Project report on Impact of Corporate Social Responsibility on    Consumer Preference for a Brand with special reference t...
Certificate from the Guide            Ramaiah Institute of Management Studies                               Bangalore - 56...
Certificate from the Dean             Ramaiah Institute of Management Studies                                 Bangalore - ...
DECLARATIONI hereby declare that this Project Report on “Impact of Corporate SocialResponsibility on Consumer Preference f...
ACKNOWLEDGEMENTAcknowledgements are due to many persons without whose cooperation, support.Encouragement and guidance, thi...
TABLE OF CONTENTSChapter                    Particulars                                              Page No.number       ...
LIST OF FIGURESSL   FIGURE                                 PARTICULARS   PAGENO   NO.                                     ...
SL.   Figure no                                           Page noNo.                Particulars20    FIG NO. 19           ...
36   FIG NO. 35                                         53                  Profit margins37   FIG NO. 36                 ...
EXECUTIVE SUMMARYThis project is mainly focused on studying the consumer preference of Classmate stationeryby analyzing an...
INTRODUCTION11
COMPANY PROFILEITC is one of Indias foremost private sector companies with a market capitalisation of nearlyUS $ 14 billio...
ITCs wholly owned Information Technology subsidiary, ITC InfoTech India Limited, isaggressively pursuing emerging opportun...
infrastructure and generate large scale direct and indirect employment. Since then ITCsHotels business has grown to occupy...
stores later expanded its range to include Wills Classic formal wear (2002) and WillsClublife evening wear (2003). ITC als...
October 2007 and Vivel De Wills & Vivel range of soaps in February and Vivel range ofshampoos in June 2008.Meaning of Name...
b.     Knowledge of image processing, printing & conversion garnered from its Packaging& Printing Business.c.     Brand Bu...
PURPOSE OF THE RESEARCHCorporate Social Responsibility is understood as the obligation of decision-makers to takeactions t...
RESEARCH METHODOLOGY      Research Design:     The descriptive research design is followed in the current research becaus...
 Sampling Plan:        Sampling unit: Consumers, Retailers        Sample size: 100 consumers, 30 retailers        Non-...
establish how things are caused. The objectives are both scientific description and prediction.If we know the form of the ...
LIMITATIONS OF THE PROJECT STUDY     Since the topic corporate social responsibility is one of the most discussed topics i...
CHAPTER 1: LITERATURE REVIEW1.1CSR DefinitionCSR is the concept of organizations promoting, participating and initiating s...
ethical behaviour by actions such as paying a higher price for a product. However, Carriganand Attalla (2001) suggest stat...
interest of consumers in the use of socially responsible technologies by companies (Doane,2001). According to MORI (2000),...
preferences‟, which refers to her propensity to internalize the effect of her own actions onothers‟ welfare. We first show...
not able to distinguish the true from the false CSR products. As a consequence, sinceproducing the former is generally mor...
and company programs for their workers (Jacoby, 1997). Little direct regulation of businessoccurred during this period.Eme...
society at large but to legitimate stakeholders: shareholders, employees, customers, suppliers,and local communities (Van ...
Berens et al., 2005; Brown & Dacin, 1997; Dacin & Brown, 2002; Sen & Bhattacharya,2001). In their germinal work, Brown and...
under which CA association and CSR association may influence consumers‟ preferences, andin some cases, their results are c...
reputations,development of closer links with customers, and greater awareness of their needs(Jones, Comfort, Hillier, & Ea...
instrument overstate the relevance of CSR issues because Likert-type scales do not give“incentives to answer questions tru...
in turn leads to corporate innovation. He believes this is essential for developing sustainableproducts and promoting sust...
In order to test conceptual ideas, empirical investigation is conducted. For this particularstudy, variables from Turker„s...
25 even suggest using the topics important to stakeholders as a tool to measure CSR such asemployee well-being and economi...
branding makes it easier for consumers to identify products, it also makes it easier to developbrand loyalty (Pride et al....
power for that company. Attractiveness is strongly affiliated with the awareness of a specificbrand.Peloza and Shang (2011...
understanding into the needs of society on behalf of the companies participating in CSR(Kitchin, 2003).Cultural perspectiv...
perspective. In terms of how, when and for which specific consumers CSR initiatives workbest, there are scarce studies (Se...
performance. With its new campaign, which sets the tagline, “What an idea” in the landscapeof rural India, it has managed ...
Responsibility work is to develop a system of Corporate Social Responsibility credits, similarto the system of carbon cred...
FINDINGSChapter 2: Analysis and findings of data collected from consumersThe findings are based on the questionnaire which...
Recall Percentage:As recall at the time plays a very important role from company‟s point of view the recallpercentage of C...
Attention towards CSR:The attention towards the CSR activities as per the responses is given in the figure4, theresponses ...
Deliberate buying of Classmate due to CSR:                      Deliberate purchase of Classmate              30          ...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand o...
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Impact of Corporate Social Responsibility on consumers' preference for a brand with special reference to Classmate brand of ITC

  1. 1. Project report on Impact of Corporate Social Responsibility on Consumer Preference for a Brand with special reference to Classmate brand of ITC By Muzamil Quadir IV SEMESTER MBA (11MB5105) Guide PROF. JULIE SUNILProject Report submitted to the University of Mysore in partial fulfilment of the requirements of IV Semester MBA degree examinations – 2013 RIMS Ramaiah Institute of Management Studies #15, New BEL Road, MSRIT Post, M S Ramaiah Nagar Bangalore – 5600541
  2. 2. Certificate from the Guide Ramaiah Institute of Management Studies Bangalore - 560054 CERTIFICATEThis is to certify that this Project Report on “Impact of Corporate SocialResponsibility on Consumer Preference for a Brand with special referenceto Classmate brand of ITC” is a bona fide study of Muzamil Quadir and carried outunder my guidance and supervision.Place: BangaloreDate: Prof. Julie Sunil2
  3. 3. Certificate from the Dean Ramaiah Institute of Management Studies Bangalore - 560054 CERTIFICATEThis is to certify that this Project Report on “Impact of Corporate SocialResponsibility on Consumer Preference for a Brand with special referenceto Classmate brand of ITC” is a bonafide study of MUZAMIL QUADIR and carriedwhile the study in the college under my guidance and supervision of Prof. Julie Sunil.Place: BangalorePlace: Dr.RejimonThomas DEAN3
  4. 4. DECLARATIONI hereby declare that this Project Report on “Impact of Corporate SocialResponsibility on Consumer Preference for a Brand with special referenceto Classmate brand of ITC” submitted in partial fulfilment of the requirement for IVSemester MBA Degree examinations 2013 of University of Mysore through RamaiahInstitute of Management Studies is my original work and not submitted to any otheruniversity. This work has been done under the supervision of Prof. Julie Sunil in RamaiahInstitute of Management Studies, Bangalore.Place: Bangalore Date: Signature of the Student Muzamil Quadir (11MB5105)4
  5. 5. ACKNOWLEDGEMENTAcknowledgements are due to many persons without whose cooperation, support.Encouragement and guidance, this dissertation would not have been carried out.I owe a great debt of gratitude to my guide Prof. Julie Sunil for her scholarly guidance,constant help and encouragement throughout the study.I also express my gratitude to the University of Mysore for providing me an opportunity todo this dissertation work.I am extremely thankful to the chairman, Department of Management, university of Mysore,Mysore for providing an opportunity to do this work for my MBA Degree.I also express my sincere thanks to Dr. M. R Pattabhiram, Director, Ramaiah Institute ofManagement studies, for providing an opportunity to do my MBA in the Institute.I also express my sincere thanks to Dr.Rejimon Thomas, Dean, Ramaiah Institute ofManagement Studies, for providing an opportunity to do my MBA in the Institute.I also express my sincere thanks to all faculty members and non- teaching staff of RamaiahInstitute of Management Studies who have supported me to do this dissertation work.I also owe my gratitude to the librarian and the staff, Ramaiah Institute of ManagementStudies for helping me to get relevant literature from time to time.I would like to express my grateful acknowledgement to those writes whose contributions arequoted in the study as well as in the bibliography.Place: BangaloreDate:5
  6. 6. TABLE OF CONTENTSChapter Particulars Page No.number Executive Summary 1 Introduction 2-12 Limitations of the research 13Ch-1 Review of literature 14-32 1.1 CSR definition 14 1.2 Ethics and CSR 14 1.3 Research on CSR relationships 25 1.4 Stakeholders and Shareholders Relationships with CSR 26 1.5 CSR and brand trust 27 1.6 initiatives of Indian companies 31 1.7 Government initiatives to promote corporate social responsibility 29 among companiesCh-2 Analysis and Findings 34-56 2.1 Chapter 2.1: Analysis and findings of data collected from consumers 41Ch-3 Chapter 3: Responses of retailers 46-56 3.1 These below are the responses by retailers on rating the ITC 52 (CLASSMATE) as supplier. 3.2: Regression Analysis 57Ch-4 Summary of findings 60Ch-5 Recommendations and suggestions 62Ch-6 Bibliography and Appendix 646
  7. 7. LIST OF FIGURESSL FIGURE PARTICULARS PAGENO NO. NO1 FIG NO. 1 Ranking of brands 342 FIG NO. 2 Recall percentage 353 FIG NO. 3 Preference of classmate 354 FIG NO. 4 Attention towards CSR 365 FIG NO. 5 Premium price 366 FIG NO. 6 Deliberately buy Classmate 377 FIG NO. 7 Recommend others 378 FIG NO. 8 Sense of fulfilment 389 FIG NO. 9 Helping our country 3910 FIG NO. 10 Giving back to society 4011 FIG NO. 11 Advertising and publicity purposes 4012 FIG NO. 12 Education for less privileged 4113 FIG NO. 13 Save environment 4114 FIG NO. 14 Public health and hygiene 4215 FIG NO. 15 Women empowerment 4216 FIG NO. 16 42 Rural development17 43 Most desired CSR18 FIG NO. 17 44 Gender19 FIG NO. 18 44 Age7
  8. 8. SL. Figure no Page noNo. Particulars20 FIG NO. 19 44 Occupation21 FIG NO. 20 45 Monthly income22 FIG NO. 21 45 Educational level23 Retailers 46 FIG NO. 22 Time of association24 FIG NO. 23 47 Familiarity with ITC products25 FIG NO. 24 47 Quality26 FIG NO. 25 48 Sales performance27 FIG NO. 26 48 Promotional schemes28 FIG NO. 27 49 Rating on the basis of monthly sales29 FIG NO. 28 50 Margins30 FIG NO. 29 50 Shelf arrangement31 FIG NO. 30 51 Services32 FIG NO. 31 51 Promotion33 FIG NO. 32 52 Feeling of change in society34 FIG NO. 33 52 Interested in offering help35 FIG NO. 34 53 Sense of responsibilitySL Table no. PageNO. Particulars number8
  9. 9. 36 FIG NO. 35 53 Profit margins37 FIG NO. 36 54 Overall performance of scheme38 FIG NO. 37 55 Stake in the scheme39 FIG NO. 38 56 Awareness among consumers40 FIG NO. 39 59 Readiness to pay TABLESSL TABLE PARTICULARS PAGENO NO NO1 Table-1 Model summary 572 Table-2 Coefficients 583 Table-3 ANOVA 589
