**1. Introduction**

The local communities of the Niger Delta have in no insignificant way benefited from the oil extraction business through Corporate Social Responsibility (CSR)—a concept that has remained embryonic and contested1 both in theory and practice. Many of the communities can boast of additional school blocks, civic centers, paved roads, potable water, healthcare facilities, etc. courtesy of the oil companies. Indeed, the oil business through CSR have made remarkable impacts on the local communities of the Delta.

<sup>1</sup> See [1] with reference to [2].

There is no intention to blow the trumpet of CSR by recounting all of its benefits in this chapter. Many analysts have x-rayed such benefits even as they left significant remarks and recommendations as to how to improve CSR in the Delta. Idemudia [3–5], as well as Idemudia and Ite [6], believe that CSR has the potential to enhance resource extraction in the Delta if only greater attention can be paid to environmental concerns through greater emphasis on issues relating to CSR. In other words, a more peaceful atmosphere for resource extraction can be guaranteed through an approach to CSR that emphasizes environmental questions. Renouard and Lado [7] remark that CSR in the Delta will be more successful if it can deal decisively with the challenge of achieving sustainable development in a context of acute inequalities. Other analysts, such as Aaron and Patrick [8] and Nwankwo [9] link the conflict in the Delta to faulty approaches to CSR. They consider sound CSR policies and practices free from inadequacies as a significant remedy.

What will be discussed in this chapter however, is the extent to which the reception or rejection of CSR approach by local communities have either strengthened or weakened the CSR processes and delivery. Are there significant implications of such reception or rejection for CSR theory and practice? What might constitute the remedies, if any?

#### **1.1 Methodology**

Local communities in the Niger Delta have responded to CSR in different ways. Many have accepted the packages they receive in their original shape and size, enjoying and enduring all the benefits and negative impacts respectively. Others have rejected the packages delivered to them as CSR, for being inadequate or insufficient. They deploy assorted violent means to register their rejection. There are yet others who have creatively engaged the CSR packages thrown at them. Rather than endure their negative impacts, they opt to modify their traditional alliances and practices either to stem or to ameliorate the violence across the Niger Delta. Obufia, a community in Egbema of Imo State, is one of such communities. The members of Obufia, as will be detailed in the coming sections, opted to modify their traditional alliances and practices to sustain the benefits of CSR which reach them in different forms.

That the conflict across the Delta fed into by CSR policies and practices has remained manageable is to be significantly attributed to the creative initiatives of communities such as Obufia. In other words, by some stroke of ingenuity local communities have muted the volatile effects of deficient CSR policies and practices. This deficiency in practice has its roots in the sociopolitical complexities associated with the global production network of oil. A remarkable theoretical implication of this is that it highlights the fact that despite the progress recorded in the substitution of 'short-term profit at any cost' for 'long term value maximization' in the corporate vocabulary, the general conception of CSR hardly excludes window dressing [10].

For years the discourse of CSR has been dominated by two opposing theories, though some prefer to classify CSR theories and approaches in four groups—political, instrumental, integrative and ethical [11]. There is on the one hand the theory attributed mainly to Friedman [12], who maintains that the social responsibility of business is nothing more than maximizing profits for shareholders. On the other hand is the view that business has the obligation to provide certain social services beside accumulating profit. These parallel theories appear to have been abridged when Carroll [13] suggested that the responsibility of the firm to maximize shareholder profit is merely a bottom line. Business, he insisted, has legal, ethical and philanthropic obligations as

#### *Responding Creatively to Faulty Corporate Social Responsibility Practices: The Case of Nigeria's… DOI: http://dx.doi.org/10.5772/intechopen.106249*

it were. The dawn of globalization ushered in a proliferation of transnational corporations across the world. This expansion is not matched with a supranational monitor of corporate activities. This implies that to be reckoned with corporations will not only assume the obligation of providing social services but also engage in its actual implementation. A new challenge yet emerges; how do corporations determine the extent to which focus on social welfare affects profit maximization? Though this challenge has not yet been surmounted completely, CSR is now as institutionalized as to warrant that companies in mature economies have CSR departments [10].

