ABSTRACT

Although research into CSR and consumer behavior is at its infant stage only, gaining insight about purchasing behavior as a result of CSR initiatives is attracting researcher interest. In this research paper effort has been employed to investigate that how consumers are considering corporations CSR initiatives at the time of deciding on their purchase decision of products and services. For measuring CSR economic and philanthropic variables have been considered from Carroll's definition and two more factors have been included as environmental and transparency. A random stratified sample of 250 respondents have been considered, the data have been collected with the help of structured questionnaire. Factor analysis has been employed to test the validity and reliability of collected data, then test of normality have been performed to make the data ready for Regression analysis in the software program SPSS. The results of the analyses were significant and in the direction hypothesized. Economic factor was found to have a stronger effect on consumer evaluations, followed by Philanthropic and environmental factor. However, the relationship between CSR initiatives and consumer behavior was significantly stronger.

Keywords: corporate social responsibility, consumer behavior, Philanthropy, Consumer buying behavior, Environment, Transparency. 1. Introduction Multinational corporations first introduced the term stakeholder in the late 1960s. Stakeholders were described as those who were in any way affected by the corporations activities. Soon thereafter, the term corporate social responsibility came into common use. The goal of corporate social responsibility (CSR) is to take responsibility for all the companys actions and to have a positive impact on its environment, communities, employees, consumers and all other stakeholders (Freeman et al., 2010). The European Commission (2011) defines CSR as the responsibility of enterprises for their impacts on society. More specifically, the responsibility of corporations includes the integration of social, environmental and ethical issues as well as human rights and consumer concerns, into their business operations and core strategy in close collaboration with their stakeholders. In research literature, CSR is defined as a business organizations configuration of principles of social responsibility, processes of social responsiveness, and policies, programs, and observable outcomes as they relate to the firms societal relationships (Wood, 1991:693).

In their opinion, the free market in that sense contributes to society by realizing this prosperity and therefore does not have any other obligations in that matter. However, on the other side of the spectrum the free market is viewed as inhibiting human freedom (e.g. through child labor) and as the root cause of economic and cultural imperialism in many developing countries. CSR is also seen as a way to attempt to be one step ahead of governmental interference, in order to avoid any kind of legislative restrictions or reprimands. Additionally, CSR is regarded as being used merely as a marketing tool, which introduces concerns about hypocrisy. As with many ethical issues, a great amount of organizations operate in the broad space in between these extremes, and the topic remains subject to continuous discussion (Friedman, 1970). One of the most important stakeholder groups is the consumer, and as Creyer and Ross (1997) confirmed; customers do indeed expect socially responsible behavior from companies. More interestingly, customers are willing to reward this behavior. It is no surprise that a steadily growing group of consumers pro-actively look for companies with sustainable products and production methods. This new type of consumer is subject to an increasing amount of research by social and economic scientists, and characterized as sophisticated and environmentally and socially conscious (Forster, 2007). Corporations that do not equip themselves with CSR activities will often be left behind with the increasing global competition and borderless markets, and international corporations with sound CSR activities grow stronger (Altman, 2007). As the education level increases, consumers are made more aware of the need for pro social corporate behaviour. A lot of work has been done in Western countries to identify an organizations behaviour regarding consumer purchasing decisions. However, not many studies have been conducted in emerging markets, such as India. CSR activities should enhance a corporation's image. This paper aims to examine the influence of perceived CSR initiatives on the buying behaviour of Indian consumers. We are interested in exploring whether consumers in India consider organisations' CSR issues before associating themselves with organisations products and services. Apart from that, this study also aims to identify the awareness level of Indian consumers towards CSR. The results of this study will also be useful for business organisations

in understanding the consumers' priority for the CSR activities that they should be engaging in, and it will contribute to the existing literature. The remainder of this paper is structured as follows. The next section will discuss the literature review. The third section will explain on the methodology used. The findings and discussion will be presented in the fourth section and will be followed by conclusions and implications in the final section. 2. Scope of the study The scope of the study has been limited to CSR initiatives of corporate and consumer buying behaviour only. The study has been confined to Dehradun city of Uttrakhand state. 3. Objectives 1. To find out the level of awareness of consumer about CSR 2. To find out the relation and influence of corporations CSR initiatives on consumer buying decisions 3. Research Methodology The study is based on empirical research design. A structured questionnaire has been designed, to know the level of awareness and impact of corporations CSR initiatives on their buying decisions. The questionnaire consists of three major sections. The first section gathers information on consumers awareness towards corporate social responsibility (CSR). This section covers some general questions to obtain the respondent's understanding of the term CSR, which indicates the ability of the respondent to complete the rest of the questionnaire. The respondents who indicated having no knowledge in CSR were not included in the data analysis. Second section covers questions on consumer buying behaviour towards CSR initiatives by the business organisations. The statements were divided into four subsections based on Carroll's pyramid of CSR and two additional factors, which include economic, philanthropic, environmental and transparency responsibilities. While third section designed to gather demographic information of the respondents such as gender, age, education level and monthly income level. Last Section were designed using nominal scales, whereas Section first and second