  10. 10. EXECUTIVE SUMMARYThis project is mainly focused on studying the consumer preference of Classmate stationeryby analyzing and studying the behavior of consumers towards the CSR initiatives undertakenby companies. The other main purpose is to study the factors which are most important indetermination of a consumers‟ preference of Classmate stationery. In this project variousfactors were determined to study the preference of consumers and various quantitative toolswere used to study the same thoroughly.Since CSR has really become one of the most discussed and debated topic, the presentresearch is aimed to explain whether the CSR initiatives taken up by companies help them insecuring consumer preference keeping in view the interests of all stakeholders. Earlierresearches identified that corporate social responsibility (CSR) has had a positive impact onconsumer behavior, but even so little was known about these effects. The present researchinvestigates the relationship between CSR and consumer preference, as well as the variablesthat best represent CSR. The research also looks into the matter of charging premium pricefor products and the consumers‟ response towards the same.The study was conducted by administering two questionnaires for consumers and retailersseparately. The questionnaire for consumers was circulated online and a paper questionnairewas administered for retailers. The sampling method considered in this research is non-probabilistic sampling viz. convenience sampling and the sample size is 100 and 30 ofconsumers and retailers respectively. The respondents are from all walks of life includingstudents and employees. The data collected was first tabulated and presented in excel andthen SPSS data viewer was used to analyze it. The data was analyzed using regressionanalysis. As per the findings collected and analyzed the CSR initiatives are taken quiteseriously and positively by consumers and it does influence in shaping their preferencetowards a particular brand. Overall this study explores the linkages between CSR andconsumer preference. This study provides a foundation for further research and identifiesseveral important implications for the leaders of organizations to consider in terms of CSRinvestment and the effects on brands within their portfolio. This positive reaction shouldcreate a positive effect towards brand feelings and trust, for consumers of products andservices of companies that engage in CSR activities.10
  11. 11. INTRODUCTION11
  12. 12. COMPANY PROFILEITC is one of Indias foremost private sector companies with a market capitalisation of nearlyUS $ 14 billion and a turnover of over US $ 5 billion. ITC is rated among the Worlds BestBig Companies, Asias Fab 50 and the Worlds Most Reputable Companies by Forbesmagazine, among Indias Most Respected Companies by Business World and among IndiasMost Valuable Companies by Business Today. ITC ranks among Indias `10 Most Valuable(Company) Brands, in a study conducted by Brand Finance and published by the EconomicTimes. ITC also ranks among Asias 50 best performing companies compiled by BusinessWeek.ITC has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers,Packaging, Agri-Business, Packaged Foods & Confectionery, Information Technology,Branded Apparel, Personal Care, Stationery, Safety Matches and other FMCG products.While ITC is an outstanding market leader in its traditional businesses of Cigarettes, Hotels,Paperboards, Packaging and Agri-Exports, it is rapidly gaining market share even in itsnascent businesses of Packaged Foods & Confectionery, Branded Apparel, Personal Care andStationery.As one of Indias most valuable and respected corporations, ITC is widely perceived to bededicatedly nation-oriented. Chairman Y C Deveshwar calls this source of inspiration "acommitment beyond the market". In his own words: "ITC believes that its aspiration to createenduring value for the nation provides the motive force to sustain growing shareholder value.ITC practices this philosophy by not only driving each of its businesses towards internationalcompetitiveness but by also consciously contributing to enhancing the competitiveness of thelarger value chain of which it is a part."ITCs diversified status originates from its corporate strategy aimed at creating multipledrivers of growth anchored on its time-tested core competencies: unmatched distributionreach, superior brand-building capabilities, effective supply chain management andacknowledged service skills in hoteliering. Over time, the strategic forays into newbusinesses are expected to garner a significant share of these emerging high-growth marketsin India.ITCs Agri-Business is one of Indias largest exporters of agricultural products. ITC is one ofthe countrys biggest foreign exchange earners (US $ 3.2 billion in the last decade). TheCompanys e-Choupal initiative is enabling Indian agriculture significantly enhance itscompetitiveness by empowering Indian farmers through the power of the Internet. Thistransformational strategy, which has already become the subject matter of a case study atHarvard Business School, is expected to progressively create for ITC a huge ruraldistribution infrastructure, significantly enhancing the Companys marketing reach.12
  13. 13. ITCs wholly owned Information Technology subsidiary, ITC InfoTech India Limited, isaggressively pursuing emerging opportunities in providing end-to-end IT solutions, includinge-enabled services and business process outsourcing.ITCs production facilities and hotels have won numerous national and international awardsfor quality, productivity, safety and environment management systems. ITC was the firstcompany in India to voluntarily seek a corporate governance rating.ITC employs over 25,000 people at more than 60 locations across India. The Companycontinuously endeavours to enhance its wealth generating capabilities in a globalisingenvironment to consistently reward more than 3, 60,000 shareholders, fulfil the aspirations ofits stakeholders and meet societal expectations. This over-arching vision of the company isexpressively captured in its corporate positioning statement: "Enduring Value. For the nationFor the Shareholder."HistoryITC was incorporated on August 24, 1910 under the name of Imperial Tobacco Company ofIndia Limited. Its beginnings were humble. A leased office on Radha Bazar Lane, Kolkata,was the centre of the Companys existence. The Company celebrated its 16th birthday onAugust 24, 1926, by purchasing the plot of land situated at 37, Chowringhee, (now renamedJ.L. Nehru Road) Kolkata, for the sum of Rs 310,000. This decision of the Company washistoric in more ways than one. It was to mark the beginning of a long and eventful journeyinto Indias future. The Companys headquarter building, Virginia House, which came up onthat plot of land two years later, would go on to become one of Kolkatas most veneratedlandmarks. The Companys ownership progressively Indianised, and the name of theCompany was changed to I.T.C. Limited in 1974. In recognition of the Companys multi-business portfolio encompassing a wide range of businesses - Cigarettes & Tobacco, Hotels,Information Technology, Packaging, Paperboards & Specialty Papers, Agri-Exports, Foods,Lifestyle Retailing and Greeting Gifting & Stationery - the full stops in the Companys namewere removed effective September 18, 2001. The Company now stands rechristened ITCLimited.Though the first six decades of the Companys existence were primarily devoted to thegrowth and consolidation of the Cigarettes and Leaf Tobacco businesses, the Seventieswitnessed the beginnings of a corporate transformation that would usher in momentouschanges in the life of the Company.ITCs Packaging & Printing Business was set up in 1925 as a strategic backward integrationfor ITCs Cigarettes business. It is today Indias most sophisticated packaging house.In 1975 the Company launched its Hotels business with the acquisition of a hotel in Chennaiwhich was rechristened ITC-Welcomgroup Hotel Chola. The objective of ITCs entry intothe hotels business was rooted in the concept of creating value for the nation. ITC chose thehotels business for its potential to earn high levels of foreign exchange, create tourism13
  14. 14. infrastructure and generate large scale direct and indirect employment. Since then ITCsHotels business has grown to occupy a position of leadership, with over 100 owned andmanaged properties spread across India.In 1979, ITC entered the Paperboards business by promoting ITC Bhadrachalam PaperboardsLimited, which today has become the market leader in India. Bhadrachalam Paperboardsamalgamated with the Company effective March 13, 2002 and became a Division of theCompany, Bhadrachalam Paperboards Division. In November 2002, this division mergedwith the Companys Tribeni Tissues Division to form the Paperboards & Specialty PapersDivision. ITCs paperboards technology, productivity, quality and manufacturing processesare comparable to the best in the world. It has also made an immense contribution to thedevelopment of Sarapaka, an economically backward area in the state of Andhra Pradesh. Itis directly involved in education, environmental protection and community development. In2004, ITC acquired the paperboard manufacturing facility of BILT Industrial Packaging Co.Ltd (BIPCO), near Coimbatore, Tamil Nadu. The Kovai Unit allows ITC to improveCustomer service with reduced lead time and a wider product range.In 1985, ITC set up Surya Tobacco Co. in Nepal as an Indo-Nepal and British joint venture.Since inception, its shares have been held by ITC, British American Tobacco and variousindependent shareholders in Nepal. In August 2002, Surya Tobacco became a subsidiary ofITC Limited and its name was changed to Surya Nepal Private Limited (Surya Nepal).In 1990, ITC acquired Tribeni Tissues Limited, a Specialty paper manufacturing companyand a major supplier of tissue paper to the cigarette industry. The merged entity was namedthe Tribeni Tissues Division (TTD). To harness strategic and operational synergies, TTD wasmerged with the Bhadrachalam Paperboards Division to form the Paperboards & SpecialtyPapers Division in November 2002.Also in 1990, leveraging its agri-sourcing competency, ITC set up the Agri BusinessDivision for export of agri-commodities. The Division is today one of Indias largestexporters. ITCs unique and now widely acknowledged e-Choupal initiative began in 2000with soya farmers in Madhya Pradesh. Now it extends to 10 states covering over 4 millionfarmers. ITCs first rural mall, christened Choupal Saagar was inaugurated in August 2004at Sehore. On the rural retail front, 24 Choupal Saagars are now operatonal in the 3 states ofMadhya Pradesh, Maharashtra and Uttar Pradesh.In 2000, ITC launched a line of high quality greeting cards under the brand nameExpressions. In 2002, the product range was enlarged with the introduction of Giftwrappers, Autograph books and Slam books. In the same year, ITC also launchedExpressions Matrubhasha, a vernacular range of greeting cards in eight languages andExpressions Paperkraft, a range of premium stationery products. In 2003, the companyrolled out Classmate, a range of notebooks in the school stationery segment.ITC also entered the Lifestyle Retailing business with the Wills Sport range of internationalquality relaxed wear for men and women in 2000. The Wills Lifestyle chain of exclusive14
