Corporate social responsibility (CSR, also called corporate sustainability, sustainable business, corporate conscience, corporate citizenship or responsible business)1 is a type of international private business self-regulation.2 While once it was possible to describe CSR as an internal organisational policy or a corporate ethic strategy,3 that time has passed as various international laws have been developed and various organisations have used their authority to push it beyond individual or even industry-wide Corporate social responsibility (CSR, also called corporate sustainability, sustainable business, corporate
conscience, corporate citizenship or responsible business)1 is a type of international private business self-regulation.2 While once it was possible to describe CSR as an internal organisational policy or a corporate ethic strategy,3 that time has passed as various international laws have been developed and various organisations have used their authority to push initiatives.Considered at the organisational level, CSR is an organisational policy. As such, it must align with and be integrated into a business model to be successful. With some models, a firm’s implementation of CSR goes beyond compliance with regulatory requirements, and engages in “actions that appear to further some social good, beyond the interests of the firm and that which is required by law”. The choices of ‘complying’ with the law, failing to comply, and ‘going beyond’ are three distinct strategic organisational choices. While in many areas such as environmental or labor regulations, employers may choose to comply with the law, or go beyond the law, other organisations may choose to flout the law.
This article describes corporate social responsibility (CSR) as an organisational tool whose successful implementation can be used to gain brand loyalty. The benefits of CSR to society have been well documented to a great extent. However, there is very little information on the benefits of it to the actual corporations that practice it. This lack of knowledge is what motivated the study on which this article is based. The key objectives of the study for the article were to determine consumer attitudes towards specific CSR programs, determine the impact of CSR on brand image and brand loyalty and determine what kinds of CSR programs are considered to be adequate by consumers to qualify as socially responsible.
This article describes corporate social responsibility (CSR) as an organisational tool whose successful implementation can be used to gain brand loyalty. The benefits of CSR to society have been well documented to a great extent. However, there is very little information on the benefits of it to the actual corporations that practice it. This lack of knowledge is what motivated the study on which this article is based. The key objectives of the study for the article were to determine consumer attitudes towards specific CSR programs, determine the impact of CSR on brand image and brand loyalty and determine what kinds of CSR programs are considered to be adequate by consumers. Let us focus on how it affects a company’s branding. It has been established that social responsibility is an excellent way for a company to build its brand and reputation.
When we speak of branding for companies and businesses, the first thing that comes to mind involves the use of a logo, a tag line, and a name unique to that entity. After all, branding has one end goal: creating a differentiated name and image for a company, business, organization, product, or service.
Using two different studies we assess under what conditions Corporate Social Responsibility (CSR) affects consumer satisfaction. In the first study, based on the American Customer Satisfaction Index, and a content analysis of CSR initiatives reported by 65 US companies, findings show a positive direct relationship between CSR and customer satisfaction with CSR training and environmental initiatives, but a negative direct relationship between CSR corporate communication initiatives and customer satisfaction. The second study, through an empirical study based on an online survey of consumers, points to a positive relationship between CSR and customer satisfaction. Our findings suggest a direct and an indirect route for this relationship through brand attitudes. These apparently divergent, but complementary results, between the two studies are explained by the different conceptual approaches that underline the CSR communication processes and the relationship between consumers and brand. Our findings also suggest that public policies on CSR visibility must be reviewed.Satisfaction with CSR initiatives therefore becomes a key metric of the successful development and implementation of a CSR policy. Consumers may wish to reward companies with good CSR records positively or even with non-negative information in the form of resilience to negative information about the company.However, the relationship between CSR initiatives and customer satisfaction has been scarcely researched and consequently, our understanding of the disaggregated drivers and causes may be incomplete. We also argue that positive attitudes may be expected to trigger satisfaction and hence CSR must have a positive influence on satisfaction.
Thus, our aim in this research is twofold: first, to assess what kinds of CSR initiatives significantly influence consumer satisfaction with the company; second, to assess the mediating role exerted by brand attitude in the relationship between CSR and satisfaction. These two main research objectives are accomplished through two different studies in two different countries, USA and Spain that reflect two cultural settings and also depict different cultural patterns in each of the five current six cultural dimensions
When it comes to successfully executing CSR strategy, even big corporations make mistakes, especially if they fail to consider the long-term impact of their efforts to give back. Case in point: Toms Shoes. From a marketing standpoint, Toms Shoes “Buy One, Give One” model is a winner. It’s easy for consumers to connect with a concrete concept like putting shoes on a poor child’s feet, rather than a more abstract concept like donating 10 percent of profits to research. But while the slogan may be good for business, critics say that the “Buy One, Give One” model creates dependency, zaps local initiatives, and ultimately hurts local businesses. As Michael Matheson Miller, the director of PovertyCure, a group promoting entrepreneurial solutions to poverty, tells [email protected], “Poor people aren’t poor because they lack stuff; they’re poor because they lack the infrastructure to create wealth.” Ultimately, donating a pair of shoes may do more damage to the local economy than good.
In other cases, donating a pair of eyeglasses may be just fine if these donations don’t undermine an existing local industry. Warby Parker, for example, uses money from every pair of glasses the brand sells to train locals at giving basic eye exams and then sell glasses at a significantly reduced rate. This turns an otherwise needy beneficiary into a responsible consumer, which Warby Park co-CEO Neil Blumenthal says empowers rather demeans the recipient. The company partners with Vision Spring, a like-minded nonprofit, to manage the training and eyeglass sales.
So how can you ensure your program is more than just well-intentioned but actually effective? For businesses that wish to alleviate poverty, Miller recommends focusing efforts on ways to create prosperity for families, such as removing barriers to education. In other cases, a “buy one, give one” approach may work, as long as the recipient’s needs and environment are carefully considered. Other companies have found success in providing microloans or making scholarship donations that restore community health, rather than just alleviating symptoms or causes.
Katherine Klein, the vice dean of Wharton’s Social Impact Initiative recommends businesses embrace the spirit of innovation and experimentation with their CSR models as “it’s not clear yet which approaches have the greatest sustainability and impact.”the researchers conducted several studies. In the first study, researchers presented 83 consumers with a fictional new sports drink. Half of the consumers were told that a portion of the drink’s proceeds go to a charitable organization. All of the consumers were then asked to try the new product, either by choosing a coupon of the new drink or one of their choice and a 12-pack of the new sports drink or another sports drink of their choice.
The researchers found that consumers were less likely to try the new product when the sports drink promoted donating proceeds (59 percent) compared to when it did not (86 percent).
A second study compared a new brand of chocolate bar to an established one. Researchers asked 178 consumers to view a candy bar. People saw either a new chocolate bar or an established bar on the market. Half of the people who saw each bar were then told that a percentage of proceeds from the bar went to a cause.
Consumers who saw the new bar were less likely to perceive that the chocolate tasted good if they were told that it supported a cause. However, the established chocolate bar brand actually saw a very slight benefit when people were told that it supported a cause.
But CSR doesn’t always mean bad news for new brands.
In a third study, 142 consumers were presented with marketing material for a fictional new brand of socks. One third of the consumers saw material listing the sock design as a top priority for the brand; one third of the consumers saw material listing social responsibility as a top priority for the brand; and one third of the consumers saw material listing sock design and social responsibility as dual priorities for the brand. Researchers then asked consumers about the perceived comfort and performance of the sock brand.
The researchers found that listing social responsibility as the brand’s top priority hurt its perceived comfort and performance – but listing social responsibility and sock design as dual priorities erased that deficit completely.