THE EFFECTIVENESS OF CORPORATE SOCIAL RESPONSIBILITY REGULATIONS
This introductory chapter examines the context of the study, the statement of the problem, the purpose and objectives of the investigation, the research questions, the study’s scope, its limitations, and its importance.
Context of the Study
Globally, organizations are concerned with value re-investment to society in recognition of the society’s contributions to their growth, survival, and continued existence. As marketing concept and philosophies are incorporated into societal marketing, which is defined as a means of achieving a desired level of social responsibility, our focus shifts to the potential consumers and non-consumers of business offerings (products) (Oko and Agbonifoh, 2014).
Public relations is the management function that identifies, builds, and maintains mutually beneficial relationships between a company and the many publics whose support is essential to its success (Broom, et al, 1994). According to the British Institute of Public Opinions, “public relations are a conscious, planned, and ongoing endeavor to build and maintain mutual understanding between an institution and its publics.” Public relations is a separate management function that facilitates communication, mutual acceptance and collaboration between an organization and its external environment, convergence between an organization’s structure and image, and maintenance of these relationships (Harlow, 1976). Corporate social responsibility is a significant means of identifying, establishing, and sustaining positive relationships.
Given that this is the focus of operations, corporations are paying more attention to concerns such as equal employment opportunity, making it easier for them to adopt corporate social responsibility concepts. In Nigeria, consumers are unwilling to sacrifice convenience and pay higher prices for environmentally friendly products because they either lack the knowledge or do not have access to information that would allow them to make informed decisions regarding their purchase, use, and disposal of these products; pollution control; energy, natural resources conservation; consumers’ and workers’ protection. Thus, businesses adhere to the principle of maximizing the beneficial benefits of their actions on society while minimizing the bad repercussions. The fundamental tenet of corporate social responsibility is regarded as an obligation by businesses in the developed nations of the world (Oko and Agbonifoh, 2014).
As a result of the deregulation and liberalization of the Nigerian economy in 2001, the Global System for Mobile Communication (GSM) industry has employed millions of Nigerians as phone distributors or retailers, recharge card vendors, or phone repairmen since the advent of mobile telecommunications in the country in 2001. This sector has significantly boosted the nation’s economy and hired a large number of formerly unemployed individuals. As the most active sector of the Nigerian economy, the operators’ expected corporate social responsibility role cannot be overstated. According to Altschuller and Smith (2011), stakeholders anticipate that businesses will control their social and environmental implications. Given the impact of the introduction of GSM into Nigeria, the widespread acceptance of this means of communication, and the role it plays in the Nigerian economy, mobile communication service providers should take CSR seriously. CSR should be voluntarily practiced by these organizations, as opposed to being mandated by the government, civil rights groups, or communities. According to Onwuegbuzie (2009), CSR is the deliberate incorporation of public interest into corporate decision-making and the respect for a triple bottom line of people, planet, and profit. In other words, CSR policy includes self-regulation, adherence to laws and regulations, ethical standards, environmental responsibility and sustainability, consumers’ happiness, employee welfare, communities’ and stakeholders’ benefits, and environmental responsibility and sustainability.
Prior to a few decades ago, the concept of Corporate Social Responsibility (CSR) was a very effective approach for most businesses to escape a highly competitive market climate. Corporate Social Responsibility is consequently the most suitable weapon for survival in an environment characterized by fluctuating and unstable consumer preference scales. In the case of Corporate Social Responsibility, the majority of businesses prefer to cut operational expenses in order to be socially and ecologically responsible. Socially responsible businesses typically attract more clients and grow their market share. CSR increases the company’s visibility and also serves as a communication channel with the public (Lawrence and Webber, 2008).