  15. 15. stores later expanded its range to include Wills Classic formal wear (2002) and WillsClublife evening wear (2003). ITC also initiated a foray into the popular segment with itsmens wear brand, John Players, in 2002. In 2006, Wills Lifestyle became title partner of thecountrys most premier fashion event - Wills Lifestyle India Fashion Week - that has gainedrecognition from buyers and retailers as the single largest B-2-B platform for the FashionDesign industry. To mark the occasion, ITC launched a special Celebration Series, takingthe event forward to consumers. In 2007, the Company introduced Miss Players- a fashionbrand in the popular segment for the young woman.In 2000, ITC spun off its information technology business into a wholly owned subsidiary,ITC Infotech India Limited, to more aggressively pursue emerging opportunities in this area.Today ITC Infotech is one of India‟s fastest growing global IT and IT-enabled servicescompanies and has established itself as a key player in offshore outsourcing, providingoutsourced IT solutions and services to leading global customers across key focus verticals -Manufacturing, BFSI (Banking, Financial Services & Insurance), CPG&R (ConsumerPackaged Goods & Retail), THT (Travel, Hospitality and Transportation) and Media &Entertainment.ITCs foray into the Foods business is an outstanding example of successfully blendingmultiple internal competencies to create a new driver of business growth. It began in August2001 with the introduction of Kitchens of India ready-to-eat Indian gourmet dishes. In 2002,ITC entered the confectionery and staples segments with the launch of the brands mint-o andCandyman confectionery and Aashirvaad atta (wheat flour). 2003 witnessed the introductionof Sunfeast as the Company entered the biscuits segment. ITCs entered the fast growingbranded snacks category with Bingo! in 2007. In just seven years, the Foods business hasgrown to a significant size with over 200 differentiated products under six distinctive brands,with an enviable distribution reach, a rapidly growing market share and a solid marketstanding.In 2002, ITCs philosophy of contributing to enhancing the competitiveness of the entirevalue chain found yet another expression in the Safety Matches initiative. ITC now marketspopular safety matches brands like iKno, Mangaldeep, Aim, Aim Mega and Aim Metro.ITCs foray into the marketing of Agarbattis (incense sticks) in 2003 marked themanifestation of its partnership with the cottage sector. ITCs popular agarbattis brandsinclude Spriha and Mangaldeep across a range of fragrances like Rose, Jasmine, Bouquet,Sandalwood, Madhur, Sambrani and Nagchampa. ITC introduced Essenza Di Wills, anexclusive range of fine fragrances and bath & body care products for men and women in July2005. Inizio, the signature range under Essenza Di Wills provides a comprehensive groomingregimen with distinct lines for men (Inizio Homme) and women (Inizio Femme). Continuingwith its tradition of bringing world class products to Indian consumers the Companylaunched Fiama Di Wills, a premium range of Shampoos, Shower Gels and Soaps inSeptember, October and December 2007 respectively. The Company also launched theSuperia range of Soaps and Shampoos in the mass-market segment at select markets in15
  16. 16. October 2007 and Vivel De Wills & Vivel range of soaps in February and Vivel range ofshampoos in June 2008.Meaning of NameITC stands for “Imperial Tobacco Company” initially when it was incorporated for the 1sttime in 1924. Later on the name has been changed to “Indian Tobacco Limited” in 1974.After that, in recognition of the Companys multi-business portfolio encompassing a widerange of businesses - Cigarettes & Tobacco, Hotels, Information Technology, Packaging,Paperboards & Specialty Papers, Agri-Exports, Foods, Lifestyle Retailing and GreetingGifting & Stationery - the full stops in the Companys name were removed effectiveSeptember 18, 2001. The Company now stands rechristened ITC Limited. There is nospecific meaning of ITC name is given on their website. But what I think is that it is the namegiven to the company to signify the operation of the company. Since ITC started its businessin tobacco industry, they have chosen the name to demonstrate their nature of business andwhat exactly what they want to perform.Evolution of NameITC was incorporated on August 24, 1910 under the name of Imperial Tobacco Company ofIndia Limited. ITC had a humble beginning and in the initial days it used to operate from aleased office on Radha Bazar Lane, Kolkata. On its 16th birthday on August 24, 1926, ITCpurchased the plot of land situated at 37, Chowringhee, (now renamed J.L. Nehru Road)Kolkata. Two years later companys headquarter building, Virginia House came on that plot.Progressively the ownership of the company Indianised, and the name of the Company waschanged to I.T.C. Limited in 1974. In recognition of the Companys multi-business portfolioencompassing a wide range of businesses, the full stops in the Companys name wereremoved effective September 18, 2001 and the Company was rechristened as ITC Limited.Since the present research is based on the educational and stationery offering the profile ofthe same is given as below:Education & Stationary products• ITC made its entry into the stationery business in the year 2002 with its premiumrange of notebooks, followed in the year 2003 with the more popular range to augment itsoffering.• Today, ITC continues to blend its core capabilities to market a growing range ofeducation and stationery products. These capabilities include,a. Manufacturer of India‟s first Ozone treated environment friendly Elemental ChlorineFree (ECF) pulp, paper and paperboard.16
  17. 17. b. Knowledge of image processing, printing & conversion garnered from its Packaging& Printing Business.c. Brand Building & Trade Marketing & Distribution strengths resident in its FMCGBusiness.• ITC‟s stationery Brands are marketed as “Classmate” and “Paperkraft”, withClassmate addressing the needs of students and Paperkraft targeted towards college studentsand executives.• Classmate - India‟s truly largest National brand, reaching 65,000 outlets across thecountry, has over 300 variants in its range which comprises notebooks, long books, practicalbooks, drawing books, scrap books, reminder pads etc.• The Classmate Fun N Learn range of children books targeting pre school learners,comprising categories like Pre School Learner, Active Minds and Read Aloud Tales withfeatures like Wipe n Use again, Trace & Color and Puzzles ensure that a childs first lessonsare truly enjoyable.• Classmate Invento Geometry Boxes, launched for school students comprise a world-class precision compass and high quality plastic instruments coupled with interesting triviaand useful information, to make geometry more fascinating for students.• Aesthetically designed, Classmate pens offer the consumer a smoother and morecomfortable writing experience through use of ergonomic design, reducing the effort requiredfor writing. The initial launch comprises ball pens - Classmate Safari and Classmate Ilet - andgel pens - Classmate Glider and Classmate Octane.• A new entry to the Classmate portfolio is its range of HB Jet Black pencils. Designedattractively for school kids, the pencils offer a unique advantage of lesser lead wear out andthus, “Stay Sharper for Longer”.• The Classmate Notebook range builds in regional preferences and caters to therequirements of All India & State Education Boards. Every Classmate notebook carries ITCsCorporate Social Responsibility message on its back. For every four Classmate Notebooks,ITC contributes Re. 1 to its rural development initiative that supports, among other projects,primary education in villages.• Classmate has successfully run the “Classmate Young Author & Artist Contest” for 5years. The contest is a national level event going across 34 cities and getting participationfrom 5000 schools.• The Paperkraft brand recently launched premium business paper – an environmentfriendly multipurpose paper for office and home use. The paper has been crafted by ITC‟sBhadrachalam unit using a pioneering technology, called “Ozone Treated Elemental Chlorine17
  18. 18. PURPOSE OF THE RESEARCHCorporate Social Responsibility is understood as the obligation of decision-makers to takeactions that protect and improve the welfare of society as a whole along with their owninterests. Every decision the business person makes and every action he or she contemplateshas social and business implications. It is debatable whether the CSR initiatives really help toachieve the company goals. It has become a very common practice for the companies. Inmost cases, CSR activities aim at reducing negative externalities, such as pollutant emissionsor the variability of farmers income. In some cases, positive externalities are produced, as inthe financing of technological transfers to local farming communities, or school building.CSR has increasingly become an important concept in public policies, corporatecommunication and management sciences, which have used various conceptual framework toexamine consumer demand for CSR (see, inter alia, Carrigan and Attalla, 2001; Mohr et al.,2001; Sen and Bhattacharya, 2001; Chatzidakis et al., 2007; Valor, 2008). Consumersresponses to CSR have been less carefully analysed in economics, perhaps because there iswide gap between positive attitudes toward social responsibility and actual purchasebehaviours. Opinion surveys reveal that there is a growing interest of consumers in the use ofsocially responsible technologies by companies (Doane, 2001). According to MORI (2000),70 per cent of European consumers declare that they are willing to pay more for a product. AIMIs CSR a fruitful activity keeping in view the interests of all stakeholders especially in andhow it benefits the ultimate owner? OBJECTIVESTo study the methods by which companies communicate their CSR to the public and howwell does that help in the consumers‟ recall of the brand at the time of purchase. RESEARCH QUESTIONSDo the CSR initiatives and efforts taken by companies translate into the preference of thebrand over the other brands not doing CSR?18
  19. 19. RESEARCH METHODOLOGY  Research Design: The descriptive research design is followed in the current research because the study aims to study the relationship of CSR and consumer behaviour in preference of a particular brand. Descriptive research, also known as statistical research, describes data and characteristics about the population or phenomenon being studied. However, it does not answer questions about e.g.: how/when/why the characteristics occurred, which is done under analytic research. Although the data description is factual, accurate and systematic, the research cannot describe what caused a situation. Thus, Descriptive research cannot be used to create a causal relationship, where one variable affects another. In other words, descriptive research can be said to have a low requirement for internal validity. The description is used for frequencies, averages and other statistical calculations. Often the best approach, prior to writing descriptive research, is to conduct a survey investigation. Qualitative research often has the aim of description and researchers may follow-up with examinations of why the observations exist and what the implications of the findings are.  Hypotheses • H0: There is no relationship between the CSR and consumer preference • H1: There exists a positive relationship between the CSR and consumer preference. • H0: There is no relationship between the CSR and the willingness to pay a premium price. • H1: There exists a positive relationship between CSR and the willingness to pay a premium price19
