ISSN 1333-2422 UDK = 366.5 PRELIMINARY COMMUNICATION Corporate Social Responsibility through the eyes of consumers Tünde Csapóné Riskó1, Ádám Péntek2, Troy Wiwczaroski3 1Institute of Marketing and Commerce, Faculty of Business and Economics, University of Debrecen, 138 Böszörményi str, 4032 Debrecen, Hungary 2Institute of Applied Informatics and Logistics, Faculty of Business and Economics, University of Debrecen, 138 Böszörményi str, 4032 Debrecen, Hungary 3Institute of Economic Languages and Communication Studies, Faculty of Business and Economics, University of Debrecen, 138 Böszörményi str, 4032 Debrecen, Hungary ABSTRACT Corporate Social Responsibility (CSR) is relevant to mainstream thought on economic organisations and their places in society. The aim of this paper is to collect some of the most relevant research findings on CSR, introduce the informedness of Hungarian respondents on CSR in general, the main influencing factors of their purchasing decisions, and to find correlations between the received results and the demographic variables based on our primary research. Our results support the present practice in terms of the definition of CSR. Almost all the listed alternatives are strongly associated with CSR by the respondents. The highest average received for the “creating work places, employment” alternative indicates the importance of this activity. Regarding the different factors influencing purchasing decision, our results underline the importance of price and price value ratio. Key words: CSR, conscious consumerism, CSR actions, consumer actions INTRODUCTION responsibility (CSR), sustainable development, corporate accountability, creating shared value As a reflection of values and ethics of firms, (CSV), citizenship and social responsibility corporate social responsibility (CSR) has in and of itself. These are all terms that are received a large amount of research attention thrown about with nothing but the glue of over the last decade (Pomering and Dolnicar, disagreement about their ultimate meanings 2008), but what is meant by CSR? to hold them together. CSR is much broader It is not a good sign when an entire than philanthropy. Rather, CSR looks to change profession cannot agree on what to call itself. business operations in a way that maximizes a Here is a short list: corporate responsibility company’s benefits to society and minimizes (CR), sustainability, corporate social the risks and costs to society, all while keeping Agroeconomia Croatica 5:2015 (1) 21-31 22 Tünde Csapóné Riskó, Ádám Péntek, Troy Wiwczarosk the company focused on creating business and human values that can be captured by a brand value (Epstein-Reeves, 2011). sole focus on economic values. Due to the wide range of CSR definitions The concept and definition of CSR are in existence, a search for commonality can be not only topics of debates. Academics and potentially instructive. After examining various corporate executives have been continuously definitions, Buchholtz (1991) in Schwartz and debating the costs and benefits of CSR. It is Saiia (2012) suggests that there are five key the fundamental question: is it worth investing elements found in most definitions of CSR: in CSR; is it worth being socially responsible; • Corporations have responsibilities that what is the responsibility of companies at all? go beyond the production of goods and CSR actions of the firms influence attitudes services at a profit. of consumers. It is them that shape customers’ • These responsibilities involve helping intentions, and their intentions affect their to solve important social problems, behaviour. So, the firms’ CSR actions may especially those they have helped create. inspire consumers to change their purchasing behaviour (i.e. buy a different product), pay • Corporations have a broader constituency a premium for responsible products, or even than stockholders alone. deliberately punish those firms that fail to meet • Corporations have impacts that go their expectations (I1). Figure 1 shows a model beyond simple marketplace transactions. of socially conscious consumerism. • Corporations serve a wider range of Figure 1. A model of socially conscious consumerism Source: I1 Agroeconomia Croatica 5:2015 (1) 21-31 Corporate Social Responsibility through the eyes of consumers 23 Kim (2011) mentions that although externalities and free riders. Most importantly, academic research has addressed the growing there is often a wide chasm between what focus on CSR, previous research has suggested is good for a company and what is good for mixed results, especially regarding the general society as a whole. In her paper, Doane defines consequences of CSR on either financial the four myths of CSR. Of the four myths, the performance of an organisation or consumer one in connection with ethical consumerism is responses. Some research studies found no introduced below in more detail: associations between CSR and consumer • the market can deliver both short-term responses, but other studies noted several financial returns and long-term social positive relationships. The common thread benefits. among academic research is that still little is known as to how and when CSR initiatives • the ethical consumer will drive the work. The research of Kim (2011) attempts to change: Although there is a small market answer these related questions, such as “if there proactively rewarding ethical business, are, indeed, direct influences of CSR initiatives for most consumers, ethics are relative. In on publics ‘evaluations of an organisation fact, most surveys show that consumers and its products” and “if consume favourable are more concerned about price, taste or reactions toward CSR initiatives are industry sell-by dates than ethics. In the United specific” by examining two companies. Kingdom, ethical consumerism data show that although most consumers are The study found that when a company was concerned about environmental or social well-known to consumers, a CSR strategy was issues, with 83 percent of consumers more effective in influencing both consumer intending to act ethically on a regular corporate ability and CSR associations and, basis, only 18 percent of people act in turn, company/product evaluations. ethically occasionally, while fewer than Additionally, consumers tend to automatically 5 percent of consumers show consistent assume that a company is good at making ethical and green purchasing behaviours. reliable products when they associate it with the strong CSR. The study results also suggest • there will be a competitive “race to the that the direct influences of CSR associations top” over ethics among businesses. differ based on industry type (Kim, 2011). • in the global economy, countries will compete to have the best ethical practices. Doane (2005) writes about the market failure of CSR. One problem here is that CSR Győri (2013) adds that not only in Hungary, as a concept simplifies some rather complex but also in more developed countries, arguments and fails to acknowledge that consumers are more concerned about ultimately, trade-offs must be made between environmentally conscious, healthy products the financial health of the company and ethical or products produced in a socially responsible outcomes. Moreover, when they are made, way than can be experienced in their real profit undoubtedly wins over principles. CSR purchasing behaviours. Even in the case of strategies work under certain conditions, but cheaper “responsible” products, they prefer the they are highly vulnerable to market failures, other, “common” product. including such factors as imperfect information, Agroeconomia Croatica 5:2015 (1) 21-31 24 Tünde Csapóné Riskó, Ádám Péntek, Troy Wiwczarosk Öberseder et al. (2011) emphasize that Wang (2008) in Wang and Anderson (2011) there is an unresolved paradox concerning also found that CSR practices and purchase the role of corporate social responsibility intention were not directly related. Several (CSR) in consumer behaviour. On the one possible variables contribute to the reasons hand, consumers demand increasingly more why CSR practices do not necessarily relate to CSR information from corporations. On financial reward. On the one hand, the impact the other hand, their research indicates a of CSR on consumers may be dependent on considerable gap between consumers’ apparent individual consumers’ perceived importance interest in CSR and the limited role of CSR of CSR. For example, consumers may consider in purchase behaviour. Consumers report CSR communications as favourable public positive attitudes toward buying products relations messages when they perceive CSR as from socially responsible companies, but these an important element of business practices. positive attitudes are not transferred into actual On the other hand, most consumers depend purchase behaviour. A total of 22 individual on CSR communications for gathering interviews were conducted by them in a Western information about corporations’ CSR practices; European country in fall 2009 and spring corporations have been increasingly involved 2010. Overall, the interviewees agreed on the in various CSR practices and communications minor importance of CSR compared to other in an attempt to improve their reputations purchase criteria, such as price, quality, brand, and to promote their brands or products. As a country of origin or service. They pointed out result, CSR communications play an important that the result was in accordance with the prior role in shaping consumers’ attitudes toward