger Delta Development Commission (NDDC) has the mandate to provide infrastructural development in the Niger Delta area and facilitate socioeconomic development in the region (Uduji, et al., 2019). However, Ite (2004) stated that there are growing concerns among political elites from the Niger Delta region that the future of the Niger Delta Development Commission (NDDC) might be worse than that of the Oil Mineral Producing Areas Development Commission (OMPADEC) if drastic measures are not put in place to reform the agency. This is due to the prevailing failure of the agency to discharge adequate social responsibility through infrastructural development, environmental protection and sustainability, and social services that will improve the standard of living of people living in the region despite huge amounts of money being budgeted yearly for the agency. Additionally, the agency has not left the news on issues of fraud, corruption, and budget padding in recent times, calling for total reform to achieve its original objectives. The above overview strongly demonstrates that the Niger Delta has a history of a nonperforming environment and development institutions, with implications for the high incidence of poverty in the region. The Nigerian government has generally been unable to implement sustainable solutions to the region’s poverty. This failure is partly due to poor governance, accountability, and corruption within the Nigerian political system and public administration. They are also due to the unreformed public administration system toward New Public Management and New Public Governance that advocated for an interorganizational or collaborative effort toward the discharge of social service and argued for social responsibility on the part of public administration for sustainable development (Uduji, Okolo-Obasi & Asongu, 2019; Cust, 2018; Rachel & Stephen, 2020).

7 Conclusion Corporate social responsibility (CSR) is expected to influence the standard of living of citizens of the host communities to organizations. These expectations vary from one community to another. Communities where extraction activities are being carried out will have demand different from where production activities or service activities are being carried out. However, in the case of Nigeria, with an analysis of the Niger Delta region where crude oil is being extracted, it is believed that implementing corporate social responsibility (CSR) in these regions would

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reposition the region’s livelihood. All stakeholders, especially the public administrators that serve as the instrument through which the government implements public policies, perform their roles that will improve the implementation of corporate social responsibility (CSR) in the region and, by extension, in Nigeria.

References Addison, T., & Roe, A. (2018). The regulation of extractive: An overview. In T. Addison & A. Roe (Eds.), Extractive industries: The management of resources as a driver of sustainable development. Oxford University Press. Agudelo, M. A., Johannsdottir, M. A., & Davidsdottir, B. (2019). A literature review of the history and evolution of corporate social responsibility. International Journal of Corporate Social Responsibility, 4(1), 1–23. Albareda, L., Lozano, J. M., & Ysa, T. (2007). Public policies on corporate social responsibility: The role of governments in Europe. Journal of Business Ethics, 74, 391–407. https://doi.org/10. 1007/s10551-007-9514-1 Amaeshi, K., Adegbite, E., & Rajwani, T. (2016). Corporate Social Responsibility in challenging and nonenabling institutional contexts: do institutional voids matter? Journal of Business Ethics, 134(1), 135–153. Anser, M. K., Zhang, Z., & Kanwal, L. (2018). Moderating effect of innovation on corporate social responsibility and firm performance in realm of sustainable development. Corporate Social Responsibility and Environmental Management, 25, 799. https://doi.org/10.1002/csr.1495 BeBe, K., & Bing, W. (2016). Social responsibility and organizational commitment in local public administration: The moderating role of organizational citizenship behavior and social bonding. International Public Administration Review, 14(2–3), 13–36. Calvo, N., & Calvo, F. (2019). Corporate social responsibility and multiple agency theory: A case study of internal stakeholder engagement. Corporate Social Responsibility and Environmental Management, 25, 1223. https://doi.org/10.1002/csr.1633 Chukwuma, O., & Agbim, C. W. (2021). Imperative of corporate social responsibility in developing the Niger Delta region of Nigeria. SAU Journal of Management and Social Sciences, 6(1), 125–134. ISSN: 2550-7302. Cust, J. (2018). The role of Governance and international norms in managing natural resources. In T. Addison & A. Roe (Eds.), Extractive industries: The management of resources as a driver of sustainable development. Oxford University Press. Deus, R. M., Seles, B. M., Vieira, K. R., & Battistelle, R. A. (2019). Organizational challenges to corporate social responsibility. In S. O. Idowu et al. (Eds.), ISO 26000 - A standardized view on corporate social responsibility, CSR, sustainability, ethics & governance. Springer Nature. https://doi.org/10.1007/978-3-319-92651-3_13 Dey-Sinay, M. C., Araujo, G. A., Sinay, L., & Dalbem, M. C. (2019). Brazilian trends in the practice of corporate social responsibility. International Journal of Logistics Systems and Management, 33(1), 26–41. Fox, T., Ward, H., & Howard, B. (2002). Public sector roles of strengthening corporate social responsibility: A baseline study. Corporate Social Responsibility Practices, Private Sector Advisory Service Department, the World Bank. Freeman, R. E., & Dmytriyev, S. (2017). Corporate social responsibility and stakeholder theory: Learning from each other. Symphonya Emerging Issues in Management, 1, 7–15. Garcia-Sanchez, I., & Garcia-Sanchez, A. (2020). Corporate social responsibility during COVID19 pandemic. Journal of Open Innovation Technology, Market and Complexity, 6(126), 1–21.

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Gorg, H., Hanley, A., Hoffman, S., & Seric, A. (2016). When do multinational companies consider corporate social responsibility? A multicountry study in Sub-Saharan Africa. European University Institute Robert Schuman Centre for Advanced Studies Global Governance Programme. Helmig, B., Spraul, K., & Ingenhoff, D. (2016). Under positive pressure: How stakeholder pressure affects corporate social responsibility implementation. Business & Society, 55(2), 151–187. Hoi, C. K., Wu, Q., & Zhang, H. (2013). Is corporate social responsibility associated with tax avoidance? Evidence from irresponsible CSR activities. The Accounting Review, 88(6), 2025– 2059. Hole, Y., Pawar-Hole, S., & Bendale, S. (2020). Corporate social responsibility: Perception, practice, and performance in present era. Journal of Xian University of Architecture and Technology, 12(2), 331–353. Hughes, O. E. (2003). Public management and administration: An introduction (3rd ed.). Palgrave Macmillan. Ite, U. E. (2004). Multinationals and corporate social responsibility in developing countries: A case study of Nigeria. Corporate Social Responsibility and Environmental Management, 11, 1–11. Published online in Wiley InterScience (www.interscience.wiley.com). https://doi.org/10.1002/ csr.049 Jiménez-Parra, B., Alonso-Martínez, D., & Godos-Díez, J. (2018). The influence of corporate social responsibility on air pollution: analysis of environmental regulation and eco-innovation effects. Corporate Social Responsibility and Environmental Management, 25, 1363. https://doi.org/10. 1002/csr.1645 Jurkowska-Gomułka, A., Kurczewska, K., & Bilan, Y. (2021). Corporate social responsibility in public administration. Case of Polish central administrative institutions. Administratie si Management Public, 36, 116–133. https://doi.org/10.24818/amp/2021.36-07 Mathende, T. L., & Nhapi, T. G. (2017). Business and society: Determinants and experiences of corporate social responsibility practices in Zimbabwean extractive industries from 2000-2015. Consilience: The Journal of Sustainable Development, 17(1), 143–161. Motilewa, D. B., Worlu, R. E., Agboola, M. G., & Olokundun, A. M. (2016). An analysis of institutional environment on corporate social responsibility practices in Nigerian renewable energy firms. International Scholarly Scientific Research and Innovation, 10(8), 2454–2460. Pavlyshyn, O. V., Ustymenko, T. P., Babiuk, M. P., Kaida, N. Y., & Shkrebets, D. V. (2021). Social responsibility as a performance indicator of public authorities. Academic Journal of Interdisciplinary Studies, 10(3), 111–122. Rachel, P., & Stephen, C. (2020). The state and the extractive industries in Australia: Growth for whose benefit? The Extractive Industries and Society, 7(2), 621–627. Sharma, E. A. (2019). Review of corporate social responsibility in developed and developing nations. Corporate Social Responsibility and Environmental Management, 26, 712. https:// doi.org/10.1002/csr.1739 Sari, H. P., Zauhar, S., Rozikin, S. M., & Riyadi, B. S. (2021). The antecedents of corporate social responsibility in Indonesian Banking Companies: A public policy perspective. Journal of Southwest Jiaotong University, 56(4), 682–696. Subramaniam, N., Kansal, M., & Babu, S. (2015). Governance of mandated corporate social responsibility: Evidence from Indian Government-owned firms. Journal of Business Ethics, 143(3), 543–563. Sudrajat, T., & Sikki, N. (2020). Public administration perspective about corporate social responsibility. A Paper presented at International Conference of Creative Industry, Business and E-Marketing, Faculty of Social Science, Telkom University, Malaysia. Szocs, I., & Schlegelmilch, B. B. (2020). Embedding corporate social responsbility in corporate strategies. In B. B. Schlegelmilch & I. Szőcs (Eds.), Rethinking business responsibility in a global context, CSR, sustainability, ethics & governance. Springer Nature. https://doi.org/10. 1007/978-3-030-34261-6_4

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Tomazevic, N. (2019). Social responsibility and consensus orientation in public governance: Content analysis. Central European Public Administration Review (CEPAR), 17(2), 189–204. Uduji, J. I., & Okolo-Obasi, E. N. (2018). Corporate social responsibility initiatives in Nigeria and rural women livestock keepers in oil host communities. AGDI Working Paper, No. WP/18/060, African Governance and Development Institute (AGDI), Yaoundé. Uduji, J. I., Okolo-Obasi, E. N., & Asongu, S. (2019). Corporate social responsibility in Nigeria and multinational corporations in the fight against human trafficking in oil-producing communities. AGDI Working Paper, No. WP/19/056, African Governance and Development Institute (AGDI), Yaoundé. Waheed, A., & Yang, J. (2018). Effect of corporate social responsibility disclosure on firms’ sales performance: A perspective of stakeholder engagement and theory. Corporate Social Responsibility and Environmental Management, 26, 559. https://doi.org/10.1002/csr.1701

Wasiu Abiodun Makinde is a researcher and lecturer in the Department of Public Administration, the Federal Polytechnic, Ilaro, Ogun State, Nigeria. He holds a National Diploma in Accounting from the Polytechnic Ibadan, Oyo State and a Bachelor of Science and Master of Science Degree in Public Administration from Obafemi Awolowo University, Ile-Ife, Nigeria. He is currently a doctoral candidate in the Department of Public Administration, Obafemi Awolowo University, Ile-Ife, Nigeria. He is also an associate member of the Association of Accountancy Bodies in West Africa (ABWA) and a full member of the Chartered Institute of Local Government and Public Administration of Nigeria (CILGPN). He’s also a professional student of the Institute of Chartered Accountants of Nigeria (ICAN). His research interest includes governance issues, public policy, public management, sustainable development, and community development.

CSR and Labor Policies in the South African Mining Industry Blessing Kanyumba

1 Introduction This chapter discusses corporate social responsibility (CSR) and labor policies that guide the mining industry in South Africa. Diale (2014) reveals that mining is the backbone of the South African economy. Consequently, mining companies abiding by CSR policies are bound to succeed. There has been a widespread strike in the South African mining industry in the last 20 years. These strikes have cost the industry billions of rands. These industrial actions led to the formulation of legislation to guide the industry’s operations. Dube and Maroun (2017) opine that mining activities are linked to a lot of social and environmental problems. Because of this, companies should be involved in vast CSR activities to ensure that their employees and society benefit. Dube and Maroun (2017) also confirmed that the Lonmin platinum mine strike in Marikana in August 2012 is a good example of violence in the mining industry after apartheid. During this strike, at least 70 mine workers were hurt, and at least 44 were killed. This industrial action also led to a change in HR policies in the mining industry. These changes were made to make investors feel better about their investments because many of them were worried about the future of their investments. This chapter will give a brief summary of the mining industry in South Africa, with a focus on how it affects the economy and society. The overview of the South African mining industry section will also indicate problems faced by the sector and what are the initiatives taken by government in order to alleviate the problems. Like any other industry in South Africa, the mining sector is governed by

B. Kanyumba (✉) Department of Human Resource Management, Durban University of Technology, Durban, South Africa e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_16

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laws and rules. The policies guiding the sector and their impact on the industry will be discussed in detail.

