The Concept of Corporate Social Responsibility

Topics: Business ethics, Corporate social responsibility, Petroleum Pages: 11 (2977 words) Published: October 11, 2010



I have chosen the concept of corporate social responsibility policies, including business ethics and their impact on business practice and key stakeholders.

The organization I have chosen for this research project is Shell Petroleum Development Company of Nigeria (SPDC).

Reasons for this topic/organization:

In the light of the recent oil spillage on April 20, 2010; caused by BP’s Deepwater Horizon oil rig explosion in the Gulf of Mexico, killing 11 workers and commencing months of oil leakage into the ocean, which witnessed unprecedented news coverage both in the print and electronic media, and eventually led to the resignation of the Chief Executive Officer of BP, Tony Hayward; that also led to the payment of a whopping $670 million in claims already as at Tuesday, September 28, 2010 (Reuter’s website:). I began to develop an interest in the activities of SPDC, the company that carries out the biggest oil exploration activities in the Niger Delta region of Nigeria.

Given the swiftness with which the US President insisted on the setting up of a $20 billion fund, now administered by GCCF head, Kenneth Feinberg (Reuter’s website: Tuesday, September 28, 2010). I decided to do this research on Shell’s activities in Nigeria regarding oil exploration, its Corporate Social Responsibility policies, including business ethics, and their impact on business practice and key stakeholders.


The aim of this research therefore is to review and analyze SPDC’s corporate social responsibility policies, including business ethics and their impact on business practice and key stakeholders.

Export of crude oil is the main stay of the Nigerian economy and oil exploration, or exploitation as the people of the Niger-Delta area would believe, is predominantly done in the Niger-Delta region of the country. It is in fact the major economic activity of the region.

The region is endowed with immense human and natural resources. The people of this area believe that crude Oil is their own gift from Mother Nature. For the purpose of this project therefore, the Niger Delta is the area situated in the South-South of the country; within the boundaries of Akwa Ibom, Rivers, Cross River, Bayelsa, Delta and Edo states. Just six states out of the 36 state Nigeria.

This research work will therefore focus on the impact of SPDC’s activities on the eco system, the Niger-Delta region and Nigeria as a country.

SPDC then known as Shell began oil exploration in Nigeria in 1937, but were granted a license on November 4, 1939 (Igho O. Natufe 2001).

The company originally known as Shell D’Arcy and later Shell-BP was jointly financed by the Royal Dutch/Shell Group of Companies and the British Petroleum (BP) Group on an equal basis. SPDC discovered the first commercial oil field in the country at Oloibiri Bayelsa State in 1956 (SPDC: How it began). As a result of a sustained oil exploration, SPDC had since discovered more oil fields which have established Nigeria as a major crude oil producer with significant gas potential, and becoming a member of the Organization of Petroleum Exporting Countries (OPEC) in 1971. Though Shell controls only 30% of the shares of SPDC, The other shareholders are the Nigerian National Petroleum Company (NNPC) 55%; Elf 10%; and Agip 5%.

Today, SPDC is capable of producing on average, about 1 million barrels of crude oil daily. As the pioneer leader in the petroleum industry, SPDC has the largest acreage in Nigeria from which it produces some 39 per cent of the nation’s oil from its operations in the Niger Delta and the adjoining shallow offshore areas where it operates in oil mining lease area of around 31,000 square kilometers. The company has more than 6,000...

References: 1. SPDC website: How it began
2. Reuters website: Tuesday, September 28, 2010
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