Corporate Social Responsibility and Consumer Buying Behavior in Emerging Market
Corporate Social Responsibility and Consumer Buying Behavior in Emerging Market
Corporate Social Responsibility and Consumer Buying Behavior in Emerging Market
Valérie Swaen
Research fellow with the National Belgian Fund for Scientific Research and the
Bernheim Foundation, Université Catholique de Louvain, Institut d'Administration et
de Gestion, Place des Doyens, 1, B 1348 Louvain-la-Neuve, Belgium.
Tel : +32.10.47.91.56; Fax : +32.10.47.83.24; Email : [email protected]
This paper presents the doctoral project we are currently carrying out with the
Institut d’Administration et de Gestion from Louvain-La-Neuve (Belgium), as well as
the precious collaboration of the Institut d’Economie Scientifique et de Gestion from
Lille (France).
The purpose of our doctoral research is to better understand the concept of
Corporate Social Responsibility (CSR) in the context of France and Belgium, as well
as to identify the CSR impacts on consumers’ attitudes and behavior intentions. This
global purpose could be divided into three principal research questions.
Firstly, since there is no consensus on a precise definition of what a socially
responsible company is, our first objective is to clarify the content of the CSR
concept. Moreover most of the existing definitions are based on managers’ point of
view only, even if gaps are likely to exist between managers’ and stakeholders’
opinions. A model of gaps between managers’ and consumers’ perceptions will then
be proposed.
Secondly, the impacts of consumers’ CSR perceptions on important variables
in marketing will be evaluated : the influence on consumer satisfaction, trust,
commitment and ultimately loyalty toward the socially responsible company will be
examined. Indeed, more companies than ever before put into place corporate social
responsibility (CSR) initiatives (Drumwright, 1994; Varadarajan and Menon, 1988).
This trend translates the belief among business leaders that CSR is an economic
imperative in today’s national as well as global marketplace (Sen and Bhattacharya,
2001). Despite this increasing emphasis on CSR in the marketplace, little is known
about the effects of CSR actions on consumers (Sen and Bhattacharya, 2001).
Thirdly, we want to highlight the consumers’ characteristics according to the
stage of development of their relations with the company. Indeed, some consumers
could be uninterested in the socially responsible features of companies; others could
express their satisfaction about the CSR activities or their trust in the citizen company.
Finally, for the consumers the most sensitive to such topics, they could develop
commitment and true loyalty toward that company.
Our methodology design includes two phases: an exploratory phase and a
causal phase. The objectives of the exploratory phase are to clarify theoretical
constructs and to propose precise hypotheses of relationships between CSR activities
and consumers’ attitudes and behaviour intentions. These hypotheses will be tested
afterwards in the causal phase.
This paper presents the first results of our exploratory investigations as well as
the model we propose to test in a close future. For instance, we will present a new
way of conceptualizing CSR into five facets : (a) the consumers’ expectations on CSR
activities, (b) the managers’ perceptions of those expectations, (c) the consumers’
perceptions of present CSR activities, (d) the CSR policies put into place by
companies, (e) their CSR communication policies. The demonstration of the existence
of gaps between these facets highlights the importance of measuring not only the
degree of CSR activities but also the consumers’ perceptions of those activities,
especially when evaluating consumers’ reactions to CSR policies.
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1. INTRODUCTION
This paper presents the doctoral project we are currently carrying out with the
Institut d’Administration et de Gestion from Louvain-La-Neuve (Belgium), as well as
the precious collaboration of the Institut d’Economie Scientifique et de Gestion from
Lille (France).
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presented in a third part and part 4 presents the research methodology as well as first
results of our exploratory investigation. Finally, the conclusion gives an overview of
the principal anticipated learnings of this research as well as some directions for
future research.
