…Model tested in Alesa seeks inclusion of host communities
Businesses and companies in the Niger Delta including the international oil corporations (IOCs) have had issues in the oil region, leading to exodus and crisis. This is because the host communities began to reject tokens given them by the companies while the IOCs began seeking models to please the host communities.
Divestments have taken place and IOCs have left the region or gone further into offshore while many relocated their workers to other zones.
Now, experts have started studying models to restore harmony between the natives and investors.
Thus, it is important for businesses to prioritise Corporate Social Responsibility (CSR) in the rollout of their operational plans. The Port Harcourt Chamber of Commerce, Industry, Mines and Agriculture (PHCCIMA) seems to be in the front row of the search and research.
Some years ago, the Manufacturers Association of Nigeria (MAN) in the Rivers/Bayelsa chapter studied this to know the best approaches to create industrial harmony, and a professor, Silva Opuala-Charles, provided insights pointing to equity inclusion as done by Indorama-Eleme Petrochemical Limited.
Now, another model seems to improve on equity but digging deeper into other versions.
Now, the fact that the PHCCIMA considered this topic for paper presentation shows a recognition by leadership of the chambers that CRS has gone above tokens to host community to being seen as the key driver of other units of investment.
Studies have started in earnest especially at the Garden City Premier Business School in Port Harcourt to find out why businesses fail in the oil region and what could be done. Many have pointed at CSR as a key factor that may create new co-habitation atmosphere in the region.
A little click will define Corporate Social Responsibility (CSR) as: “A business model where companies integrate social and environmental concerns into their operations, acting ethically and being accountable for their impact on society, stakeholders, and the planet, going beyond just making profits. It involves balancing economic, social, and environmental goals (the Triple Bottom Line) through initiatives like reducing pollution, ethical labor practices, and community engagement, essentially “self-policing” to benefit everyone.”
In the Niger Delta, CSR seems to have gone far beyond this. Businesses that operated on this model have hit the rocks, because this concept made the host communities to think they are a mere after-thought. They think about it in terms of ‘Tokenism’, and they have since revolted or rebelled against this approach.
This could explain why the International Oil Corporations (IOCs) moved from MOUs (memorandum of understanding) to global memorandum of understanding (GMOUs) now to partnership through the Petroleum Industry Act (PIA) which provides 3% of the capital expenditure of an oil company.
Many people will admit that the host communities are still not satisfied, demanding direct equity in the oil companies. All these are issues from CSR, issues that show that CSR should no longer be seen as tokenism but partnership, according to experts at the 2025 PH International Trade Fair.
An expert paper said: “Adopting CSR as a partnership model has been tested in Rivers State; Indorama-Eleme Petrochemicals Limited. There, the FG and the investors resolved to set aside 7.5% to the host community. The first time their accumulated share was handed to them, it was as high as N14Bn. Many will admit that no CSR budget could have been so high.
“After initial crisis of how the host communities would enjoy this windfall, the Eleme/Elelenwo areas have become the most peaceful zone in the state. They see themselves as partners and equity holders in Indorama instead of the pains of getting tokens in the name of CSR.”
Read also: Excitement sweeps through Alesa Eleme as land papers arrive to begin world smart city
The Alesa model:
The model is about starting CSR from the onset and scale as you row, says the paper.
The Alesa Model is thus the interpretation of CSR as total partnership that begins before inception of any project. Over the years, host communities are told to create peace, wait for the project to bear fruits, and hope they would enjoy it. In a country where doubt rules, most host communities would not trust the process, and would tend to create chaos to get attention.
We have applied this model in Alesa and it has worked. Hospitality of the host community adds value to the project. They also protect the project.
Thus, a new investor in Alesa, the Housing and Construction Mayor Limited, who wished to start what they called the Alesa Highlands Green Smart City Project, first began CSR. They began with scholarship schemes, yearly Christmas parties, employment of youths, creation of a vigilante team sponsored by the company, etc. Though the indigenes were a bit hesitant at the onset, but when this achieved consistency, they embraced it and embraced the company.
What actually made it a model is the allocation of 10% equity to the aboriginal land owners who had already sold their lands. This allows them to retain 10% equity in what they had sold. This guarantees them and their children’s children ownership of 10% as longs as the life continues. The project is now accepted as a partnership.
To show understanding of this model, the Alesa Community recently went about creating and registering the Alesa Land Development Committee to henceforth oversee any land transaction in their community. This government-backed land authority has taken up the task of bringing sanity in the area so land buyers can invest and go to sleep. This, to them, is the antidote to Land Grabbing and Land Frauds. Sale of land by unknown persons or wrong persons or minors will no longer be possible.
