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Doing Well by Avoiding Bad

Consumers’ Perceptions of CSR and the Effect on Consumer-Based Brand Equity

Written by A. Bengtsson, F. Sundquist

Paper category

Master Thesis


Business Administration>Marketing & Sales




Thesis: Corporate Social Responsibility Some people believe that the sole responsibility of a company is to provide maximum profits to its shareholders (Carroll, 1991). However, as discussed, time has shown that a company is also obliged to be interested in a wider range of stakeholders who are interested in legal and moral rights. The importance of CSR practice has been widely recognized by scholars, because today's consumers are more socially aware than before (Rayapura, 2014). In addition, the Internet has made the company's business practices more transparent (Iglesias, Ind and Alfaro, 2013). Therefore, companies must not only pay attention to profits, but also pay attention to their social responsibilities in their daily operations. However, people find it troublesome to accurately define corporate social responsibility (Sheehy, 2015). Carroll (1991) tried to conceptualize CSR in the form of a pyramid. The pyramid consists of four types of social responsibility, which together constitute the concept of corporate social responsibility; economics, law, ethics, and charity. Economic responsibility refers to the company's responsibility in terms of profitability (Carroll, 1991). The company should act in a manner consistent with maximizing earnings per share. The company should also maintain a high level of operating efficiency and competitiveness. In addition, a successful company should be defined as a continuously profitable company. Since this article focuses on consumer perception, economic responsibility will not be the subject of research. In addition to making profits, the company also bears legal responsibilities. We expect to conduct business in a manner that complies with laws and regulations, and it is very important to provide products and services that at least comply with legal requirements. According to Carroll (1991), a successful company is defined as a company that fulfills its legal obligations. In addition to complying with laws and regulations, the company also has expectations of members of society on the company's ethical responsibilities. Moral values ​​are usually formed before laws are enacted because they become the driving force for enacting new laws (Carroll, 1991). Therefore, ethical responsibility is to realize the emerging values ​​and norms that society expects companies to meet, even if the standards they reflect are higher than those required by law. This also means that ethical responsibility is often difficult to define or frequently disputed, which in turn makes it difficult for companies to keep up (Carroll, 1991). Finally, the company can take on charitable responsibility, which is a responsibility based on society's expectations of the company to become a good citizen (Carroll, 1991). 2.2.1 Several authors of "Doing good deeds" divided corporate social responsibility into positive organizational actions of "doing good" and "avoiding bad deeds" (for example, Lin-Hi & Blumberg, 2018; Lin-Hi & Müller 2013; Minor & Morgan 2011; Moore et al., 2001). In this department, "doing good" includes activities that are not enforced by laws and social norms, such as art funding, disaster relief donations, recruitment of ethnic minority employees, and the use of environmentally friendly technologies, similar to Carol's approach. (1991) Charity activities (Lin-Hi & Müller, 2013). By devoting part of its resources to non-social causes, companies can contribute to a better society through “doing good” (Lin-Hi & Blumberg, 2018) and become good citizens, because charitable CSR activities have been found to be beneficial to consumers. Attitudes have a positive impact on the company's evaluation (Lii & Lee, 2012). In academic discussions, the voluntary nature of corporate social responsibility has received a lot of attention (Dahlsrud, 2008). Therefore, many suggestions on corporate social responsibility are related to how they can make additional contributions to social welfare as an increase in social welfare. One way. Their social responsibility (Lin-Hi & Müller, 2013). The organizational behavior of “doing good” allows companies to take unlimited actions to increase their social responsibilities, while also allowing them to gain a competitive advantage by attracting new customers and penetrating socially responsible markets (Lin-Hi & Müller, 2013). By communicating how companies benefit society, companies can gain business benefits by positioning themselves as responsible for society (Du, Bhattacharaya, and Sen, 2010). Since “doing good” is voluntary, failure to practice should not lead to negative effects, because stakeholders do not want the company to participate in pro-social actions (Lin-Hi & Blumberg. 2018). However, other researchers have found that stakeholders have higher expectations of companies that practice “good deeds” than companies that do not practice “good deeds” (Janssen, Sen, and Bhattacharya, 2015). Therefore, companies that have a good reputation for “doing good” often suffer more in crisis than companies that do not have a reputation for “doing good” (Sohn and Lariscy, 2015). 2.2.2 "Avoiding evil" The society expects companies to "avoid evil" in addition to being good citizens who "do good." In other words, prevent irresponsible behaviors that are harmful to stakeholders and society, such as market manipulation, customer fraud, corruption, employee exploitation, human rights violations, and tax evasion (Lin-Hi & Blumberg, 2018). Do not practice "avoidance of evil." Read Less