CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE
STUDY
Companies has recently gave priority to their interactions with
the people constituting the environment they operates in and draws resources
from, to foster mutual understanding, trust, and support between the company
and the host communities (Meyers, 2005). This study is examining the role that
these activities involved in community relations on the corporate image of
Shell petroleum Plc, Port Harcourt. Corporate image” was once an advertising
jargon but is today a common phrase referring to a company’s reputation. The
“image” is what the public is supposed to see when the corporation is
mentioned. The ordinary man and woman on the street usually have a wry view of
community relations, advertising, hype, hoopla, and therefore also of corporate
image—and this often for good reasons (Brady, 2005). But a good corporate image
is a genuine asset; it translates into dollars at the counter and higher stock
valuation.
The concept is usually associated with large corporations, but
small businesses also have a corporate image even if neither their owners nor
customers think of it that way. In the absence of active efforts, corporate
image “simply happens”: it is how a company is perceived (Johnson, 2002).
Management, however, may actively attempt to shape the image by communications,
brand selection and promotion, use of symbols, and by publicizing its actions.
Corporations trying to shape their image are analogous to individuals who will
dress appropriately, cultivate courteous manners, and choose their words
carefully in order to come across competent, likeable, and reliable. In the
personal as in the corporate case, the image should match reality (Hayward,
2005). When it does not, the consequence will be the opposite of the one
intended. Community relations is no longer an afterthought or corporate
window-dressing, community relations, as more chief executives are
acknowledging, is now a serious, strategic aspect of business for Nigerian
companies, a fundamental ingredient for the health of the enterprise.
Competitive business and social pressures are forcing a redefinition of the
relationship between company and community. When a company makes a commitment
to the community part of its core business strategy, it not only helps attract
and retain top employees, but it also positions itself positively among
customers and, increasingly, improves its position in the market. Positive,
proactive connections to the community can translate into a boost to the bottom
line. Leading-edge companies are now seeing that to succeed in a global
economy, the corporation has to be more than a preferred shareholder. The broad
array of new stakeholders that the enterprise must embrace require a new perspective
on corporate governance and behavior (Brady, 2005). Consequently, in addition
to becoming the investment of choice, a company must become the supplier of
choice, the employer of choice. Several community relations strategies by oil
companies have failed to reduce the incidence of violent conflict between the
host communities and oil companies in the Niger Delta, Nigeria. Shell is
Nigeria’s oldest energy company, and has a long term and continuing commitment
to the country, its people and the economy. The largest contribution by Shell
companies in Nigeria is through the taxes and royalties they pay as well as its
commitment to support and finance community development initiatives in the host
communities.
1.2 STATEMENT OF THE
PROBLEM
Given the pressures that accompany the growing parity in the price
of goods and services, companies will achieve an increasing competitive
advantage through community relations and social responsibility as an approach
of building corporate image. This makes strategic social investment all the
more important for global corporations as they seek to establish a consistent
image and market presence across the world. However, the researcher is
examining the role community relations have played on the corporate image of
Shell petroleum Plc, Port Harcourt.
1.3 OBJECTIVES OF THE
STUDY
The following are the objectives of this study:
1. To examine the role of
community relations on corporate image building at Shell Petroleum Plc Port
Harcourt.
2. To determine the process
of effective community relations.
3. To identify the factors
that determine the corporate image of an organization.
1.4 RESEARCH QUESTIONS
1. What is the role of
community relations on corporate image building at Shell Petroleum Plc Port
Harcourt?
2. What is the process of
effective community relations?
3. What are the factors
that determine the corporate image of an organization?
1.6 SIGNIFICANCE OF THE
STUDY
The following are the significance of this study:
1. The outcome of this
study will be a useful guide for the management of Shell Petroleum Plc Port
Harcourt in reorganizing and restructuring their community relations programmes
to meet the need of the host communities to enhance cooperation and mutual
understanding.
2. This research will also
serve as a resource base to other scholars and researchers interested in
carrying out further research in this field subsequently, if applied will go to
an extent to provide new explanation to the topic.
1.7 SCOPE/LIMITATIONS OF THE STUDY
This study on the role of community relations on corporate image
building at Shell Petroleum Plc Port Harcourt will cover all the community
relations strategies that has been used by shell to facilitate cooperation and
mutual understanding between the company and the host communities.
LIMITATION OF STUDY
Financial constraint– Insufficient fund tends to impede the
efficiency of the researcher in sourcing for the relevant materials, literature
or information and in the process of data collection (internet, questionnaire
and interview).
Time constraint– The researcher will simultaneously engage in this
study with other academic work. This consequently will cut down on the time
devoted for the research work.
REFERENCES
Meyers B.Y. (2005): Analysis: Corporate Case Study—Schering-Plough
Looks to Remedy An Ailing Image.” PR Week. 12 December 2005.
Brady, Diane, Michael Arndt and Amy Barrett. “When Your Name is
Mud, Advertise; Companies in Crisis Used to Lie Low. The New Response to Bad
Press is Positive Spin.” Business Week. 4 July 2005.
Johnson L.O. (2002)”Explaining the Enron bankruptcy.” CNN.com/U.S.
Available from http://archives.cnn.com/2002/US/01/12/enron.qanda.focus/. 13
January 2002.
Hayward, Roger. “Insight: Corporate Reputation” Accountancy Age.
30 June 2005.
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