2 A Brief Overview of the South African Mining Industry Fine and Rustomjee (2018) posit that South Africa has been a leading global supplier of minerals and mineral products for a long time. Neingo and Tholana (2016) aver that the mining industry in South Africa directly adds about 7% to the country’s gross domestic product (GDP). Also, the industry is responsible for at least R540 billion in exports each year, which is 66% of all exports from the country. In terms of safety in the sector, Zvarivadza (2018) confirms that the mining industry in South Africa has put measures in place to make mines safer. This has resulted in a 50% reduction in fatalities. Makgoba (2019) argues that after apartheid ended in the 1990s, the South African government came up with ways to help black people gain economic power in the industry. As a result of this project, the number of black business owners has grown in the sector dominated by white men. According to PwC (2020), mining in South Africa is concentrated in four provinces: Limpopo, Mpumalanga, the Northern Cape, and the Northwest. Thambi (2019) avers that the mining industry contributes to economic growth through infrastructure development, taxes, and job creation. For instance, the industry has created and/or sustained estimates of 1,519,890 and 1,593,979 direct and indirect jobs in the 2020 financial year. Consequently, there is a positive impact on local communities through poverty alleviation. It is imperative to note the effects of COVID-19 on the industry. Laing (2020) confirms that COVID-19 regulations lowered production levels in the sector, thus reducing revenue across the industry. Furthermore, PwC (2020) confirms that operating expenses in the industry increased by 33% with more costs emanating from labor costs, electricity costs, and the weakening of the South African rand. In South Africa, the Department of Mineral Resources (DMR) is the custodian of all mineral resources in the mining sector. Igbayiloye and Bradlow (2021) confirmed that DMR regulates the mining industry. The mining industry is regulated by three branches: • Mineral regulation branch: This branch is responsible for regulating all mining activities. • Mineral policy and promotion branch: This branch is responsible for developing new policies, reviewing existing policies, and amending legislation to promote investment growth in the industry. This branch promotes mineral development as well. • Mine health and safety inspectorate: This branch aims to execute the constitutional mandate of the DMR to protect and safeguard the health and safety of mine employees and communities affected by mining operations.

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Karolia-Hussain and Fourie (2021) postulate that there are numerous policies and key pieces of legislation in the South African mining industry. These include the following: (1) the Mineral and Petroleum Resources Development (MPRDA) Act 28 of 2002, which aims at introducing a policy of equal access to mineral resources in South Africa; (2) the Mine Health and Safety Act of 1996 (Act 29 of 1996), which is responsible for the health and safety protection of mine workers and communities affected by mining activities; and (3) the Geoscience Amendment Act of 2010 (Act 16 of 2010), which is mandated to be a national advisory in relation to geohazards, infrastructure, and development in the mining sector. The aforementioned legislations help and guide the mining industry by ensuring that all stakeholders involved in mining are protected and compliant with the laws of the country.

3 Labor Legislative Frameworks Guiding the Mining Industry The South African constitution is the Republic’s supreme law, which provides a framework within which mining and environmental legislation must operate. The constitution also provides guidelines on how employees should be treated in the working environment, including the extractive industry. Section 23 of the constitution paves the way for the formation of trade unions and gives employees the right to join trade unions (Kruger & Thsoose, 2013). Due to the provisions of the constitution, rampant industrial action in the industry escalated as the legislation permitted protected strike action. The labor legislative frameworks guiding the mining industry include the following:

4 Labour Relations Act 66 of 1995 The Labour Relations Act (LRA) in South Africa was formed to regulate and give effect to the rights stipulated in Section 23 of the Constitution. The LRA is labor legislation aimed at regulating collective rights such as the right to strike and the right to engage in and organize in collective bargaining. Twala (2012) confirms that the mining industry witnessed numerous strike actions, with a major strike occurring in Marikana at the Lonmin mine on 16 August 2012, where 34 protesting mine workers were killed. This number was in addition to the ten people who were killed in the week leading up to the tragedy, bringing the death toll to 44; furthermore, 70 were injured, and more than 250 people were arrested. With this kind of incident, it is evident that the right to strike can lead to unfortunate proceedings if proper procedures are not considered. Karolia-Hussain and Fourie (2021) stipulate that Chap. 8 of the LRA protects unfair labor practices and unfair dismissals. Employees

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who engage in violent actions while protesting often misrepresent this protection. This could lead to dismissals, especially if the employer’s premises are damaged. This is evidenced by the case of the Industrial Court in Lefu vs Western Areas Gold Mining. The employer dismissed 205 employees for inciting or partaking in a riot in its mine. This riot resulted in nine deaths and the employer suffered huge financial losses. The employer did not hold a disciplinary inquiry since the process would have taken at least five days during which the employer would have had to house those believed to be guilty of the offences. Furthermore, it felt that immediate dismissal would help alleviate the highly emotional state of affairs at the workplace. The dismissed employees alleged that they were innocent and that they had not committed the alleged offences. However, the court ruled that the employer had not committed an unfair labor practice and that the dismissal was valid (Karolia-Hussain and Fourie, 2021). Furthermore, Sections 4 and 6 of the LRA regulate employers’ organizations and trade unions. The mining industry is dominated by two trade unions called the National Union of Mineworkers (NUM) and the Association of Mineworkers and Construction Union (AMCU). Uzar (2014) revealed that differences in these unions were a contributing factor to the Marikana massacre, as the AMCU had armed its members and ten NUM members were already killed. Thus, Chap. 3 should be amended and stipulate expected behaviors from unions and employer associations. Unions that encourage violent acts during a strike should be charged so that the Marikana history is not repeated. Additionally, the establishment of participatory structures in the form of workplace forums is provided in Chap. 5 of the LRA. It is imperative to note that the LRA is silent on the nature of collective bargaining and how it should be conducted. The Act does not compel collective bargaining; consequently, the courts have no role in determining whether an employer should bargain collectively with a trade union, what to bargain about, or at what level they should bargain. With the objective of promoting orderly collective bargaining, the LRA prioritizes bargaining at the sectoral level. This is done through the establishment of bargaining councils and statutory councils. Bargaining councils have the power to extend their agreements to all employers in their sector and level the competitive playing field on their terms. According to Tenza (2020), there are two levels of collective bargaining, namely, centralized collective bargaining and decentralized collective bargaining. Centralized collective bargaining is about concluding agreements at the bargaining and statutory councils (thus, the national level). In contrast, decentralized collective bargaining agreements are concluded not only at bargaining and statutory councils but also at the plant level. Centralized bargaining is utilized in the mining industry; however, this has not yielded positive results due to continued industrial action in the sector. Hayter (2015) postulates that centralized bargaining is ineffective in dealing with plant-specific issues. These demands are specific to particular mines and cannot be dealt with through national bargaining.

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5 Basic Conditions of Employment Act (BCEA) 75 of 1997 The Act is aimed at giving effect to the right to fair labor practices referred to in Section 23(1) of the Constitution by establishing and making provisions for the regulation of basic conditions of employment, thereby complying with the obligations of the Republic as a member state of the International Labour Organization. This Act provides guidelines on the working hours, leave, particulars of employment, and remuneration and termination of employment, among others. Mining workers have protested the unconducive working environment in the sector; thus, this led to the amendment of the Act in 2016, particularly for the mining sector. The amendment involved the following terms: • To average hours of work over the agreed period with an average of 10-h overtime per week • To dispense with a formal meal interval for miner, artisan, and official recognition units who work underground and in processing plants • To reduce the daily rest period to not less than 8 h for the purposes of rapid shift changeovers • Those shifts commencing at or after 04:00 are not regarded as night work

6 The Employment Equity Act (EEA) No. 55 of 1998 The other labor legislation guiding the mining industry in South Africa is the EEA 55 of 1998. The purpose of the Act is to ensure that there is equity in the workplace. Karolia-Hussain and Fourie (2021) stipulate that the Act prohibits unfair discrimination in the workplace and guarantees equal opportunity and fair treatment to all employees. However, it recognizes that, given historical disparities, simply removing discrimination does not result in substantive equality. The Act, therefore, imposes an obligation on certain employers (“designated employers”) to implement affirmative action measures to advance “designated groups” (African, Indian, and Colored people, women, and people with disabilities). EEA’s key requirement is eliminating all barriers, especially unfair discrimination in the workplace. Phakathi (2012) attests that during the apartheid era in South Africa, blacks did not hold any leadership positions in the mining sector, and no mine was owned by a black person. Thus, this Act is meant to redress the decisions of the past and provide equal opportunities to every individual despite their background.

7 Occupational Health and Safety Act (OHSA) 85 of 1993 OHSA was formulated to provide a safe working environment that is free from hazards. The main intent of the Act is to

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• Provide for the health and safety of persons at work and the health and safety of persons in connection with the use of plants and machinery • Offer protection of persons other than persons at work against hazards to health and safety arising out of or in connection with the activities of persons at work • To establish an advisory council for occupational health and safety • To provide for matters connected therewith In the mining sector, OHSA is critical due to the harsh working conditions faced by mine workers on the surface and underground. Statistics from the South African labor department indicated that the mining sector has a high risk of workplace fatalities. Due to the danger, more stringent regulations are required to minimize the health and safety dangers of mine workers (Kamunda, Mathuthu & Madhuku, 2016a). Utembe, Faustman, Matatiele, and Gulumian (2015) reveal that mine workers contract numerous diseases such as tuberculosis (TB), lung cancer, pulmonary silicosis, and other diseases. The effect of these diseases does not appear immediately but takes a long time to show; thus, it is imperative to minimize the dangers. A study by Kamunda, Mathuthu, Madhuku (2016b) confirmed that many mine workers, especially gold miners, face challenges of lung diseases and respiratory problems due to dust in mining areas. Furthermore, the South African High Court passed a judgment in 2016 in a class action instituted by 68 mine workers against various mining companies. The mine workers contracted silicosis and TB while working in the mines, and the action included all workers who worked in a gold mine after 12 March 1965. In 2019, the High Court made the settlement agreement an order of the court. The settlement amounted to R5 billion, paid to a trust, past and current mine workers, or their dependents if they contracted silicosis and TB as a result of working in the gold mines.

8 Labor Issues Affecting the South African Mining Industry According to Diale (2014), the majority of mine workers are from poverty-stricken communities; thus, being employed will automatically mean they would like to improve their livelihoods and that of their families. As these workers are from disadvantaged backgrounds, this would imply that their level of education is minimal; thus, they will be employed for manual jobs that have a history of low pay. Thus, low salaries being paid to mine workers has led to the rise of trade unions that are responsible for representing the employees when dealing with employers, and this is done through collective bargaining. Doellgast and Benassi (2015) attest that collective bargaining is the primary mechanism that employees and trade unions use to settle conflicts about employment-related matters. However, there is poor communication between the role players, and employees do not receive proper feedback on the problems that they are facing. Employees feel that collective bargaining

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should meet their “human needs,” alleviate poverty, ensure fair labor practices, and thereby contribute to a better life. Thus, failure to meet these needs often leads to insecurity and mistrust. This will also lead to unprecedented strike actions that have been rising in the industry. Strike action is counterproductive and costly for employers because of the damage to property, the expense of hiring private security firms, and the costs involved in litigation These strikes have also led to massive job losses in the industry. The Statistics SA Report (2019) revealed that the mining industry lost 23,000 jobs between 2012 and 2019. Due to the rise of labor costs and labor unrest, the industry has seen losses over the years. The COVID-19 pandemic has also exacerbated the losses.

9 The Role of HR in CSR: A Mining Industry Perspective Human resource managers are well positioned to play a crucial role in assisting their organization to achieve its goals of becoming environmentally and socially responsible. This encompasses reducing its negative and enhancing its positive impacts on society and the environment. Furthermore, HR professionals in organizations that perceive successful CSR as a key driver of their financial performance can be influential in realizing that objective (Anong, 2019). Human resource management (HRM) departments play a crucial role in ensuring that companies adopt CSR programs that facilitate sustainability, particularly in the mining industry. Dube and Maroun (2017) highlight that a critical success factor for CSR performance is employee involvement. Human resource managers have the tools and the opportunity to leverage employee commitment and engagement in the organization’s CSR strategy. Key systems and business processes underpinning effective delivery are influenced by HR and are well positioned to foster a high-performance CRS culture and CSR ethics. Human resource management can play an imperative role in order for CSR to become “the way we do things around here,” meaning employees would have embraced the concept. HR can be a key organizational partner to ensure that what the organization says publicly aligns with how people are treated within the organization. For instance, trade unions in the mining industry have indicated that the mining companies have neglected the communities in which they operate, but to the media, the companies portray a different perspective (Henderson, 2022). Therefore, HR is in the enviable position of being able to provide the tools and framework for the executive team and CEO to embed CSR ethics and culture into the brand and the strategic framework of the organization. Diale (2014) portrays that in the mining sector, CSR could be incorporated into processes such as recruitment, employer branding, motivation, appraisal, reward, retention, internal communications, coaching, diversity, and training. The way a company treats its employees contributes directly to it being seen as willing to accept its wider responsibilities. Building integrity and trust among employees is increasingly seen as important by employees when choosing a company to work for.