This model is expected to not only attract investors in Alesa but is expected to spread to other communities and bring to an end the menace of land grabbing and fraud.
Cost-effectiveness
It is cost effective, says the owners of the model. The money you would have spent on damage control would have been higher than what you voted for CSR and Corporate Social Capital.
CSR must be community-based. Every part of Africa is a community. In Alesa, there are stakeholders from the King to the youths. Thy now choose their leaders.
Advice: Follow the structure in the community to implement your CSR. If you go choosing leaders for them, it will backfire. Also, choose what affects the community. The Mayor of Housing chose football and security which everybody in the community benefited from.
It is also good to make it a culture. If you start and stop, it might create bad feeling or feeling of abandonment. The company has an Alesa Foundation which would help to sustain the CSR project or capital.
For instance, the project has a Mall, and there are areas to be given free to the indigenes. The new business mantra is that: Collaboration is the new competition. So, CSR is the tool to build collaboration. Build a culture so they get a sense of co-ownership and collaboration.
CSR has moved far ahead and the Niger Delta area is regarded as a pioneer in this growth and transformation. It has created a system that would make host communities and settlors to live in peace in shared values with peace as the biggest prize.
At the trade fair session featuring CSR, the model owner, My-ACE China, said: “I know that Corporate Social Responsibility, as the name suggests, is the most responsible response any company can give to any society. As a matter of fact, Corporate Social Responsibility is more important than philanthropy because philanthropy might be a whim and caprice, and responsibility is a duty. So, CSR is the duty of every company to effect the society where they are doing business positively and responsibly.
“And there are several models. But the model that I believe is most sustainable, most inclusive, and most, uh, committing, is the Equity Inclusion Model.
He said the Equity Inclusion Model is where you include CSR into your company equity. And it’s more powerful when it is at the founding stage of the company, so that when you are founding your company, you already have an equity that goes to CSR. So when you are budgeting for marketing, you are budgeting for sales, you are budgeting for staff salary, CSR becomes an intrinsic part of your budget.
“And that is what we are doing in the Mayor of Housing, through one of our subsidiaries, the Alesa Highlands Estate Limited, that is the corporate entity managing the Alesa Highlands Sustainable Green Smart City.
“In Alesa, we not only included the community and the aboriginal land owners in a 10% equity inclusion in all our expenses, all our budget, and all our profit allocation and resource allocation; but we did that at inception. And that is why we named the project after the community—Alesa. The community is Alesa. But we had to find a meaning for Alesa in our corporate identity.
“Alesa for us means: Advanced Living Environment for Sustainable Advantage, which is what the Green Smart City stands for. So for us to go as far as even looking for a meaning for the aboriginal name that has existed for centuries, it shows our commitment to CSR.
“And why we chose this 10% equity inclusion is that one of the greatest sages that ever lived, Confucius, says: “Tell me and I will forget. Show me and I might remember. But involve me and I will be committed.”
So, involvement of the aboriginal owners—they might not be involved in the running of our company, they might not be involved in the board of decision, but they are involved in resource allocation to the tune of 10% for everything. And we have already started disbursing that 10% equity from the early days when that 10% was as small as possible.
He went on: “And we are the first company in Nigeria to scale CSR. That CSR is not something you do in a company when you have made it and you are established. CSR is something you do in a company from day one. When you are a baby company, you do baby CSR. When you grow to a toddler company, you do toddler CSR. When you become a crawling company, you do crawling CSR. When you become a running company, you do running CSR. When you become an international company, you do international CSR.
“And the community initially were a little bit shocked and apprehensive to our intent, because they were afraid it would not be sustainable. But seeing that the CSR was growing directly proportional as we grow, they have now not only embraced us, but they are now committed to this project as if it is their own. And they are ensuring that not only that the project succeeds, but that every enabling environment we need in the community for this project… before we say the word, they provide it. Because they now know this is for their own good.
“There is a trust deficit between operational companies and host communities when the operational companies do not make the host communities see that this company operating in your community is for your own good. And most times they allow the host community to get the pollution and the negative effluence of their presence in the community, but don’t get the positive response in the Corporate Social Responsibility resources to the community.”
He said that mutual suspicion, “We felt it palpably when we started, but right now, it has not only dissolved, but I can say unequivocally that Alesa community, the King, the aboriginal land owners, are equal stakeholders in the Alesa Highlands Development Green Smart City as we are.”
Many businesses are now said to be studying the Alesa Model as a critical fallout of the International Trade Fair 2025.
