GNPC’s CSR activities… is it worth it? (Part 1)
Adnan Adams Mohammed
Over past few years, many energy and developmental experts,
oversight institutions and citizens have voiced out their reservations on the
Ghana National Petroleum Corporation’s (GNPC) expenditure on Corporate Social
Responsibility (CSR).
These were much heightened when GNPC in 2015 decided to be
headline sponsor of the senior national team (Black Stars) with an amount of US$3.0
million-a-year expected to last between three to five years but was terminated
in 2017 after many public agitations and in November 2019, when a leaked memo
permitting GNPC Foundation to release over GHC4 million to support some
individuals and state institutions.
GNPC operates on behalf of the citizens of Ghana and for
that matter, the citizens need to know how much the petroleum revenue allocated
to GNPC is being used for unassociated or non-core activities. For this reason,
Economy Times and www.newsguideafrica.com
considered as part of their watchdog role to the citizens and the world at
large decided to undertake monitoring of the Corporation’s Corporate Social
Responsibility (CSR) projects spanning from 2015 to mid-2019 using available
information and data from GNPC, Public Interest Accountability Committee
(PIAC), Petroleum Commission (PC), Energy Ministry, Ministry of Finance, Civil
Society Groups and expert opinions.
Somewhere July 2016, Mr Alexander Kofi-Mensah Mould, then
Acting Chief Executive Officer (CEO) of Ghana National Petroleum Corporation
(GNPC), called on businesses to move away from Corporate Social Responsibility
(CSR) to pursuing Creating Shared Value (CSV), for mutual benefit as GNPC takes
same direction.
“Yes, we can move from philanthropy - driven CSR to one
that focuses on Creating Shared Value; that would better integrate social
values, business values and environmental stewardship into a more cohesive and
mutually beneficial relationship,” he said at a Accra Academy Founder’s Day
event as a guest speaker.
However, PIAC, in its 2018 report remarked that, expenditure
analysis of the GNPC Foundation’s programmes reveals a carefully thought
through strategy, aimed at complementing government’s development efforts, and
at improving the socio-economic wellbeing of beneficiary communities.
“While most of the projects are concentrated in the
frontline oil and gas communities, the Foundation makes some attempt to spread
its activities to other parts of the country, especially in areas likely to be
impacted by its onshore exploration activities, This makes the Foundation’s CSI
strategy assumes a forward-looking character”, it added.
The Committee was however worried about the political
interference in GNPC’s operations. “There is a consistent and disturbing the pattern of political interference in the affairs of GNPC, which has hindered
its ability to operate effectively in accordance with good corporate governance
practice.”
PIAC is a statutory obligation under the Petroleum Revenue
Management Act, 2011 (Act 815), as amended by Act 893, to publish Semi-Annual
and Annual Reports. Its reports are reconciliation of data supplied by
stakeholder institutions, and an independent assessment of the collection and
management of the country’s petroleum revenues for each financial year for the
period starting 2011 to mid-2019.
GNPC is Ghana’s national oil company established in 1983 to
support the government's objective of providing an adequate and reliable supply
of petroleum products and reducing the country's dependence on crude oil imports,
through the development of the country’s own petroleum resources. GNPC is a
partner in all petroleum agreements in Ghana and the national gas sector
aggregator in Ghana.
The ‘GNPC Foundation’ has since 2017 replaced the ‘GNPC Oil
and Gas Learning Foundation’ established in 2012. The new foundation is
registered as a company limited by guarantee, with a sole purpose of
administering the corporation’s social investment strategy and programmes. The
new GNPC Foundation has a broader scope and mandate for Corporate Social
Investments (CSI), based on three key thematic areas of support to stakeholder
communities. These are:
i. Education and Training;
ii. Economic Empowerment; and,
iii. Environment and Social Amenities.
The establishment of this singular vehicle for managing and
implementing the Corporation’s social investment strategy, frees it to focus
more on its core mandate of exploring and optimizing the value of the country’s
investment in its hydrocarbon industry.
GNPC CSR budgetary
allocation and projects:
For the periods of 2015, 2016 and 2017; data was not
available on specific budgetary allocation and expenditure for the CSR
projects. The reasons given by the GNPC Foundation media outfit was that,
during those years, the Foundation was not in placed so there was no direct
allocation for CSR activities in the Corporation’s work-plan submitted to
parliament for debate and subsequent adjustments and approval.
However, the Corporation was undertaking CSR activities
under the then GNPC Oil and Gas Learning Foundation, established in 2012.
But, according to the data available, investigations
revealed that, most of the projects captured under 2018 and 2019 financial year
were started as far as 2015 through the proceeding years till their
completions. For the two periods, 2018 and 2019, the Foundation was allocated a
total of over GHC88.75 million.
According to information from the GNPC and PIAC, the
following data were obtained on CSR projects and budgetary allocations:
In 2018, the GNPC Foundation received a total amount of
GH₵45,702,285 to cover its projects and operational expenses. The amount was
derived from two funding streams, namely:
i. GNPC – GH₵39,309,825
ii. Learning Foundation - GH₵6,392,460
Out of the total amount, GH₵39,458,515 was spent on
projects, and another GH₵2,031,270.26 on operational expenses, bringing total
expenditure to GH₵41,489,786.17.
In line with its CSI strategy, the Foundation spent its
allocated budget on education, health, sanitation, water, and agriculture.
Funds were also channeled in support of sports and a sanitation project being
undertaken by a Past Students’ Association.
A total of US$43.05 million has been budgeted in 2019 to
cater for the Corporation’s Corporate Social Responsibility (CSR) obligations
under the GNPC Foundation. The Corporation undertook several initiatives as
part of its CSR goals. The initiatives addressed two, out of four of the
Foundation’s strategic goals.
These are:
(1) Education and social infrastructure
(2) Health, sanitary, and other facilities across the
country
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