Crossing the Borderline in Strategic Corporate Philanthropy: Dangote and the Construction of Cement Roads in Nigeria

Abstract

Using the case of Nigeria's Dangote Group and an exploratory research technique, we critique CSR practices in a developing country context based on a three‐pillar model—traditional CSR, strategic CSR and strategic business engagements. Our paper makes a unique contribution by revealing how a company can transform its strategic CSR into strategic business engagements that permit it to circumvent public procurement laws and secure public contracts at non‐competitive terms. We show how, in weak institutional and regulatory contexts, strategic CSR could be turned to a tool for rent extraction and profit maximization. We advocate for regulatory measures that impose ex ante and ex post limits on the extent to which firms can go in integrating CSR into their normal business operations. Based on the outcomes from this important African case study, we illustrate and propose the strategic business engagement model as a new framework for analysing the social benefits of strategic CSR practices in developing countries.