Corporate Social Responsibility in Ghana's Beverage Industry: A Critical Study of

Guinness Ghana
Background
Historically, the concept of Corporate Social Responsibility (CSR) has been largely unfamiliar in
many developing countries and remains so in some even today. Often, donations are made under
the guise of CSR without a true understanding of its meaning. Companies may make such
donations to keep up with competitors or to showcase the generosity of an individual within the
organization. CSR has not traditionally been a priority in the corporate agendas of many
companies in the developing world. However, over the past decade, significant progress has been
made in human rights and CSR in several African countries, notably South Africa and Kenya.
Despite this progress, the spread of CSR practices has not been as widespread as needed, given
the exploitation of natural resources in many locations. Most companies focus their CSR efforts
on environmental issues and philanthropy rather than legal and ethical business practices,
creating global awareness and concern.
In Ghana, the socialist policies of its first president, Dr. Kwame Nkrumah, fostered the belief,
rightly or wrongly, that State Owned Enterprises (SOEs) could solve societal problems. This
limited the perceived social obligations of private organizations to merely paying taxes.
However, recently, there has been a push for NGOs to implement social initiatives, recognizing
that the government alone cannot address all societal issues. Large-scale multinational
companies currently spearhead CSR activities in Ghana.
Problem Statement
The practice of CSR among organizations has increased due to a growing understanding of its
contribution to society. According to Ofori and Hinson (2007), CSR encompasses a company's
responsibility to its stakeholders, including employees, customers, the community, and the
environment, beyond just profit generation. In Ghana, CSR has become increasingly important in
recent years. The beverage industry, including companies like Guinness Ghana and Coca-Cola, is
a significant sector contributing to the national economy. The growth of this industry has been
accompanied by a heightened focus on CSR, as companies recognize the importance of
maintaining a positive image and fostering goodwill among consumers and local communities.
Research Purpose
This study seeks to provide a comprehensive understanding of the complex dynamics
surrounding Guinness Ghana's CSR activities and their implications for the Ghanaian beverage
industry.
Research Questions
1. What are the key areas Guinness Ghana focuses on in its Corporate Social Responsibility
report?
2. How does Guinness Ghana implement CSR in these focused areas?
 3. Why does Guinness Ghana prioritize these key areas in its CSR activities?
Significance of the Study
This study will offer a detailed overview of CSR actions in Ghana's beverage sector. Analyzing
Guinness Ghana's methods will provide a better understanding of how multinational corporations
can effectively engage with local communities and address social and environmental issues.
Organization of the Study
This study is structured into five chapters. Following Chapter One, Chapter Two reviews the
theoretical and empirical literature on Corporate Social Responsibility. Chapter Three outlines
the research methodology, including the strategy, data sources, data collection, and data analysis.
Chapter Four discusses the data, and Chapter Five presents the study's summary and conclusions.
Chapter Two: Literature Review
Introduction
This chapter explores the fundamental concepts of corporate social responsibility and reviews
various literary works on the topic. It employs conceptual, empirical, and theoretical frameworks
to provide a comprehensive understanding of CSR.
Conceptual Review
Conceptual research involves observing and analyzing existing information on a given topic. In
the context of CSR, a conceptual review can help determine the various theoretical frameworks
and models presented to understand and analyze CSR. It can also identify gaps in existing
literature. A conceptual framework sets the standards for defining a research question and finding
meaningful answers. It connects the theories, assumptions, beliefs, and concepts behind the
research, presenting them in a pictorial, graphical, or narrative format.
Definition of CSR
The definition of CSR has evolved over time, with various studies arguing that its meaning and
practice are constantly being reexamined and redefined to serve changing needs and times
(Cernec, 2014). The meaning of CSR varies depending on the perceptions of stakeholders and
the industry under study (Campbell, 2007). According to Forstater et al. (2002), CSR involves a
company's actions that contribute to sustainable development through its core business activities,
social investment, and public policy debate. Organizations have responsibilities not only to their
shareholders but to a broader group of stakeholders, including employees, the local community,
and society at large (Wheeler, Colbert, and Freeman, 2003).
Beverage Industry in Ghana
The beverage industry in Ghana has evolved from traditional drinks made from indigenous
ingredients to modern commercial beverage production. During the colonial period, European
settlers established commercial breweries, with Ghana Brewery Limited (GBL) being the first
large brewery established in 1931. The 1990s saw economic reforms that liberalized the market
and encouraged international investment, leading to the entry of companies like Guinness Ghana
and Coca-Cola. The 2000s saw a shift towards non-alcoholic beverages, bottled water, and fruit
juices, with companies focusing on local ingredient sourcing and sustainable practices.
Importance of CSR in the Beverage Industry
Companies in the beverage industry recognize the need to go beyond traditional profit-making
activities and consider their impact on society. CSR initiatives enhance a company's reputation
by demonstrating a commitment to ethical practices, social equity, and environmental
stewardship. Engaging in socially responsible activities can improve public image, build trust
with stakeholders, and lead to increased consumer loyalty and trust. CSR initiatives can also
have a positive impact on employee engagement and satisfaction, as employees are more likely
to be motivated and committed when they perceive a strong CSR culture. Additionally, CSR
initiatives can lead to increased profitability in the long term by reducing costs, improving
efficiency, and gaining a competitive advantage.
Empirical Review
An empirical literature review examines prior empirical studies to respond to a specific research
question. In the context of CSR, an empirical review seeks to discover empirical evidence and
trends in CSR research. It combines evidence from various studies to provide a thorough
understanding of a specific topic and can inform policymakers, practitioners, and academics
about effective practices, interventions, and theories in the field.
Corporate Social Responsibility in the Beverage Industry
Given the importance of water in beverage production, many companies use water conservation
methods to reduce usage and prevent pollution of local water sources. Companies are
increasingly sourcing ingredients sustainably, ensuring that suppliers follow environmental and
ethical guidelines. Many beverage firms work with local communities on development projects,
educational activities, and health initiatives, promoting trust and strengthening the company's
social license to operate. Companies are also responding to consumer demand for healthier
options by reformulating their beverages to reduce sugar, calories, and artificial additives.
Overview of Guinness Ghana
Guinness Ghana Breweries Limited (GGBL) was founded in 1960, introducing one of the
world's most iconic beer brands to Ghana. As a subsidiary of Diageo, GGBL has access to
international best practices, resources, and innovation. The company operates several breweries
in Ghana, using modern brewing methods and strict quality control measures to ensure high
standards. Guinness Ghana focuses on water stewardship, community development, and
responsible drinking.
Theoretical Review
CSR has had a contentious evolution, with neoclassical theorists arguing that the concept is
incompatible with the goal of doing business. However, proponents of CSR argue that firms
prioritizing shareholder profits cannot thrive in today's globalized and interconnected economies.
Stakeholder Theory
Stakeholder theory emphasizes the importance of addressing the interests and concerns of all
stakeholders involved in or impacted by a company's activities. It broadens the scope of
corporate responsibility, encouraging companies to engage in practices that benefit various
stakeholders, thereby improving overall social welfare. The theory highlights the
interconnectedness of a corporation and its stakeholders, suggesting that fulfilling stakeholder
demands can promote loyalty, increase reputation, and drive long-term success.
Chapter Summary
This chapter provided background information and a description of CSR based on previous
academic writing in various areas and regions. It then examined the concept in the industrial
sector and the Ghanaian context. Finally, it introduced and explored the stakeholder theory,
which serves as the framework for this research.