Corporate Social Responsibility (CSR) and its

perceptions affecting Consumer Choices.

To gain a better understanding between the relationship between ‘Corporate Social
Responsibility’ (CSR) and how perceptions of CSR affect consumer choices, particularly
when customers are choosing electronic products, we first need to know the meaning of
the term CSR. According to the article ‘A model of Customer Loyalty and CSR’ by
Poolthong (2001), in majority of the present day businesses, CSR is treated as a
combination of social and environmental concerns in their day-to-day operations and
fulfilling or exceeding the legal and ethical expectations, which the overall society
expects a business to undertaken

However, a criticism towards the legal expectations of CSR is that companies are legally
bound to follow certain rules and regulations set by the governing bodies, hence it is not a
voluntary practice followed. For example, in war affected countries like Congo, various
electronic manufacturing companies like Nokia, IBM and Siemens are still extracting
mineral deposits of tantalum, which is a vital component in their computer and mobile
components. Prior research suggests that consumers take into consideration towards
companies that take CSR initiatives more on ethical levels than on legal levels,
suggesting the company is proactive rather than reactive.

The article ‘How does CSR create value for Customers’ by Todd Green & John Peloza
(2011) states a positive correlation between CSR and purchasing behavior of consumers.
A systematic qualitative study was carried out involving in-depth personal interviews of
30 consumers across major cities in North America which lead 334 pages of interview
transcripts which were reviewed and discussed in detail by the authors to arrive at the
above conclusion. However, this study could have been more comprehensive, if the
sample size was large enough, as it represents a large area of North America and
secondly the results would have been situational based, as the timing of this study was
during the recession, which would lead to a change in spending and buying patterns due
to budgetary constraints.
According to Griffin (2000) in the article ‘The boundaries of strategic CSR’, Research
has proven that there exists a positive relationship between CSR and corporate financial
performance (CFP), the activities and initiatives taken up by companies with respect to
CSR has a positive effect on the buying patterns of consumers with respect to their
choices, developing a particular brand image of the company and developing a consumer-
company identification, which plays a vital role in the overall profitability of the
companies.

To conclude, we can highlight the discussion in the article ‘CSR or cause related
marketing? The role of cause specificity of CSR.’ (Sheikh, 2011), where the author states
that public/consumers of electronic goods and also other markets take into consideration
towards the company which takes CSR initiatives towards community support, diversity,
employee support, environment, country of operations and finally the product. These
factors lead to the purchasing behavior of consumers with respect to 1) emotional value-
arising out of CSR initiatives of companies with respect to charity/donations. 2) social
value- arising out of CSR initiatives of companies with respect to environmental
considerations, and 3) functional value – in this scenario consumers include even the
most traditional marketing tools such as sales promotion as a part of CSR if they are
positioned through traditional social or environmental attributes (for e.g.; recycling).
References:

Geoffrey, P.L. (2001), “The boundaries of strategic corporate social responsibility”.

Journal of Consumer Marketing, Vol 18, No 7, pp 595-630.

Rujirutana, M. and Yaowolak, P. (2009), “A model of customer loyalty and CSR”.

Journal of Services Marketing, Vol 25, Issue 2, pp 122-133.

Sana, R.S and Rian, B.Z. (2011), “CSR or cause related marketing? The role of cause
specificity of CSR”. Journal of Consumer Marketing, Vol 28 , issue 1 , pp 27-39.

Sen, S. and Bhattacharya, C.B, (2011) Does doing good always lead to doing better?
Consumer reaction to CSR. Journal of Marketing Research, pp 225-244.

Todd, G. and John, P. (2011), “How does CSR create value for consumers?”. Journal of
Consumer Marketing, Vol 28, No1 pp, 48-56.