  20. 20.  Sampling Plan:  Sampling unit: Consumers, Retailers  Sample size: 100 consumers, 30 retailers  Non-probabilistic sampling i.e.; convenience samplingSampling is the use of a subset of the population to represent the whole population.Probability sampling, or random sampling, is a sampling technique in which the probabilityof getting any particular sample may be calculated. Nonprobability sampling does not meetthis criterion and should be used with caution. Nonprobability sampling techniques cannot beused to infer from the sample to the general population. Any generalizations obtained from anonprobability sample must be filtered through ones knowledge of the topic being studied.Performing nonprobability sampling can be considerably less expensive than doingprobability sampling. However, the results of studies conducted using nonprobabilitysampling are of extremely limited value.Convenience, Haphazard or Accidental sampling - members of the population are chosenbased on their relative ease of access. To sample friends, co-workers, or shoppers at a singlemall, are all examples of convenience sampling. Such samples are biased because researchersmay unconsciously approach some kinds of respondents and avoid others (Lucas 2012), andrespondents who volunteer for a study may differ in unknown but important ways fromothers  Data collection: Primary Data: This research has been conducted by administering two structured questionnaires online as well as offline for retailers and consumers separately. A total of more than 130 questionnaires were distributed. There were separate questionnaires for consumers and retailers; the consumers‟ questionnaire was circulated online through websites like Facebook, Gmail and Linked In and the questionnaire for retailers was directly filled in person, total of 30 questionnaires were circulated among retailers.Data Analysis: SPSS and MS ExcelRegression analysis: A body of statistical techniques in which the form of the relationshipbetween a dependent variable and one or more independent variables is established so thatknowledge of the values of the independent variables enables prediction of the value of thedependent variable or likelihood of the occurrence of an event if the dependent variable iscategorical. Regression analysis is a method by which quantitative social science seeks to20
  21. 21. establish how things are caused. The objectives are both scientific description and prediction.If we know the form of the relationship between things we have measured and know to becausal to something else, then we can predict the value of the caused thing.The dependent variable in this research is Consumer preference and independent variablesare many which affect the consumer preference of consumers.21
  22. 22. LIMITATIONS OF THE PROJECT STUDY Since the topic corporate social responsibility is one of the most discussed topics in the modern day business, it has drawn attention from all the stakeholders including consumers. Consumers are also building consciousness towards the same. Since the present research has been conducted to study the topic impact of CSR on the consumer preference though the research has been conducted quite rigorously but still like the rule says every research has some limitations to which a researcher can‟t attend to due to the inherent limitations in the research process. The present research suffers from following limitations:  Small sample size: The sample size of the present research is 100 which is quite small keeping in view the scope of Corporate Social Responsibility and its impact on the society, it would have been prudential to involve the beneficiaries of the scheme but due to constraints of time and finance it was subject to confinement.  Composition of sample: The sample is composed of good number of educated people who are quite conscious of the positive or negative measures of the companies. In addition to that almost none of the minor students has found a place in sample which also would have been quite useful in understanding the behavior of children towards the scheme, because they are also the direct customers of the Classmate products.  Method of sampling: Convenience sampling though quite useful but suffers from many limitations that limit the equal chance of every individual being selected in the sample. Since the sampling frame is not known, and the sample is not chosen at random, the inherent bias in convenience sampling arises that the sample is unlikely to be representative of the population being studied. This undermines our ability to make generalizations from the sample to the population we are studying.  CSR being a social initiative, it is supported by every individual on paper: The bias arises from the human nature which is people tend to support causes on paper but when action is to be taken only a few prove to be pragmatic.  Online data collection: Though the online data collection is convenient and cost effective method, it limits the interaction of respondents with the enumerator.22
  23. 23. CHAPTER 1: LITERATURE REVIEW1.1CSR DefinitionCSR is the concept of organizations promoting, participating and initiating social programsin order to address an issue or concern in the wider community. A broad definition, includingmultiple dimensions such as philanthropy and stakeholders, is favoured by academics (DeLos Salmones et al., 2005; Godfrey & Hatch, 2006; Piercy & Lane, 2009). The definition ofCSR has developed over time from the 1950s to the present. Literature from the 1980sonwards presents fewer set definitions and further research into CSR (Carroll, 1999).1.2Ethics and CSREthical decision making in leadership and in regards to the environment is an important partof CSR. Agatiello (2009) states ethics is made up of role, responsibilities and interactionsbetween people. However, the foundations of each of these principles are different dependingon the practice and the person (Frederiksen, 2010). Sharp and Zaidman (2009) suggest thatCSR decisions can be divided into two groups, from an ethical and moral basis or from abusiness orientation. Although, Quairel-Lanoizele´e (2011) propose demand for „virtue‟ isweak in the business world but the expectation for ethical and responsible company behavioris still strong.Agatiello (2009) advise there needs to be a rigid structure for making ethical decisions forenvironmental strategy. Similarly, Sharp and Zaidman (2009) conclude that CSR decisionsneed to be governed by strict rules. Ethical decisions are now valued as major responsibilitiesfor corporations and these corporations have a duty to environmental conservation.Frederiksen (2010) discussed the moral frameworks for ethical decisions and concluded thatutilitarianism would dictate the best CSR action; this creates the most happiness for majorityof stakeholders. Bansel and Roth (2000) support the idea of involving stakeholders inimportant decisions. Duarte (2010) concludes the creation of an organizational identity thatsupports ethical decision making can help mould a culture that supports CSR activities byhighlighting sustainability, environment, ethics and transparency.Creyer and Ross (1997) advocate that the behaviours a company engages in can affect theway the consumer views a product, consumers may even be more willing to reward good23
  24. 24. ethical behaviour by actions such as paying a higher price for a product. However, Carriganand Attalla (2001) suggest stating ethical firm behaviour will be rewarded with purchaseintention is neither straightforward nor simple.Creyer and Ross (1997) discovered if consumers perceive no difference between companiesoffering a similar product, it may be the marketing manager promoting the ethics of the firmthat sways the purchase decision. CSR by definition is an ethical behaviour, but the actualdefinitions of „ethical and unethical‟ need to be determined. Carrigan and Attalla (2001)suggest consumers are more informed in this modern age and may have less sympathy withcauses they feel they can not relate to. However, Ardvisson (2010) discovered businessesfundamentally engage in CSR activities and communication to avoid negative impacts ratherthan proactively wanting to help society. The reactive response directly influences corporatereputation and brand building.CSR has increasingly become an important concept in public policies, corporatecommunication and management sciences, which have used various conceptual framework toexamine consumer demand for CSR (see, inter alia, The spectrum of activities covered byCSR is likely to be large, as social responsibility requires that attention be paid to manystakeholders, including the company‟s stock holders, its suppliers, its employees, itscustomers, and all individuals and communities that may be affected by its decisions. This isreminiscent of considerations of externalities associated to private actions in publiceconomics. In most cases, CSR activities aim at reducing negative externalities, such aspollutant emissions or the variability of farmers income. In some cases, positive externalitiesare produced, as in the financing of technological transfers to local farming communities, orschool building. Hence, from a neo-classical point of view, favouring the development ofCSR has three key advantages. It may help to solve some market imperfections, such as theexternalities generated by market activities. It may increase the local provision of publicgoods in an efficient, decentralized, manner. A priori, state intervention is kept at aminimum, and so are market distortions.Carrigan and Attalla, 2001; Mohr et al., 2001; Sen and Bhattacharya, 2001; Chatzidakis etal., 2007; Valor, 2008). Consumers responses to CSR have been less carefully analyzed ineconomics, perhaps because there is wide gap between positive attitudes toward socialresponsibility and actual purchase behaviors. Opinion surveys reveal that there is a growing24
  25. 25. interest of consumers in the use of socially responsible technologies by companies (Doane,2001). According to MORI (2000), 70 per cent of European consumers declare that they arewilling to pay more for a product which they perceive as ethically superior and 66 per centdeclare that a CSR claim has triggered a purchase at least once in the past year. From theeconomist‟s point of view, „CSR products‟ are both private goods and public goods. Theirconsumption produces some private hedonic benefits, but consumers can also derive utilityfrom knowing that the firm is committed to care for the well-being of their suppliers and theiremployees or for the environment, i.e., that it produces some public good alongside theproduct supply chain ( Hines and Ames, 2000). Yet, market shares remain quite low: Frenchconsumers and U.S. consumers spent only 1.71 Euro and 1.14 Euros respectively per year onpurchases of fair-trade products in 2005, as against 19.02 Euros for the Swiss or 4.62 Eurosfor the British (Poret, 2007). It complements marketing- and psychology-based insights intothis question, by focusing on the two main economic barriers to CSR consumption: (i) theconsumers‟ subjective valuation of CSR, and (ii) the information asymmetry betweencompanies and consumers. Understanding and breaking down these barriers is a key issue,because companies‟ involvement into social responsibility is partly determined by theprospect of not losing profits or expanding market opportunities.In this perspective, we show that the development of CSR may be favored by appropriateconsumer policies. From the economist‟s point of view, „CSR products‟ are both privategoods and public goods. Their consumption produces some private hedonic benefits, butconsumers can also derive utility from knowing that the firm is committed to care for thewell-being of their suppliers and their employees or for the environment, i.e., that it producessome public good alongside the product supply chain ( Besley and Ghatak, 2007). Whetherthe consumption of CSR products leads to additional welfare gains for consumers, ascompared to standard products, depends on two conditions. First, consumers must grant somevalue to the public good aspect of their purchase. Second, they must be well informed aboutthe quantity of public good that has been incorporated into the product during the productionprocess.The decision to purchase a CSR product is primarily determined by the consumerswillingness-to-pay (WTP) for CSR. The WTP is a monetary measure of his/her preferencefor this product attribute. It depends on two parameters of her utility function: the marginalutility of income and the marginal utility of CSR. The latter is determined by her „social25
