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Corporate Social Responsibility: An Imperative for the fulfillment of the Promise of the Digital Age

Jimson OlufuyeJimson Olufuye, fncs, ficma, PhD, fncs, ficma, PhDITAN President, Vice Chair’ WITSA (sub-Saharan Africa)ITAN President, Vice Chair’ WITSA (sub-Saharan Africa)

Member International Chamber of Commerce (ICC)Member International Chamber of Commerce (ICC)CEO Kontemporary GroupCEO Kontemporary Group

Monday, January 10, 2011Monday, January 10, 2011

Agenda

• Introduction• Definitions• Looking at the Big Picture• Current Realities: Africa Connectivity Infrastructure

• Cases of Failures of CSR: The Congo Mineral Conflict

• Solution: The Congo Mineral Conflict

• Cases of Failures of CSR: The Nigeria’s Niger-Delta

• Solution: The Nigeria’s Niger-Delta

• Lessons Learnt: The Nigeria’s Niger-Delta

• CSR: Application to ICT Industry Association

• CSR: World Bank Perspective

• Conclusion

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Introduction

• About mewww.google.com – Jimson Olufuye

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Introduction• About ITANwww.itan.org.ng- Established in 1991 by IT Companies- Membership now over 200- Runs 2 flagship events: Information Technology Public-Private Forum

ITPPF (April) & IT CEO Summit (Sept)- Joined other stakeholders to form the Nigeria Computer Society in 2002- Engendered Nigeria’s admission into WITSA in 2008- Represents Nigeria in WITSA since 2008- Focus:

- IT Advocacy for market expansion for members- IT industry Intelligence & research- Industry capacity building/ Certifications

- Vision:- To fulfill the promise of the Digital Age for Nigeria

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Introduction• About WITSAwww.witsa.org - Established in 1978 in USA- Membership now about 75 countries- Controls 90% of global ICT market- Runs biennially, 2 flagship events: World Congress on IT (even year) & Global

Public Policy Summit (odd year)- Partnership: UN, ICANN, ITU, ICC, OECD- Established 7 Regional Secretariats across continents including Africa in 2009.

Nigeria is hosting the African Regional Secretariat thro’ ITAN- Focus:

- IT Public Policy Advocacy- Global Trade- IT industry Intelligence & research

- Publishes the Digital Planet of global ICT Market Data- Vision:

- To fulfill the promise of the Digital Age for Everyone on earth- Chairman: Dato’ Dan Khoo – Malaysia- Secretary-General: Dr James Poisant – USA- Vice-Chair WITSA (sub-Saharan Africa): Dr Jimson Olufuye04/19/23

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Definitions

• Information – Communications Technology (ICT) industry is composed of four technology categories:– Computer Hardware:13%– Computer Software: 9%– Computer Services: 20%– Communications: 58%

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Definitions

• Computer hardware: This includes computers, storage devices, memory upgrades, printers, monitors, scanners, input-output devices, terminals, other peripherals, and bundled operating systems.

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Definitions

• Computer software: This includes software such as operating systems, database systems, programming tools, utilities, and applications.

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Definitions

• Computer services: This includes outsourced services – whether domestic or offshore – such as IT consulting, computer systems integration, outsourced custom software development, outsourced world wide web page design, network systems, network systems integration, office automation, facilities management, equipment maintenance, web hosting, computer disaster recovery, and data processing services.

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Definitions

• Communications: This includes voice and data communications services and equipment. – Communications services include local and long

distance wire-line telecommunications, wireless telecommunications, paging, satellite telecommunications, internet access, private line services, and other data communications services.

– Communications equipment includes wire-line and wireless telephone handsets, legacy and IP PBXs, key systems, wired and wireless LAN equipment, WAN equipment, central office equipment, modems, multiplexers, and telephone answering machines and systems.

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Definitions:Ave Growth rate over the next 4yrs

• Computer Services: 7.9%• Computer Software: 7.7%• Communications: 7.4%• Computer Hardware: 6.6%

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Definitions

• BroadbandSimply refers to a high data rate connection to the internet with 1meg upstream and 4meg down stream according to the US FCC.The data rate is often adjusted as the market roles out faster services. In this regard, broadband used to be 128kbps/256kbps when narrow band was 56kbps of telephone modem. The term itself is technology neutral; broadband can be delivered by a range of technologies including DSL, WiMAX or next generation access.