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However, due to the high unemployment rate, employees tend to settle for less, and companies tend to exploit their workforce due to the vast labor force at their disposal. Dube and Maroun (2017) posit that the trust built through successful CSR is hard to recover if lost. HR needs to ensure that their organization’s CSR can stand up to the inevitable scrutiny by stakeholders. This can be facilitated through training and communication and ensure that the CSR culture is embedded into the organizational culture. It is imperative to note that to deal with the negative perception of mines, the mining companies responded by attempting to mend their tarnished images by engaging in various CSR-linked initiatives, although back then such actions were seen as mere philanthropic acts. For example, Anglo American Platinum spent 100 million rands from 2014 to 2014 for education programs in Limpopo and Northwest provinces alone. This reflects the financial capability of mining companies to change the status quo of the communities in which they operate.

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Conclusion

The South African mining industry is in dire need of CSR initiatives supported by effective labor policies to ensure that the industry remains sustainable. This chapter provided an overview of the South African mining industry and indicated that the sector remains a major contributor to the country’s economy. Thus, measures must be taken to ensure that the industry alleviates poverty and creates employment. This can be facilitated with the assistance of HR departments, which will ensure that CSR programs relevant to communities are implemented. Labor legislation must be amended timeously to adapt to the changing nature of the workforce in the mining industry. The industry has seen massive strike actions followed by job losses. Much stricter labor laws need to be incorporated to minimize the danger posed by striking employees as the economic state of the Republic benefits from taxes emanating from the industry. The Marikana incident has proven to have offered “history lessons” to the mining industry, and labor issues have to be dealt with utmost care.

References Anong, V. (2019). A critical view of the contribution of corporate social responsibility (CSR) to improving the economic and social profile of mining communities in South Africa (Doctoral dissertation, Cape Peninsula University of Technology). Diale, A. J. (2014). Corporate social responsibility in the South African mining industry: Necessity, conformity or convenience? International Journal of Business and Economic Development (IJBED), 2(1), 16. Doellgast, V., & Benassi, C. (2020). Collective bargaining. Edward Elgar Publishing.

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Dube, S., & Maroun, W. (2017). Corporate social responsibility reporting by South African mining companies: Evidence of legitimacy theory. South African Journal of Business Management, 48(1), 23–34. Karolia-Hussain, F., & Fourie, E. (2021). The relevance and impact of South African labor law in the mining sector: a fourth industrial revolution perspective. Obiter, 42(3). https://doi.org/10. 17159/obiter.v42i3.12896 Fine, B., & Rustomjee, Z. (2018). The political economy of South Africa: From minerals–energy complex to industrialisation. Routledge. Hayter, S. (2015). Unions and collective bargaining. Edward Elgar Publishing. Henderson, A. (2022, March 20). Mines, state slammed for neglecting rural communities. https:// www.businesslive.co.za/fm/fm-fox/2022-02-24-mines-state-slammed-for-neglecting-ruralcommunities/ Igbayiloye, O. B., & Bradlow, D. (2021). An assessment of the regulatory legal and institutional framework of the mining industry in South Africa and Kenya for effective human rights protection: Lessons for other countries. African Human Rights Law Journal, 21(1), 363–388. Kamunda, C., Mathuthu, M., & Madhuku, M. (2016a). An assessment of radiological hazards from gold mine tailings in the province of Gauteng in South Africa. International Journal of Environmental Research and Public Health, 13(1), 138. Kamunda, C., Mathuthu, M., & Madhuku, M. (2016b). Health risk assessment of heavy metals in soils from Witwatersrand Gold Mining Basin, South Africa. International Journal of Environmental Research and Public Health, 13(7), 663. Kruger, J., & Tshoose, C. I. (2013). The impact of the labor relations act on minority trade unions: A South African perspective. Potchefstroom Electronic Law Journal/Potchefstroomse Elektroniese Regsblad, 16(4), 284–326. Laing, T. (2020). The economic impact of the Coronavirus 2019 (Covid-2019): Implications for the mining industry. The Extractive Industries and Society, 7(2), 580–582. Makgoba, M. (2019). Constructing black economic empowerment in South African mining: Government corporate discourse. African Studies, 78(4), 568–589. Neingo, P. N., & Tholana, T. (2016). Trends in productivity in the South African gold mining industry. Journal of the Southern African Institute of Mining and Metallurgy, 116(3), 283–290. Phakathi, T. S. (2012). Worker agency in colonial, apartheid and postapartheid gold mining workplace regimes. Review of African Political Economy, 39(132), 279–294. https://doi.org/ 10.1080/03056244.2012.688806 PwC. (2020). Essential and resilient, SA mine 2020. Retrieved March 25, 2022, from https://www. pwc.co.za/en/assets/pdf/sa-mine-2020.pdf Statistics South Africa. (2019). Sustainable Devevelopment Goals: Country report. Tenza, M. (2020). The effects of violent strikes on the economy of a developing country: A case of South Africa. Obiter, 41(3), 519–537. Thambi, K. (2019). Mining companies attain relief through deductions on infrastructure relating to Social and Labor Plans: A case of the cart before the horse? Journal of the Southern African Institute of Mining and Metallurgy, 119(5), 479–483. Twala, C. (2012). The Marikana Massacre: A historical overview of the labor unrest in the mining sector in South Africa. Southern African Peace and Security Studies, 1(2), 61–67. Utembe, W., Faustman, E. M., Matatiele, P., & Gulumian, M. (2015). Hazards identified and the need for health risk assessment in the South African mining industry. Human & Experimental Toxicology, 34(12), 1212–1221. Uzar, E. (2014). Marikana: Voices from South Africa’s mining Massacre. African Studies Quarterly, 14(3), 120–128. Zvarivadza, T. (2018). Sustainability in the mining industry: An evaluation of the National Planning Commission’s diagnostic overview. Resources Policy, 56, 70–77.

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Blessing Kanyumba is a PhD candidate at the Durban University of Technology (DUT) in South Africa. She is a holder of a Master’s degree in management sciences specializing in Human Resource Management from the Durban University of Technology. Blessing is a Lecturer at the Department of Human Resource Management (DUT), responsible for lecturing on project management, personnel management, organizational behavior, and business communication and information literacy. Blessing’s research interest includes corporate social responsibility, leadership development, career development, talent retention, gender, and higher education.

Corporate Social Responsibility and Role of the Indian State: A Transition Beyond Corporate Philanthropy Kunal Debnath

and Souvik Chatterjee

1 Introduction Over the last four decades, the term corporate social responsibility (hereinafter CSR) has become a buzzword, attracting the attention of social science researchers, entrepreneurs, and business organizations in the West and East. India has not been beyond this universal phenomenon. CSR can be defined as a company’s ethical commitment to conducting business in a transparent manner while also considering the well-being of its stakeholders, consumers, the environment, and society at large (Chatterjee & Debnath, 2019). The philosophy behind CSR can be perceived as paying back something to society from which corporations extract resources for their business. However, the idea of CSR is a highly contested one, and there is a great indistinctness in its implications despite its rich historical heritage. It is multifaceted and varied since states have developed their own agendas, policies, and strategies to address a variety of societal issues. However, in light of the desirability of social performances by business entities, a new debate has erupted. Some researchers believe that the ultimate goal of any corporation should be to do well by only serving the needs of society and making profits, whereas others believe that “every large corporation should be seen as an entity whose decisions and existence can only be justified if it only serves public or social purpose” (Dahl, 1972, p. 18). The conquest of liberalization, privatization, and globalization (hereinafter LPG) enabled the global proliferation of multinational corporations (hereinafter MNCs) and small and medium enterprises (hereinafter SMEs). As the number of business entities grows, so do the challenges and approaches to CSR. The triple bottom line (TBL) K. Debnath (✉) Rabindra Bharati University, Kolkata, West Bengal, India S. Chatterjee Central University of Jharkhand, Ranchi, India © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_17

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approach – people, profit, and planet – is now used to define CSR (Agarwal, 2008). However, the social performance of corporations is a contentious issue because corporations’ primary concern is how to increase profits and reduce losses. This dichotomy between profits and ethics pervades the entire concept of CSR. In this regard, the role of the state is critical in ensuring the success of CSR in developing countries such as India. State initiatives should not be limited to drafting laws but should also include enforcing those laws, engaging in ongoing discussions and deliberations with stakeholders, and providing assistance to various stakeholders – these are the keys to CSR success. This chapter is an attempt to understand the systematic transformations of CSR policies in India. There is ample literature that makes sense regarding CSR policies in India (e.g., Agarwal, 2008; Bansal & Rai, 2014; Pandey & Mukherjee, 2018; Ray & Raju, 2014; Singh & Sarkar, 2018). However, these earlier works have remained silent about the role of the state in promoting CSR policies. Unlike the neoliberal maxim of rolling back the state, this paper rejuvenates the importance of the state in endorsing CSR. Therefore, this chapter provides a conceptual outline of CSR and its application in India. In this chapter, we argue that the contemporary version of CSR in India has transcended beyond both the US philanthropist model and the European ethical business model. After the enactment of the Companies Act, 2013, the Indian state and its subsequent amendments have taken proactive measures to implement CSR both at the company and grassroots levels.

2 Methods and Methodology The theoretical foundation of the relevant issues is the bedrock of any research activity. Despite the fact that this study includes some empirical data, it is still qualitative in nature. Annual reports of governmental organization were used as primary sources to obtain the necessary data. The literature on CSR has been surveyed as a secondary source to understand the role of government in promoting CSR initiatives in the public and private sectors. Various books and journal articles were also useful in preparing for this research. The neoinstitutionalist methodology has been used to assess the nature of the Indian state in this case. Neoinstitutionalism, as a method, investigates the nature of the state and opposes neoliberal theory. While the latter defends the market rather than the state, the former accepts the active role of state institutions in promoting public policies, particularly in developing countries such as India.

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3 Corporate Philanthropy and CSR: Search for Differences CSR focuses on the socially responsible behavior of corporations and is not synonymous with corporate philanthropy (hereinafter CP). CSR is a sustainable practice grounded in ethical principles that directs corporations to be accountable for their actions toward society at large. However, CSR may embrace philanthropic activities such as donations, charitable programs, or other voluntary initiatives. Philanthropic activities help an organization garner positive public opinions, attract customers, and sustain goodwill among stakeholders. In short, CP refers to voluntary investments and activities of corporations for their impact on society (Council on Foundations, 2021). Investments in money, donations, technical assistance, employee volunteerism, etc. are examples of corporate philanthropic ventures (Council on Foundations, 2021). Both in the West and in the East, corporations, be it public or private, have been engaged in philanthropic activities since time immemorial. However, in recent times, organizations have used philanthropic activities to imbibe socially responsible practices in their business as a means of reducing investment risk and improving brand value. The nature of CP has been transformed significantly along with changes in society and in the global economy. Since the 1990s, CP has transformed itself as a strategic philanthropy for business strategy and marketing purposes. Such philanthropic ventures are motivated to increase brand recognition among consumers, boost productivity, reduce research and development costs, and foster synergy among business units. However, the voluntary nature of philanthropic activities makes no attempt to incorporate CSR activities into core business plans. That is why social auditing of philanthropic activities is difficult and companies cannot be held accountable for their actions toward society. Unlike philanthropic activities, CSR refers to sustainable business practices. CSR aims to integrate social, environmental, and other global issues into core business operations. CSR aspires for corporations’ direct involvement to address societal problems and provide solutions in a responsible manner. Despite the fact that CSR is not mandatory in many countries, the ethical aspect of CSR requires corporations to mitigate corporations’ negative effects on the community and adopt CSR into their core business operations. Therefore, if a corporation fails to implement CSR policies effectively, then that corporation will suffer from negative perceptions among consumers. In short, neither CSR is synonymous with CP nor CP is an alternative to CSR. In CP, corporations donate a portion of their profits for charitable purposes. On the other hand, CSR has a much broader scope. CSR focuses on enhancing the quality of life of the workforce, the local community, and society at large (Holme & Watts, 2000).