In order to expand the Nigerian economy, the telecommunications industry was deregulated, granting the private sector a preeminent position. Participation from the private sector is preferred since it provides operational efficiency in the delivery of goods and services and possesses viable ideas for sustainable growth (Hassan, 2011). Government recognised that it cannot grow the economy on its own, thus it created a climate conducive to deregulation policies in Nigeria. In order for the deregulation exercise to achieve its policy goals, the government established a solid legal and regulatory framework to protect and improve the Nigerian Business Environment (NBE). Analysts stated that quality regulations are required in the business environment to compel corporations to act responsibly within the bounds of the existing laws, protect property rights, ensure the well-being of citizens, and create an investment-friendly environment consistent with international best practices (Braithwaite and Drahos, 2000). Several of these laws/regulations establish basic requirements for corporations as corporate citizens, as well as demands for social/environmental reporting to prevent corporate excesses, executive abuse, and other widely documented corporate misdeeds (Campbell, 2007).
According to some academics, CSR legislation could encourage positive corporate compliance and effective social, financial, and environmental reporting (Hart, 2012). According to McBarnet (2009), in the European Union, Socialist and Green Members of the European Parliament (MEPs) have argued against a purely voluntary policy on corporate social responsibility and urged the European Commission to impose binding rules on corporations as opposed to voluntary compliance. However, CSR legislation are viewed as necessary, but their efficacy is questioned; the notion that regulations may make businesses responsible for corporate social responsibility is contradictory and illusive. Osuji (2011) adds that the ineffectiveness of regulations in eliciting compliance in the face of rising gross misconducts and corporate corruption of multinational corporations (MNCs) calls into doubt the fluidity of CSR relationship regulation.
Self-regulation, government regulations, and international regulations are the three regulatory areas of CSR (UN Global Compact, 2014). Self-regulation requires firms to voluntarily comply with social involvement and reporting requirements. When self-regulation failed, government regulations evolved to require firms to comply with binding laws on corporate operations, environmental reporting and disclosures, and engagement with all stakeholders across the board. Government regulations take the form of state action through enacting legislation regarding health and safety, labor standards, consumer protection, host community rights, sustainable business operations, environmental reporting, and stakeholder management, among others. International Regulations, the third level of regulation, evolved to complement the two preceding domains of regulation (Raimi, Adeleke, Aljadani and Fadipe, 2014).
International Regulations are typically policies, protocols, conventions, and occasionally laws created by institutions such as International Labour Organization (ILO), United Nations (UN), Organization for Economic Co-operation and Development (OECD), etc., to compel multinational corporations and large indigenous corporations to comply with international standards and best business practices. UN Global Compact, 2014), while ILO and United Nations Children’s Fund (UNICEF) have produced employment-related conventions on Child Labor, Forced Labor, and Slavery. The Environmental Law Research Institute (2011) recognizes at least twenty-seven (27) regulations that provide direct and indirect support for CSR and SR in Nigeria. “theory of responsive regulation” refers to the consideration of CSR compliance from a regulatory standpoint (Shamir, 2010).
Numerous firms in Nigeria are motivated by the avaricious desire to increase profits at the expense of its stakeholders. Some plans not effectively address the requirements of host communities, employee welfare (cheap labor is frequently favoured), environmental preservation, or community development. Research indicates that CSR can boost a company’s profitability, sustainability, integrity, and reputation if it is incorporated into its policy. According to Nkanga (2007), CSR is the commitment displayed by businesses to contribute to the economic development of a local community and society as a whole. It is typical practice for Nigerian organizations to include corporate social responsibility in their mission statements. The organizations must have learned that including CSR in one of their mission statements appeals to stakeholders in particular. Consequently, there is an increase in corporate understanding and acknowledgement of CSR.
MTN Nigeria is the major provider of mobile telecommunications in Nigeria. MTN’s aim is “to be the dominant supplier of telecommunications services in Nigeria, with a commitment to deliver world-class network quality, customer service, and value” (MTN, 2012). The company’s CSR initiatives, as detailed on its website and in its publications, include health, economic empowerment, environmental sustainability, and education. MTN’s CSR performance has earned it a positive reputation and the title of “The No. 1 CSR telecommunications firm” in the Nigerian telecommunications sector.
