Jon Paul
Philosophy 484
Dr. Paul Neiman
Community Contracts in Papua New Guinea
Conflict Analysis
Backstory
Commonwealth Development Capital Partners (CDC) is a nancial ins!tu!on owned by the UK
government and is considered a mul!na!onal corpora!on (MNC) opera!ng in Africa and South Asia. The
par!al mission statement of CDC is “CDC supports the building of businesses throughout Africa and
South Asia to create jobs and make a las!ng di.erence to people’s lives in some of the world’s poorest
places.”1 The company (subsidiary) in this case involving Papua New Guinea (PNG) is Paci c Rim
Planta!ons of which, CDC has a 76% stake making it the majority owner and influencer in the business
decisions. Paci c Rim Planta!ons which operates landholdings in three PNG loca!ons: New Ireland,
Poponde9a and Milne Bay, which includes Borowai, the village in conflict. Three components of MNC
and community conflict analyzed will be: Stakeholder Power Inequality, Stakeholder Percep!on Gap, and
Cultural Context.
Stakeholder Power Inequality
Stakeholder power inequality is composed of three main concepts. First, the Dark Side of Corporate
Social Responsibility which is perceived to only have one primary func!on that is to enhance rm
pro tability. Secondly the neglect of community stakeholders which is basically says to think of the rms
rst rather than the community that they are invading.
1. h9p://www.cdcgroup.com/What-we-do/Our–Mission/#sthash.kVkS3BPB.dpuf
2. “Community Contracts in Papua New Guinea.” Michael Peel.
Dark Side of CSR
This is illustrated in the case where the commodity price of palm oil is decreasing in which CDC claims
the reason while villagers and communi!es are not receiving their contracted amount which lowers the
expenses on PacRims income statement ul!mately increasing their bottom line which enhances the
rm’s pro tability. Also, the corporate philanthropy to o.er housing through its subsidiary Milne Bay
Estates also increases revenues which posi!vely a.ect the bottom line which can be seen as a form a
greenwashing to divert the a9en!on from the “big social and environmental problems” and cover up the
misdeeds from the case. These two examples men!oned have strong favor in the idea that CSR has one
primary func!on to increase the rm’s pro ts.
The neglect of community Stakeholders
There are two main theories for understanding how rms balance the compe!ng interests of internal
and external groups. The rst one being analyzed will be the stakeholder salience model. There is