  26. 26. preferences‟, which refers to her propensity to internalize the effect of her own actions onothers‟ welfare. We first show how social preferences are revealed by economic experimentsusing actual monetary incentives. This literature suggests a first explanation for the attitude-behaviour gap: most (if not all) measures of attitudes toward ethical consumption are notincentive compatible. We then trace social preferences back to three important motives:altruism, self-image and social image. Self-image concerns are important for thoseindividuals Self-image concerns are important for those individuals who want to reassurethemselves that they are good people by contributing to the provision of public good. Socialimage concerns may also drive the choice of CSR products, when their consumption is ameans of buying social prestige or of avoiding social stigma (Bénabou and Tirole, 2010). Wepresent empirical evidence that, in addition to pure altruism and self-image, social-imageconcerns strongly affect individuals‟ generosity, which should be more intensively used inthe private and social marketing of ethical products. Last, following the recent advances inthe economics of personality psychology, we relate social preferences to some personalitytraits. For psychologists, personality traits are "relatively enduring patterns of thoughts,feelings, and behaviours that reflect the tendency to respond in certain ways under certaincircumstances" (Roberts cited in Almlund et al., 2011). Interestingly, some traits have beenlinked to the individual propensity to donate to charities or to engage in social activities. Aspersonality traits have been shown to be sensitive to interventions, especially during earlychildhood, education is a means of favouring the consumption of ethical products (Borghanset al., 2008). However, well-developed social preferences will not translate into actualpurchase decisions for consumers with a high marginal utility of income, i.e. for the lesswell-off, as the latter reduces their WTP.In addition, a high WTP for CSR products will lead to a purchase only if consumers haveaccurate information about who has made the product, and how it has been made. That theproduction process followed socially responsible procedures is largely a credence attribute:its presence cannot be verified by a careful and low-cost pre-purchase inspection, as it wouldbe the case for a „search attribute‟, or by the repetition of consumption experiences. Thisraises problems of information asymmetry between consumers and firms, and the latter arelikely to develop strategic behaviors on the supply side of the market. Since consumers withwell-developed social preferences are often willing to pay more for a CSR product,unsubstantiated claims may proliferate and cause adverse selection, whereby consumers are26
  27. 27. not able to distinguish the true from the false CSR products. As a consequence, sinceproducing the former is generally more expensive, the true CSR products will be selected outof the market (as in the market for „lemons‟ described by Akerlof, 1970). Labeling is anatural solution to adverse selection. A key distinction between simple communication (theso-called „green washing‟) and labeling is that the latter requires a reputable certificationagent whom consumers can trust (Caswell and Mojduszka, 1996). Labels transform credenceattributes into search attributes. They favor the emergence of a separating marketequilibrium, whereby consumers with social preferences are matched with CSR-firms, andconsumers without social preferences are matched with non-CSR firms. Although theliterature on labels is mainly theoretical, we present some recent empirical results fromlaboratory experiments that evaluate the effect of labels on consumers under different labelregulation rules. Last, we point several limits to the use of labels, which essentially relate tobiases in the consumers‟ perception and treatment of information. This suggests that theproliferation of labels should be avoided, and that labels should be unified and carefullyregulated by public authorities The reminder of the paper is organized as follows. Section 2focuses on consumers‟ social preferences. Section 3 analyzes the information issue, and therole of labels. Section 4 concludes on the role of consumer policies in the development ofCSR.The objective of reviewing germinal works on CSR, CA, and CnSR is to obtain a deep andbroad understanding of the concepts and their relationships. The following sections include aliterature review related to the independent variables and then the dependent variable.Independent Variable: Corporate Social ResponsibilityIn its evolution, the concept of CSR passed through several stages. Starting with thechronological classification developed by Schwalb and García (2003) and integrating newconcepts from the literature, it is possible to identify the following stages: germinal,emergent, development, and generalization and audit.Germinal stage.The germinal stage started during the last decades of the 19th century, and anentrepreneurial spirit and the laissez-faire philosophy characterized this stage. During thisstage, the terms corporate philanthropy and welfare capitalism emerged. This last conceptbecame the name of the system in which companies provided extensive community facilities27
  28. 28. and company programs for their workers (Jacoby, 1997). Little direct regulation of businessoccurred during this period.Emergent stage. The second stage began with the Great Depression and a focus onmanagerial values and principles. This was a normative and ethical philosophical period. Theemergence of the formal concept of corporate social responsibility (CSR1) characterized thisstage. Bowen (1953) defined CSR as comprising “the obligations of businessmen to pursuethose policies, to make those decisions, or to follow those lines of action which are desirablein terms of the objectives and values of our society” (as cited in Wolff & Barth, 2005, p. 6).Bowen clearly emphasized the ethical considerations over the economic ones.Development stage. This stage started in the 1960s. The attention shifted away fromtheorizing about what was good for society to analysing which demands on business societyput forward. The focus was the processes that ensure the capacity of a firm to respond to itsenvironment. This stage had an action-oriented managerial inclination. Social activism andthe rise of consumerism; increasing public awareness of environmental and ethical issues;and increasing pressure from environmentalists, consumer advocates, feminists, youngpeople, and civil rights movements characterized this period. During this stage and in the late1970s, Carroll (1979), working on the founding concept of Bowen (1953), developed a morestructured analysis and formulated a four-part definition of CSR, suggesting that companieshave four responsibilities: economic, legal, ethical, and philanthropic (or altruistic orhumanitarian). Between 1970 and 1990 and parallel to the development of CSR, otherconcepts began to appear, often tied to environmental subjects such as sustainabledevelopment and sustainability. The emergence and evolution of the principles of sustainabledevelopment have had an important impact on the concept of CSR, resulting in twosignificant contributions to the construct: incorporating the environmental variable as one ofthe main social expectations to be covered and considering sustainability. Essentially,organizations must satisfy not only the expectations of current society but also those of futuregenerations. Moreover, the environmental concern caused CSR to shift away from thetheoretical and philosophical level, to a more concrete and practical dimension, the urgentnecessity for the firm to respond to its environment.Generalization and audit stage. Between the 1980s and 1990s, the stakeholder theorycontributed significantly to the development of CSR. This theory proposes that a firm is anexus of contracts between stakeholders and that the responsibility of a business is not to28
  29. 29. society at large but to legitimate stakeholders: shareholders, employees, customers, suppliers,and local communities (Van der Putten, 2005). The impact of the environmental andsustainability discourse initiated in the previous stage and the proposal of concepts, such asthe triple bottom line (Elkington, 1999), developed the CSR concept to include the threedimensions of sustainability: social, ecological, and economic bottom line. Despite its longhistory, the evolution of the concept, and the increasing importance of CSR worldwide, auniversally accepted definition of CSR does not exist. Different terms in the literaturedescribe the phenomena related to corporate responsibility in society: corporate socialresponsibility, corporate citizenship, corporate philanthropy, corporate giving, corporatecommunity involvement, community relations, community affairs, community development,global citizenship, corporate societal marketing, society and business, social issuesmanagement, public policy and business, stakeholder management, corporate accountability,and corporate sustainability (Garriga & Melé, 2004; Kotler & Lee, 2005). The criteria ofCSR may change between generations and cultures and will be different in Europe (welfaresociety) and the United States than in developing countries. Previous research indicates thatthese differences exist because of differences in culture, economic development, legal andpolitical environment, organizational ethical climate, and gender (Juholin, 2004; Lines, 2003;Papasolomou-Doukakis et al., 2005; Singhapakdi & Karande, 2001). The followingcomprehensive definition for use in the proposed research borrows and integrates elementsfrom these different areas and approaches: CSR involves running a business with an action-oriented managerial strategy under a comprehensive set of policies, practices, and programsintegrated throughout the business operations. Decision making includes a voluntarycommitment to contribute to sustainable development by making decisions that fairly balancethe claims of all key stakeholders, shareholders, employees, customers, suppliers, and localcommunities. These decisions should maximize the positive impact and minimize thenegative effects of the business, while maintaining concern for society‟s long-term needs inways that address or exceed the ethical, legal, environmental, commercial, and other wants orexpectations of society, with consumers trying to be accountable to society for performanceby explaining, justifying, or reporting on their actions.Independent Variable: Corporate Ability A number of researchers have investigated thedegree to which consumers‟ associations regarding a company influence them (Berens, 2004;29
