Professional Documents
Culture Documents
David Wheeler
Heike Fabig
Richard Boele
the struggles of Shell to replicate its corporate stakeholder-responsiveness at the local level in Nigeria
with the experiences of other firms that seem to have
developed managerial capabilities at a somewhat
deeper level throughout the firm with consequent
benefits both for stakeholders and the business.
KEY WORDS: corporate social responsibility. Shell,
stakeholder theory, sustainability
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1. Introduction
One of the most helpful conceptual frameworks
for exploring the corporate attitude of Shell and
other firms in the extractive sector towards stakeholders is that of Corporate Social Responsibility
(CSR). Along with references to stakeholders,
sustainability and "triple bottom line" thinking,
CSR terminology is employed widely by Shell
and other actors in the extractive industries who
are members of the World Business Council on
Sustainable Development (WBCSD). Consistent
with current definitions of sustainable development, WBCSD recognises "corporate responsibility" in the three domains of financial,
environmental and social responsibihty (WBCSD,
2001). The WBCSD also offers a number of
candidate definitions for CSR which it may be
assumed refiect the views of Shell and other
influential members of the organisation. One
definition is that CSR requires "the continuing
commitrhent by business to behaving ethically
and contributing to economic development
while iniproving the quality of life of the workforce and their families as well as of the community and society at large" (Watts and Holme,
1999).
The CSR literature also bridges well to practical applications of allied concepts such as stakeholder- Responsiveness on which this paper will
focus. In this paper we will not assume that "corporate responsibility" and "sustainability" are
more or less interchangeable terms for the overarching notion that business must be economically, environmentally and socially viable in the
long term. We will, however, assume that as a
subsidiary construct "corporate social responsibility" encompasses many of those ethical questions which reside in the relationship between a
firm and its stakeholders. We also recognise that
there are those who would describe CSR or
"corporate citizenship" as an overarching notion,
so we will be careful to include all of these terms
in the appropriate way in our commentary and
discussion.
The literature on corporate social responsibility has been reviewed at length by Carroll
(1999). Describing the phenomenon as centuries
old but the literature as mostly associated with
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im^age as the socially and environmentally responsible company portrayed in magazine advertisements and promotional videos around the world.
They pointed to what they saw as a continuing
difference between what Shell International
espoused and how Shell in Nigeria behaved. And
they reflected on their ongoing experience of
Shell in Nigeria as clumsy and unresponsive to
their needs (authors' experience).
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such as sustainability and stakebolder- responsiveness (Moody-Stuart et al., 1998; MoodyStuart, 1999). As we have noted, at the corporate
level Shell International has well articulated
strategies, systems and processes to describe their
commitment to sustainability and corporate social
responsibihty (Wheeler et al., 2000). But for
some reason Shell has not fared as well in
reputational terms with NGOs and opinionformers as BP (Arnold, 2000) and the issue of
Nigeria remains a seemingly intractable challenge. It seems to us that the lack of consistency
between corporate leadership and strategy (in
London and the Hague) and local leadership and
operational behaviour (in Nigeria) is a major part
of the problem.
Interestingly, there are cases in the natural
resources sector where boundary spanning and
leadership questions have been addressed simultaneously with remarkable results. Boutilier and
Svendsen (forthcoming) have described how after
several years of bitter confiict with non-governmental organisations and first nations groups,
forestry company MacMillan Bloedel (since
bought by Weyerhaeuser) renounced clearcutting
on Vancouver Island and even formed a joint
venture company with its former adversaries in
Clayoquot Sound. The company appointed a
new CEO who immediately announced his
intention for MacMillan Bloedel to eliminate
antagonism with stakeholders and instead become
the safest, most respected, and most profitable
forest company in Canada. These breakthroughs
occurred almost entirely as a result of effective
boundary spanning by individuals representing
the protagonists and the subsequent integrity of
leadership pronouncements and behaviours.
In contrast to the MacMillan Bloedel story, it
is clear that SheU Nigeria has been permitted to
continue using defensive and non-conciliatory
language on its corporate web site. And the
evidence the company gave to the Oputa panel
hearings in Port Harcourt in early 2001 was
abrasive and unhelpful. Thus however many good
things may be happening in London and the
Hague and in other parts of Shell's international
operations, the continued flawed implementation
of Shell's approach to CSR and stakeholderresponsiveness in a Nigerian context continued
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International (1999). In many ways, at the corporate level SheU is now a model company with
respect to the concepts of CSR advocated by
Committee on Economic Development (1971),
Sethi (1975) and Carroll (1979). At the corporate level, and indeed in a number of key business
units (May et al., 1999), SheU has developed and
continues to operate a comprehensive and leading
edge approach to CSR and stakeholder-responsiveness.
But for the Ogoni, the exploitation of oil in
their homeland - and their subsequent introduction into a global economic system has left
them struggling to make sense of SheU's approach
to CSR as it has impacted on them. The Ogoni
feel that oil exploitation without sufficient regard
for the environment and local customs may well
be beneficial for the economic growth of Nigeria
as a whole but it has done little or nothing to
improve the quality of life for the local communities who live above the oil reserves.
Have the Ogoni been unreasonable in tbeir
economic and social demands? First president of
MOSOP, Garrick Leton described these demands
thus:
The people of the Niger Delta have not demanded
the total proceeds from the rent and royalties. They
have always said that since they live in a federation,
they must be their brother's keepers. An equitable
portion of the proceeds is what they have always
asked for. To deny them everything in the face of
the massive pollution and degradation of their
environment is totally inhuman (Rowell and
Goodal, 1994).
Conclusions
There is no doubt that Shell's corporate repositioning on sustainability, CSR and stakeholderresponsiveness is real. Their international
stakeholder outreach and public relations in the
years since the events of 1995 have been very
effective with a number of audiences. A U.K.
newspaper reported that a survey of 160
(Western) global opinion leaders found that Shell
was thought to be "strong on tbe environment",
"ethical" and "committed to human rights"
(Vidal, 1999a). This has been reinforced in
international polling of ordinary citizens in 23
countries world wide conducted by Environics
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References
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David Wheeler
Erivan K Haub Program in Business and
Sustainability,
Schulich School of Business,
York University,
4700 Keele Street,
Toronto, Ontario,
Canada M3J 1P3,
E-mail: dwheeler@schulich.yorku.ca
Heike Fabig
Graduate Research Centre for the Comparative
Study of Culture,
Development and Environment,
Sussex University,
U.K.
Richard Boele
Centre for Stakeholding and Sustainable Enterprise,
Kingston Business School
Kingston University,
U.K.