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4 The Role of Corporate Philanthropy in CSR Corporate philanthropy (hereinafter CP) is a major aspect of CSR that includes voluntary and charitable contributions made by business entities for the well-being of society (Hadani & Coombes, 2012). Before the arrival and acceptance of CSR as a mandatory activity by business bodies, CP was a common business practice both in developing and developed societies. CP entails corporations accepting responsibility for their actions and contributing to the positive development of the environment and society through their business operations. The origins of CP in the West can be traced back to the rise of industry in the late nineteenth and early twentieth centuries, when business leaders such as Henry Ford, John D. Rockefeller, Eli Lilly, and others established a number of philanthropic foundations in the United States (Harvey et al., 2019). In modern-day practices, CP, therefore, includes the donation of funds, goods, or services from business organizations for public cause. However, the relevance of CP has become a source of heated debate among academics and practitioners. The supporters of corporate philanthropy are of the opinion that CP improves companies’ reputation and performance among key stakeholders. Critics of CP are skeptical of companies’ philanthropic engagements. For critics, the primary goal of a business body is to generate economic returns, not to solve societal problems that fall under the purview of the state (Cha & Rew, 2018). CSR and CP are often perceived as diametrically opposed, with the former indicating a positive business practice and the latter indicating negative ones due to its voluntary nature. However, this perception is overly simplistic, given that both CSR and CP are motivated by strategic calculations and value additions. Despite this heated debate, CSR scholars in the West have argued that CP helps business bodies secure resources and support from stakeholders and creates a favorable reputation in the eyes of stakeholders. According to Su and Sauerwald (2015), corporate governance mechanisms such as the role and power of the CEO, oversight activities of board directors, etc. play a critical role in the relationship between CP and firm value. This research highlights that corporate governance is critical in determining whether the financial benefits of CP outweigh agency costs and increase the value of a firm. In other words, corporate governance moderates the effect of CP on firm value; then, agency costs are limited, and philanthropic investments increase firm value (Su & Sauerwald, 2015). Unlike the corporate philanthropic model of the West, social sensitivity in business activities in India is not a new phenomenon. The concept of CP and its various manifestations are well observed in the business activities of various Indian firms even in the preindustrialized era. In the Indian context, corporations have focused on creating shared value for society, whereas Western corporations have focused on creating value for their shareholders (Pillai, 2017). Therefore, the Indian CSR concept is unique, as it blends the voluntary aspects of CP and social obligations in synchronization with the profit activities of corporations. Taking into account India’s socioeconomic and contextual conditions, the Government of India has taken a step forward by instituting CP under regulatory requirements for

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corporations to be socially responsible and respond to societal expectations. India was the first country in the world to incorporate both voluntary aspects of CP with mandatory aspects of CSR into the Companies Act of 2013 (Jain et al., 2020).

5 Revisiting the Role of the State in CSR: Search for a Theory The current discourse of CSR has transcended beyond the philanthropic notion and voluntary form of corporate engagement. In this aspect, the role of the state is pivotal for nurturing an environment to regulate CSR activities. To date, the state and the corporations’ aversion from direct involvement in CSR activities are noticeable both in the West and in the East. Corporations were not convinced or failed to apprehend the benefits of engagement from the CSR activities. Generally, CSR was mostly perceived as a domain traditionally located in the private sphere and does not affect the business of these corporations. However, the changes in the global economy and the role of CSR in creating brand awareness among consumers have led to the gradual involvement of more corporations in CSR. Therefore, corporate engagement in CSR not only improves the quality of life of a society but also helps corporations build positive brand equity among consumers (Mahmood & Bashir, 2020). Thus, interactions between the state and corporations have increased to promote social causes and to legitimize the actions of the governments and the corporations among the stakeholders. In this era of LPG, the state must provide a forum for corporations, government, and civil society to discuss social and political issues such as affordable health care, education, unemployment, environmental sustainability, rural development, and so on (Albereda et al., 2008). Hence, the role of the state is important to adopt CSR as a sustainable corporate practice. On the other hand, corporations need to initiate proactive CSR business policies to achieve sustainable development goals and to gain a strong hold in this age of regional competitiveness. From the current discourse on CSR, the three prominent roles of the state in CSR can be identified (Modic, 2008). These are as follows: first, the regulating role of the state; second, the state and its role in corporate governance and sustainable business practices; and third, the supervising role of the state in CSR. In this neoliberal regime, the role and responsibilities of the state in CSR are multifaceted. However, under the influence of the Washington Consensus of 1989, global financial institutions such as the World Bank, IMF, WTO, etc. have preferred the market over the state to allocate resources within society. Fragility and corruption in government and administrative structures were cited as a hindrance for the state to engage in various social welfare and developmental activities. The neoinstitutional framework, on the other hand, has focused on the role of formal and informal institutional norms and practices in promoting democratic governance in developing societies (Rakner & Randall, 2011). Neoinstitutionalism has tried to reinvent the importance of the state in developmental activities in developing societies. Scholars have examined the role

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of states in introducing inclusive political reforms, shaping national economic development, and bargaining with MNCs (Skocpol, 1985; Evans, 1979). In developing countries, such as India, the state needs to protect and promote the interests of the least advantaged groups. In this context, the neoliberal framework is unable to address the social maladies in heterogeneous societies and to promote the common good for all. Thus, in developing societies, the state should play a pivotal role in promoting CSR, formulating policies on CSR, and developing a legal framework on CSR. Fox et al. (2002) identified several important government functions in the CSR agenda, including mandating, facilitating, partnering, and endorsing. The task of mandating requires the government to have a clear legal mandate on CSR policies. It involves framing laws on CSR and inspecting whether such laws are obeyed by corporations. The task of facilitating involves promotion of CSR activities by the state among the corporations and society at large. Furthermore, in this age of democratic decentralization, the state is required to have partnership and active engagement with the various stakeholders of society in implementing CSR policy efficiently. Hence, the task of partnership involves public–private partnership in the implementation of CSR policies. Endorsing has obliged the state to provide political and financial support to business bodies. Therefore, governments need to identify and publicly praise corporations that are performing well in CSR activities. The promotion of such sectors among the public will boost their enthusiasm.

6 Development of CSR in India: A Journey from Corporate Philanthropy to CSR After World War II, a dominant paradigm evolved in the West that pointed out the negative consequences of business corporations on society, particularly on the environment. During that time, various NGOs and other voluntary groups demanded that business entities accept social responsibility beyond the corporations’ economic and legal obligations. Prior to this period, corporate social policies and standards in the West had not been properly developed. Therefore, it was a herculean task before the state to develop an integrated corporate social policy. The growth and popularity of new social movements in the 1960s, particularly the workers’ movements in many Western countries, have played a critical role behind the emergence of CSR. Against the backdrop of these movements, companies started to realize the importance of corporations’ interactions with society to fulfill public expectations. However, in the context of India, CSR has existed in the form of CP since time immemorial. In the past, some of the Indian emperors had invested in the communities around them to gain support from its subjects. Construction of temples, mosques, dharamsalas, etc. were among the prominent societal activities that the Indian emperors have undertaken (Agarwal, 2008). However, in India, the transition from CP to CSR can be divided into five stages. The first phase (1850–1909) was

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charitable and philanthropic in nature. The origin of CP in India can be traced back to the philanthropic activities of Jamsetji Tata in the nineteenth century. In the first half of the twentieth century, other private enterprises such as Godrej, Birla, etc. had also invested considerably in various philanthropic ventures. The second phase (1910–1950) was influenced by the Gandhian doctrine of trusteeship. The socioeconomic philosophy of trusteeship has focused on the transfer of wealth for the benefit of the underprivileged (The Confederation of Indian Industry, 2016). Therefore, trusteeship is a technique to transform the present unequal order of society into an egalitarian one (The Confederation of Indian Industry, 2016). With Gandhi’s untimely death, the concept of trusteeship has vanished from the Indian landscape. Following that, Indian private corporations’ involvement in various societal activities remained minimal in the years that followed. The third phase (1951–1990) saw the rise of various public sector units (PSUs) in India. The state and public enterprises were expected to play a pivotal role in addressing the problem of poverty under the Nehruvian model, which was emphasized during the Bombay plan in 1944 (Chakrabarty, 2012). Various Indian public enterprises, such as Hindustan Petroleum Corporation, Gas Authority of India Limited (GAIL), Steel Authority of India Limited (SAIL), and Indian Oil Corporation, were involved in various societal development programs, such as providing health care, education, and environmental protection, during this time period. Furthermore, various workshops and seminars were frequently held with collaboration between the public and private sectors to raise public awareness of CSR. This tendency fundamentally changed the notion of CSR in India. Nevertheless, the subsequent Indian leadership was not able to bring about an equitable distribution of resources within the society. The fourth phase (1991–2012) begins with the introduction of LPG and the beginning of India’s economic reforms in the 1990s. Like the West, the nature of the Indian state has also been transformed into a changing globalized economy. The emergence of globalization, as well as India’s new economic plan adopted in 1991, compelled the Indian state to reinvent itself. Chakrabarty (2012) believes that in this new setting, the role of the Indian state in CSR has undergone significant changes. To date, CSR planning has been performed without state interference. Therefore, the goal of planning needs to be reinvented to facilitate companies’ involvement in CSR while sustaining economic growth. In today’s globalized world, the private sector’s role in economic growth is equally important and must be recognized. For this reason, the Government of India in its Eleventh Plan has stressed the role of the private sector in rural development such as health, education, and infrastructure development (Chakrabarty, 2012). As a result, the Indian government has begun collaborating with various corporations and has taken a bottom-up approach to developing policies by soliciting input from civil society and corporate houses. The Indian state has also devised strict regulations regarding environmental sustainability in response to the pressure from below. In short, a “counterhegemonic legality” has evolved in the current discourse of CSR in India. This legality focuses in particular on social groups and communities whose livelihoods have been harmed

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by the state and corporations. The legal system in India has reached its apex with the emergence of public interest litigation or PIL (Chakrabarty, 2012). The fifth phase (2013–ongoing) begins with the Companies Act, 2013. CSR in contemporary India is projected as a developmental strategy and included within the broad framework of the human development agenda. This new paradigm focuses on the function of the state to protect and develop human capability to overcome various social, political, and economic issues. As a result, the current CSR paradigm in India provides a triangular relationship between the government, civil society, and corporations to become partners and address social malaise. The most important aspect of this phase is that it attempts to move away from philanthropic thinking to make CSR mandatory for corporations.

7 The Companies Act, 2013: A Transition Beyond Corporate Philanthropy in India The Companies Act, 2013, effective from April 1, 2014, carried a radical change in the area of corporate governance in India. According to Section 135 of the Companies Act of 2013, CSR must be applicable to all companies that meet the following criteria: 1. INR 5000 million or more in net worth. 2. Turnover of INR 10,000 million or more in any fiscal year. 3. During any fiscal year, a net profit of INR 50 million or more is generated. According to the CSR policy, companies must ensure that the surplus generated from CSR- related activities is not used for business profits. Similarly, this Act requires companies to spend at least 2% of their average net profits from the three fiscal years preceding the current one on CSR activities. If they fail to spend the required amount, the reason(s) must be stated in their annual report. This Act also calls for the formation of a CSR Committee of the Board, comprised of three or more directors, to be in charge of all CSR-related activities (Ministry of Corporate Affairs, 2013). In 2014, an amendment made under Schedule VII highlights the probable areas of spending of CSR funds. Some of them are as follows (Bhushan, 2018): 1. Getting rid of extreme poverty and hunger 2. Promoting health care and sanitation, including participation in the “Swachh Bharat Kosh” initiative 3. Advancing education and job-related skills 4. Promoting gender equality and women’s empowerment 5. Ensuring environmental sustainability and natural resource conservation, including contributions to the “Clean Ganga Fund” 6. Providing training to promote specific types of sports 7. Contributing to the Prime Minister’s National Relief Fund or any other Central Government relief fund

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With a general circular circulated on March 23, 2020, the Ministry of Corporate Affairs, India, specifies that spending CSR funds for COVID-19 is an eligible CSR activity under Schedule VII relating to the promotion of health care, including disaster management (Ministry of Corporate Affairs, 2020). Following the Companies Act of 2013, which went into effect on April 1, 2014, India was the pioneer in making CSR spending mandatory. This mandatory version of CSR is viewed by the corporate sector as “taxation over taxation” (Bhushan, 2018, p. 318). Although this Act has reawakened a new sense of hope in India regarding CSR, the initial results have been unsatisfactory. According to the 2014 Annual CSR Report, despite the Act, various corporations contribute only a small amount (sometimes less than 0.3–0.5 percent) to CSR- related activities. It occurs as a result of a lack of penalty provisions for defaulters, which calls into question the Act’s effectiveness. Despite some shortcomings, the Companies Act, 2013, has been hailed as the start of a new era in CSR-related activities in India. With the increasing number of business entities in India and the lack of penalty provisions for defaulters, the Government of India enacted the Companies (Amendment) Act in 2019 by amending Section 135 of the Companies Act of 2013. The Amendment Act of 2019 made some significant and much-needed changes to India’s CSR provisions. The following are the major changes brought about by this Act: (a) If a company fails to spend the prescribed CSR amount, the unspent amount must now be transferred to one of the funds listed in Schedule VII, such as the Prime Minister’s National Relief Fund, within 6 months of the end of the fiscal year, and the reasons for not spending must be stated (Ministry of Corporate Affairs, 2019). (b) The unspent amount under subsection (5) in relation to ongoing CSR policy projects must be transferred to a separate bank account within 30 days of the end of the fiscal year, and the company must use this amount within 3 years of the date of transfer (Ministry of Corporate Affairs, 2019). (c) This Act also includes penalties for companies that violate the provisions of subsections (5) and (6) of this Act. As a result of this Amendment Act, companies face a monetary fine ranging from INR 0.05 million to INR 2.5 million. Similarly, every officer of that company will be held accountable for failing to comply and will face up to 3 years in prison or a fine ranging from INR 0.05 million to INR 0.5 million, or both (Ministry of Corporate Affairs, 2019). These changes seem to be a burden on the companies and officers. One could argue that the monetary penalty does not ensure the ethical or moral stimulus for CSR spending. However, responsibility is more moral than legal, and according to Carroll (1991), “social responsibility can only become reality if more managers become moral instead of amoral or immoral.” However, the situation necessitates these adjustments. The government wishes to establish a joint venture to ensure social well-being. According to the National CSR Portal (2023), “Successful companies have a social responsibility to make the world a better place and not just take from it. CSR extends beyond Corporate Philanthropy: It is a collective responsibility to build a society which supplements

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Government’s efforts to achieve inclusive growth which includes broad-based benefits and ensures equality of opportunity for all.”

