Social Responsibility Of Nigeria Businesses (A Case Study Of Nigeria Bottling Company Plc)
Many social critics have noted the failure of organization to behave in socially responsible ways and to also observe why the organization should operate ethically, this enormous pressure from various interest groups has been put on business organization to identify and solve those social problems in which they are intimately involved. This project identifies and analyzes the relationship of corporate social responsibility on organizational performance. Since most business of today now use social responsibility to improve image, make profit and survive. A broad explanation on what social responsibility is, its mode, school of thought, its dimensional involvement, limitation, how it can be improved as well as relevance to individual, organization and the society at large were given. To be able to effectively and efficiently carryout this study, and hypothesis was formulated to provide focus and direction for the ascertain the views of other writers and authors on the subject. Data were collected and analyzed via statistical techniques, which provide the result, that social responsibility has a positive effect on organizational performance.
Table of Content
- 1.1 Background of the Study
- 1.2 Statement of the Problem
- 1.3 Objective of the Study
- 1.4 Research Questions
- 1.5 Research Hypothesis
- 1.6 Significance of the Study
- 1.7 Scope of the Study
- 1.8 Limitation of the Study
- 1.9 Definition of Terms
- 1.10 Organizations of the Study
- 2.1 Conceptual Framework
- 2.2 Theoretical Framework
- 2.3 Empirical Review
- 3.1 Introduction
- 3.2 Characteristics of the Study Population
- 3.3 Research Design
- 3.4 Sampling Plan
- 3.5 Description of Data Collection Instrument
- 3.6 Setting of the Study
- 3.7 Limitation of Methodology
- 3.8 Coding Procedure
- 3.9 Description of Statistical Tools
- 3.10 Decision Rule
- 3.11 Administration of Data Collection Instrument
Presentation and Analysis of Data
Summary, Conclusion and Recommendation
- 5.1 Summary of Findings
- 5.2 Conclusion
- 5.3 Recommendation
- 5.4 Suggestion for Further Studies
1.1 Background of the Study
Since the institutions operate in an environment, produce and services for the environment and employ People to eradicate or resolve social problems posed to the society as a result of their operation.
Social responsibility whether of a business, governmental or non-governmental may arise in two ways, it may arise out of the social impact of the institutions or it may arise as problems of the society itself (Holmes, 1977). Both are of great concern to management. The first deals with what an institutions does to the society while the second is concerned with what an institutions can do for society, for instance the purpose of textile industry established in a area is not to cause water pollution but to provide clothing to people but in the process of its production, its bye product may cause water pollution.
Also the purpose of power generator is not to make or release noxious fame, it is to bring out light but in order to do this, it produces noise; create heat and releases heat fumes to the environment thereby causing air pollution. Nobody in his right senses will want to create traffic jam, but if a lot of people are employed in the place it end result will not be desirable to the society.
In the recent year, globalization, increased influence of companies, retrenchment and repositioning, war for talent, growth of global civil society activities and increased importance of intangible assets have led to an explosion of interest in corporate social responsibility and the phrase ‘’being a responsible corporate citizen” has became a managerial clinic (Boston college for CR 2002). Top management organizations were ultimately involved in drawing up a new chapter of responsibility for its relations with stakeholders to demonstrate that the enlightened corporation is no longer prepared to tolerate long-run excessive external costs.
Most contemporary managers are looking for empathy with society rather than alienation. It is not surprising that many of them have decided that time is own ripe for a new interpretation of the duties and responsibilities of corporations. Professional managers have realized that profits are necessary but not sufficient condition for healthy corporate society. For instance, a large number of contemporary organizations have introduced employee ownership schemes. Such developments do not mean that these companies are becoming less profit Conscious. In facts, quite contrary, more and more companies are realizing that employees, who dedicate their lives to the company, deserve to benefit from the wealth crating potentials of the corporation.
To have a clearer picture of this study we will look at corporate social responsibility from two different perspectives. What does it mean for an organization to be socially responsible? Few concepts have been described in so many different ways. For instance, it is been called “ profit making only” going beyond profit making only “voluntary activities” “concern for the broader social system and social responsiveness” A great deal of attention has been focused on the extremes on one side, there is the classical or purely economic-view and on the other side is the social economic position.
The classical views are the opinion that managements only social responsibility is to maximize profit. The most outspoken advocate of this approach is economist and Nobel laureate Milton Friedman. He argues that manager’s primary responsibility is to operate the business in the set interest of the stockholders (the owners of the corporative).
What are those interests? Freidman contends that stockholders have a single concern. Financial return. He also argues that anytime managers decide to spend the organization’s resources for “social goods” they’re adding to the costs of doing business. These costs have to be passed on to customers either through higher prices or absorbed by stockholders through a smaller profit returned as divided.
