Ghana: ACEP raises alert over Ghana National Petroleum Corporation’s $43m CSR budget

The Africa Centre for Energy Policy (ACEP) is unhappy with plans by the Ghana National Petroleum Corporation (GNPC) to spend about $43 million on Corporate Social Responsibility and less on its operational functions.

According to ACEP, GNPC is spending $20 million on its operations in the Voltain Basin which is less than 50% of the amount it is blowing on CSR programmes. “The Corporation plans to spend US$ 43.05 million on corporate social responsibility for the 2019 operational year.”

ACEP stated that spending that much on corporate social responsibility gives a cause for concern particularly, when it is juxtaposed against GNPC’s “operations expenditure beyond the traditional cash call on the producing fields.”

ACEP noted that GNPC in recent times has become more popular in delivering development projects rather than its core mandate.

“While GNPC, like any corporate entity, has a responsibility towards society, it is unusual for sound corporate organisations to spend more than 10% of its cash flow (not profit) on corporate social responsibility. The Corporation’s CSR expenditure becomes more profound when its CSR budget is compared with the budget of some critical ministries.”

ACEP in its analysis said the CSR budget of the Corporation represents 2819%, 270%, 240%, 629% of the capital budget of the Ministries of Justice and Attorney General, Energy, Agriculture and Finance respectively.

“In relation to the total budget of the mentioned ministries, GNPC’s CSR budget represents 210%, 254%, 47%, and 65% respectively,” ACEP added.

ACEP in the document sighted by citinewsroom.com urged Parliament not to approve the CSR budget for GNPC.

“Parliament should not approve any CSR budget for the Corporation until the end of the fifteen-year financing window provided in the PRMA has elapsed. This should free up funds for the Corporation to deliver on its core mandate as an upstream oil player,” ACEP recommended.

Source: Ghana Web