8 The Contributions of Major Extractive Industries in CSR in India: An Overview The Companies Act of 2013 has brought systemic changes in terms of corporations’ engagements in India’s socioeconomic development. Before the Companies Act, 2013, it was mainly the largest corporations in India who were engaged in CSR-related activities. Furthermore, Indian extractive industries used to spend a significant portion of their profit (annually at least two percent of their net profit) on CSR as philanthropic ventures. However, these activities were mainly voluntary in nature, and there was a lack of CSR specified regulations. The major trends observed before the Companies Act of 2013 were that corporations’ contributions were very minimal in terms of their gross revenues. Additionally, due to the absence of a legal mandate from the state, corporations before 2013 focused on improving a single sector of society, i.e., education. However, the Companies Act of 2013 has attempted to bring holistic development with the engagement of both corporations and other stakeholders into the CSR paradigm. In 2011–2011, the average CSR expenditure by domestic firms was INR 3.79 million and by foreign firms was INR 8.5 million if we compare the major trends in CSR in India before and after the Companies Act, 2013. However, the figures have increased to INR 22.6 million by domestic firms and INR 19.5 million by foreign firms in 2012–2013 (Bansal & Rai, 2014). Therefore, we can observe a significant rise in CSR disclosure in the following years. In 2010–2011, 336 companies disclosed their CSR spending; in 2012–2013, the figure increased to 1470 (Bansal & Rai, 2014). Despite these figures, timely reporting and monitoring of CSR-related activities have remained a challenge for the Indian state. As a result, the Companies Act of 2013 was an attempt by the Indian government to develop an integrated CSR policy to recommend the amount of expenditure in socioeconomic activities and to develop a transparent monitoring mechanism for corporations’ implementation of CSR projects. The financial year 2014–2015 marks the beginning of a new era regarding CSR in India. The Companies Act of 2013 has made it mandatory for both the private and public sectors to disclose their annual CSR report and uphold their commitment to socioeconomic development. Table 1 indicates that prominent private extractive industries have been able to contribute their prescribed CSR amounts during the financial year 2014–2015. However, ensuring timely contributions from public extractive industries in CSR has remained a challenge before the Indian state. However, because of the Companies Act, 2013, major extractive industries have already set up their own CSR team and are legally obliged to publish their annual CSR reports.

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Table 1 Contributions to CSR by major Indian extractive industries during fiscal years 2014–2015 CSR prescribed expenditure (in INR billion) 0

CSR spent (in INR billion) 0.052

Priority areas where CSR amounts have been utilized Not specified

Name of the company Adani Power Reliance Power Ltd. Oil And Natural Gas Corporation Ltd. Coal India Ltd.

Sector type Private

Average net profit (in INR billion) -16.5069

Private

2.9376

0.0588

0.0588

Health care

Public

330

6.600

4.950

Heritage art and culture, environment, health care, education, etc.

Public

12.021

0.244

0.244

National Aluminum Co. Ltd. Indian Oil Corporation Ltd. JSW Energy Ltd. Gas Authority of India Ltd.

Public

10.070

0.2014

0.19

Public

56.475

1.330

1.370

Vocational skills, socioeconomic inequalities, health care, education, art and culture, etc. Education, health care, sanitation, environmental sustainability, etc. Education, health care, vocational skills, etc.

Private

7.8579

0.157

0.158

Public

59.3337

1.1867

0.17

Environmental sustainability, education, etc. Not specified

Source: National CSR Portal, India, 2023. Data compiled by the authors

The Companies (Amendment) Act of 2019 has substituted the liability of penalties in place of monetary fines in several provisions. Unlike before, the Registrar of Companies and Regional Directors can directly impose penalties if any corporations violate the CSR provisions mentioned in the Companies Act, 2013 (Ministry of Corporate Affairs, 2019). In short, with this amendment, the Indian state has tried to overcome legal complications and ensure accountability and transparency in the CSR paradigm in India. This amendment has made public extractive industries more conscious about CSR policies that were absent during the initial year of 2014–2015 (Chatterjee & Debnath, 2019). From Table 2, we can observe that except for the Gas Authority of India Ltd. and Indian Oil Corporation Ltd., all the major public extractive industries spent the prescribed amount on the CSR agenda during the financial year 2019–2020. At the same time, each of these enterprises has its own set of CSR priorities. For example, Coal India Ltd. has taken an active role in health care and education, while other areas, such as environmental sustainability, community development, livelihood enhancement, and so on, have also been addressed during fiscal year 2019–2020.

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Table 2 Contributions to CSR by major Indian extractive industries during fiscal year 2019–2020 CSR prescribed expenditure (in INR billion) 0

CSR spent (in INR billion) 0.0008

Priority areas where CSR amounts have been utilized Education

Name of the company Adani Power Reliance Power Ltd. Oil And Natural Gas Corporation Ltd. Coal India Ltd. National Aluminum Co. Ltd.

Sector type Private

Average net profit (in INR billion) -20.671

Private

-1.806

0

0.0392

Not specified

Public

285.907

5.718

5.823

Education, rural development, drinking water, etc.

Public

4.042

0.080

1.723

Education, health care, etc.

Public

19.173

0.383

0.397

Indian Oil Corporation Ltd. JSW Energy Ltd. Gas Authority of India Ltd.

Public

271.688

5.433

5.184

Education, Prime Minister’s National Relief Fund, sanitation, environmental sustainability, etc. Education, sanitation, health care, etc.

Private

3.284

0.0657

0.0657

Public

62.395

1.2479

1.2273

Education, socioeconomic inequalities, health care, etc. Education, livelihood enhancement projects, Senior Citizens Welfare, etc.

Source: National CSR Portal, India, 2023. Data compiled by the authors

9 Conclusion India usually faces many challenges in the proper implementation of CSR in extractive industries. Unlike other manufactured companies, extractive industries cannot determine the special distribution of natural resources. In many cases, natural resources are often found in protected or conflict-prone areas. Instability and weak natural resource management in such areas often lead to a struggle for power, and the state has often failed to implement CSR laws in extractive industries. Despite the continuous growth of extractive industries in India to meet domestic resource consumption, it brings new challenges before the Indian state to ensure sustainability in the mining and energy sector. Debates over the environmental sustainability and social impacts of extractive industries in India have highlighted the growing importance of social performance in business operations. Despite the fact that there is a simple understanding of making companies responsible and responsive to socioeconomic development, several factors compelled India to incorporate CSR into a specific legal mechanism. First, the number of SMEs has increased dramatically in this LPG era, particularly since India’s

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economic reform in the 1990s. Today, it is the major contributor to India’s GDP (The Confederation of Indian Industry, 2021). Thus, the Companies Act of 2013 was intended to keep not only the large corporations but also these diverse enterprises within a single legal regime. Second, despite the passage of a number of laws and regulations aimed primarily at corporate accountability, such as the Companies Act of 1956, the majority of these Acts were either vague or failed to meet the needs of society. The Companies Act of 2013 has been an attempt to make a single and systematic initiative toward CSR. Third, the philosophy behind this Act was to provide a platform for constructive and healthy discussions among corporations, government, and other key stakeholders in society, rather than simply imposing a penalty. In short, the Companies Act of 2013 has ensured robust community engagement of both public and private extractive industries. The subsequent amendments of the Companies Act, 2013, have tried to integrate CSR into mainstream business operations. In many cases, extractive industries in India failed to coordinate among the environmental impact of their operations, legal issues, profits, and government regulations before the amendment took place in 2019 in the Companies Act, 2013. The recent amendments in the Companies Act, 2013, focus on the full integration of CSR into business operations. Furthermore, the Indian state has implemented a collaborative approach to ensure the success of CSR in India. This collaborative approach combines the combined activities of major industry sectors, policymakers, and other stakeholders to discuss the environmental and social impacts of mining and energy projects. Although there are many limitations and controversies over the Companies Act, 2013, and its subsequent amendments, according to Bhushan (2018), such activities do not need to be imposed from above but must come from within. However, public awareness, the possibility of state involvement, and the obligation of corporations to pay back to society something from which they extract resources and derive their profits have all been made possible through the Companies Act, 2013, and its subsequent amendments.

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Kunal Debnath, PhD, has been an assistant professor in the Department of Political Science at Rabindra Bharati University, Kolkata, West Bengal, India, since 2019. Before joining Rabindra Bharati University, he has taught at Kazi Nazrul University, Asansol, West Bengal, India, since 2015. His interest in research covers theories of comparative politics, political sociology, state politics in India, corporate social responsibility, and caste movements in Bengal. Debnath has published more than 20 research papers with some of the leading publishers, such as SAGE, Wiley, Brill, Emerald, Springer, etc. He may be contacted at [email protected]. Souvik Chatterjee has been a senior research fellow in the Department of International Relations, Central University of Jharkhand, Ranchi, India, since 2019. His area of interests includes political theory, political sociology, comparative politics, theories of international relations, and public policy. Currently he is working on Inner Asian studies. Chatterjee has published more than 10 research papers with some reputed publishers including SAGE and Brill. He may be contacted at [email protected].

Corporate Social Responsibility Challenges in the Extractive Industry: A Summary Steven Kayambazinthu Msosa

1 Introduction CSR continues to be a subject of debate among practitioners and scholars due to the role it plays in the host communities where the extraction of oil and minerals takes place. This is crucial, especially in developing countries where stakeholders required to play the oversight role do not execute their mandate effectively. Despite their abundant natural resources, developing countries consistently rank among the world’s poorest nations. Natural resources are poorly managed, earnings are misappropriated, and corruption and conflict are driven by power struggles over who controls resources. The contentious issue of corporate social responsibility (CSR) in host nations revolves mainly around governments and multinational corporations (MNCs). Therefore, the contributions made by different scholars in this book are thought provoking and relevant in the context of the CSR challenges that developing countries face. Furthermore, the different perspectives on CSR provided by the contributors have helped to evaluate the myriad of challenges experienced in the extractive sector. The conclusions and suggestions in this book are helpful and can be used in other developing countries that are not explicitly named. In the context of corporate social responsibility (CSR), extractive industries have multilayered stakeholder responsibilities to their respective societies to successfully operate and manage their businesses in developing countries. In other words, they will only be able to achieve a sustainable level of corporate performance if they consider how CSR may effectively contribute to the growth of their communities and the societies in which they operate. This problem is more readily visible in developing countries, which typically have weak economies and no government S. K. Msosa (✉) Department of Marketing, Mangosuthu University of Technology, Durban, South Africa © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8_18

