The effect of corporate social responsibility and stakeholder management on corporate social performance of multinational oil companies in Nigeria

The discovery of oil has been identified as both a blessing and a curse for Nigeria. While oil revenue has been a blessing to the country, the failure of oil companies to be socially responsible to their host communities has been a source of numerous crises in the Niger-Delta region of Nigeria. Earlier studies have enriched our knowledge on how corporate social responsibility (CSR) can be used to benefit host communities, but how corporate social responsibility and the stakeholder approach can be used to prevent these crises have received little attention in the literature. Thus, this study contributes to knowledge by investigating the effect of corporate social responsibility and stakeholder management on corporate social performance. This research adopted a quantitative approach method, and survey was developed based on the existing scales of corporate social responsibility measurement. Two different sets of questionnaires were administered to 160 employees of the big four multinational oil companies in Nigeria and 225 members of the host communities in the Niger-Delta area. A hundred and forty-six questionnaires were returned from each of the two sets of respondents. These questionnaires were analysed using Partial Least Square and descriptive statistics. The results of the analyses revealed that a strong relationship exists between compliance to industry standards and environmental performance evidence from employees of multinational oil companies. While the results showed that a weak relationship exists between compliance to industry standards and environmental performance based on the response from the host communities. The results also showed that a strong relationship exists between corporate legitimacy and community relations from both the employees of multinational oil companies and host communities. Furthermore, the results revealed that a strong relationship exists between corporate legitimacy and community perception from both stakeholders. In addition, there is also a strong relationship between regulatory infractions and environmental performance from the results of the two main stakeholders. The results also indicated that a strong relationship exists between CSR initiatives and community relations for the two main stakeholders. However, the results revealed that a weak relationship exists between CSR initiatives and community perception from both groups of stakeholders. Another contribution of this stufy to knowledge is the corporate social responsibility and corporate social performance measures used in this research. While existing measurements of corporate social responsibility in the literature have combined all the variables, this study separated them into various dimensions, to ensure easier adaptability for other studies. This study is a set of possible ideals, practicable and feasible concerns corporate social responsibility (CSR) measures. In addition, this study is a response to a prolonged and contested problem of appropriate measurement of corporate social responsibility (CSR). However, this gap in the literature led to development of a more robust conceptual model of a reflective construct of corporate social responsibility and corporate social performance that in some respects differ from existing conceptual model of corporate social responsibility. Therefore, this research recognised the attempt by previous studies on development of corporate social responsibility measurement model. Still, this study proposed agenda and scope of corporate social responsibility, as well as the measures used to implement corporate social responsibility via the reflective construct for the oil companies' operationalisation in Nigeria