The social responsibility of corporations in East Africa
University of British Columbia
Master of Laws - LLM
The corporate social responsibility concept has, over a period of time, attracted many both in North America and Western Europe as evidenced by the literature on the subject. Although various suggestions have been made, no comprehensive reform has been undertaken and the debate continues. The thesis is an extension of this debate to the circumstances of East Africa. Drawing on reform proposals and practical examples in other countries, corporate law reform is discussed and related to the East African conditions. The thesis is divided in five chapters. Chapter I discusses the nature of the problem - disregard to society and human values by business organizations. The chapter focusses on the conceptual legal problems that are a result of legal history, the development of which aimed at individuals and not companies. The limited liability concept that has enhanced corporate social irresponsibility is discussed and the separation between ownership and control that makes it difficult to punish and control corporations is pointed out. A review of the debate on corporate social responsibility is followed by an assessment of the interest of the various groups (the shareholders, the employees, the consumers and the general public) in a company. The irresponsible activities of corporations, especially the multinational corporations (MNC) both in their mother countries and in the developing world are discussed. Finally, the chapter concludes with a call for corporate social responsibility if for nothing else, for the survival of the free enterprise system as an acceptable economic and political philosophy. Chapter II presents a case for worker-participation in corporate decision making as a means of extending political democracy beyond the factory gates. Worker participation is seen as a means of enabling workers to appreciate the value- of their labour and in the East African context, it is hoped this would enhance worker identification with national economic development strategies. In the final analysis, the aim is to improve industrial relations, avoid waste and promote efficiency in production and hence economic development in a healthy society. In Chapter III, the disclosure philosophy is seen as a means of policing corporations through an informed public, the investor and the government. Social audit is advocated as a means towards achieving the same objective. An extension of duties of the governing board of the corporation is discussed in Chapter IV and finally, in Chapter V, the reform proposals are related to the historic, economic and social circumstances of East Africa.
Law, Peter A. Allard School of