Conflict in the Niger Delta and corporate social responsibility of multinational oil companies: An assessment

Abstract

The Niger Delta region of Nigeria contributes more than 95 percent of the country’s export incomes and generates more than 40 percent of the Nigerian Gross Domestic Product (GDP) and 85 percent of the nation’s total revenue (Karl and Gray, 2003, p. 26). Although most multinational oil companies (MNOCs) have found the Niger Delta a fertile ground for business, the region remains backward, poor and underdeveloped. The host communities have been frustrated by the effects of oil production on the environment, which include oil spillages, the reduction of arable land, and the destruction of wild life and fish reserves. As a result of the oil bearing communities’ angry sentiments towards the MNOCs and the Nigerian Government, incessant conflict, and violent crises have enveloped the region. To mitigate the anger, the MNOCs have engaged in some programs and projects intended to benefit the oil- bearing communities in the area of corporate social responsibility (CSR). This thesis is focused on how the CSR strategies of the MNOCs have contributed to the perennial conflict in the Niger Delta region of Nigeria. The mixed methods descriptive design study employed involves the use of survey instruments and content analysis to interrogate the conflict situation. Findings indicate that the failure of MNOCs operating in the Niger Delta region to provide concrete and sustainable CSR, and the government’s inability to regulate the MNOCs and plough back the taxes paid by the latter to develop the region, has led to the current crises. These supported the thesis that the lack of concrete social responsibility contributes to conflicts in the Niger Delta. Building upon the stakeholders’ theory, the theory of frustration and aggression, and conflict theory, this study discovered that the cause of the conflict in the Niger Delta is not solely an issue of corporate social responsibility and revenue allocation, but it largely depends on the divergences of the different stakeholders’ interests. This study, therefore, recommends a revocation of the 60/40 ownership structure between the government and the oil companies. Instead, host communities should be considered part owners of the oil deposits in their land, which would give them a fair percentage in the ownership structure.