August 11th 2022

Comparative Analysis of Corporate Social Responsibility Laws: UK, EU, and Nigerian Perspectives

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Abstract

In addition, research reveals that the concept and practice of CSR are socio-culturally shaped (Amaeshi, Adi, Ogbechie & Amao, 2006). Despite this awareness, popular literature and research concentrate surprisingly little on how regions other than those in the West implement the CSR agenda. This thesis consequently focuses on Africa in general and Nigeria in particular.

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This thesis on Corporate Social Responsibility Laws seeks to study and analyze the notion of CSR from a Nigerian view point in order to provide a foundation for future research. The objective is to investigate how Nigerian organizations see their role and contribution to achieving sustainable growth and development in Nigeria, as well as to identify the learning experiences. The core data was gathered through a field research that included personal interviews and discussions with a variety of Nigerian organizations.

The field research indicates that CSR is a relatively new idea in Nigeria and that it originated as a reaction by multinational corporations to mitigate the negative consequences of their extractive operations on local people. From a Nigerian viewpoint, CSR may be regarded in a dual light. First, there is the recent emergence of formal CSR procedures, mostly pushed by multinational corporations and major national corporations. These activities are mostly charitable, with habits and knowledge “imported” from the West.

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CHAPTER ONE

INTRODUCTION

Background to the study

Since the late 1980s, numerous individuals have investigated the implications of globalization and global capitalism. Initially, the majority of individuals saw the system as the ideal mechanism for contributing to wealth growth. Midway through the 1990s, however, the system’s flaws, such as the vast economic disparities across countries, became more apparent.

The discussion has centered on the necessity for a robust and moral ecosystem that reflects broader social and cultural norms. For the development of this environment, assistance is required not just from governments, but from all stakeholders, including the corporate sector.

Dunning (2003) advocates the establishment of what he terms a Responsible Global Capitalism, which should not be seen as an aim in itself but as a method of social reform of nations to improve the lives of its residents. According to Dunning, no religion or philosophy can impose its norms and standards on others, but each may contribute to a healthy moral ecosystem.

It is impossible not to see the private business sector as one of the primary players in reforming and bettering society in this transition process.

The 2002 Bali Roundtable on developing nations acknowledged the business sector as a main engine of economic progress, and the 2002 World Summit on Sustainable Development emphasized corporate participation as crucial for reducing poverty and attaining sustainable development (www.un.org).

Corporate Social Responsibility (CSR), the set of norms to which a corporation subscribes in order to influence society, has the ability to contribute positively to the growth of both society and enterprises. Increasing numbers of businesses are starting to see the advantages of establishing strategic CSR agendas. In recent years, a vast variety of CSR-related approaches and frameworks have been established, the bulk of them have been created in the West. This thesis, however, will concentrate on Africa in general and Nigeria in particular. The objective is to research and examine the notion of CSR from a Nigerian standpoint.

Several research suggest that the concept and practice of CSR are socioculturally framed (Amaeshi, Adi, Ogbechie & Amao, 2006). In spite of this, research on management and CSR in Africa is limited and mostly centered on a developing-developed world perspective (Jackson, 2004).

Concerning Nigeria, there are research on CSR, but it seems that the majority of these studies have concentrated mostly on multinational corporations and not on indigenous corporations or the regional settings in which the corporations operate (Amaeshi, Adi, Ogbechie & Amao, 2006).

Recently, shortcomings of African institutions have been the subject of discussion. In this discussion, it is essential to recall that the majority of African nations inherited a model of a powerful, centralized state whose primary function was to enforce the law and collect taxes. This system met its primary objective of upholding law and enforcing revenue admirably, but it was ill-suited to the requirements of post-independence Africa (Dia, 1996).

Today, there is a growing realization that institutional and managerial models transplanted from the West to other areas of the globe are not necessarily very effective (Wohlgemuth, Carlsson & Kifle ed, 1998).

According to the World Bank research “African management in the 1990s and beyond” (Dia, 2006), institutional failures in Africa are mostly the result of poor or nonexistent ties between western institutions and institutions with deep roots in the country’s history and culture.

Due to the fact that the exported models did not represent societal values, they failed to generate involvement and ownership among the populace. Africa requires institutions that are rooted in local culture and tradition, but also receptive to new ideas, and current research confirms this coexistence need (Wohlgemuth, Carlsson & Kifle ed, 1998).

It is obvious that the issue of exporting Western ideas without incorporating local culture and tradition would also apply to Corporate Social Responsibility models.

Additionally, an increasing number of writers are investigating the complexity of CSR. McIntosh (2003) discusses how complexity theory explains the inexplicability of some observable events non the natural sciences and how to see individual inhabitants as components of the whole. McIntosh discusses the complexity of the majority of CSR situations and the role complexity theory may play in the CSR environment.

McIntosh argues further that the Corporate Social Responsibility movement’s attempts to build methods to quantify the achievements of Corporate Social Responsibility pose a challenge. He contends that the universalization of these systems makes it harder to assess unpredictability. Mcintosh also suggests a practical technique for managers based on what South African social philosopher and activist Mark Swilling refers to as “culture of humanity.”

Swilling desires better collaboration between the sciences and the humanities and wants to use the complexity approach due to the humanistic concerns of ethics in theory and practice.

This research begins with CSR from a Nigerian and British viewpoint. Nigeria has a long history of handling cultural diversity and different stakeholders, and its residents and corporate leaders must constantly navigate cross-cultural relations. There should be lessons and experiences from Nigerian best practices that may contribute not just to management in Africa but also to management worldwide.