  30. 30. Berens et al., 2005; Brown & Dacin, 1997; Dacin & Brown, 2002; Sen & Bhattacharya,2001). In their germinal work, Brown and Dacin (1997) defined corporate associations as “ageneric label for all the information about a company that a person holds” (p. 69). Corporateassociations include the following: Perceptions, inferences, and beliefs about a company: aperson‟s knowledge of his or her behaviors with respect to the company; information aboutthe company‟s prior actions; moods and emotions experienced by the person with respect tothe company; and overall and specific evaluations of the company and its perceivedattributes. (p. 69) Furthermore, Berens (2004) defined corporate associations as “aheterogeneous set of perceptions, which may relate to a wide variety of aspects of acompany” (p. 17). Berens et al. (2005) remarked that perceptions of individual people, ratherthan groups of people, define corporate associations. In addition, corporate associations areregarded as a set of perceptions, which may or may not be related to one another, rather thanas a holistic picture, and as Brown (1998) pointed out, corporate associations are aheterogeneous set of perceptions, which may be related to a wide variety of aspects of acompany. Berens and Van Riel (2004), after developing an overview of the studies oncorporate associations of the last five decades, established three main typologies of corporateassociations. They include “(1) the different social expectations that people have regarding acompany, (2) the different personality traits that people attribute to a company, and (3) thedifferent reasons they have to trust or not to trust a company” (p. 174). Berens (2004) statedthat in terms of the social role typology, two specific types of corporate associations exist:corporate ability (CA) and CSR associations. In their germinal work, Brown and Dacin(1997) introduced and studied these two types of corporate associations as a way to explainthe inconsistent results observed in previous studies under the rubric of corporate image.They demonstrated that “what consumers know about a company can influence theirevaluations of products introduced by the company” (p. 68) and that “different types ofcorporate associations (i.e. CA and CSR) can have important” (p. 68) but different influenceson company and product evaluations. The authors provided participants either with extensiveattribute information about new products or information about corporate associations andmeasured the associations. They found that CA “may have a greater impact on both specificproduct attribute perceptions and the overall corporate evaluation than a reputation for socialresponsibility” (p. 80). However, they also observed that CSR has a positive influence onconsumer response to new products. Researchers have begun investigating the conditions30
  31. 31. under which CA association and CSR association may influence consumers‟ preferences, andin some cases, their results are contradictory. Sen and Bhattacharya (2001) found that theCSR issues addressed by the company, “the quality of its products,” “the consumers‟personal support for the CSR issues,” “their general beliefs about CSR,” and “the consumers‟perceptions of congruence between their own characters and that of the company in theirreactions to its CSR initiatives” (p. 225) moderated the effect of CSR on product preferences.Moreover, they found that consumers are more sensitive to negative CSR than positive CSRand that the consumers‟ perceptions of the tradeoffs between CSR and CA efforts play asignificant role in their final response. Berens (2004) found that the effect of CA associationand CSR association on product evaluations and purchase intentions is different dependingon the accessibility of the associations, their diagnostic value, and the corporate brandstrategy that a company uses. The experimental results of Mohr and Webb (2005) indicatedthat CSR had an important and positive influence on company evaluation and purchaseintent. Their results showed that American consumers “reacted more strongly to negativethan to positive CSR” (p. 139) and that a “low price did not appear to compensate for a lowlevel of social responsibility” (p. 142). According to Berens et al. (2005), academicresearchers, on the influence of corporate associations in consumer response, “have foundthat associations with a company‟s corporate ability (CA) and its corporate socialresponsibility (CSR) both influence product evaluations but that CA associations have astronger effect than CSR associations” (p. 35). In contrast, Marin and Ruiz (2007)demonstrated that the contribution of CSR is stronger than CA. The authors suggested thatthe increasing competition and the decreasing CA-based variation in the marketplace may beresponsible for this result. Moreover, they claimed that “CA may have become a base linebelow which companies face great difficulties to stay in the market, and above whichcompanies benefit from competitive advantage in the form of associations obtained from theundertaken CSR activities” (p. 255).Dependent Variable: Consumer Social ResponsibilityA growing body of academic researchsupports this new corporate global approach. Researchers claim that the business case ofCSR includes improved financial performance, reduced operating costs, long-termsustainability of the company, increased staff commitment and involvement, long-term returnon investments, enhanced capacity to innovate, enhanced brand value and31
  32. 32. reputations,development of closer links with customers, and greater awareness of their needs(Jones, Comfort, Hillier, & Eastwood, 2005). Researchers have investigated the interfacebetween CSR and the customer broadly, and as the literature shows, this is a truly complexmatter. Many surveys developed at an international level suggest that a positive relationshipexists between a company‟s CSR actions and consumers‟ reaction to that company and itsproduct (Bhattacharya & Sen, 2004; Sen & Bhattacharya, 2001). A growing body ofacademic research corroborates and attests to the generally positive influence of CSR onconsumers‟ company evaluations and product purchaseintentions (Brown & Dacin, 1997; Carrigan et al., 2004; Creyer & Ross, 1997; Maignan,2001; Schroeder & McEachern, 2005; Uusitalo & Oksanen, 2004). This kind of consumerismmainly incorporates environmental issues but also extends to animal welfare, human rights,and labor working conditions in the third world (Tallontire et al., 2001). The links toconsumers‟ positive product and brand valuations, brand choice, and brand recommendationsdocumented the relationship between CSR and consumer attitudes. As a result of the broadliterature, Devinney, Auger, et al. (2006) proposed a new concept highlighting the importantrole that CSR plays in consumer behaviour, consumer social responsibility (CnSR: “Theconscious and deliberate choice to make certain consumption choices based on personal andmoral beliefs” (p. 32). This concept has ethical and consumerism components, which canappear as an “expressed activity in terms of purchasing or no purchasing behaviour; and asan expressed opinion in surveys or other forms of market research” (p. 32). Conversely,recent investigations demonstrate that the relationship between CSR and ethical consumerismis not always direct and evident. The results are in many cases contradictory and establishnumerous factors that affect whether a firm‟s CSR activities translate into consumerpurchase. They include trade-offs with traditional criteria like price, quality, and convenienceand lack of information (Mohr et al., 2001); corporate brand dominance (Berens et al., 2005);and the type of CSR, quality of products, consumers‟ personal support for the CSR issues,and their general beliefs about CSR (Sen & Bhattacharya, 2001). There seems to be acontradiction between what the international polls and surveys established in terms ofintentions to buy products with CSR features and the real purchasing of them (Devinney,Auger et al., 2006). Auger et al. (2003) explained that the differences occurred because in theformer studies, researchers used surveys to rank the importance of some CSR issues, withoutany trade-off between traditional features and CSR product features. These types of32
  33. 33. instrument overstate the relevance of CSR issues because Likert-type scales do not give“incentives to answer questions truthfully” (Auger & Devinney, 2005, p. 2) and because“respondents may want to edit their private judgment before they report it to the researcher,due to reasons of social desirability and self-presentations” (p. 6). Hence, “these surveys mayoverstate the importance of social features, since there are clearly more socially acceptableanswers” (Auger et al., 2006, p. 6).Majority of the private companies say they embrace corporate social responsibility not onlybecause it‟s the right thing to do, but also because it strengthens their brands. The percentageof brand value represented by corporate social responsibility is trending upward but all otheridentifiable contributors to corporate brand value-advertising, market cap, and the industry inwhich a company competes – appear to be declining. The relationship between brand imageand Corporate Social Responsibility is strongest for familiarity, not for favourability. That is,if the company is well known in its community, its Corporate Social Responsibility activitieswill strengthen its brand image more than they would if the company were less well known.According to a study by financial paper, The Economic Times, donations by listedcompanies grew 8% during the fiscal ended March 2009. As many as 108 companies donatedup to 20% more than the previous year.Consumers increasingly expect companies to make a broader contribution to society. Thebusiness benefits of doing are not evident. Prior studies conclude that consumer‟s purchasedecisions are positively influenced by socially responsible initiatives. According to theresearch carried by Cone Inc., in 2009, 79% of consumers would switch to a brand associatedwith a good cause. Bharat Petroleum and Maruti Udyog came on top with 134 points each,followed by Tata Motors (133) and Hero Honda (131). The study was based on a publicgoodwill index and India received 119 points in the index against a global average of 100.Thailand was at the top slot with 124 points. Malini Mehra, founder and CEO of SocialMarkets, an organization that works towards transition to sustainable development andrealisation of human rights and social justice, explains, “There is minimalist version,Corporate Social Responsibility is little more than a philanthropic activity-tree planting,schools and health clinics. In the maximalist version, Corporate Social Responsibility isabout character and conduct, where integrity and responsibility run right through every seamof the firm‟s activities and ethos. External Relations Director Lee Bansil of Procter andGamble explains: co-donation and cause-related marketing help promote competition, which33
  34. 34. in turn leads to corporate innovation. He believes this is essential for developing sustainableproducts and promoting sustainable consumption.1.3 Research on CSR RelationshipsPivato et al. (2008) investigated the consumer trust and CSR realm, but although hypotheseswere developed, the findings are based on other literature and not an empirical study. Thereis empirical evidence relating to brand and consumer behaviour in reference to CSR such asBecker-Olsen et al. (2006) and Pivato et al. (2008). Specifically relating to brand loyalty andconsumer valuation of services, De Los Solmones et al. (2005) conducted a survey toinvestigate the effect that selected company„s socially responsible activities had on theconsumer„s service evaluation.Other research investigates leadership, culture and strategy (Angus-Leppan et al., 2010;Sharp & Zaidman, 2009; Duarte, 2010; Lee, 2009). Strategy relies on leadership forexecution and the development of a culture that fosters CSR initiatives. Cruz and Pedrozo(2009) used case studies to investigate green management. Yu, Ting and Wu (2009)investigated ‗greenness„ of firms directly influencing financial performance in relation toSMEs and large corporations. Sen et al. (2006) had the only field study identified, whichexplored stakeholder relationships in relation to CSR.There are a number of studies that examine the use of CSR to attract employees andinfluence levels of organisational commitment. Job seekers found companies with higherCSR involvement more attractive, as it was perceived these companies had greater diversityand employees were more valued (Albinger & Freeman, 2000). Organisational commitmentwas investigated by Brammer et al. (2007) and Turker (2009), who studied organisationalcommitment in relation to CSR and commitment levels of employees in CSR orientatedorganisations respectively. Peloza and Shang (2011) identify several studies investigatingCSR in single and diffuse activities involving a range of other subjects such as businesspractices, philanthropy, products, fit and consumers. Vlachos, Tsmakos, Vrechopaulos andAvramidis (2009) and Castaldo, Perrini, Misani and Tencati (2009) investigated trust, withorganisational reputation as a regulating factor, when assigning consumer attributions tobrand or company.34