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Definitions

• ConvergenceConvergence in this context is

a technology enabled digital state in which voice, texts, video, pictures, broadcasts, presentation, streaming media, global connectivity and personalized services; are provided through common platform – Internet Protocol.

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Looking at the Big Picture• The global ICT market is worth more than US$4tr according to WITSA

Digital Planet 2010. This is so with about 2.2billion people in the world connected digitally. What would happen if the remaining active world population ie another 4billion people is connected? The implication is clear, more businesses and profit for companies.

• More than 20terabit/s ring of fibre will surround Africa by end of first quarter in 2011 and without peace and order the last man cannot be reached.

• Therefore, my advocacy is for the private sector government to undergo deep self examination and take strong steps to avert further conflict on the Congo and even in Nigeria and other potential locations in our global village where mineral raw materials are sourced.

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Current Realities:Africa Connectivity Infrastructure

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Cases of Failure of CSR: The Congo Mineral Conflict

• The conflict in eastern Congo, the deadliest war on earth is a case of failure to address CSR. In the absence of law and order, rebel groups, local militias, and the Congolese army fight for access to Congo’s abundant minerals, to the tune of $180 million per year, according to estimates by The Enough Project.

• The mineral ores mined in Congo, like tin, tungsten, tantalum, and gold, all end up in electronic devices like cell phones, MP3 players, and laptops.

http://www.flickr.com/photos/grassrootsgroup/sets/72157621838823803/show/

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Cases of Failure of CSR: The Congo Mineral Conflict

• What is expected to advance the fulfillment of the digital promise is driving digital penury, hopelessness and hell and the underlining economic interest is to blame.

• In the conflict, women and children are being displaced en masse, sexually assaulted and forced to take part in the trade, whether at gunpoint or by economic necessity. Well over 5.4 million people have been killed, either directly by violence or by the myriad hardships the conflict has caused.

• Companies that do not support vigorously the effort to stop conflicts in Congo are unwittingly committing a crime against humanity.

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Cases of Failure of CSR: The Congo Mineral Conflict

• “Making the minerals trade more transparent and accountable could not only help bring an end to the conflict, but would also promote sustainable economic growth, strengthen Congolese state institutions, and reduce corruption in the security services,” student leaders Sara Egozi and Liza Starr wrote in the Yale Daily News recently.

• When trade rules are changed, it is to pressure electronics companies to take responsibility for the minerals in their supply chain, so that other reforms necessary for ending the conflict can take hold. This line of action should be pursued with vigor.

• But why should companies be forced to do what is right? Power without control is destructive…

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Cases of Failure of CSR: The Congo Mineral Conflict

• Here was President Obama signing the highly anticipated financial reform bill on September 30, 2010. With it, the United States took a significant step to address the mineral trade fueling conflict in the Democratic Republic of Congo.

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Solution: The Congo Mineral Conflict

• The financial regulation Act includes a provision requiring U.S. companies that import products containing certain minerals to file an annual report declaring whether they source their minerals from Congo or one of the nine surrounding countries, since much of Congo’s mineral wealth is smuggled out of the region through its neighbors. If a company declares that its supply chain passes through the region, it will have to report what steps it is taking to trace the origin of the minerals and ensure that its purchases don’t fund armed groups responsible for atrocities in eastern Congo.

• While the provision doesn’t ban companies from importing conflict minerals into the United States, companies will have to publish this information on their websites. Consumers will then be able to choose which products to buy based on a company’s track record in Congo. This would give advocacy groups information to organize around and make the consequence a market driven one.

• There’s a long road ahead, no doubt littered with ploys by those who currently benefit from the trade in conflict minerals. But consensus is clearly building around the belief that cutting off militias in eastern Congo from a key source of funding is good not just for Congolese civilians and the Congolese government, but also for U.S. & other consumers and companies that prioritize social responsibility.