2. THEORETICAL FRAMEWORK
According to Carroll (1979) and Maignan, Ferrell and Hult (1999), CSR has
an economic, a legal, an ethical and a philanthropic face. Socially responsible
companies are expected: (1) to be profitable while providing desired goods and
services (fulfill their economic responsibilities), (2) to obey the law (fulfill their legal
responsibilities), (3) to follow codes of conduct considered as morally right (meet
their ethical responsibilities), and (4) to contribute actively to the well-being of the
communities in which they operate (address their philanthropic responsibilities).
Maignan, Ferrell and Hult (1999) add the fact that these responsibilities are imposed
on companies by their various stakeholders.
Given the broad conceptualization of CSR, it is not surprising that the domains
of socially responsible behaviors are many and diverse. Sen and Bhattacharya (2001)
summarize different CSR action into six broad domains (on the basis of the US
database Socrates, Corporate Social Ratings Monitor): (1) community support (arts,
education, corporate giving); (2) diversity (sexe, race, disability); (3) employee
support (job security); (4) environment (environmentally-friendly products, waste
management, pollution control); (5) non-US operations (overseas labor practices,
operations in countries with human resources violation); and (6) product (safety and
research and development).
4
We just want to remark that these broad domains are typical from the US
conception of CSR and it has been noted that the nature of the actions typifying CSR
is likely to vary across both countries and industries (ARESE, 2001; Maignan and
Swaen, 2000). That’s why we have to examine in which CSR domains companies
invest in France and in Belgium.
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CSR Europe Corporate social responsibility is operating a business in a manner
(http://www.csreurope.org/csr_e that consistently meets or exceeds the ethical, legal, commercial and
urope/index/index2.htm) public expectations that society has of business
Belgian Business Network for Although there is not really a “Belgian definition” for Corporate
Social Cohesion Social Responsibility, CSR Europe presents three main elements that
(http://www.csreurope.org/csr_e usually reappear in the Belgian conceptualization of CSR :
urope/nationalnetworks/national • On a voluntary basis the company takes on board some other
networksframes.htm?content=B objectives than the maximizing of profits;
elgium/NPOs/Belgium.htm) • The company has a responsibility, not only to the shareholders,
but also to all stakeholders and broader society. This
responsibility should show in the policies, decision-making,
business processes, daily activities and communication of the
company.
• Usually the term also refers to companies that do more than
usual, and thus are innovative in their social, ecological or
ethical management.
CSR may be desirable for stakeholder groups and for society as a whole – but
such initiatives are rather unlikely to be welcomed by corporate leaders unless they
yield some business benefits.
Many studies have attempted to link CSR to financial performance, yet the
findings remain mainly inconclusive (for a recent review, see Stanwick and Stanwick,
1998).
Some authors uncover a positive association (e.g., Cochran and Wood, 1984 ;
Spencer and Taylor, 1987 ; Wokutch and Spencer, 1987 ; Graves and Waddock,
1993 ; Waddock and Graves, 1997 ; Maignan, Ferrell and Hult, 1999 ; Maignan and
Ferrell, 2001). Some others highlight a negative relationship (e.g., Vance, 1975 ;
Davidson and Worrell, 1988), while a last category of researchers fails to find any
significant association between CSR and financial performance (e.g., Alexander and
Buchholz, 1978 ; Preston, 1978 ; Spicer, 1980 ; Aupperle, Carroll and Hatfield, 1985 ;
McGuire, Sundgreen and Schneeweis, 1988 ; Davidson and Worrell, 1990).
It may be easier to gauge how CSR can generate “indirect” business benefits
through the active support of stakeholders.
More recently, some studies have been carried out on the effects of CSR on
the reactions of specific stakeholder groups (e.g., Brown and Dacin, 1997; Creyer and
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Ross, 1997; Murray and Vogel, 1997; Turban and Greening, 1997; Ellen, Mohr and
Webb, 2000; Sen and Bhattacharya, 2001).