The socioeconomic view on the other hand views that management’s social responsibility goes beyond making profit to include protecting and improving society’s welfare. This position is based on the belief that corporations are not independent entities responsible only to stockholders. They also have a responsibility to the large society that endorses their creation through various laws and regulations and supports them by purchasing their product and services. In addition proponents of this just merely economic institutions society expects and even encourages business to become involved in social, political and legal; issues. For example, proponent if socioeconomic view would say that Avon product inc. was being socially responsible when it initiated its breast Cancer Crusade to provide women with breast cancer education and early detection screening services and which after 10 years, has raised more than $250 million worldwide. And they would say that the educational program implemented by Brazilian cosmetics manufacturer of Natural cosmetics SA in public primary schools in Sao Paulo, to improve children’s literacy and decision making skills, were socially responsible. Why? Through this program, the managers were protecting and improving society’s welfare. More and more organizations around the world are taking their social responsibilities seriously especially in Europe, where the view that business need to focus on more than profits has stronger tradition than In the United States. The key differences between these two perspectives are easier to understand if we think in terms of the people to whom organizations are responsible. Classicists would say that the stockholders or owners are the only legitimate concern others would respond that managers are the responsible to any group affected by the organization’s decision and actions-that is the stakeholders shows a four stages model of progression of an organization’s social responsibility.
A Stage 1: Managers are following the classical view of social responsibility and pursue stakeholder’s interest while following all laws and regulations.
At stage 2: Managers expand their responsibilities to another important stakeholder’s group-employee. Because they’ll want to attract, keep and motivate good employees. At this stage managers will improve working conditions, expand employee rights, increase job security and focus on human resources concern.
At stage three, managers expand their responsibilities to other stakeholders in the specific environment. Primarily customers and suppliers. Social responsibility goals for these stakeholders might include fair prices, high-quality products and services, safe products, good supplier relationship, and similar actions. Their philosophy is that they can meet their responsibilities to stockholders only by meeting the needs of these other stakeholders.
Finally, stage 4 characterized the highest socio-economic commitment. At this stage, managers feel a responsibility to society as a whole. They view their business as a public entity and feel a responsibility to advance the public good. The acceptance of such responsibility means that managers actively promote social justice, preserve the environment and support social and cultural activities. They do these things even if such actions may negatively affect profits.
The Nigeria business environment has become complex and dynamic, hence contemporary business organizations operating in Nigeria are witnessing greater influence and enormous pressure from interest groups and increase government regulation have been put to socially responsible. Indeed, the business organizations of today are much more socially responsible than before. In fact a comparative study of organization effectiveness in Nigeria industries shows that public limited liability companies are performing better than public enterprises. Hence these papers seeks to evaluate the social responsibility of Nigeria businesses using Nigeria bottling company plc. as a case study
1.2 Statement of Problem
Many researches and literature has been conducted and studies in the area of social responsibility but no particular reference effect organizational performance. It was noted that some organizations considered social responsibility as a waste and drain on business resources and believe that organizational and rather ignore the outcome of social responsiveness to organizational performance. The problem of this study is to determine the social responsibility of Nigeria businesses using Nigeria bottling company plc. as a case study. The study shall discuss how Nigeria business organizations are socially responses and how it is a benefit to the society and also how social responsibilities affect the performance of an organization.
1.3 Purpose of the Study
The main purpose of this is to examine social responsibility of Nigeria businesses using Nigeria bottling company plc. as a case study. Social responsibility has been neglected overtime, business organization have forgotten that they operate in an environment and the environment also expect the organization to assist in tacking its socio-economic problem.
This study seeks to:
- Determine the effect of social responsibility on business organizations in Nigeria.
- Discuss why some business organizations in Nigeria are socially responsible than others
- Identify and evaluate the various forms of social responsibility business organizations in Nigeria will achieve their set objectives and attain their goals.
1.4 Research Question
To evaluate the impact of corporate social responsibility on organizational performance, the following statement and question shall be tested.
- Are Nigerian businesses socially responsible?
- Does the impact of social responsibility favourable or is a wasteful spending to businesses in Nigeria?
- Is social responsibility relevant to organizations profitability?
- In what areas is the business organizations socially responsible?
- What are the aims of social responsibility?
- Does social responsibility of a business organization have impact on its performance?
1.5 Research Hypothesis
From the above research questions, the study shall focus on the stated hypothesis relationship. The test of the hypothesis is formulated below:
Null Hypothesis (Ho): There is no relationship between social responsibility and organizational performance.
Alternative Hypothesis (Hi): There is a relationship between social responsibility and organizational performance.
1.6 Significance of the Study
Their study on corporate social responsibility is significant to organization in particular and the society in general.
The organization would benefit by knowing the different areas where they be socially responsible, measure their impact on the society, thus improving their corporate image and on the long run to make more profit. The research work also intend to assist immensely other corporate organization and general public to know the significance of social responsibilities and to relate their roles as a stakeholder in the wheel of progress, if adequate studied. More so, the general public will became aware and informed about the various kinds of social performances which corporate bodies can extend them. It will create awareness that environmental degradation.
It also enable corporate bodies to benefit greatly as various form of social responsibilities and area they can readily assist the public and other stakeholders. This will be of tremendous significant to them, as it will increase their goodwill.
