The Contribution of Oil Companies to the Development in River State


The primary objective of this chapter is to review literature on the  subject matter.  This means re-examine the work of people which fall within they context of this study. To ensure a concise review of relevant available information as a result of the above to the economic growth of the country.  It is generally agreed that the strength of any economy depends on the oil company and other business.  In carrying out this study information is gathered through the secondary data in respect of oil companies, it has been grouped  under the following heading to enhance logical presentation true historical development of some of these oil companies, social and responsibility  yesterday  today and tomorrow requirement of a responsible companies the importance of responsibility and contribution and finally argument for and against social involvement in their host communities.


The idea that oil companies have a responsibility other than producing oil goods and services and project maximization is not new. They also have the responsibility pf contributing to the development of our economy especially over our communities.

The question that calls oil attention is the oil companies being social responsible the surrounding communities.

According to Chowdberry (1976) social looking after the welfare  of the socially and economically in its entirety.

This it refers to community development and in the sense it covers those programmes that are capable of portraying oil companies as to the communities in which they are operating.

The community development programmes award secondary and universities scholarship water supply, health service and other rural development programme.  It was observed that these oil companies provide more direct and closer communities in its area if operation.

 2.2     Social Responsibility Yesterday, Today And Tomorrow.

Social responsibility yesterday according to Knontz  and Odonuel (1976) critically view or observed were injected and opposed by corporate manager hitherto

According to Milton Fubara (1986) an uncompromising actor or business philanthropy denounced the concern for responsibility as fundamentally subversive to the society.

He went further and agree also that there is one only social responsibility of business which id to use its resource and engage in activities designed to increase  its profit so long as it engage in open and free competition without deception or fraud.  Social responsibility today.  In responsibility of oil companies contribution in developing their host communities and other business they have accepted and incorporated it into their policy guidelines.

According to Fubara (1985) he states that young and dynamic managers of tomorrow would place most high social responsibility than manager of yesterday and today.

  • Requirement Of A Responsible Company

The ultimate goal of every oil company should be presentation of happiness and prosperity of the society through the provision of efficient goods and service without the communities being held to ransom by group of self contain and greedy companies. To fulfill responsibility the various statutory and non statutory functions they are supported to ender to the society the service. this is more so in that any malfunction no function or inefficiency particularly those performing and holding monopolies of such essential service as transport housing, water electrically could spell doom or bring about un told hardship disaster inconvenience, unhappiness and economic strangulation to the generality of people in Nigeria. Oil companies in Nigeria today need be the educated manager and more skilled employees since advances in science and technology have continued to increase the complexities of industrial organization consequently the need for well framed person who would be able to learn.

Employees must be well trained recruited remunerated and highly motivated.  They must be given sense of belonging and encouragement as much as possible to participate in discussing matters that affect them and their future.

  • Responsibility Of The Industry

A company has responsibility to contribute to the maintenance of acceptable ethical standards in its particular profession and in the world of business generally.

  • Responsibility To The Communities

In oil companies there is now general consensus that the most determining factor in the community is its ability to fulfill social economic function.  Happily enough some of our oil companies have helped to set up blood bank in hospitals others have established clinics road and   pipe borne water and awarded scholarship to persons living ground the geographical location of plants about the pollution of their stream and rivers with affect from the operation of some oil companies

  •  Responsibility Of The Owners

The management staff of the oil companies have a responsibility to protect and increase the property and services of the companies.  They manage and use all the facilities at their disposal for the betterment of the share holder, companies directors one judiciary duties of loyalty and good faith in addition to the duty of care to their companies owners expect from good return on their investment good quality product efficient service and above all good public image for their company responsibility to the society

 (Government) a society or nation can be defined as the aggregation of people or units band together by some common principles and objectives.  It is an indisputable fact that in Nigeria it is the society that grant our company executives in power to exploits our companies must display responsibility in planning organizing co-ordinating and controlling and be a continuous resposiblity in decision making process based on research verifiable factors.

2.4     The Importance Of Responsibility

Responsibility is concerned with how individual and organization deals are with current social issues.

According to Maswortman and Fredivethans  (1972) they states that responsibility must be seen as a major goal of any company without taking to heart the many problem of society and getting involved in them. The companies might finally and itself smoothened by these issues.  To protect the long them interest of everyone affected by or connected with it such as the governments share holders, employees, consumers and other member of the society.

To ensure adequate company performance in the long run and company should contribute immensely to the society.

Responsibility are not codified in the law rather they are regarded as self imposed it therefore owes responsibilities to the environment in which it operates especially as the society serves its purpose of existence.

 2.5     Argument For Social Involvement

  1. a) Improvement of the social environment benefits both society and companies society gains through better neighbourhood and employment opportunities also these oil companies benefits from better community since community is the source of its work force and the companies of it product and service.
  2. b) Social involvement discover age additional government regulations and intervention the went is greater freedom and more companies
  3. c) Oil companies have the resources so they should use their talented manager and specialist as well as the capital resources to solve some of the society problems
  4. d) It is better to protect or prevent social problems through oil company involvement than to sure they care unemployed than to cope with social interest.

2.5     Arguments Against Social Involvement

  1. a) Weaken the international balance of payments. The cost of social involvement programme would have be added to the prices of the product.
  2. b) The primary task of oil companies is to maximize profit by focusing strictly on economic activities.
  3. c) In the final analysis society must pay for the social involvement of these oil companies through higher prices.
  4. d) There is lack of accountability of some oil companies to society unless accountability can be establish, oil companies should not
  5. e) There is not complete support for involvement among group with different view points will cause friction


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