Associate Professor of Economics

With Kimberly Reeve

Abstract:

In sub-Saharan Africa, the number of foreign-owned extractive industries in natural-resource-rich continues to increase. As these multi-national corporations (MNCs) expand, there is increasing pressure from western governments and NGOs for these MNCs to give back to these “resource-cursed” communities through Corporate Social Responsibility (CSR) initiatives. This leads to a need to understand the extent to which a MNC in sub-Saharan Africa should pursue a (CSR) strategy. This paper explores the current challenges of CSR in sub-Saharan Africa through the lens of Carroll’s Pyramid of Social Responsibility, which reflects on a corporation’s pursuit of economic, legal, ethical, and philanthropic responsibilities. With a focus on CSR initiatives that have the most economic benefit to both the MNC and the country in which it operates, this paper suggests that in sub-Saharan Africa, the most challenging aspects of the pyramid are the legal and ethical contexts, as MNCs are often operating in countries with autocratic regimes and differing perceptions on the rule of law. Based on the challenges of having effective CSR initiatives in sub-Saharan countries, this paper will conclude with a recommendation that the most economically effective form of CSR may, in fact, be requiring more accountability on the part of MNCs and focusing on these companies upholding the legal and ethical contexts of Carroll’s pyramid to retain capital in the resource-cursed countries of sub-Saharan Africa.

Draft