30
3 Literature Review: Social Investment …
contexts; (2) where O&G social investment is solely business oriented; (3) where
social investment benefits only a few individuals; (4) where social investment is used
as an alternative to government and (5) where it is solely based on philanthropy.
3.1.1 Replicating the Same Social Investment Concept
and Design in Different Contexts
Preconceived assumptions of who the local community is and what they need, without
local consultation, are conditions that lead O&G social investment to fail. The literature indicates that social investment is unlikely to benefit host communities if a
universal agenda of social investment is adopted across different cultural groups.
Standardised approaches to social investment reflect a lack of awareness of individual host countries’ political and economic circumstances and of the possible
impacts that a social investment might have in a specific context.
For example, the O&G sector in Papua New Guinea developed a series of social
investments that were shaped by the International Finance Corporation’s (IFC)
performance standards and the United Nations’ sustainable development principles,
rather than the specificities of local communities (Gilberthorpe & Banks, 2012). This
has generated a series of ideological and cultural conflicts that negatively impacted
local individuals’ sense of security (Gilberthorpe & Banks, 2012) and hampered the
socio-political exchange networks within and among communities.
Frynas (2009a) argues that O&G companies are pressured by governments,
funding institutions, and their own O&G peers to develop social investment in host
societies, and while some companies endeavour to modify social investment to meet
local demands, the majority do not. In fact, Frynas’ findings suggest that adopting
a universal agenda for social investment often occurs when small O&G companies replicate successful social investment programmes from O&G multinationals
(Frynas, 2009a). This is due to institutional isomorphism (Frynas, 2009a), or companies replicating what they perceive as the successful programmes of other companies
in order to be competitive. For instance, state owned companies, such as Brazilian
Petrobras, Indian Oil and Kuwait Petroleum, are increasingly adopting social investment programme designs developed by western European and American companies
for their host communities (Frynas, 2009a). Replicating a successful American fishfarming social investment in a Brazilian community whose main economic activity
is based on crop farming is an example of institutional isomorphism and an example
of a social investment that is likely to fail to address the needs of the host community.
Social investment driven by a single ‘model’ is unlikely to result in communitycentred social investment programmes. O&G companies’ replication of social investments that were ‘successful’ in one context may be seen as ‘benefiting’ host communities in another context. However, these types of social investment can also be seen
as actually harming, rather than benefiting, communities due to the disconnection
3 Literature Review: Social Investment …
contexts; (2) where O&G social investment is solely business oriented; (3) where
social investment benefits only a few individuals; (4) where social investment is used
as an alternative to government and (5) where it is solely based on philanthropy.
3.1.1 Replicating the Same Social Investment Concept
and Design in Different Contexts
Preconceived assumptions of who the local community is and what they need, without
local consultation, are conditions that lead O&G social investment to fail. The literature indicates that social investment is unlikely to benefit host communities if a
universal agenda of social investment is adopted across different cultural groups.
Standardised approaches to social investment reflect a lack of awareness of individual host countries’ political and economic circumstances and of the possible
impacts that a social investment might have in a specific context.
For example, the O&G sector in Papua New Guinea developed a series of social
investments that were shaped by the International Finance Corporation’s (IFC)
performance standards and the United Nations’ sustainable development principles,
rather than the specificities of local communities (Gilberthorpe & Banks, 2012). This
has generated a series of ideological and cultural conflicts that negatively impacted
local individuals’ sense of security (Gilberthorpe & Banks, 2012) and hampered the
socio-political exchange networks within and among communities.
Frynas (2009a) argues that O&G companies are pressured by governments,
funding institutions, and their own O&G peers to develop social investment in host
societies, and while some companies endeavour to modify social investment to meet
local demands, the majority do not. In fact, Frynas’ findings suggest that adopting
a universal agenda for social investment often occurs when small O&G companies replicate successful social investment programmes from O&G multinationals
(Frynas, 2009a). This is due to institutional isomorphism (Frynas, 2009a), or companies replicating what they perceive as the successful programmes of other companies
in order to be competitive. For instance, state owned companies, such as Brazilian
Petrobras, Indian Oil and Kuwait Petroleum, are increasingly adopting social investment programme designs developed by western European and American companies
for their host communities (Frynas, 2009a). Replicating a successful American fishfarming social investment in a Brazilian community whose main economic activity
is based on crop farming is an example of institutional isomorphism and an example
of a social investment that is likely to fail to address the needs of the host community.
Social investment driven by a single ‘model’ is unlikely to result in communitycentred social investment programmes. O&G companies’ replication of social investments that were ‘successful’ in one context may be seen as ‘benefiting’ host communities in another context. However, these types of social investment can also be seen
as actually harming, rather than benefiting, communities due to the disconnection