was designed using a five-point Likert scale ranging from "1" for "strongly disagree" to "5" for "strongly agree". Factor analysis has been performed to check the validity as well as reliability of data collected. After factor analysis normality of the data has been checked to make data usable for Regression analysis. The survey was conducted in Dehradun; responses of 250 respondents were collected. We targeted respondents who are seems to be conscious buyer and hence the sampling technique is non-probability convenience sampling. For visual representation of finding and results bar charts, pie charts and tables etc. ahs been used. Review of Literature In 2005, FleishmanHillard Research partnered with the National Consumers League (NCL) to conduct a survey among U.S. adult consumers (www.csrresults.com). Given five choices, consumers most frequently selected being socially responsible as the factor most likely to make them loyal followers of a particular brand or company. According to Boulstridge and Carrigan (2000), CSR is far from being the most dominant criteria in consumers purchasing decisions; Traditional criteria such as price, quality, and brand familiarity seem to remain the most important choice criteria. Consumers buy for personal reasons rather than for societal ones (Beckmann et al., 2001). These relatively contradictory results call for further research on this topic. Motivated, in part, by these contradictory results, additional research has found that CSR activities have a significant influence on several consumer related outcomes such as consumer product responses (Pirsch et al., 2007) and attitudes (Berens et al., 2005), as well as consumercompany identification (Sen and Bhattacharya, 2001). In a recent article, Sen et al. (2006), employed a lab experiment to demonstrate that CSR initiatives are capable of affecting stakeholders internal outcomes and behavioural intentions. Extending these results, Journal of Business Ethics (2009) 84:6578 _ Springer 2008 DOI 10.1007/s10551-008-9673-8 internal outcomes (evaluations and identification) may serve as mediators between CSR initiatives and external outcomes, especially loyalty in a consumer

company relationship context. In this set of relationships, introducing identity salience as a moderator may provide additional information to help resolve previous discrepancies. Identity salience is an important characteristic of relationship marketing success in contexts in which one party to the exchange is an individual who could receive significant social benefits from the relationship (Arnett et al., 2003). To the extent that a particular social identity is relevant to evaluating a company, making that identity more salient is likely to increase the weight that identity-relevant information is given when evaluating the company (Reed, 2004).

Analysis of data As mentioned below the sample comprises of 52.4% male and 47.6% females. This suggests that
Gender Cumulative Frequency Valid Male Female Total 131 119 250 Percent 52.4 47.6 100.0 Valid Percent 52.4 47.6 100.0 Percent 52.4 100.0

The age of the respondents is divided into five group intervals. Most of the respondents belonged to the age group from 26-33 years (30.4 %), this suggests that most of the young working generation is concerned about the corporate social responsibility activities performed by the companies and they do make an enquiry before buying their products. 26.8% of the respondents comprised of the age group interval from 18-25 years suggesting that young generation is also acquainted with concept of corporate social responsibility.

Age group intervals Cumulative Frequency Valid 18-25 26-33 34-41 42-49 67 76 61 25 Percent 26.8 30.4 24.4 10.0 Valid Percent 26.8 30.4 24.4 10.0 Percent 26.8 57.2 81.6 91.6

above 50 Total

21 250

8.4 100.0

8.4 100.0

100.0

Educational qualification Cumulative Frequency Valid 10th/Matriculation 10+2/Intermediate Graduation Post Graduation P.Hd Total 5 52 76 91 26 250 Percent 2.0 20.8 30.4 36.4 10.4 100.0 Valid Percent 2.0 20.8 30.4 36.4 10.4 100.0 Percent 2.0 22.8 53.2 89.6 100.0

Annual income Cumulative Frequency Valid 1-2 lacs 3-4 lacs 5-6 lacs 7-8 above 8 Total 15 96 76 47 16 250 Percent 6.0 38.4 30.4 18.8 6.4 100.0 Valid Percent 6.0 38.4 30.4 18.8 6.4 100.0 Percent 6.0 44.4 74.8 93.6 100.0

Model Summary Adjusted R Model 1 R .468

a

Std. Error of the Estimate

R Square .219

Square .200

1.07112

a. Predictors: (Constant), Transparency, Philanthropic, Environmental, Economic

ANOVA Model 1 Regression Residual Total Sum of Squares 53.101 189.305 242.406 df

Mean Square 4 165 169 13.275 1.147

F 11.571

Sig. .000
a

a. Predictors: (Constant), Transparency, Philanthropic, Environmental, Economic b. Dependent Variable: Consumer behaviour

Coefficients

Standardized Unstandardized Coefficients Model 1 (Constant) Economic Philanthropic Environmental Transparency B 3.492 .277 .148 -.198 .416 Std. Error .082 .081 .083 .083 .083 .235 .123 -.165 .347 Coefficients Beta t 42.469 3.412 1.786 -2.401 5.035 Sig. .000 .001 .076 .017 .000

a. Dependent Variable: Consumer behaviour

Economic

Philanthropic Corporate Social Responsibility

Environmental

Transparency

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