1.2 Statement of the problem

CSR has significantly contributed to the competitive advantage of both for-profit and non-profit enterprises. It has been shown that organizations who engage in CSR have a number of advantages, including increased sustainability, risk anticipation and management, reputation enhancement, employee retention, operational efficiency, cost savings, and improved interactions with regulators (Chepkwony, 2004).

Governments of developing nations have been accused of not enforcing CSR-related rules and laws or reducing corporate regulation. (Campbell, 2007; Moon and Vogel, 2008). This may be the reason why some firms in Nigeria include CSR concerns in their strategy goals while others do not. In groups that engage in it, it is done on a charitable or volunteer basis. Rowley (2006) noticed that the commitment of libraries to environmental concerns, which is a facet of corporate social responsibility, is considerable but implicit rather than explicit. She said that there should be more coordinated discussion, policy development, and action in this area of CSR.

The Nigerian and British constitutions have modest rules for corporate social responsibility. It is assumed but not explicitly stated. Through education, training, health, the environment, housing, urbanization, gender, children’s social development, youth, and sports, the Nigeria vision 2020 social pillar seeks to improve the quality of life for its citizens (Ministry of Planning and National Development, 2007 & National Economic and Social Council, 2007). These are CSR’s focal points. For instance, the vision recognizes that the country’s institutional structure for environmental management is fragmented. This indicates the necessity to strengthen the country’s CSR legislative structure and policies. This research will examine how other governments’ institutionalization of CSR has improved the strategic positioning of enterprises, especially information institutions. It will highlight CSR projects implemented in both the United Kingdom and Nigeria. In addition, it will provide strategic ways that the government may use to enhance the CSR legal framework and policy in order to lead its implementation in information institutions and other organizations.

1.3 Objective of the study

The primary purpose of this research is to compare the legislative framework governing corporate social responsibility in the United Kingdom, the European Union, and Nigeria. To achieve this aim and provide a framework for the study, I have established the following particular objectives:

To assess what may be learned from Nigeria about the global CSR path of continual improvement
To assess the knowledge and rationale for CSR in Nigerian businesses.
To compare how Nigerian and British businesses utilize CSR.
Evaluating corporate engagement in the development of a sustainable society in terms of learning experiences and future solutions

1.4 Significance of the study

Multiple academic fields intersect in the study of corporate social responsibility. It is not only concerned with the administration of economic operations, but also with the purpose and function of these organizations in society. Among others, this has consequences for philosophy, business ethics, law, and economics.

These issues have a significant influence on the lives of many people in nations across the globe; they are not just intellectual in nature. In 2010, the Social Investment Foundation projected that over $3.1 trillion was invested in ethically oriented funds in the United States, or around one dollar out of every nine put in managed funds. Similar quantities are invested in Europe and other nations with sustained growth. People expect and prefer companies to operate morally and responsibly, yet the view that corporations have no obligation beyond maximizing profits is prevalent in economics textbooks but not elsewhere. There is real dismay and fury when the media sometimes reveals gross corporate misdeeds.

1.5 Research Question

The research will seek to address the following issues:

What can Nigeria teach us about the road of continuous improvement for CSR globally?
What is the meaning and purpose of CSR in Nigerian businesses?
How do Nigerian firms adopt CSR in comparison to the United Kingdom?
What learning experiences and future solutions pertain to corporate engagement in the creation of a sustainable society?

1.6 Scope/Limitation of the study

This research does not analyze how Western CSR methods may be applied to the Nigerian environment or if these models have worked or failed in Nigeria. This study’s primary objective was to provide a foundational knowledge of CSR from a Nigerian and British viewpoint for future research.

Due to limited time in Nigeria and the decision to use interviews and conversations as a research technique, this study does not provide a comprehensive benchmark of CSR activities in Nigeria, but is confined to a handful of Lagos, Nigeria-based organizations.

Optionally, questionnaires could have been used to reach a larger number of organizations in Nigeria; however, according to our contacts in Nigeria, the response rate would have been very low as it is difficult to gain access to Nigerian organizations without prior personal contacts and an established platform in Nigeria. Other researches have also shown the difficulties of contacting individuals given the distance, prompting them to use social networks to overcome this obstacle (Amaeshi, Adi, Ogbechie & Amao, 2006).

Therefore, I cannot claim to give a totally representative image of CSR from a Nigerian viewpoint, but this was not the objective of the study. This study’s primary objective is to provide a foundational knowledge of CSR from a Nigerian viewpoint for future research.

1.7 Methodology

I collected and analyzed empirical data using an inductive and qualitative methodology. Inductive research is conducted when the actual world serves as the beginning point and reality is investigated via observations. My study’s objective was to collect so-called soft data, such as personal understanding and experiences; hence, I used a qualitative research approach as it is accessible to fresh information and understanding.

1.7.2 Data collection

I have used both primary and secondary data in my study. It was necessary to acquire secondary material from books, papers, reports, and the Internet to get a grasp of the topic and previous work. Personal interviews and conversations were used to acquire the research’s primary data, which consists of undocumented information gathered specifically for the study.

1.7.3 Validity and reliability

Reliability refers to the amount to which a repeated examination will provide same findings. To establish dependability, one must show that the study’s activities, such as data gathering processes, can be repeated with the same outcome.

When a study’s findings are consistent with reality, it is considered valid. High validity is achieved by measuring the whole phenomenon to be assessed and nothing else. It is essential to understand that information is constantly interpreted and that a researcher cannot see or assess a phenomena objectively. Patel and Davidson (2003) argue that it is impossible to standardize techniques to ensure the validity of qualitative research since each qualitative research process is unique.