MTN Nigeria is part of the MTN Group, a South Africa-based firm that was licensed as a GSM operator in Nigeria on February 9, 2001, and made its first call in Nigeria on May 16, 2001. MTN was the first mobile carrier to register one million active members on its network on February 10, 2003, and its subscriber number increased to 35 million by June 30, 2010. According to a survey from the National Bureau of Statistics for the first quarter of 2016, MTN accounted for 38 percent (57.04 million subscribers) of active mobile users in Nigeria. MTN is a key player in the Nigerian telecommunications market, covering 85.24 percent of the country’s land mass with its network. MTN has been a catalyst for economic growth and development in Nigeria, particularly through the MTN Foundation, through which it has executed projects in the education, health, and economic empowerment sectors in Nigeria (Bolajoko and Jagun, 2013).
1.2 Description of the Problem
Several communication firms (MTN, Globacom, Airtel, 9mobile, Visafone, and Starcomms, to name a few) are vying for market share in Nigeria’s mobile telecommunications industry. Therefore, it would not be inappropriate for communication companies to devise strategies and programs that can not only combat the forces of competition, but also gain and maintain competitive advantage. In addition to the well-known generic tactics that dominate the literature, telecoms firms around the world are evaluating socially responsible behavior as a feasible approach for attracting and retaining consumers.
Recent studies and interest in corporate social responsibility (CSR) in Nigeria have been (optimistic) in the wake of problems involving international oil companies in the Niger Delta. These investigations have focused mostly on international oil and gas corporations. They have disregarded multinational and domestic communication firms. This study examines the present meaning and practice of corporate social responsibility (CSR) in Nigeria, focusing on the health and education programs of MTN Nigeria. This study investigates the efficacy of corporate social responsibility legislation in MTN Nigeria and if MTN Nigeria is concerned with improving staff working conditions, the work environment, and community well-being through CSR.
1.3 Aims and Objectives of the Research
This study’s primary objective is to assess MTN Nigeria’s involvement in corporate social responsibility initiatives. Other particular objectives include:
Determine the elements that influence MTN Nigeria’s participation in CSR activities;
2. evaluate MTN Nigeria’s corporate social responsibility programs for education;
Assess the impact of MTN Nigeria’s health-focused CSR operations;
Examine the impact of government priorities and policies on MTN Nigeria; and
5. Evaluate the effect of CSR efforts on the performance of MTN Nigeria.
1.4 Investigative Questions
In this project, the following research questions will be examined:
What variables influence MTN Nigeria’s participation in CSR activities?
What impact do MTN Nigeria’s corporate social responsibility programs have on education?
In what way does MTN Nigeria contribute to health-related CSR?
What impact does government policy and priority have on MTN Nigeria?
What benefits does MTN Nigeria receive from its corporate social responsibility initiatives?
1.5 Scope and Restriction of the Study
This study focuses on two areas of MTN Nigeria’s corporate social responsibility. In particular, on health and education.
Due to time, availability of materials and information, as well as their adequacy, the researcher is restricted to studying solely MTM’s corporate social responsibility in the areas of health and education. Due to differing privacy policies and the non-disclosure of essential information, obtaining information from MTN Nigeria’s workers may constitute a significant barrier to this study. However, despite these constraints, attempts will be made to produce a thorough research paper on the topic.
1.6 Importance of the Research
There has been discussion regarding the advantages of corporations’ social service; some authors say that corporate social responsibility is for community development, while others argue that it is a profit-making ploy by organizations. This study reveals to MTN’s stakeholders the numerous tactics it should employ to address societal challenges. It aids in investigating the impact of corporate social responsibility on stakeholders, if MTN has any interaction with these stakeholders. The report also provides the perceptions of MTN’s corporate social responsibility recipients regarding the corporation.
The study generates suggestions that could contribute to an increase in corporate social responsibility. The findings may potentially inspire additional research on corporate social responsibility in Nigeria, particularly for MTN Nigeria. This study is particularly significant since it sheds additional information on the sorts of corporate social responsibility in MTN Nigeria. However, the study boosts the quantity and quality of studies on CSR in the Nigerian telecommunications industry.
THE EFFECTIVENESS OF CORPORATE SOCIAL RESPONSIBILITY REGULATIONS