Power and Borders - TNCs as a threat to sovereignty - Shell Nigeria CS Flashcards
How do TNCs benefit countries?
Allow superpowers and emerging powers to spread their influence globally, both in terms of economics and culture and politics
How can TNCs influence politics and elections?
Koch brothers support Republicans with $100 million campaign funds, from Koch industries
How do TNCs cause the spread of western culture throughout the rest of the world?
- Language-free global brands such as McDonald’s and Nike have an influence and dominate the markets
How do TNCs have influence?
- Influence in politics and election -> money to persuade others to take a specific stance -> lobbying
- Influencing employment levels and poverty levels -> exploit workers
- Introduce capital and technology
Who are the main actors in the Shell CS?
- Nigerian Govt
- Shell TNC
- Ogoni Tribe
Why is there territorial integrity/ sovereignty issue?
- Oil spills
- Human rights abuse
- Pollution of environment
- Child labour
- Execution of non-violent protesters
- Threaten LICs into passing less stringent regulations
- Bribe corrupt govt officials and political campaigns
- Shell has political leverage
Why is the issue complex?
- Sabotage
- Theft
- Tax evasion
- Corruption
- TNCs provide economies and make jobs in local area
What the economic causes of the issue?
- Govt won’t want to challenge relationship as Shell pays tax to Govt which help economically -> Govt doesn’t have control over investment decisions or revenue
How much of Nigerias oil revenue come from Shell?
40%
How much of Govt revenue comes from oil extraction?
> 75%
What are the social causes of the issue?
- Human rights violation against the Ogoni Tribe in the Niger Delta
- Unreliable contracts, not permanent
- Low wages + poor health conditions
-> Govt does not have control over its labour force, citizens, their human rights and welfare
What are the political causes of the issue?
- Govt corrupt so won’t use money properly
- $ billions of oil profits go missing
- Shell violates international labour conventions
How much corporation tax does Shell pay?
£20 billion in 2013
How much oil revenue went missing in 2016?
$16 billion
How many barrels of oil were stolen in 2019?
22 million
What are the environmental causes of the issue?
- Shell responsible oil spills between 1988 and 2009 -> 580,000 barrels leaked in 1978
- Farmland poisoned -> fishermen limited catches, water toxic
- Toxic gases released from flaring / burning off gas
-> Govt does not have control over its land or natural resources
What are the long term impacts on people?
- Provides jobs
- $20 million on corporation tax
- Charity of Shell foundation -> helps sustainability, biodiversity and local people
- Pollution to waters -> fishermen limited catch
- Shell clean up very slow to cover oil spill - use sand
- Human rights violation
What are the short term impacts on people?
- People are to scared to speak out about issue
- Unreliable contracts, jobs not permanent
What is the relationship between the citizens and the countries involved?
- Shell violates international labour conventions
- The profits go straight to HQ in HICs -> not reinvested in the LIC
- Oil theft -> e.g., Delta Avengers -> illegal oil refineries
- Shell has the Shell foundation to help sustainability and biodiversity and help local communities
- Finally, oil refineries like those in Nigeria use lots of local companies to help them run -> multiplier effect
- Employees in LIC’s are working for long hours (e.g. 12+ hours) in poor conditions
What are the interventions from other world powers? - Global governance strategies used
- 2010 report costing $10 million produced by the UNEP has exonerated Shell -> 90% of pollution from illegal activity - not 100% accurate
- Ogoni people took Shell to court -> won case
What does UNEP stand for?
United Nations Environment Programme
How much did Shell give for losing the case?
£77 million
What are the consequences of global governance strategies for local people?
- Protest movement were attacked, mutilated and some people blamed the Govt
- NGOs are active -> Ken Saro-Wiwa organised locals into the MOSOP who accused non-violent protest methods against shell
What does MOSOP mean?
The Movement for the Survival of the Ogoni People
Whose responsibility could it be to ensure operation of a TNCs abroad respect the environment, HR and long term security + development of a country?
- TNC CEOs managers
- TNC Shareholders
- The Govt in the country - HQ
- The Govt where the TNC is operating
- A regional or political trade body e.g., EU
- NGOs
- An international political body e.g., UN
How can TNCs redress their balance to ensure they also act for the advantage of their customers, employees and global business locations?
Corporate social responsibility (CSR) is when companies integrate social and environmental concerns into their business operations and in their interaction with their stakeholders on a funds looking to make equity investments in companies with strong CSR reputations
How are Nigeria at risk from sovereignty being threatened?
- Weak state apparatus
- Does not have refining facilities - so has to buy it back
How much are Shell contract workers paid?
$200 a month
How long do Shell employees work for?
12 hours a day, 6 days a week