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Solution: The Congo Mineral Conflict

• Another step that can be taken is a combination of UN Military intervention through the strengthening of the Congolese Military with the support of the AU coupled with sanction of neighbouring Countries involved in the Congo illicit mineral plunge; and the convening of national conference among the Congolese people to determine the most practical income sharing mechanism on the minerals and the enthronement of a Social Responsibility culture on the operators of the mines based on the rule of law.

• It is only when this is done that respite can quickly come for the women, children, unwilling victims of Eastern Congo and elsewhere in the world.

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Cases of Failure of CSR: The Nigeria’s Niger Delta

• Accumulated neglect of corporate social responsibility by MNC eg Shell, Exxon Mobil, over a significant period of time in the oil and gas rich Niger Delta region…

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Cases of Failure of CSR: The Nigeria’s Niger Delta

• Accumulated neglect of corporate social responsibility by MNC eg Shell, Exxon Mobil, over a significant period of time in the oil and gas rich Niger Delta region caused the eruption of militancy, kidnapping and other vices in the area.

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Cases of Failure of CSR: The Nigeria’s Niger Delta

• The neglect took the life of Ken Saro-Wiwa, the Ogoni activist and eight others in 1995 among many others and caused unprecedented environmental devastation in the region.

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Cases of Failure of CSR: The Nigeria’s Niger Delta

• Accumulated neglect of corporate social responsibility by MNC eg Shell, Exxon Mobil, over a significant period of time in the oil and gas rich Niger Delta region caused the eruption of militancy, kidnapping and other vices in the area.

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Solution: The Nigeria’s Niger Delta

• The government of Nigeria lost revenue in excess of US$30b in 7 years due to the instability; and it took the introduction of amnesty by the Federal Government of Nigeria in 2009 for some calm to return. A law was also enacted by the National Assembly of Nigeria to make mandatory Social Responsibility contribution of operating companies into the cleaning up and development of the region

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Lessons Learnt: The Nigeria’s Niger Delta

• Lessons learnt in the oil and gas sector have quickened operators in the telecom sector to take serious the issue of corporate social responsibility. Companies like MTN, Zain, Glo to mention but a few are quite popular and receive good patronage for being socially responsive to the community.

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CSR: Application to ICT Industry Associations

• While some companies in the Nigerian IT sector pursue some form of individualistic corporate social responsibilities, their effort is however incomplete.

• Why? Because they feel there is no need to be part of the organized private sector industry group to develop the industry.

• I’m talking about the failure of companies like HP, Cisco, Microsoft, Huawe, Dell etc to be part of the industry association in Nigeria eg Information Technology (Industry) Association of Nigeria (ITAN) –

www.itan.org.ng

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CSR: Application to ICT Industry Associations

• Corporate Social Responsibility demands that MNC join hands with local industry group to accelerate the development of the local community know-how and capabilities.

• It is not enough to come, do business and make money and that is it. As global brand, MNC should be part of the happenings in their local communities. Failure to see the imperative need for this is what degenerates to violence in the future.

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CSR: World Bank Perspective

• The World Bank Managing Director, Dr (Mrs) Ngozi Okojo-Iweala (former Nigeria’s Minister of Finance) said in China recently while addressing Chinese investors interested in mineral exploration in Africa that the way business is conducted in African communities should change.

• She said that investors should be transparent with agreement signed, involve the local communities by providing employment, social amenities and be involved in local activities as stakeholders otherwise discontent will brew and the effect of that from experience is conflict as seen in Congo and the Niger Delta of Nigeria.

• The time to make a change is now.

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Conclusion

• The failure of leading global private sector government to show responsibility fueled conflicts, wars, kidnapping, rape and the commission of erroneous crimes in Africa. This development is threatening the fulfillment of the United Nations Millennium Development Goals by 2015 and stands as one of the greatest obstacles to the achievement of the promise of the digital age for everyone.

• From Congo to Nigeria, MNC must rethink their corporate social responsibilities and engage local communities and organizations and be part of the environment to assure more business and profit on the long run.

• The need to operate locally through CSR in a globally connected world is an imperative to avert future conflict and assure the bottom line.

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…

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The next generation is watching…

Thank you…

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www.itan.org.ng, president@itan.org.ngwww.witsa.org, jolufuye@witsa.org

www.kontemporary.net.ng, jolufuye@kontemporray.net