In the last decade, China's investments in Africa's agricultural sector but can the geographic origin of investment affect the Performance and the Corporate Social Responsibility (CSR) of the Company? CIFOR Scientists Samuel Assembe-Mvondo, Pablo Cerutti, Louis Putzel and Richard Eba'a Atyi present "What happens when corporate ownership shifts to China? A case study on rubber production in Cameroon".

1. What happens when corporate ownership
shifts to China? A case study on rubber
production in Cameroon
Samuel Assembe–Mvondo, Paolo O Cerutti, Louis Putzel & Richard
Eba’a Atyi

2. Outline
Background
Methods
Results
Discussion
Conclusion

3. Background:

4. Background
China’s investment in Africa’s agricultural sector have
increased over the past 10 years, and one the
modalities of investment is the acquisition of pre-
existing corporate holdings:
 It is in this framework that one Chinese transnational Company
has became the main shareholder of the Singaporean based
transnational company in 2008;
 Then, a subsidiary main rubber company in Cameroon has also
become a part of Chinese Company;
 The Cameroonian subsidiary share: 87% to Chinese; 3% to
employees (last year agreement); 10% to State;
 State (1975-1997); Singaporean ownership (1997-2008);
Chinese (2008- today).

5. Research QUESTION
Can the geographic
origin of investment
affect the Performance
and the Corporate Social
Responsibility (CSR) of
the Company?

6. Theoretical framework
This study draws on the concept of
Corporate Social Responsibility (CSR),
in which companies go beyond
compliance and undertake actions
that seem to provide for social and
environmental well-being over and
above the interests of and its legal
obligations (see McWilliams & Siegel
2001; Logsdon & Wood 2002);
 CSR requires to the company to
respect: human rights; labour rights
and environmental conditions.

7. Methods
The following Social sciences
Methods have been used:
 Literature review;
 Interview with 7 managers, 5
administrative authorities, 2
NGOs leaders;
 Interview with 35 lower –
ranking employees;
 Focus group discussion in 7
adjacent villages;
 Participatory observation

8. Results

9. THINKING beyond the canopy
Summary of main events in the life of the rubber company
Types of
investments
State of Cameroon: public
capital, 1975-1997
Singapore capital
1997- 2008 Chinese capital
2008-today
Industrial
investments
 41,339 ha
 18 000 ha of rubber
plantation
 1 24-ton capacity industrial
rubber transformation
facility
 5000 employees
 Increase in
transformation capacity
to 50,000 tons
 4500 employees
 Renovation of plantations:
2000 ha
 Creation of a research
laboratory and nurseries
 Plan extension of plantations
 5500 employees
 Adoption of a sanitation-
security-environment policy
Social investments  Construction of 17 camps
and 3 villages
 2 nursery schools
 1 primary school
 1 secondary school
 1 hospital with140-beds
 1 cultural centre
 Sports and recreational
areas, a swimming pool
 Increase in enrolment
capacity in schools
 Increase in technical
capacity of the hospital
 First step in electricity
installation in camps
 Improvement of hospital
capacity
 New insurance policies for
employees
 Safety equipment and means
of transport for workers
 Salary readjustments in 2012
 Payment of bonus to
employees, following the
strike
 Transfer 3% of the capital
to the employees, following
the strike and negotiation
 Opening of discussions with
local communities on
establishing rubber
plantations

10. THINKING beyond the canopy
Summary of management evolution of a rubber company
State of Cameroon
ownership (1975-
1997 )
Singaporean (1997-
2008)
Chinese (2008-
today)
CSR No CSR, especially
land conflict with
local communities;
Claims of local
communities on their
land and financial
compensation
Salaries were
acceptable ;
 No internal
environmental
strategy
 No CSR, conflicts
with local
communities on
customary land;
Worse work
conditions for
employees;
 Salaries conditions
were bad;
Reduction of
employees
No internal
environmental
strategy
 Yes, existence of
CSR;
Improved salaries ,
security and health
conditions of
employees;
 adopted the
internal security and
environmental policy;
Dialogue with local
communities
ISO 9001 certificate
Performance  10 000 tons of latex
production in 1992
 26 000 tons of latex
production in 2002
 no plantation
extension
 30. 000 tons of
latex (2010);
49% of the global
profits in 2010

11. THINKING beyond the canopy
Towards Chinese investment Management New Strategy
 Cameroonian subsidiary has just started the expansion
rubber Plantations, areas will be increased to 18 300 ha,
with creation of 3 000 jobs;
 Chinese Transnational company has just created another
subsidiary in Cameroon (SUD- Cameroun HEVEA), with
45 000 ha land concession for planting rubber, with 9 500
jobs;

12. Discussion

13. In general, this study shows that employment conditions and
relations between local communities and a Cameroonian
subsidiary have oftentimes been conflictual. The causes and
intensity of conflicts and their degree of violent manifestation
varied with time. But overall they were and still are, based on
a sense of perceived injustice, inequity and unfair treatment
by the local communities and the workers. Such feelings and
the suboptimal remuneration and employment conditions can
be traced first of all to the heritage bequeathed by the former
owner (state of Cameroon), to the Singaporean group at the
time of privatization. However, this subsidiary company
under Chinese investor management seems determined to
adopt, implement and improve social strategy.

14. Conclusion
In summary, the case of two –phased
privatization of rubber company in
Cameroon, challenges a number of prevailing
assumptions:
 First, it challenges the notion upon which
the privatization was based i.e. Would bring
new employment to sector and improve
working conditions;
Second, it challenges the common
perception in the Western media that
investment of China will result less
satisfactory corporate social practices than
non-Asian companies.
Finally, the origin of company’s capital does
not really have impact for this case study.

15. Thank You for your Attention
China’s Trade and Investment in Africa Project is funded by BMZ