Corporate social responsibility in the oil and gas sector

Corporate Social Responsibility (CSR) has emerged as an important approach for addressing the social and environmental impact of company activities. Yet companies are increasingly expected to go beyond this. They are now often expected to assist in addressing many of the world’s most pressing problems, including climate change and poverty. With increasing expectations placed on business, this article asks if CSR is capable of delivering on these larger issues based on evidence from the oil and gas sector. Looking at companies from developed countries, such as Exxon and Shell, as well as companies from emerging economies, such as Brazil’s Petrobras and Hungary’s MOL, the article investigates the potential of CSR for addressing three important challenges in the business-society relationship: the environment, development and governance

Corporate social responsibility or government regulation? evidence on oil spill prevention

Major oil spills normally occur from oil pipelines and oil tankers that are under operational control of companies, namely, oil companies and tanker owners. There are two generic responses for changing the behavior of companies with regard to oil spill prevention: mandatory government regulation or voluntary initiatives often pursued under the banner of Corporate Social Responsibility (CSR). Here we investigate to what extent voluntary CSR initiatives can be effective in oil spill prevention. A global perspective on voluntary mechanisms is taken by looking at the progress of 20 oil and gas firms from around the world toward oil spill prevention, using the companies’ 2010 sustainability reports for self-reported oil spill information. The analysis includes ten oil companies from OECD countries (including Exxon and Shell, among others) and 10 oil companies from non-OECD countries (including Brazil’s Petrobras and Indian Oil, among others). The study finds that oil spill prevention has generally improved over recent decades. Government regulation played a significant part in these improvements whereas it is less clear to what extent CSR played a significant part in these improvements. Some of CSR’s key limitations are highlighted. It is not suggested that CSR should be abandoned; however, new hybrid forms of regulation that combine voluntary and mandatory elements are advocated

Corporate social responsibility and societal governance: lessons from transparency in the oil and gas sector

This article evaluates the potential of the current Corporate Social Responsibility (CSR) agenda for addressing issues related to societal governance. The investigation focuses on the experience of the oil and gas sector, which has been among the leading industry sectors in championing CSR. In particular, the article analyses the issue of revenue transparency, which has been the principal governance challenge addressed by multinational oil and gas companies. The article suggests that (1) tackling governance challenges is crucial to addressing the impact of corporate activities; (2) current CSR and policy initiatives are entirely insufficient in addressing governance challenges and (3) corporate activities may be contributing to governance failures

Social and environmental litigation against transnational firms in Africa

As elsewhere in the world, Africa has experienced a rise in litigation against transnational corporations for adverse environmental and social impact. Cape plc and RTZ have been sued in British courts for environmental damage and for breach of employment rights in Africa. Companies which sold products to South Africa's former apartheid regime, such as Fujitsu and IBM, are now being sued in US courts. Shell and Chevron are being sued in US courts for human rights abuses in Nigeria. At the same time, foreign firms have been successfully sued in African courts for social and environmental damage. This article outlines the main relevant court cases and attempts to assess the significance of this litigation. The discussion of litigation in this article is divided into three parts: court cases filed in English, American and African (mainly Nigerian) courts. This is followed by an explanation of the triggers of legal change, a discussion of the impact of litigation and the conclusion

Political corporate social responsibility: reviewing theories and setting new agendas

There has been rising interest in political corporate social responsibility (political CSR), defined as activities where CSR has an intended or unintended political impact, or where intended or unintended political impacts on CSR exist. Based on a survey and content analysis of 146 peer-reviewed academic articles from 18 journals over the 14-year period 2000–2013, this paper systematically reviews the existing applications of general theories (such as legitimacy theory, the resource-based view and Habermasian political theory) within the political CSR literature.The survey indicates that the political CSR field is dominated by institutional theory and stakeholder theory, but future theory development needs to go beyond these theories in order to address a number of critical gaps. This review specifically points to several avenues for future political CSR research with regard to the individual level of analysis, domain integration and political CSR in multinational enterprises. The paper ends with a call for a new theory-informed and pluralist research agenda on political CSR to integrate different perspectives and re-examine the role of the state

Institutional determinants of private shareholder engagement in Brazil and South Africa: the role of regulation

