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, one hypothesis was formulated to provide focus and direction for 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 CONTENTS
of the Study
of the Study
questions & Hypothesis
of the Study
and limitation of the Study
of Technical Terms
History of the Company
TWO: Literature Review
of the Concept
Concept of Social Responsibility
for Social Responsibility
Responsibility Schools of Thought
Whom Business be socially Responsible
issues Affecting Organizational Performance
of Social Responsibility
of Improving Corporate Social Responsibility
THREE: Research Methodology
of the Study Population
of Data Collection Instrument
of the Study
of Statistical Tools
of Data Collection Instrument
FOUR: Presentation and Analysis of Data
Presentation and Analysis of Data
Conclusion and Recommendation
for Further Studies
1.1 BACKGROUNG 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
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 chater 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
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
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 socio economic 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
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
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
impact of corporate social responsibility of one of the public limited
liability companies with sole objective of determining whether the concept has
impacts on modern business organization performance.
1.2 STATEMNET OF PROBLEM
Many researches and literatures 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 impact of social responsibilities on organizational performance.
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
empirically the relationship between corporate social responsibility and
organizational performance. Social responsibility has been neglected overtime,
organization have forgotten that they operate in an environment and the
environment also expect the organization to assist in tacking its
§ Determine the effect of social responsibility
§ Discuss why some organizations are socially
responsible than others
§ Identify and evaluate the various forms of
social responsibility companies will achieve their set objectives and attain
§ Above all, the purpose of this study is to
partially fulfill the requirement for the award of higher national Diploma in
1.4 RESEARCH QUESTION AND HYPOTHESIS
To evaluate the impact of corporate social
responsibility on organizational performance, the following statement and
question shall be tested.
business enterprises socially responsible?
Does the impact
of social responsibility favourable or is a wasteful spending?
responsibility has relevant to organization profitability?
In what areas is
your organization socially responsible?
What are the aims
of social responsibility?
responsibility of an enterprise have impact on its performance?
From the above research questions, the thesis
of this project shall focus on the stated hypothesis relationship. The test of
the hypothesis is formulated below:
Hypothesis (Ho): There is no relationship between social
responsibility and organizational performance.
Alternative Hypothesis (Hi): There is a relationship between social responsibility and
1.5 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.
1.6 SCOPES AND LIMITATION OF THE STUDY
The scope of this study is in the areas of
social responsibility and involvement of soft drinks industry. The scope covers
soft drinks industry in Lagos using Nigeria Bottling Company Plc as a case
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.
1.7 DEFINITION OF TECHNICAL 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.
Social Responsibility: 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).
Corporate Image: The intangible possession that distinguishes
and enables a business organization of similar type and capability.
Organization: It can be define as any structured system of
rules and functional relationship designed to carry out a firm’s policies.
Performance: operationally, it can be defined as a function
of profitability, survival, market share and efficiency and growth achievement
of the organizations.
1.8 BRIEF HISTORY OF THE COMPANY
Nigeria Bottling Company Plc, a single largest
bottling company in the world renewed for its top product such as (Coca-Cola,
Sprite, Fanta, Orange Fanta Lemon, Fanta Giger-ale, Eva water and Diet Coke) to
mention few, out of all these product coca-cola was first produced in Atlanta
Georgia USA on 8th May, 1886 by Dr. John Styth Pemberton, a
Coca-cola came into Nigeria in 1963, when
Nigeria Bottling Company opened its first plant in Lagos and has today grown to
twenty plants nationwide. It was publicly quoted company listed since 1978 on
the Nigerian stock exchange with 235,037,889 Nigeria citizen shareholders
participating in approximately 48.595, south Africa 199,347, 341 of 41.21%
other foreign shareholders 49,355,210 of 10%.
The major objectives are to satisfy the
requirement of customers with high quality product and to reach everybody that
is why special considerations are made. Other objectives are to maintain the
leading production soft drink, and to reach every individual both urban and
rural areas. That is why they have plants and depots almost in every state and
capital in Nigeria and mini depots in every local area.
To improve the social and economic life people
living within the areas of its operation in particular and generally of the
people of Nigeria through the provision of employment and infrastructural
facilities when necessary. To ensure a reasonable return on investment of the
shareholders. Concerning the raw material sourcing, most of the Nigeria
Bottling Company raw materials are ordered from abroad, through coca-cola
international, this is another separate company that supervises all the
activities of Nigeria Bottling Company.
It serves as intermediary between Nigerian
Bottling Company and the entire bottling company in the world. Such raw
materials include concentrate and sugar; other materials are locally produced
by other sisters company such as better industries, this comprises of Delta
Glass Plc, producing bottles of different sizes, Benin Plastics produces
plastic tray for the bottles while perfumes and cap for eva water, crown
products Limited at Ijebu Ode manufactures Bottle Crowns.
(1977) key of Social Responsibility as Cited by Adeleke in ``Managing Nigeria’s
Economic System” 1985, Nigeria Heineman Educational Books.
Holmes, L. Sandra
(1977) ``corporate Social Performance” Academy of Management Journal, Vol. 20
Edward, R.F. Daniel A.G. (1996) Management Prentice-Hall of India Private Ltd.
A.A (1993) Management ion Focus Lagos Abdul Industry Enterprises.