Little is known about the effects of CSR actions on consumers (Sen and
Bhattacharya, 2001). Just some research have focused explicitly on consumers’
reactions to CSR. In a recent study by Ipsos/Fleishman-Hillard (1999), 86 percent of
European consumers claimed to be more likely to buy products from a company
which engages in social actions. In addition, 89 percent of the respondents declared
they would trust a firm which had demonstrated a genuine commitment to taking
social actions.
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relation between the extent to which their perceptions of that company’s ethicality
exceed their expectations and consumer preferences for a company product.
Sen and Bhattacharya (2001) suggest that CSR can affect consumers’
intentions to purchase not only indirectly - through the creation of a corporate context
for purchase intentions - but also directly for some CSR domains and for some
consumers. They add company-specific factors (CSR domain and product quality) as
well as individual-specific factors (CSR support, CSR related beliefs) as key
moderators of consumers’ responses to CSR initiatives. They also highlight the
mediating role of congruence between consumers’ own characters and that of the
company. The most interesting aspect of their paper is to show that the indirect effect
between positive CSR and consumers’ intentions to purchase can be negative under
certain conditions (for high CSR support consumers when products of high quality
and for low CSR support consumers when products of low quality).
Researchers also tried to show the positive relationship between CSR and
customers’ loyalty, but the results of these different studies diverge. While Maignan,
Ferrell, and Hult (1999) found a positive relationship between corporate social
involvement and customer loyalty, Maignan and Ferrell (2001) concluded to the
absence of significant impact1.
In this research, we will try to increase the knowledge about the effects of
CSR on consumers’ attitudes and behavior intentions. More specifically, we will work
on the consumers’ perceptions of CSR and the influence of their perceptions on their
satisfaction, trust, commitment and loyalty intentions toward that company. Our
complete research model is presented in the next part.
1
In Maignan, Ferrell and Hult (1999) and in Maignan and Ferrell (2001), the same conceptualization of
CSR has been used (basis = Maignan, Ferrell and Hult, 1999 definition and measure of CSR). Both
authors asked managers to evaluate the degree of their customers’ loyalty and not directly customers’
opinions.
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The existence of potential gaps between these facets (see Figure 1) would
highlight the importance of measuring the consumers’ CSR perceptions when
evaluating consumers’ reactions to CSR policies.
Consumer
Expected CSR
GAP 4
Perceived CSR
Marketer
GAP 3
External
CSR politics
communication
and activities
to consumers
GAP 1
GAP 2
Managers’ perceptions of
consumers’ CSR
expectations
We will briefly detail the different gaps presented in Figure 1, as all these gaps
explains the formation of perceived CSR.
It is essential for companies that want to put into practice social activities
desired by consumers to have a very good knowledge of consumers’ needs, desires
and expectations about social issues and social responsibilities. That’s why companies
have to collect data coming directly from consumers themselves, for instance, by
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organizing meetings with consumers, listening them and installing a continuous
dialogue with them.
Gap 3 between CSR activities put into place by managers and the external
communication of such activities
It is necessary to respect its promises if we do not want to lose all credibility. When
external communication of the company gives a better socially responsible image of
the company than the real case is, this could lead to a deterioration of consumers’
CSR perceptions if consumers discover the differences.
In the reverse case, when companies tell consumers less than what they really do on
the CSR aspects, consumers could not be aware of the CSR activities of the company
and cannot react consequently.
10
Consumers also expect organizations to demonstrate congruence with some social
values as contribution to the community (Handelman and Arnold, 1999). Consumers
are not only economic beings but also members of a community. They can choose to
evaluate a company based on whether the organization acts in consistence with the
welfare of the community and society. Consequently, they can be willing to offer their
support for socially responsible companies (Bhattacharya, Rao and Glynn, 1995).
These variables have been chosen because of their important role in predicting
consumer behaviour and because of their practical importance for companies. Indeed,
“manufacturers see brand loyalty as key to superior performance and make efforts to
build it through providing superior benefits, promoting the firms’ values (green
marketing, corporate philanthropy) and establishing an image as a trustworthy
manufacturer” (Morgan and Hunt, 1994).
