The Oil Industry in Mexico, Corporate Social Responsibility and Local Development. Social Clauses in the New Oil Contracts. Real Alternative for Development?

Sunday, 10 July 2016
Location: Hörsaal II (Neues Institutsgebäude (NIG))
Distributed Paper
Armando GARCIA CHIANG, Universidad Autónoma Metropolitana, Unidad Iztapalapa, Mexico
From the year 2012, a new type of contracts were created in Mexico that allowed, for the first time in over sixty years, that foreign companies are able to participate in the Mexican oil market.

In fulfillment of the requirements of the “Integral Contracts for Exploration and Production”, the new operators must apply 1 % of their annual budget to social development and they have to set up Corporative Social Responsibility (CSR) plans, that could be applied during the extent of the contracts (25 to 30 years).These plans must contain propositions of concrete initiatives that could contribute to a sustainable development in the territories where the oil companies operate.

 The present paper approaches  the context in which private petroleum companies have implemented actions of social responsibility capable of improving the situation of the localities involved in the petroleum activity. With it in mind, the first section of the text presents a characterization of the petroleum contracts and introduces briefly the term of extractivism as conceptual frame that helps to understand the oil industry. The second section, The second section discusses the characteristics of integrated contracts and provides an approach to the relationship between social responsibility and sustainability. The third part is led to analyze the social implications of oil contracts through the work realized by a team of the Universidad Autonoma Metropolitana, Unit Iztapalapa that has worked in diverse oil zones during last the three years. Finally, the fourth section presents concrete actions of social responsibility implemented by nine oil companies that holds integrated contracts and tries, through them, to respond two questions: a) Define whether CSR can become a real source of financing for local development and b) Whether the actions of social responsibility may represent the beginning of the creation of a viable alternative to extractivism.