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backing for industry, compared to industrialised countries (Pedro et al., 2017). The effects of authoritarian governments, civil wars, insurgencies, corruption, and interethnic violence on economic activity place human rights duties and liabilities on the shoulders of multinational enterprises. This indicates that persons who operate in the extractive industry face a crucial choice when deciding whether or not to become a citizen of a country and engage in commercial activity with a particular government. Should multinational firms engage in commerce in countries where authoritarian regimes are in power? Is it justifiable to make a distinction between partnering with governments that have a “poor” human rights record and those that are referred to as pariah states? The problem of conflicts in areas where the extractive sector operates is one of the major issues in implementing CSR. This is rampant in the Niger Delta, where bandits and military groups have wreaked havoc on innocent civilians and companies extracting oil. There is a lot of conflict in the extractive sector, which threatens national peace and cohesion and keeps businesses from making big contributions to development. The resource curse manifests itself in various ways, one of the most obvious of which is conflict. The fundamental element driving this trend is rivalry over controlling mineral resources and, as a result, capturing the advantages that come with those controls. However, conflicts can also be caused by grievances when they are predominantly attributed to the negative externalities caused by extractive activities, such as pollution. Many resource-based conflicts are caused by competition for control or ownership of resources. We believe society’s expectations placed on leaders in the extractive industries are that they will demonstrate dedication, assert themselves, and resolve conflicts by accepting responsibility and accountability. To attain a higher level of sustainable community development, the extractive sectors should implement policies that encourage community engagement. This sheds light on the social structures and social interactions that exist within these enclave economies, as well as how mining companies use corporate social responsibility to construct socially coherent communities within these economic outposts. For members of a society or a particular community to feel like they belong and work toward the same goal, a social process known as social cohesion needs to be maintained consistently. It is built on trust and reciprocity, which helps it to maintain its strength. It is of the utmost significance in mining towns and other small, geographically remote villages if it is naturalised. The concept of social responsibility is extremely important in forming relationships between businesses and the communities in which they are located. Businesses can foster peaceful cohabitation with the communities in their surrounding areas through the use of CSR activities. In the extractive industry, corporate social responsibility (CSR) can be a strategy to alleviate conflict among various stakeholders and meet their respective interests. Both social and economic forms of corporate social responsibility (CSR) are viable options for mediating resource disputes in locales rich in mineral deposits. Projects with a social focus, such as building schools, health centres, entertainment centres, and water facilities, could reduce the number of fights between businesses and the people nearby. To help mining towns as a whole, companies are also expected to provide the needed

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resources and infrastructure. It is absolutely necessary to have alternative livelihood initiatives available to keep the local communities’ economic lives going to maintain peaceful coexistence (Boadi et al., 2018). To be considered sustainable, society must consider and attend to various human needs rather than focusing solely on meeting one requirement at the expense of all others. In an ideal community, diversity is celebrated and respected; everyone can contribute their thoughts and ideas, and economic success is distributed fairly among all members. Community development is at the centre of the economic growth and environmental protection debate. The main issue is whether community development can reduce crime, conserve valuable resources, cut waste, attract sustainable economic development, preserve the natural environment, and bring communities together for the greater good (Roseland & Spiliotopoulou, 2017). With the incorporation of CSR into essential aspects of a company’s operations, the concept of corporate social responsibility in the current day has expanded far beyond its original altruistic connotation. In societies that are still in the process of growth, it is common practice to charge private businesses, in addition to the state, with the responsibility of societal development, particularly as it relates to the emancipation of underprivileged groups. As a result, CSR outlines socially responsible behaviour inside the operations of a corporation. CSR urges businesses in the extractive sectors to consider factors other than earnings and to accord the same level of significance to the societal and environmental problems for which they are also accountable. Thus, corporate sectors are viewed as agents of socioeconomic development, which is in contrast to the prevalent model of corporate social responsibility (CSR) in the West, which places an emphasis on the moral and social obligations of businesses. As a result, our understanding of corporate social responsibility in the modern era must center on the responsibilities of businesses to assist the state in its role as a stakeholder in the process of socioeconomic growth. In contrast to their counterparts in developed countries, corporations in societies that are still in the process of developing pay less attention to their social performances. The participation of corporations in socioeconomic endeavours is hindered when inadequate restrictions and a significant degree of corruption are present. We believe that in the era of New Public Management, the emphasis placed on public values in public administration through accountability, openness, justice, and customer orientation is a driver for increasing corporate social responsibility (CSR). The application of consensus orientation, participation, inclusion, and equity in public governance has emerged as a direct result of the new approach to valuebased activities in public administration, which is directly equivalent to the concept of corporate social responsibility (CSR). In the field of public administration, this means that corporate social responsibility and sustainable development go together like peanut butter and jelly. Because Africa is the central mining hub, the future of sustainable mining practices is seen as a barometer for the whole continent. Companies with local offices must work with neighbourhood organisations, labour unions, and governmental agencies to establish company-wide CSR practices. Companies are routinely evaluated on how well they are at removing the socioeconomic hurdles left over

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from the apartheid era. This is especially true when training and promoting black employees for senior roles and hiring and promoting women and people with disabilities (Ford, 2022). We believe there is a breakdown in communication between the different role players, and employees are not receiving adequate feedback on the issues they are dealing with. Employees perceive that the purpose of collective bargaining is to satisfy their “human needs, reduce poverty, secure fair labour practices, and contribute to a better living”. On the other hand, these expectations are lofty and unattainable, and the inability to live up to them breeds feelings of insecurity and mistrust. This will also result in unprecedented strike actions, which have been steadily increasing in frequency across the industry. Strike actions are ineffective and expensive for employers since they create “damage to property, the expenditure of engaging private security agencies, and the fees involved in litigation”. The extractive industry, such as mining, oil, and gas, contributes heavily to environmental pollution, degradation, and resource depletion, which is one of the challenges of implementing CSR. Companies operating in the extractive sector are under increasing pressure to embrace more ethical business practices. The concept that adopting more responsible practices is in the industry’s best interests to raise productivity and prevent negative press is expanding as shareholders and lenders demand reductions in greenhouse gas emissions and pollution and improvements in worker and community welfare. The mining sector produces much local pollution during the extraction process and during transportation, because it is by its very nature quite invasive, requires a great deal of energy, and moves a great deal of rock and soil (Ford, 2022). We think it is important to use sustainable frameworks and lead responsibly to solve these problems. A sustainability framework can be characterised as a rational and systematic approach to integrating concepts, approaches, procedures, and tools. As a result, communities can reach their goals and accurately measure their success in ecological, social, and economic areas while keeping their residents engaged. Therefore, we believe that the thrust of corporate social responsibility is to ensure that best practices are used in all industries to protect people and the environment. As a result, industries are looking for ways to contribute constructively to combating climate change and protecting the world. Because of this, the extractive industry needs to use 4IR technologies such as artificial intelligence, the Internet of Things, machine learning, and robots to help protect the environment. Cleaner production is a proactive approach to environmental protection. Its main goal is to reduce the chance that workers will be exposed to chemicals that could be harmful and to improve the efficiency of production by making better use of raw materials and energy sources. Throughout the entire life cycle of an item, from raw material extraction to final disposal, the environment benefits when the procedures are applied. Due to mines becoming more self-sufficient and labour opportunities becoming scarcer due to rising automation, fewer people may feel that their well-being is directly tied to the health of fundamental industries. Governments often act unilaterally to close the gap when there is a mismatch between what society needs and what the mining industry wants. Mine owners should not sit on their hands and do

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nothing while they wait for new rules to be published; instead, they should actively engage with government authorities to shape policy. Organisational leaders can strengthen their cases by forming a shared vision of their companies’ value to local communities. This framework views sustainability as an overarching challenge incorporating stakeholder relations, community development, safety, health, and environmental impacts (Lane & Muricy, 2021). We believe there is a discrepancy between the policy declarations, the legal provisions, and the reality on the ground, as evidenced by the evidence. As a consequence, implementing CSR programmes to share the benefits of mining investments with local people is a significant step toward achieving an all- encompassing strategy for tackling the issue of rural development in regions where mining is conducted. In addition, the regulatory environment has not sufficiently supported the principles of sustainable development in terms of their practical application. Even though mining companies may comply with mining legislation, they are not able to contribute to the socioeconomic development of the host countries. This is because the laws of the host countries are said to provide insufficient support for socioeconomic development and do not provide clearly defined benchmarks or standards that must be achieved. Because of this, mining corporations frequently resort to techniques that do not have to comply with any specific regulatory requirements. It is possible that major expansion of the mining sector may not lead to sustained socioeconomic development, particularly on the local level, unless these difficulties are successfully recognised and dealt with. Recently, the extractive industry has been severely affected by the COVID-19 pandemic. Despite this being a challenge for the sector, it also presented companies with an opportunity to make a difference. Several African countries have reported increased COVID-19 cases while already having weak disease surveillance and public health infrastructure. Governments, individuals, and companies must work together to combat the virus. Major participants on the continent, mining firms, support the health sector and other government initiatives in the economy and society. It is critical for businesses to devote resources to combating this worldwide pandemic as part of their corporate social responsibility efforts. Companies should realise that their employees are not solitary people. Both above and below ground, mining facilities need flowing water, soap, and hand sanitisers, and workers should always keep their distance from one another. It is crucial that mining companies deliberately allocate funds toward strengthening emergency health systems and access to information on COVID-19 transmission prevention in communities close to their mines, given the high poverty levels and underdeveloped local health systems in mining areas. Safety and health measures are of the utmost importance in all fields to prevent the spread of COVID-19, which could ultimately force governments to cease all economic activity (Southern Africa Resource Watch, 2020). Therefore, the devastating effects of the COVID-19 in many sectors in general and the extractive industry in particular are fertile ground for further research. Could the interventions implemented by various players in the industry reduce the further spread of the virus should the pandemic reoccur and thereby minimise the disruption of production and the entire value chain? The importance of

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analysing this problem cannot be overemphasised; otherwise, the industry may find itself in a situation where it has to bleed heavily beyond its current predicament. Thus, the extractive industry can improve people’s lives in developing countries by helping to reduce poverty, speed up economic growth that benefits all, and raise living standards. When all is said and done, we think COVID-19 was a blessing in disguise. The COVID-19 epidemic has highlighted the shortcomings of underfunded public health services. These problems have led to the extractive industry taking on a more prominent role in providing services that have hitherto fallen under the purview of the state. Whether or not specific health programmes implemented by mining firms will be sustainable over the long run if mines are closed is a matter of some concern. The equal distribution of these benefits among the country’s many demographic subgroups has also been called into question. By developing novel approaches to combat the pandemic, the mining industry has been able to maintain its goals, such as the pursuit of increasing legitimacy. Creating novel methods for fighting the epidemic is one such alternative approach. This is partly attributable to insufficient cooperation on the individuals’ side and partly to relevant regulations gaps. Companies in the extractive sector frequently violate the rights of host communities by stealing resources, forcibly relocating people, and wreaking devastation on the environment to maximise profits. There are many unanswered questions about the responsibilities of key stakeholders such as governments, community leaders, and nongovernmental organisations (NGOs), who are sometimes considered the last line of defence for protecting human rights and the welfare of society when there are no effective policing mechanisms in place to protect vulnerable communities. The extractive industry is susceptible to external disturbances. For this reason, there are specific challenges that local businesses face head-on. These corporations have the potential to have a positive impact on society and gain legitimacy in the eyes of their customers. Nonetheless, many questions remain about the morality of extractive industry companies’ practices. Corporate social responsibility (CSR) researchers and practitioners have an obligation to determine whether CSR activities are merely a public relations (PR) stunt designed to make the company look good to its stakeholders or whether they are essential to the success of the business. Therefore, academics and professionals in underdeveloped nations should prioritise creating a sustainable business model to guarantee that funds go toward long-term community development.

References Boadi, E. A., He, Z., Darko, D. F., & Abrokwah, E. (2018). Unlocking from community stakeholders, corporate social responsibility (CSR) projects for effective company–community relationship. Labor History, 59(6), 746–762. Ford, N. (2022). Can African mining ever be sustainable? https://african.business/2022/04/energyresources/can-african-mining-ever-be-sustainable/

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Lane, A., & Muricy, P. (2021). Trend 4: ESG: Working to overcome the social trust deficit: Linking social investments to sustainable outcomes. https://www2.deloitte.com/za/en/insights/industry/ mining-and-metals/tracking-the-trends/2021/mining-industry-trust-deficit.html Pedro, A., Ayuk, E. T., Bodouroglou, C., Milligan, B., Ekins, P., & Oberle, B. (2017). Toward a sustainable development license to operate for the extractive sector. Mineral Economics, 30(2), 153–165. Roseland, M., & Spiliotopoulou, M. (2017). Sustainable community planning and development. In M. A. Abraham (Ed.), Encyclopedia of sustainable technologies (Vol. 2). Elsevier. https://doi. org/10.1016/B978-0-12-409548-9.10185-X South Africa Resource Watch. (2020). SARW calls on mining companies in Africa to support the fight against coronavirus 2019 (COVID-19) in the workplace and in surrounding communities. https://www.sarwatch.co.za/sarw-calls-on-mining-companies-in-africa-to-support-the-fightagainst-coronavirus-2019-covid-19-in-the-workplace-and-in-surrounding-communities/

Steven Kayambazinthu Msosa is an expert in marketing. He has worked in the private and public sectors for over 15 years. Steven is currently a Lecturer in Marketing and Research Fellow at the Mangosuthu University of Technology. He has held positions as a Head of Marketing and Controller of Courier Services responsible for Sales at the Malawi Posts Corporation, and Customer ive and Card Marketing Executive at Total Malawi Limited. Steven obtained his PhD in Marketing and a Master’s Degree in Marketing at the Durban University of Technology, a Master of Commerce in Business Management Specialising in Entrepreneurship, a Bachelor of Commerce Honours Degree in Business Management Specialising in Marketing from the University of South Africa, a Bachelor’s Degree in Business Administration from the University of Malawi, and a Diploma in Community Development from the Association of Business Managers and Administrators (ABMA), UK. He is a member of the editorial board of an international journal and a reviewer for several DHET-accredited journals. He has published in DHET-accredited journals and presented at local and international conferences. His research interests are corporate social responsibility, sustainability, entrepreneurship, services marketing, higher education marketing, international marketing, multi-level marketing, relationship marketing, and integrated marketing communication.