Manuscript type: Empirical Research Question/Issue: This study investigates to what extent regulation encourages private shareholder engagement attitudes and behaviour (including behind-the-scenes consultations, letters, meetings and ongoing dialogues) of pension funds and asset managers with listed investee companies on environmental, social and corporate governance (ESG) issues in Brazil and South Africa. Research Findings/Insights: Drawing on 44 in-depth semi-structured interviews with pension fund representatives, asset managers and other investment players, the findings suggest that legislation provides limited direct encouragement to private engagement behaviour. However, legislation encourages attitudes towards Responsible Investment by enhancing investor understanding of Responsible Investment, increasing the interest of pension funds and asset consultants in the Responsible Investment practices of asset managers, and reducing the fear of pension funds to violate their fiduciary duties, thereby promoting an enabling environment for ESG engagement. Theoretical/Academic Implications: This article adds to the literature on comparative corporate governance and shareholder engagement. To the best of our knowledge, this is first study that specifically analyses how regulation affects private shareholder engagement behaviour in emerging markets, providing empirical support for the institutional perspective. The findings also suggest that the sophistication of the legislation on ESG issues in Brazil and South Africa is more typical of developed countries, indicating the need for a more fine-grained analysis of emerging markets in corporate governance studies. Practitioner/Policy Implications: This study draws investors’ attention to the importance of understanding the national legal environment of the companies with which they engage and offers insights to governments interested in fostering ESG engagement practices

Editorial: employee responses to changing work practices

Widespread and profound changes in the ways that work is carried out have occurred across recent decades, resulting in a cumulative revolution in the ways that employees are treated. This editorial introduces a virtual special issue of the British Journal of Management, which brings together articles addressing employee responses to changes in work practices and conditions of work. The editorial provides an overview of theories which help to explain employee responses to changing work practices at micro level, and outlines directions for future research on employee responses to changing work practices

Management innovation made in China: Haier’s Rendanheyi

This article shows how emerging market companies like China’s Haier Group create management innovations that are appropriate for an environment characterized by increased volatility, uncertainty, complexity, and ambiguity (VUCA). Dealing with VUCA effectively requires practices favoring nimble and decentralized responses; the Haier Group developed a platform of management practices under the label Rendanheyi (in Chinese: 人单合一) to transform itself from a conventional hierarchical manufacturing firm into a highly responsive online-based entrepreneurial company with “zero distance to the customer”. We demonstrate how the organizational, competitive, institutional, and technological contexts mattered for the development of Rendanheyi. Our study contributes several insights for practitioners and academics. First, we showcase how context dependent management innovations are created to allow emerging market firms like Haier to deal with a high VUCA world. Second, we draw lessons from Haier’s experimentation process for other firms. Finally, we create an extended process model of management innovation that managers, in both emerging and developed countries, can readily apply

The resource curse without natural resources: expectations of resource booms and their impact

Many resource rich countries have experienced a range of negative economic and political effects from natural resource extraction, often lumped together as the ‘resource curse’. This article investigates to what extent future expectations of natural resource booms in São Tomé e Príncipe and Madagascar led to ‘resource curse’ effects even though these countries did not experience the expected natural resource booms. It finds that both countries did experience resource curse effects as a result of future expectations, including volatile economic growth and deteriorated governance. The article demonstrates that shared aspirations and expectations alone may make for material political and economic outcomes even when they become visibly divorced from reality. Thus, there is much more to resource curse effects than simply the product of the material extraction of natural endowments. At a time of extremely volatile prices for primary commodities, and the relatively easy availability of investment capital and credit to support speculative ventures that in turn incentivize resource hype, it is likely that a growing number of countries may suffer the malign effects of a resource curse without natural resource extraction

Performance management practices within emerging market multinational enterprises: the case of Brazilian multinationals

This study advances our understanding of HRM within EM-MNEs by examining the extent to, and mechanism by, which Brazilian MNEs standardize or localise their performance management (PM) policies and practices, and the factors that influence their design and implementation. We explored these issues through qualitative case studies of three Brazilian MNEs. The analysis of interview data reveals a strong tendency for Brazilian MNEs to centralise and standardise their PM policies and practices. The key finding of this paper is that PM practices within Brazilian MNEs are not based on indigenous Brazilian practices, but rather, are heavily influenced by global best practices. The findings are at odds with previous research, which suggests that EM-MNEs apply different HR practices in developed country subsidiaries and developing country subsidiaries. Also, contrary to expectations, our results indicate that institutional distance does not have a significant influence on the adaptation of PM practices at subsidiary level