Exploring sustainable procurement practices within the Nigerian oil and gas sector

Ekiugbo, I

Abstract

Although sustainable procurement (SP) practices literature is increasingly evolving - especially from the European context - this innovative approach to sustainability is hardly heard of, discuss or appears to be present in the Nigerian context. In particular, it lacks formal sustainability criteria for the procurement of goods and services in the O&G sector – a key sector of the Nigerian economy - despite the fact that SP can lead to sustainable development. This situation is evidently responsible for the lack of SP studies within the Nigerian O&G sector. Hence, this thesis sets out to determine the underlying dimensions of sustainable procurement (SP) practices and to empirically examine the relationships among SP practices, procurement sustainability strategy and initiatives, and the impact of SP practices on firms’ performances within the Nigerian O&G sector. To achieve its purpose, an in-depth literature review of SP practices and related terms was conducted, upon which the initial conceptual framework for this research is built.
Primary data was collected from the Nigerian O&G upstream sector after ethical and industry approval from the University of Salford and Department for Petroleum Resource (DPR) Nigeria, respectively. A total of 51 valid responses were obtained for the data analysis, which utilised exploratory factor analysis (EFA), hierarchical multiple regression models, cross tabulation and confirmatory factor analysis (CFA). The reliability and validity of scales and results obtained were also confirmed with the aid of appropriate tools.
The EFA led to the extraction of three factors, which were subsequently named social & community improvement (SCI); economic & environmental improvement (EEI) and equality & safety improvement (ESI), due to the factor loadings and in line with assumptions held in the literature review. The results suggest that SP practices are environmental, social or economic oriented have some degree of relationship. The hierarchical multiple regression models indicate a statistically significant relationship between clear SP strategy and all three factors of SP practices but display a partial relationship between the sustainability initiatives (ISO 14001 certification and UNGC initiative) and all three factors of SP practices. For example, the results indicate that ISO 14001 certification is only statistically significant with SCI and ESI factors of SP practices, whilst UNGC initiative is only statistically significant with SCI and EEI factors of SP practices. In regard to performances, the results showed a perceived impact on firms’ financial and non-financial performances as a result of SP practices. For instance, the findings indicate that SP practices have perceived positive impacts on the quality of products and services, sales and revenue. The findings also highlight the fact that SP practices may lead to increase in market share and customer loyalty.
The findings of the research provide useful insights into SP practices within the Nigerian O&G sector. These insights may help practitioners to focus on those SP practices (the three factor loadings) that can lead to sustainability, especially where there is a scarcity of resources in operationalising SP practices. Furthermore, insights were gained on the link between the drivers examined in the multiple regression and the adoption of SP practices. Further, it is worth noting that this empirical research is one of the first to investigate SP practices within the Nigerian O&G sector, and therefore, expected to lead to further studies and debates needed to advance SP practices.

Keywords: sustainable procurement, sustainability, oil & gas, firms’ performance, Nigeria

• Thesis Type: Thesis
• Deposit Date: Jun 25, 2019
• Publicly Available Date: Jan 2, 2024
• Award Date: Feb 1, 2019