Index

A Abject poverty, 229 Absenteeism, 20 Accountability, 175–177, 179–181, 183, 185, 186, 245, 247, 248, 250 Accruing revenue, 224 Accuracy, 241 Act, 159, 162–164, 166–168 Adani Power, 275, 276 Administration, 247 Administrative efficiency, 226 Affirmative action, 259 Africa, 65–78, 83–85, 87, 88, 93, 94, 98, 111, 214 African, 207, 212–214 African studies, 83, 84, 98 Agencies, 238, 239, 242–250 Ahmadu Bello University, 224 Air, 47, 52, 54, 55, 57, 58 Amnesty, 115 Anglo American, 59–60, 128 AngloGold Ashanti, 76–77 Apartheid, 256, 259 Arewa Consultative Forum (ACF), 229 Arms of government, 226 Artificial intelligence (AI), 50, 57 At-home employees, 20

B Bad governance, 232 The Bank of the North, 224 Basarwa, 128

Belonging, 127, 128, 130 Berlin Conference, 223 Bikita minerals, 139–153 Birla, 271 The Bombay plan, 271 Botswana, 123–128, 131–136 Bribery, 179, 183, 184 Brown environmental agenda, 139 Bureaucracy, 238, 248, 249 Business ethics, 193, 194 Business philosophy, 145, 147–149, 175 Business principles, 141, 233 Business practices, 193

C Carbon footprint, 55, 60 Carroll’s (1991) model, 32 Central government, 225, 227, 228 Civil society, 149, 152, 153, 177, 181, 184, 185 Classic pyramid, 33 Clean environments, 20, 146 Climate, 47, 49, 51, 52, 55, 56, 58 Climate change, 16, 18, 284 Coal India Ltd., 275, 276 Cocoa, 224 Collaborative governance, 247 Collective bargaining, 257, 258, 260 Collectivity, 2, 32, 124, 130, 164, 211, 212, 248, 257, 258, 260, 273, 284 Colonial rule, 223 Commission, 88, 131, 153, 179, 192, 200, 215– 217, 233, 234, 239, 250

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 S. K. Msosa et al. (eds.), Corporate Social Responsibility in Developing Countries, CSR, Sustainability, Ethics & Governance, https://doi.org/10.1007/978-3-031-27512-8

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290 Communalist, 212, 213, 219 Community, 123–125, 127–136, 206, 214–216, 219, 237–250 host community, 159 impacted community, 169, 170 local communities, 160 mining community, 24, 67, 69, 78, 82–106, 129, 130, 132, 133, 136, 139–153 village community, 197 Community cohesion, 130 Community development (CD), 6, 21, 23, 65– 78, 90, 96, 98, 99, 104, 105, 192, 193, 195–198, 200, 275 Community development dimensions, 36 Community engagement, 68, 72, 78, 90 Community investment, 69, 90 Community leaders, 68, 97 Community resettlement, 77 Community security, 21, 51, 99 The Companies Act, 2013, 266, 272–275, 277 The Companies (Amendment) Act 2019, 273, 275 The Confederation of Indian Industry, 271, 277 Companies’ reputation, 196 Company, 123–129, 131–136, 206, 208, 214– 220 Company’s value, 194 Compensation, 6, 9 Compliance with the Law, 194 Conceptualization, 218 Concurrent list, 246 Conflict, 192, 193, 195, 197, 198, 201, 211, 215, 227, 228, 232, 281, 282 Conflict management, 8 Connivance, 191–201 Constitution, 219, 220, 224, 226, 246 Consultancy, 91 Consumers, 123 Contamination, 52 Content analysis, 67, 71, 77 Contract, 184 Corporate, 206, 207, 214 Corporate behavior, 237, 238 Corporate citizen, 131 Corporate citizenship, 49 Corporate goals, 195 Corporate governance, 2, 133, 177, 179, 180, 193, 268, 269, 272 Corporate ideology, 220 Corporate image, 42 Corporate learning, 42 Corporate organizations, 111–113, 116 Corporate philanthropy (CP), 265, 267–274 Corporate reputation, 41 Corporate social investment (CSI), 133

Index Corporate social responsibility (CSR), 1–11, 15–25, 29–42, 47–61, 65–78, 83–106, 111–120, 123–136, 139–153, 175, 176, 186, 191–201, 205–220, 237–251, 255, 261–262, 265–277, 281–286 CSR implementing, 168 Corporations, 139, 175, 177–180, 183–185 Corruption, 177, 178, 180, 181, 183, 185, 191– 201, 241, 250 Council on Foundations, 267 Counterhegemonic legality, 271 Countries developed countries, 6, 30, 32, 70, 111, 223, 283 developing countries, 157, 158 COVID-19, 273 COVID-19 pandemic, 15, 16, 18, 19, 24, 25, 74, 76, 285 Criminality, 191–201 CSR activities, 65, 67, 70–74, 84, 85, 89–95, 98, 100, 103–105 CSR decisions, 65, 87 CSR initiatives, 67–71, 73, 74, 76–78, 85, 105 CSR pyramid, 32, 33 CSR pyramid for the developing countries, 33 Cultural, 4 Culture, 211 Customers, 15, 16, 18, 283, 286

D Data, 50, 56–59 data collection, 159 secondary data, 159 Deaths, 20, 22 De Beers, 126, 127 Debswana, 123, 124, 126, 127, 131–136 Degradation, 47, 51, 143, 145, 177, 184, 225, 230, 232, 234 Democratic, 227, 228, 231, 269, 270 Department, 238, 246 Deprivation, 105, 201, 229 Derivation principle, 228, 229, 232 Derivation revenues, 228 Devastated communities, 197 Developing countries, 1, 3, 5–6, 10, 22, 23, 67, 70, 77, 83, 87, 93, 106, 111, 113, 139, 143, 144, 152, 175, 183, 266, 270, 281, 286 Developing nations, 29–42 Development, 123–126, 128–134, 238–242, 244, 245, 247, 248, 250 mine development, 67 sustainable development, 158, 165, 166, 169

Index Developmental aspirations, 196 Diamonds, 126, 127 Digital, 50, 51, 56, 58 Disclosures, 176, 177, 179–181, 183–186 Discrimination, 259 Distributive, 210, 212, 218 Drones, 57–58

E Eastern regions, 224 Ecocentric rights, 142 Economic, 47–51, 56, 58, 60, 61 Economic development, 29, 31, 32, 35, 42, 131 Economic growth, 10, 22, 29, 30, 32, 35, 50, 51, 60, 61, 158, 170, 248, 259, 271, 283, 286 Economic performance, 194 Economic prosperity, 234 Economic security, 165 Education, 4–6 Education and training, 77 EMA, 140, 143, 145, 150 Emancipation of Niger Delta, 229 Embezzlement, 229 Emerging economies, 30 Employee welfare, 16 Employees, 10, 17, 20, 22, 24, 66–70, 74, 75, 77, 97, 284, 285 Employers’ organizations, 258 Employment, 48, 50, 51, 69, 76, 78, 90–92, 96, 97, 99, 103 Employment Equity Act (EEA), 259 Endowment, 158 Environment, 1–4, 6–8, 10, 20, 21, 24, 66, 67, 69, 70, 72, 77, 283, 284, 286 Environmental, 123–125, 130, 132–134, 136, 139–153, 175–179, 181, 182, 184, 185 Environmental challenges, 228 Environmental compliance, 141 Environmental concerns, 193 Environmental degradation, 114, 115, 118, 119 Environmental devastation, 245 Environmental impact assessment, 71, 90, 143, 168 Environmental issues, 113, 195 Environmental laws, 141, 143, 168, 200 Environmental pollution, 195, 199, 225, 231, 234 Environmental protection, 29, 55, 66, 70, 75, 89, 95, 141–147, 162, 167, 217, 238, 246, 248–250, 271, 283 Environmental Protection Agency (EPA), 75

291 Environmental regulations, 141 Environmental responsibility, 6, 8, 140, 143, 148, 245 Environmental rights (ER), 119, 139–153 Environmental rule of law, 141 Environmental security, 21, 51 Environmental standards, 141 Environmental stewardship, 6 Environmental sustainability, 240, 248, 269, 271, 272, 275, 276 Environments, 83, 85, 86, 88–91, 93, 96, 139– 142, 144–153, 176, 177, 180, 185 Equalization fund, 228 Equatorial Guinea, 71 Equity, 130, 134, 283 Ethical, 123, 124, 136, 140, 175, 180 Ethical obligations, 196 Ethical responsibility, 32, 33 Ethics, 49, 216 European ethical business model, 266 Exclusive list, 246 Exploitation, 128 Extraction, 123, 131, 244, 246, 248, 250 Extractive, 47–61 Extractive industry (EI), 1–11, 15, 16, 19–21, 25, 29, 30, 32–39, 41, 42, 66–71, 77, 78, 87, 90, 93, 111, 112, 116, 237–251, 274–277, 281–286 Extractive industry research (EIR) approaches, 159, 166 methodology/methods, 159–160 mining company, 160, 162, 163, 165, 167, 168 techniques, 55

F Federal allocation, 225 Federal government, 238, 246 Federalism, 226–228 Fiber optics, 59 Financial autonomy, 229 Financial incentives, 21, 211, 216, 218 Financial performance, 39 Financial reporting, 92 Financial reward, 183, 184 Findings, 67, 69, 96, 99, 100, 147 Fiscal relations, 225 Focus group discussions (FGDs), 159, 160 Foreign direct investment, 114 Fossil fuels, 51, 52 Fourth Industrial Revolution (4IR), 47–61 Framework

292 Framework (cont.) sustainable livelihood framework (SLF), 160

G Gandhian doctrine of trusteeship, 271 Gas, 47–49, 51–58, 60 Gas Authority of India Limited (GAIL), 271 Gas flaring, 195, 196, 200 Geographic, 4 Ghana, 69, 71–73, 75, 76 GHG emissions, 52 Ghost towns, 128–129 Global competition, 32, 195 Globalization, 3, 6, 271 Global markets, 30 Global Memorandum of Understanding (GMOU), 197 Goggles, 15 Gold mining, 69 Good corporate citizenship, 195 Governance, 160, 161, 163, 165, 166, 168, 215, 216, 218 Government, 1–4, 7–10, 15–18, 20–25, 50, 61, 66, 67, 71, 74–76, 84–88, 90–94, 96–99, 102, 104, 105, 206–208, 214–220, 281, 282, 284–286 Governmental agency, 283 Gowns, 15 Green environmental agenda, 153 Greenhouse emission, 1, 31, 284 Greenwashing, 2 Gross domestic product (GDP), 48, 51 Groundnut pyramid, 224 Grundnorm, 219

H Health, 15, 17, 19–25, 68–70, 72–77, 84, 89, 90, 92, 93, 96, 97, 99–104 Health and safety, 256, 257, 259–260 Health care, 269, 271–273, 275 Healthcare services, 226, 233 Healthy environment, 141, 144, 146, 152, 166 Heightened environmental rights, 144, 151 Honest information, 194 Host community, 65–69, 74, 75, 93, 100, 105, 192, 193, 195, 198, 199, 208, 214–220, 238, 239, 244–246, 248–250 HR-integrated CSR, 41 Human, 51, 52, 54, 57 Human development, 117, 197 Human insecurities, 51 Human resources, 261

Index Human rights, 16, 20, 24, 111–120, 282, 286 Human security, 114

I Identity-based oppression, 4 Illegal dumping, 181 Illicit activities, 184 Impacted communities, 16 Incessant violent conflicts, 195 Inclusion, 283 Inclusive growth, 74 Incompatibility tests, 214 India, 266, 268–277 Indian Oil Corporation Ltd., 275, 276 India’s economic reform, 271, 277 Indirect rule, 223 Individuals, 68, 77, 78, 105 Industrial action, 255, 257, 258 Industries, 47–61 Information, 144, 149, 151, 153, 176–179, 181–185 Infrastructural facilities, 226, 235 Injury, 7 Innovative, 56 Insecurity, 112, 118, 119 Institutional structures, 211 Insurgency, 230, 282 Interdependency test, 214, 220 Interviews, 159, 160

J JSW Energy Ltd., 275, 276 Jubilee Field, 72 Justice, 210 Jwaneng, 125–128, 134, 135

K Kenya, 73, 74, 83–106 Kidnapping, 225, 233 Kimberley Process (K.P.), 8 Kosmos Energy, 71–74