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CSR Satisfaction Loyalty. We propose that consumers’ CSR perceptions
are contingent to the amount of congruence they perceive between the company’s
CSR activities and their expectations according to that criteria (for instance, their
values, Oliver, 1997, p. 71). Like in the disconfirmation paradigm (Oliver, 1980), we
hypothesise that this disconfirmation could lead to consumer satisfaction. Moreover, a
lot of scholars show in different contexts that consumer satisfaction is an antecedent
of consumer loyalty (Anderson, Fornell and Lehmann, 1994; Cronin and Taylor,
1992; Garbarino and Johnson, 1999 for low relational customers; Selnes, 1993).
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Figure 2. Conceptual Model of this research
Marketing variables
Reputation
Satisfaction
Commitment
Moderators
Individual variables
Contextual variables
In the exploratory phase, our research objective is to analyze the content of the
CSR concept, by integrating consumers’ expectations and perceptions of the socially
responsible activities of companies delivering products and services.
Different data collection techniques have been used in this exploratory phase:
individual interviews with customers (questionnaire, scenario reading2) and focus
groups with customers (use of projective techniques3). 30 individual interviews as
well as 4 focus groups (4 or 5 persons) have already been carried out.
2
Two presentations of a cosmetic company have been created. The first one gives a relatively positive
CSR image of the company (no testing on animals, employees’ diversity, handicapped hiring, good
causes supporting), the second one gives a relatively negative CSR image of the company.
Respondents read one of these scenarios and tell us what would be their reactions toward that company.
3
For instance, completing an uncompleted story, completing some sentences, some comics and
comparing the socially responsible firm to an animal.
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Objective 1: Do consumers have certain expectations on the CSR activities of
companies? Which dimensions do consumers use to evaluate the
degree of CSR of a company?
We want to identify the social actions that interest consumers, the social issues
that they feel concerned with. This will highlight different dimensions of expected
CSR, the comparison level that consumers use to evaluate the CSR activities of
companies.
Some consumers add that companies have to take into account the different
stakeholders’ points of view in their decisions. They often cite the responsibilities of
companies toward the environment, the workers, the shareholders as well as the
government.
It seems useful to notice that some respondents think the role of a firm does
not include environmental and social responsibilities. According to them,
governments must be more demanding on social and environmental aspects of
business and companies have “only” to respect all the legal norms.
None of the respondents were able to cite spontaneously a company that they
really consider as socially responsible. Often, on reflection, they cite their own
employer, maybe to rationalize their belonging to that company. Some companies are
often cited: Douwe Egberts (because of giving back a part of its profits to a good
cause), ESSO (because of its good security norms), The Body Shop (because of no
animal testing) as well as ISO-certified companies in general.
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Conversely, consumers have no difficulties at all to give some examples of
non responsible companies: Nike (because of children working), TotalFinaElf
(because of the Erika story), Marks&Spencer and Renault (because of the large
number of redundancies).
We ask consumers to talk spontaneously about the different criteria they use
when choosing a product. All of them talks about the product price, product quality
and design; some about the product security. None of them cites a more social,
environmental or ethical criteria.
When asking them to talk about their potential reactions to positive CSR, they
indicate clearly that social, environmental and ethical criteria are not decisive in most
of their purchasing decisions. Different reasons could explain this fact.
First of all, consumers think there are some more important criteria to take into
account (price and quality) before considering social, ethical and environmental
criteria. Furthermore, consumers have the impression that a product produced in a
socially responsible way will cost more than others products of equal quality.
Thirdly, even when they have good intentions and the willingness to buy
“better” products, consumers admit that it is difficult to change their buying habits.
They continue buying what they have the habit to buy, because it is the easiest way to
proceed, because it takes less time.
Finally, they think it is totally normal for a company to respect such social,
ethical and environmental criteria. So, they are not sure that even if they receive
reliable information about positive CSR, this will have an impact on their buying
behavior.
