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Consumer perceptions of corporate social responsibility: the CSR halo effect

Author: Smith, Craig ; Read, Daniel ; López-Rodriguez, SofíaINSEAD Area: Faculty at Large Series: Working Paper ; 2010/16/ISIC Publisher: Fontainebleau : INSEAD Social Innovation Centre (ISIC) 2010.Language: EnglishDescription: 22 p.Type of document: INSEAD Working Paper Online Access: Click here Abstract: While the consumer is often identified as a driver of the “business case” for corporate social responsibility, little is known about the precise impact CSR has on consumers. It has been widely speculated that socially responsible behaviour will be subject to a halo effect whereby consumer awareness of one set of CSR actions (e.g., recycling) will influence their perceptions of CSR performance in other areas (e.g., eco-friendly production) about which they have little or no information. Two studies provide support for a halo effect within domain (e.g., environment) and across domains (e.g., environmental action influences perceptions of CSR performance in relation to the local community). Our research suggests that consumers may well make inferences about company CSR performance on the basis of very limited information. This has implications for company CSR strategy and for public policy where companies attempt to use the CSR halo to manipulate consumer perceptions of CSR performance.
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While the consumer is often identified as a driver of the “business case” for corporate social responsibility, little is known about the precise impact CSR has on consumers. It has been widely speculated that socially responsible behaviour will be subject to a halo effect whereby consumer awareness of one set of CSR actions (e.g., recycling) will influence their perceptions of CSR performance in other areas (e.g., eco-friendly production) about which they have little or no information. Two studies provide support for a halo effect within domain (e.g., environment) and across domains (e.g., environmental action influences perceptions of CSR performance in relation to the local community). Our research suggests that consumers may well make inferences about company CSR performance on the basis of very limited information. This has implications for company CSR strategy and for public policy where companies attempt to use the CSR halo to manipulate consumer perceptions of CSR performance.

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