L Labor market, 50, 56, 60 Labour, 255–257, 259–262 Labour laws, 262 Labour Relations Act (LRA), 257–258 Labour unions, 283 Land, 51, 52 Land Use Act, 225 Law, 7

Index Leadership effectiveness, 41 Leadership performance, 39 Legal, 206–210, 214–220 Legal framework, 139–143, 145, 147, 183 Legal obligation, 143, 144, 193, 270 Legal norms, 208, 212, 219 Legislation, 143, 144, 148, 153, 179, 180, 183, 184, 255–257, 259, 262 Legitimate, 179–181, 183, 184 Legitimately, 180, 184 Letlhakane, 124, 126–128, 134, 135 Liberalization, 265 Littleton’s Constitution, 224 Livelihood, 6, 66, 67, 69, 74, 99, 283 livelihood activities, 161 Living standard, 193 Local communities, 130, 131, 157–160, 164, 166–170 Local economies, 192, 194 Local government, 246

M Machine learning, 57, 58 Macroeconomic environment, 35 Malaria, 76, 77 Marikana, 255, 257, 258, 262 Market orientation, 30, 40 Masks, 15, 17 Mass poverty, 113 Maximize profits, 192 Medical care, 5 Memorandum of Understanding (MOUs), 197 Micro-meso-macro model, 38 Migration, 127, 131 Mine closure, 167 sites, 165 Mineral resources, 244, 246 Minerals, 48, 51, 57, 256, 257 benefits, 90 exploitation, 158 exports, 157 value, 157 wealth, 163 Mineworkers, 258 Mining, 1–7, 9–11, 16–18, 20–25, 66, 67, 69, 74–78, 83–106, 123–130, 132–136, 139–153, 255–262, 282–286 activities, 157, 161, 163–168 Mining Act, 159, 163, 164, 166, 167 mining process, 52, 55 mining regulations, 162–163

293 mining sector, 157–170 Mining and environmental legislation, 257 Mining community, 24, 67, 69, 78, 82–106, 129, 130, 132, 133, 136, 139–153 Mining companies, 123–130, 132–136 Mining firms, 66, 67, 74, 78, 92 Mining industry, 255–259, 261, 262 Mining towns, 123–136 Mining violence, 255 Minings, 47–49, 51–53, 55–61 Ministry, 246 Monitoring, 3 Moral minimum, 196 Movement for the Actualization of Sovereign State of Biafra (MASSOB), 229 Movement for the Survival of Ogoni People (MOSOP), 229 Multinational, 183–185 Multinational corporations (MNCs), 65, 195, 197, 198, 200, 201, 224, 232–234, 265, 270 Multinational oil and gas company, 67, 119 Multistakeholder, 177 Municipality, 21, 228

N National Aluminum Co. Ltd., 275, 276 National identity, 227 Natural, 47, 49, 51–58, 60 Natural resource curse, 4 Natural resources, 66, 67, 90 Nature, 38, 84, 87, 94, 100, 139, 141, 144, 145, 192, 208 Negative impacts, 193, 195 Negative social impacts, 195 Nehruvian model of political economy, 271 Neighborhood, 130 Neighbourhood organisations, 283 Neoinstitutionalism, 266, 269 Network governance, 247, 248 Newmont Corporation, 74–76 New public governance, 248, 249 New public management, 246–248 Niger Delta, 111–120, 177, 178, 182, 192–201, 205–220, 238, 244, 245, 248–250 Niger Delta Communities, 229 Niger Delta Development Commission (NDDC), 192, 200, 201, 229, 233, 234 Nigeria, 67–69, 83, 91, 95, 111–120, 142–144, 176–179, 181–186, 205–220 Nigerian Extractive Industry Transparency Initiative (NEITI), 176–178

294 Nigerian Extractive Industry, 175–186 Nigerian Niger Delta region, 235 NNPC, 197 Nongovernmental organizations (NGOs), 197, 240, 245 Nonrelativist, 213, 214 Norms, 124, 130 Northern part, 224 Northern region, 224

O Objectivity, 15, 18, 25, 34, 36, 66–68, 78, 89, 95, 123, 125, 130, 132, 134, 136, 142, 144, 167, 176, 196, 200, 206, 215–217, 219, 240, 243, 250, 258, 261 Oceans, 53–54 Oil, 47–49, 51–57, 60, 238, 244, 245, 248–250 Oil and gas, 176, 177, 183 Oil and gas industry, 5, 55, 60, 177 Oil and Natural Gas Corporation Ltd. (ONGC), 275, 276 Oil bunkering, 233 Oil communities, 118, 119 Oil companies, 196–200 Oil dependent economy, 229 Oil exploration, 5, 67, 69, 77, 91 Oil extraction, 196 Oil Mineral Producing Areas Development Commission (OMPADEC), 234 Oil multinationals, 111, 112, 119 Oil producing regions, 192 Oil revenue, 200, 225, 228, 230 Oil spills, 195, 197 Oil spillage, 52, 179, 196, 232 The Oodua Poeple Congress (OPC), 229 Operations, 139–141, 143, 147, 149, 152, 153, 175, 183, 185 Orapa, 123, 124, 126, 127, 131–135 Organizational learning, 38 Organizational management, 194 Organizational performance, 40 Organizations, 49, 50, 60 Orientation, 283

P Palm oil, 223 Palm produce, 224 Paris Agreement, 55 Participation, 283 Partnerships, 123, 130 Peace building, 116 People, 211, 219

Index Personal protective equipment (PPE), 15, 75–77 Petroleum, 48, 51 Petroleum Act, 224 Petroleum Industry Act (PIA), 216, 218–220 Philanthropic responsibility, 33, 193 Philanthropy, 32, 33 Pipeline vandalization, 225 Piracy, 225, 233 Policies, 140–145, 152, 153, 176–178, 183–186, 241–243, 245, 249, 255–257, 262 mining policy, 159, 164–168 policy environment, 158, 160, 163–164 statements, 168, 169 Policy makers, 183 Political, 1, 4, 10 Political will, 177, 183 Pollution, 7, 47, 53, 54, 56–58 Poor planning, 232 Post amnesty, 111–120 Poverty, 4, 6, 7, 67, 70, 83, 93, 95 Power, 206–212, 215, 217–220 Presidential Amnesty, 229 Private sector, 145, 179, 180, 182, 186 Privatization, 265 Proactive strategy, 195 Procedural environmental rights, 144, 146, 151 Productivity, 48, 50, 57, 60 Profitability, 18, 66, 193, 194 Profit-seeking, 192, 194, 198 Promoting human welfare, 193 Protection, 139, 141–147, 149–150, 176, 179–186 Public, 16–18, 22, 23 Public administration, 238, 246–250 Public administrators, 237, 238, 243, 244, 246, 249, 251 Public authorities, 182 Public governance, 247, 248, 283 Public institutions, 249 Public interest, 207–209, 211–214, 216–220 Public management, 238, 246–250 Public opinion, 207–209, 212, 217–220 Public policies, 241, 246, 247, 249, 251 Public–private partnership, 270 Public sector, 179, 182, 237, 238, 246, 247 Public sector units (PSUs), 271 Public values, 247, 248

R Reciprocity, 130 Redundancy, 20

Index Reforms, 238, 246, 247, 250 Regulations, 140, 141, 143–147, 151, 179, 180, 183–185 Regulatory environment, 285 Relational, 207, 208, 211, 212 The relational perspectives in leadership theory, 34 Relations, 206–209, 212, 214, 215, 217–220 Relativist, 212, 213 Reliance Power Ltd., 275, 276 Reporting, 179, 180, 184–186 Research research interests, 158 Research approaches, 159 Residual list, 246 Resolution, 86, 88 Resource governance, 160 Resources mineral resources, 157, 158, 161, 167, 168 natural resources, 165, 166, 169 Responsibilities, 206–209, 214, 216–218, 220 Responsible leadership, 29–42 Retaliation, 180, 181 Revenue allocation formula, 228 Rights of nature, 139, 140, 142, 144, 145, 149, 150 Rights to nature, 140, 145, 150 Robotics, 50, 57 Role of the state, 266, 269–270 Rolling back the state, 266 Rule of Law, 208

S Safe environments, 142, 180 Safety, 15, 17, 19–23, 25, 56, 57, 59, 61 Salaries, 20 Sanitation, 77 SDG 11 (sustainable cities and communities), 42 SDGs 2030, 42 Sector mining sector, 157–160, 162, 163, 166, 167, 169, 170 private sector, 163 public sector, 179, 182, 237, 238, 246, 247 Sectors, 47, 48, 56, 61 Security, 118, 119 Self-regulation, 35, 86, 124, 242 Shareholder’s interests, 195 Shell Petroleum Development Company (SPDC), 196, 197 Sick, 20

295 Skills, 49, 50, 56, 57, 60 Skills development, 77, 92 Small and medium enterprises (SMEs), 265, 276 Social, 157–170 Social and political cleavages, 229 Social auditing, 267 Social capital, 39, 40, 105, 161 Social cohesion, 123–136 Social conventions, 214 Social designs, 47, 90, 131 Social development, 29 Social investment, 71, 72 Social investment scheme, 233 Social norms, 208, 213 Social obligation, 140, 283 Social responsibility, 111–120, 237–242, 244–247, 250 Social structure, 129 Social tool, 129, 130 Social values, 214 Societal goals, 195 Societal governance, 111 Society, 2, 4, 6–11, 124, 128–133, 136 Socioeconomic, 126, 132 Socioeconomic conditions, 228 Socioeconomic development, 35, 192–196, 198, 229, 234 Solidarity, 130 South Africa, 16, 17, 21–23 South African government, 256 Southern Nigeria, 223 Sovereignty, 228 Staff replacement, 20 Stakeholder engagement, 40 Stakeholder expectation, 7, 66, 239, 240 Stakeholder group, 34, 67, 140, 216, 217, 219 Stakeholder participation, 40 Stakeholder perception, 125 Stakeholder relationships, 38, 40, 42 Stakeholder theory, 33, 34, 41, 194, 195, 243, 244 Stakeholders, 5, 7–11, 16, 21, 25, 48–50, 58, 65–69, 76, 78, 88, 90, 93, 94, 98, 99, 104, 139–142, 145, 148, 149, 192–195, 227, 231, 281–283, 285, 286 Standards, 207, 209, 210, 212–214, 217–220 State, 282, 283, 286 State government, 246 Steel Authority of India Limited (SAIL), 271 Strikes, 255, 257, 258, 261, 262 Substantive environmental rights, 142, 144, 146, 150–152

296 Suppliers and customers, 194 Support, 16, 18, 20–22 Sustainability, 2, 7, 30, 31, 34, 35, 37, 41, 206, 231, 240, 242, 244, 247, 250, 261 Sustainability report, 67, 71, 73, 74, 76, 77, 98, 100, 233 Sustainable, 124, 125, 128, 131–136 Sustainable communities, 29, 31, 32 Sustainable community development (SCD), 29–42, 197, 282 Sustainable development, 192–195, 198, 201, 237, 239–242, 245–248, 250 Sustainable development goals (SDGs), 66 Sustainable performance, 32, 37

T Tanzania, 69 Tata, 271 Taxation over taxation, 273 Tax holiday, 21 Technology, 47–61 Temperature, 52, 55, 58 Tensions and agitations, 227, 232, 235 Theory institutional theories, 161 stakeholder theory, 161, 170 Third generation rights, 140, 149 Three-Element test, 213–214, 218–220 Trade unions, 257, 258, 260, 261 Traditional leadership, 34 Traditional public administration, 248 Training, 50 Transnational Company, 244, 249 Transnational corporations (TNCs), 192–195, 198, 200, 201 Transparency, 176–181, 183–186, 239, 244, 245, 247 Triangulation, 146 Triple bottom line (TBL) approach, 265

Index Triple P concept, 143, 145 Typology research approach, 146 Tullow Oil, 72–74, 91

U Ubuntu, 212–214 Under-employment, 231 Unemployment, 115 United Nations, 55 United Nations’ 2030 Goals, 42 Unity, 128–130 US philanthropic model, 268

V Values, 124, 126, 129, 130 Visser’s (2008) Model, 32 Voegtlin et al. (2012) Model, 38 Voluntary, 176

W Wages, 20 Water, 47, 52–55, 59, 67, 71, 72, 74, 75, 91, 96, 97, 99, 100, 102, 103 Water facilities, 69, 101 The welfare state, 111 Well-being, 15 Western Region, 224 Whistleblowers, 178–180, 182–186 Whistleblowing laws, 177, 181, 185, 186 Whistleblowing policy, 178, 183–186 Workers, 15–20, 22, 24, 284, 285 Wrongdoings, 179–181, 183, 184, 186

Y YOUWIN, 229