With the modification of the notion of shareholder wealth, many scholars have come to believe that maximizing profit can be done in a socially responsible manner [14]. Jensen [15] introduces the enlightened value maximization as a concept that reconciles the conflict between shareholder value and social responsibility. This concept incorporates aspects of the stakeholder theory even as it locates business' foremost objective on long-term value maximization [10]. Before the champagne is puffed over the definitive resolution of the theoretical controversies surrounding CSR, it is important to issue guidance for managerial decisions in situations where tradeoffs are to be made between competing stakeholders. "Managers, for example, might potentially seek to maximize their own utility at the expense of the shareholders' interests, all of which does not necessarily enhance the company's long-term value" [10]. Hence, there is yet some green washing and window dressing especially in the practice of CSR despite the seeming definitive substitution of the notion of 'long-term value maximization' for 'short-term profit at any cost'. The insensitivity of oil Transcorps to local community values in their practice of CSR, the details of which will be given in the coming sections augments this position. The oil Transcorps are caught between serving the interest of the shareholders and meeting their social obligation to the local communities. Even if the these corporations prioritize their long-term value in their CSR practices, the socio-political and economic forces peculiar to developing oil producing countries—the oil complex—frustrate their efforts further.

This conclusion follows from a nine-month ethnographic study of Obufia, one of the local communities in the Niger Delta. Shell Petroleum Development Company (SPDC) operates the oil wells in Obufia and this has been the case since the early days of oil explorations in Nigeria in the late 1950s. During the ethnographic study, data was collected from the Obufia Town Union, the traditional ruler, the Obufia Youth Association and the Obufia Women Association, which have kept a relationship in different degrees and capacities with the Transcorp and the State government. Data was also collected from the staff of the SPDC, especially the public relations officer. All data was collected via participant observation and interviews—structured and semi-structured. Data analysis was accomplished through a post-structuralist relational placemaking framework designed by Pierce, Martin, and Murphy [16].

The Niger Delta is examined as a place of placemaking projects, in which the politics of placemaking is played by groups and interests who attach different meanings to the oil rich physical space. Cheng, Kruger and Daniels [17] cite the example of different potentials of an open field as imagined by a farmer, a hunter, and a developer. The developer sees the open field as 'suburban home sites', the farmer sees it as 'endless rows of wheat', and the hunter sees it as 'grazing grounds for five-point buck'. Thus, the Niger Delta can be seen as one of the global oil and gas resource reservoirs that must be managed on a worldwide scale for the benefit of all. It can as well be seen as nothing more than a lived or inhabited environment. In that case, the oil and gas resources become part of the natural endowments to be engaged in the same manner as other natural resources, such as water, land, plants, etc. The significance of oil to

global economy implies that a lot of wealth is generated from it. Everyone wants a piece of this wealth. A focus on the distribution and privatization channels of the oil wealth using the analytical framework introduced by Pierce, Martin, and Murphy [16] can lead to a good grasp of the technique actors bring into the scramble for the oil wealth. CSR is one of the distribution channels and actors representing the local communities benefit from it and endeavor sustain it.

The rest of the discussion will proceed as follows. In the next section, a brief overview of Obufia and how the oil extraction economy has affected it will be given. This will be followed by a short history of CSR in Obufia beginning from the earliest days of oil discovery in and around the properties belonging to the community. How CSR has evolved over time to arrive at where it is presently will also be featured. Next is a focus on the principal shortcomings of CSR approaches, which is democratic deficiency or lack of participation. This will be accompanied by a spotlight on the forces that need to be factored in when decrying the lack of participation in the delivery of CSR. Finally, it will be concluded that unless there is a drop in global interest in oil or a change of the method of oil acquisition by the global super powers, CSR will continue to encounter problems. The gains in the harmonization of wealth maximization and social welfare in the concept of enlightened value maximization is merely utopia.