However, some cues indicate that this situation is likely to evolve. Indeed, for
some consumers, receiving positive CSR information about a company inspires
confidence in that company. Other consumers tell us that if they have the choice
between two products of equal quality, one with and the other without social and
environmental problems, they will choose the second one, to set their mind at rest.
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A first type of consumers’ reactions is to take into account only the quality and
the price. For instance, a consumer says about Nike accused of using children: “It is a
little bit regretful but Nike makes some durable shoes and I am not aware of the rest”.
Nike’s products are of very good quality, so he buys them and rationalizes his
behavior by ignoring the social issue at stake.
(1) The lack of alternatives at the same level of quality, for instance in the
case of sport shoes. According to respondents, each producer of sport
shoes uses the Asian cheapest workforce and there is no difference
between the behaviors of the different companies. There is no opportunity
to adopt a more socially responsible consumption.
(2) The price of the socially responsible products is perceived as higher
comparatively to products of equal quality. Consumers think that
producing in a socially responsible way costs more and that it is normal
that the price increases in consequence, but they are not incline to pay
more for that in the absolute. Only if the difference in price is not too big,
they will consider the socially responsible alternative.
(3) There is an information problem. Consumers don’t have a lot of
information about socially responsible alternatives and they don’t really
trust information coming from companies. That’s why most of them ask
for CSR information and communication in the media, information not
only about irresponsible actions of companies but also about the positive
CSR actions.
To conclude this part, we give some first insights in the results of a projective
technique used during focus groups: the comparison between companies and animals.
This technique often gives interesting information about the consumers’ perceptions
(Pellemans, 1998).
Ø A cat: opportunist, he always lands on his paws, knows what he wants and
puts all the means in practice to have it.
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Ø A hyena, a tiger, a lion, a bear: eat everything, kill people if necessary, are
strong, fierce, aggressive and dangerous, pay attention to nothing.
Ø A shark: kills small fishes, has no respect, tries to be the strongest to
produce and sell more, keeps away from the rest.
The image consumers have of the traditional company is far from being
positive. It is very clear that they consider the company as a predator that is likely to
eat everything to stay alive, that could use all possible means to achieve its aims.
Conversely, the citizen company is seen as a social animal, living in group, for
whom the mutual aid and collective life are ends to achieve: they are members of a
community.
These exploratory data need to be analyzed more in depth that what is already
done. However we think the reader could already have an overview of the richness of
the data collected.
Hypotheses will be tested afterwards in the causal phase. We plan to use one
(or both) of the methods briefly outlined below.
The first one consists in using the scenario method on a sample of consumers.
Three levels of scenarios would be built: (1) with positive CSR (positive issues
support); (2) with negative CSR (lack of support of CSR issues); (3) with no CSR
information (control level). CSR perceptions, attitudes and behavior intentions will be
measured after the scenario reading. The advantage of this method is a better control
of the internal validity: if differences exist between the answers of consumers
assigned to different scenarios, this could only be explained by the different CSR
levels.
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research. Furthermore, this second method is welcomed in the literature on CSR since
most of the existing papers are based on scenarios and experimental design.
The choice between these two techniques will be partly based on the results of
a pretest that we will carry out in the next months. This pretest is a questionnaire
administrated in face-to-face on a sample of 400 French people. This questionnaire
will include questions about consumers’ perceptions on the different dimensions of
Corporate Social Responsibility (consumers’ rights, employees’ rights, human rights,
environmental protection…), on product/service quality, company reputation,
consumers’ satisfaction, trust, commitment, behavioral intentions as well as socio-
demographic variables (age, sex, education, revenue, social activities,
involvement…).
5. CONCLUSION
From a theoretical point of view, this research will give insight in consumers’
perceptions of CSR activities in France and Belgium. This will contrast with common
CSR literature based principally on UK and US managers’ viewpoints.
ACKNOWLEDGEMENTS
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