  35. 35. In order to test conceptual ideas, empirical investigation is conducted. For this particularstudy, variables from Turker„s (2009) conceptual measurement scale for CSR was used. TheTurker (2009) scale was developed from multiple areas including legal, environment,employee and ethics and has been adapted and applied in the data analysis. Turker (2009)conducted empirical research in order to develop a 21 factor variable list, but the scale hasnot been tested in a wider CSR context. An adaptation of Turker„s (2009) scale is used as itprovide a multidimensional representation of CSR, which can help determine whichdimensions will have an effect on brand trust.1.4 Stakeholders and Shareholders Relationships with CSR1.4.1 StakeholdersPiercy and Lane (2009), De Los Salmones et al. (2005) and Godfrey and Hatch (2006)identify stakeholders as important in relation to CSR. Conceptual theorists have suggestedthat research into CSR can be made operational, especially to examine marketing benefits ofCSR on stakeholder relations (Maignan & Ferrell, 2004). Russo and Perrini (2009) state thatsocial capital explains SMEs approach to CSR more appropriately, where stakeholder theoryexplains the CSR approach by large organisations. Larger organisations CSR approach caninclude different individuals as well as consumers. The differences in strategy and ethicalconsiderations between CSR and SMEs are other areas for development. Russo and Perrini(2009) concluded that stakeholder views have a large impact on the decisions of large firmsin relation to CSR activities. Similarly, Piercy and Lane (2009) propose the support acompany receives from investors and the strength of business relationship are prominentfactors in the implementation and success of CSR efforts. According to Pivato et al. (2008),people in authority in business are now recognising CSR as important.Sen, Bhattacharya and Korschun (2006) concluded that CSR influences stakeholders intopurchasing brands as well as strengthening the overall relationships. Implementing CSR tofoster stakeholder relationships is important, as individual stakeholders such as shareholdersand employees may have multiple relationships with the company (Sen et al., 2006).Stakeholders need to be informed of organisational policy or goals, the communicationincreases stakeholder„s confidence in the company„s actions (Bansel & Roth, 2000).Stakeholders are important to consider in CSR implementation. Walton and Rawlins (2010)35
  36. 36. 25 even suggest using the topics important to stakeholders as a tool to measure CSR such asemployee well-being and economic performance.1.4.2 ShareholdersSjostrom (2010) suggests that shareholders can provide a benchmark for organisational socialactivities. In contrast, Arvidsson (2010) suggests that focus has moved from shareholdervalue to CSR efforts after corporate scandals (i.e. companies employing child labour).Shareholder value can be built by CSR activities giving ‗insurance„ protection for companiesin bad times, meaning the positive reputation, which would foster brand trust and loyalty, canhelp reduce the bad effect of a negative event (Godfrey et al., 2008).Hsieh (2009) determined that managers should make decisions on the overall happiness ofsociety (through CSR activities), sometimes at the expense of shareholder interests. This ideadoes not consider shareholders as a main benchmark for CSR as suggested, but simply anaddition to the main societal responsibilities of an organisation. Godfrey and Hatch (2006)identified shareholder capitalism for an organisation as negative when considered in relationto the CSR-CFP (corporate financial performance). Shareholder capitalism for anorganisational strategy focuses on the manufacture of economic goods to contribute to socialwelfare and this has a negative effect on the CSR-CFP relationship (Godfrey & Hatch, 2006).The buying of shares and the impact on organisational financial performance can be affectedby the activities organisations are involved in. Adam and Shavit (2008) state investmentshave increased over time in organisations that consider the social needs of the market andoperate best practice policies. There is also indication that organisations that are sociallyresponsible can positively change investor attitudes by having a greater social responsibilityranking (Adam & Shavit, 2008). Ranking companies in relation to a social responsibilitycould motivate organisations to participate in CSR to improve image in the market.1.5 CSR and Brand TrustBranding is used to differentiate one product or service from another using a symbol, nameor design (Pride et al., 2006, p.208). Branding can be used for customers to identify a productor service, making the introduction of new products into the market easier, whilst buildingbrand equity, or the value a company can leverage off the brand. More importantly whilst36
  37. 37. branding makes it easier for consumers to identify products, it also makes it easier to developbrand loyalty (Pride et al., 2006, p.209). Although brand loyalty will vary depending on theitem and consumer, brand trust is a major component to loyalty; consumers have faith in theproduct or service they are purchasing. Dunn and Davis (2004) state one of the greatestchallenges CEOs can address is managing consumer loyalty effectively. Whether trust can beaffected by external actions of the company rather than the performance of the product orservice is what this study aims to research.CSR and branding have a number of linkages, specifically through trust, corporate reputationand consumer attribution. Gurhan-Canli and Fries (2009) developed a corporate socialresponsibility and brand-related outcomes model. Gurhan-Canli and Fries (2009) suggest thatboth consumer characteristics, such as awareness of CSR programmes and personaljudgement and company characteristics such as reputation are factors influencing brandingoutcomes. The branding outcome would include evaluation of the company, brand andproduct, in which brand trust would be considered. Fit between the CSR activities and thecompany and brand itself also impacts on the way consumers perceive the CSR activities(Ellen et al., 2000; Yoon et al., 2006).Delgado-Ballester and Munuera-Aleman (2005) suggest that brand equity can be developedthrough brand trust. Brand trust must be maintained not only to foster consumer loyalty andbrand equity, but to create a sustainable competitive advantage (Delgado-Ballester andMunuera-Aleman, 2005).Consumer Attributions and Corporate ReputationsThe awareness of CSR in general provides influence on attitude, attribution and purchasedecisions (Pomering & Dolcinar, 2009; Ellen at al., 2006; Yoon et al., 2006). Similarly,Maignan (2001) suggests further study to identify at which point consumers are aware of theCSR efforts a company has undertaken. This is associated with leadership ability in thecorporation and the need to communicate CSR activities (cause marketing included) whiledeveloping an appropriate direction or strategy (Morlin-Azorin et al., 2009; Murillo &Loranzo, 2006). Marin and Ruiz (2007) suggest CSR has direct influence on a company„sidentity attractiveness; this identity can both attract new consumers and influence marketing37
  38. 38. power for that company. Attractiveness is strongly affiliated with the awareness of a specificbrand.Peloza and Shang (2011) suggest that product-related CSR means higher levels of consumerawareness. Du, Bhattacharya and Sen (2007) found evidence to suggest that a brand thatpositions itself as a CSR brand can improve consumer awareness levels, in contrast to abrand that just engages in CSR activities. This may due to the consumer being directlyexposed to the CSR information. Bhattacharya and Sen (2004) expressed that CSR activitieshad greater influence on outcomes internal to a consumer, such as awareness and attributions,which are easier to target than external outcomes such as purchase behaviour. Bhattacharyaand Sen (2004) suggest CSR awareness is a stumbling block for most companies, who canonly get the benefits from CSR once consumer awareness is increased. De Los Salmones etal. (2005) state the possibility that the perception of CSR influences the valuation ofindividual services as well as goods, as the concept of perceived quality can apply to bothservice and goods.Affiliated with consumer awareness, corporate reputation is another area that could beinfluenced by CSR activities (Yoon et al., 2006; Ellen et al., 2006). Yoon et al. (2006)identified suspicion in consumers as a factor influencing positive or negative attribution tothe company. Bhattacharya and Sen (2004) also identified corporate reputation as moderatingconsumer suspicion. If a company has a good reputation the consumer will act favourably toevent sponsorship even if there is not perceived fit between the event and the company. If theconsumer suspects the reason for the CSR activity is for an ulterior motive, other thanlegitimately helping a cause then there will be a negative response. Bhattacharya and Sen„s(2004) findings imply that consumers are aware of CSR activities and the legitimacy of theseactivities in relation the company. Likewise, Ellen et al. (2006) states decisions made forCSR activities that display self-centred motives or are for stakeholder benefit can receivenegative feelings from consumers, impacting on consumer trust.Kitchin (2003) expresses that the responsibility in CSR is brand responsibility and that it is infact the brand that has the social responsibility. The brand relies on brand promises andrelationship to the stakeholders to convey the CSR efforts. Kitchin (2003) concludes CSRactivities are not considered a separate entity from a brand or company, but part ofeverything the brand does. Brand learning gaps can only be decreased by further cultural38
  39. 39. understanding into the needs of society on behalf of the companies participating in CSR(Kitchin, 2003).Cultural perspectives in regards to branding and CSR have been explored to a small extent.Little is known about public relations practices and culturally specific CSR to date (Kim &Kim, 2010). Other studies have not considered a cultural approach, this could impact on thebrand trust perspectives as different cultures may consider different practices as moretrustworthy.Other empirical studies support the relationship between CSR and brand performance. Lai,Chin, Yang and Pai (2010) concluded that both CSR and corporate reputation had a positiveeffect on brand equity in the industrial sector. The brand equity also included brand loyaltyand brand awareness. Brand equity can help adjudicate a relationship between brandperformance and CSR.Biloslavo and Trnavcevic (2009) suggest using websites to communicate ‗green„ corporateidentity. In each case of 20 Slovene companies, green reputation was used in an attempt tocreate a lasting competitive advantage. All the companies presented information about socialresponsibility through green messages and supporting the environment, but it did nottranslate to a distinct advantage for each company such as consumers purchasing moreproducts (Biloslavo & Trnavcevic, 2009). Websites that communicate green messages andconvey corporate social responsibility need to be combined with activities that consumerscan see, thus reducing the amount of scepticism from the consumer. 34Curras-Perez et al. (2009) state that CSR helps construct a brand with personality that can bedifferentiated by consumers, while fulfilling their needs. However, effectiveness of CSR canoften be hard to measure (Pivato et al., 2008). CSR activities are mainly associated andcompared to financial gains. Godfrey and Hatch (2006) identified extensions beyond profitfor CSR activities, but there are has not been any empirical evidence to date. This study plansto add exploratory empirical evidence to the CSR and branding relationship.De Los Salmones et al. (2005) concluded although social responsibility has become popularin recent years, there have been few studies conducted towards CSR in reference to consumerbehaviour and attitudes. Maignan, Ferrell and Hult (1999) suggest CSR has general positiveconsequences for business, but there is limited research on the impact from a marketing39