Finally, the researchers are not to be left out of the benefits, as the research project will allow them to discover more about this crucial and ever controversial concept of our time.
1.7 Scopes of the Study
The scope of this study is in the areas of social responsibility and involvement of manufacturing companies in Nigeria. The scope is delimited to Nigeria Bottling Company Plc.
1.8 Limitation of the Study
The limitation of the study arises from the fact that most business organization hardily gives out their information to outsiders for fear of competitors however the little information gathered will be used as a generalization of the performance of others. This study is also limited by the time coupled with cost involved in conducting this research.
1.9 Definition of Terms
In a study like this, it’s important to clarify some technical words used in the study, so that better understanding of the topic shall be achieved.
Some of the key words used and their definitions are given below.
It is the intelligent and objective concern, which restrains individual or corporate behavior from ultimately destructive activities no matter how immediately, profitable and leads to the direction of the contributing to human betterment. (Andrew, 1977). It also means not only fulfilling legal expectations but also going beyond compliance and investing more into human capital, the environment and relations with stakeholders (the European economic commission, 2011).
The intangible possession that distinguishes and enables a business organization of similar type and capability.
It can be define as any structured system of rules and functional relationship designed to carry out a firm’s policies.
Operationally, it can be defined as a function of profitability, survival, market share and efficiency and growth achievement of the organizations.
1.10 Organization of the Study
The study is categorized into five chapters. The first chapter presents the background of the study, statement of the problem, objective of the study, research questions and hypothesis, the significance of the study, scope/limitations of the study, and definition of terms. The chapter two covers the review of literature with emphasis on conceptual framework, theoretical framework, and empirical review. Likewise, the chapter three which is the research methodology, specifically covers the research design, population of the study, sample size determination, sample size, and selection technique and procedure, research instrument and administration, method of data collection, method of data analysis, validity and reliability of the study, and ethical consideration. The second to last chapter being the chapter four presents the data presentation and analysis, while the last chapter(chapter five) contains the summary, conclusion and recommendation.
Summary Conclusion and Recommendation
5.1 Summary of Finding
The study revealed that people view social responsibility as an intelligent and objective concern for the welfare of the society without being forced to do so while organizations view corporate social responsibility as an act of refraining from destruction activities and encouraging actions that are in the best interest of the society.
Most scholars in the field of business and that is desirous of making profit, grow and survive in the surrounding environment must be socially responsible however, the study revealed that a few scholars still believe that the business should purely be business. This led to the problem statement of the study and formulation of research questions and hypothesis for the research. During the course of research, the following findings were further revealed.
- Social responsibility has impacts on the level of sales profitability, motivation of employees, reputation of an organizations and market share.
- Nigerian organizations are socially responsible
- Business organizations encountered problem(s) in designing and implementing social actions programmes
- Nigerian organizations assist in reducing, level of unemployment in the country.
As a result of the findings, it was concluded that corporate social responsibility means the obligation of businessman to pursue those policies to make decisions or to follow those lines of action which are desirable in terms of objectives and value of the society Lattaus and Hodget (1976).
It is also seen as the responsibility of managers in carrying out their social approved mission to be responsive to, congruent with and interest and live with the forces and element of their social environment Koontz et al (1984).
As far as this study is concerned, all Nigeria organization is socially responsible which might have been because all of them are large profit oriented conglomerate who embark in all necessary actions to improve their organizational performance.
Another finding shows that business organizations encountered problems in designing and implementing social action programmes may be because business people lack social skill to deal with problems in the society, which may result into societal unrest and discretion in the operations of the organization.
- Industries should create a social responsibility department charged with the responsibility of alerting the organization about their social responsibility of alerting the organization about social responsibility function.
- Organizations should see responsibility as a business opportunity that is profitable in the long run.
- The government should reshape existing laws to ensure that business organization operate in society responsibility manner.
- Government should provide enlightenment and orientation campaign for business organization on the need for and importance of scale responsibility as well as the areas and aspect in which they could socially responsible.
- There is need to re-orientates chief and manager to pursue policies, decisions and actions or follows the lives of action, which are desirable in terms of society.
- Government must formulate policies and guideline that make social responsibility binding on business organizations and should try to evaluate their performance of such organization frequently.
- Organization should on a frequent basis identify with problems by helping to solve these problems as much as they could.
The organization should conduct which will enable them assess their contributions towards the society and determine the next course of action.
5.4 Suggestions for Further Studies
The study of corporate social responsibility is complex and wide; it cuts across all fields and profession and could as well as looked into from other perspective.
For further studies, corporate social responsibility could be viewed in relation to manage responses of managers to social responsibility. Also, it is suggested that further studies should focus in comparative analysis of the study in reaction to other countries so that this could be used as basis for making a concrete decision about the degree of social involvement about the industries in Nigeria.
Additionally, a research on corporate social responsibility of public corporative should be conducted to establish whether they are socially responsible.
Finally, more recent journals, textbooks and other literature on the topic should be reviewed in order to determine the current status for social responsibility.
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