  40. 40. perspective. In terms of how, when and for which specific consumers CSR initiatives workbest, there are scarce studies (Sen & Bhattacharya, 2001). There is however a few studiesexploring the connections between CSR and corporate reputation and reputation can providean influence on brand trust. The relationship between reputation and brand trust is exploredin the next section.1.6 Initiatives of Indian companies to promote brand image withthe help of corporate social responsibilityThe 2010 list of Forbes Asia‟s 48 heroes of Philanthropy contains four Indians. Nearly allleading corporate in India are involved in Corporate Social Responsibility programmes inareas like education, health, livelihood creation, skill development and empowerment ofweaker sections of society. Notable efforts have come from the Tata Group, Infosys, BhartiEnterprises, ITC Welcome group, IOC among others. For brands, it is an excellent way toshow they care, taking the lead with innovative “giving back” schemes. Few ways by whichProcter and Gamble did in the past was, that they teamed up with UNICEF to introduceNutristar-a powdered drinking product that addressed micronutrient malnutrition in somepopulations and by acquiring the PuR brand to bring low-cost water purification technologiesto consumers in developing markets. The company also promoted better hygiene in at-riskcommunities and in return had the benefit of forming new markets for its products like soapand toothpastes.A recent initiative of Corporate Social Responsibility by Procter and Gamble is that it joinedhands with the International Olympic Committee (IOC) jointly announced a sponsorshipscheme wherein Procter and Gamble‟s portfolio of brands will sponsor “Proud Sponsor ofMoms” campaign globally. To celebrate the dedication and sacrifices of moms, families andOlympians, Procter and Gamble will produce a documentary video series called “Raising anOlympian” that will provide the insight into the experiences of mom of an Olympian whichwill guide and improve the lives of forthcoming athletes.Mr.Sunil Mittal, chairman and managing director of Bharti Enterprises, runs the countryslargest affirmative action project imparting quality education to 30,000 underprivilegedchildren in rural India across five states. The initiative is housed under the Bharti Foundation.Idea is a telecom service provider, which historically lacked the market leaders in terms of40
  41. 41. performance. With its new campaign, which sets the tagline, “What an idea” in the landscapeof rural India, it has managed to become a stronger and more credible player. The advertisingfocuses on stories that demonstrate how the mobile phone helps education and democracy torural India, not to mention solving the caste problem. Another instance is that of a leadingtea brand from India‟s most respected business house, Tatas. Tata Tea uses the tag line“Jaago re” (wake up) and its advertising shows its protagonists handing out cups of tea toyoung people in college insisting that they are asleep and need to “wake up”. The waking upin question involves their going out and voting. In this case, the advertising leads us to awebsite which actually allows people to register on-line as voters.Corporate companies like ITC have made farmer development a vital part of its businessstrategy, and made major efforts to improve the livelihood standards of the ruralcommunities. Unilever is using micro enterprises to strategically augment the penetration ofconsumer products in rural markets. IT companies like TCS and WIPRO have developedsoftware to help teachers and children in schools across India to further the cause ofeducation. The adult literacy software has been a significant factor in reducing illiteracy inremote communities. Banks and insurance companies are targeting migrant labourers andstreet vendors to help them through micro credits and related schemes. As in the West,Indian companies are also waking up to the realization that Corporate Social Responsibilityis not just an external philanthropic activity, but an internal responsibility as well. In fact, asPaul Abhram, COO, Induslnd Bank, puts it, “If you don‟t start from within, the entireCorporate Social Responsibility program would turn out to be meaningless.” The concept ofsolar ATMs and encouraging customers to choose e-statements over traditional paperstatements has been a part of Induslnd Bank‟s broader Corporate Social Responsibilityinitiatives.1.7 Government initiatives to promote corporate socialresponsibility among companiesAlthough corporate India is involved in Corporate Social Responsibility activities, the centralgovernment is working on a framework for quantifying the Corporate Social Responsibilityinitiatives of companies to promote them further. According to Minister of Corporate Affairs,Mr.Salman Khurshid, one of the ways to attract companies towards Corporate Social41
  42. 42. Responsibility work is to develop a system of Corporate Social Responsibility credits, similarto the system of carbon credits which are given to companies for green initiatives.Pharmaceuticals Company Jubilant Organosys Ltd., already runs an anti-tuberculosisprogramme with the government of Uttar Pardesh. Apart from schools and hospitals that arerun by trusts and societies, the government too is exploring to widen the scope of public-private partnerships to build and maintain schools and hospitals in return for a fixed annuitypayment.Besides the private sector, the government is also ensuring that the public sectorcompanies participate actively in Corporate Social Responsibility initiatives. The Departmentof Public Enterprises (DPE) has prepared guidelines for central public sector enterprises totake up important Corporate Social Responsibility projects to be funded by 2-5 per cent ofthe company‟s net profits.42
  43. 43. FINDINGSChapter 2: Analysis and findings of data collected from consumersThe findings are based on the questionnaire which was circulated online to consumersthrough various websites viz. Facebook, Gmail, Linked In etc. the below are given thefindings. The Fig. 1 is the preference of consumers they exhibit in buying stationeryproducts, the total brands mentioned in the questionnaire were 5 viz. Apsara, Kores, Camlin,Navneet, Classmate and Faber castell. The ranking of the brands is in terms of percentage. Ranking of Brands 40 35 30 25 20 Series1 15 10 5 0 Apsara Kores Camlin Navneet Classma Faber te Castell Series1 18.987 8.86 15.189 4.43 35.443 17.088Figure 1The figure 1 depicts that consumers rank Classmate as number 1 stationery brand followedby Apsara and Faber Castell. The ranking depicts the overall buyer behaviour towards theClassmate. The question asked for this question was ranking the brands on a scale of five,where 1 stood for the most preferred and 5 stood for least preferred and out of the brandsshown in the figure Classmate got most of the 1s and 2s and the overall percentage of gettingmost preferred rank is 35.443% which is quite high comparing it to the other competitorbrands. Classmate is followed by Apsara and Faber Castell with 18.987% and 17.088%respectively.43
  44. 44. Recall Percentage:As recall at the time plays a very important role from company‟s point of view the recallpercentage of Classmate‟s “let‟s put India first” initiative is given in the Fig2 Recall Percentage 80 60 Series1 40 20 0 Yes No Series1 75 25Figure 2The figure 2 depicts the responses in the form of Yes and No, 75% of the respondents wereaware of the scheme and 25% did not know about the scheme. The awareness is the basis forpreference, and as established by responses, the awareness of Classmate CSR is modest.Since awareness is one of the most important factors in the buyer‟s purchase process. Only25% of the respondents were not aware of the CSR efforts of Classmate.Preference for Classmate due to its CSR initiatives Preferece for Classmate 80 60 Series1 40 20 0 Yes No Series1 75 25Figure 3The figure 3 depicts the responses collected in the form of Yes and No, the question asked iswhether the CSR efforts of Classmate leads them to prefer it over the companies not doingCSR. The figure depicts 75% of the total respondents showed a positive response which isexactly equal to the percentage of respondents who are aware of the CSR efforts ofClassmate.44
  45. 45. Attention towards CSR:The attention towards the CSR activities as per the responses is given in the figure4, theresponses are below: Attention towards CSR 45 40 35 30 25 20 Series1 15 10 5 0 Strongly Strongly Agree Neutral Disagree agree disagree Series1 18 25 40 10 7Figure 4The figure 4 depicts the percentage of people who pay close attention to the CSR initiativesand as per the responses collected 40% are neutral to this and 18% and 25% strongly agreeand agree respectively. Relatively only a small percentage of consumers do not pay attentionto the CSR efforts. A good percentage of people are neutral to it which may be taken as anopportunity as the interest among consumers can be generated by efforts by any company.Readiness for Premium Price: Readiness to pay premium price 30 25 20 15 Series1 10 5 0 Strongly Agree Neutral Disagree Strongly agree disagree Series1 16 27 29 19 9Figure 5The question was intended to know the readiness of people towards paying premium priceand the results in the sample depict that 29% are neutral towards it, 27% are ready to pay apremium price and 16% are strongly ready to pay premium price. The premium price is theextra price that consumers pay to help less privileged or any other cause.45
  46. 46. Deliberate buying of Classmate due to CSR: Deliberate purchase of Classmate 30 25 20 15 Series1 10 5 0 Strongly Agree Neutral Disagree Strongly agree disagree Series1 16 27 29 19 9Figure 6Deliberate purchase of Classmate refers to the tendency of consumers to buy Classmatestationery because of its social initiatives. The deliberate purchase means a consumer prefersto buy Classmate even if the options are available and it may be assumed at a lower price.Since Classmate stationery is comparatively following high pricing consumers still don‟tmind paying high price.Recommendation to others: Recommendation to others 30 20 Series1 10 0 Strongly Agree Neutral Disagree Strongly agree disagree Series1 21 30 24 15 10Figure 7The recommendation refers to adverting others to buy a particular product or service here itrefers to Classmate, as recommendation is a form of communication that is quite powerfulthat works for the benefit of a company. A high percentage of respondents agreed that theyrefer people to buy classmate which is a good sign, recommendation may be assumed to be46

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