Consumers Consider the Importance of Corporate Social Responsibility

By Verschoor, Curtis C. | Strategic Finance, August 2006 | Go to article overview

Consumers Consider the Importance of Corporate Social Responsibility


Verschoor, Curtis C., Strategic Finance


The corporate social responsibility (CSR) factors that American consumers believe are most important differ from those that socially responsible investors (SRI) use. Although its members are far from united in their appraisal methods, the SRI movement embraces a wide spectrum of evaluation characteristics. Prominent investment research firm KLD Research & Analytics, Inc. created Socrates[TM], an online social research database that provides measures of company performance designed to help investment professionals integrate environmental, social, and governance factors into their decisions.

For seven years, Business Ethics magazine has used Socrates[TM] data to define its 100 Best Corporate Citizens list. Firms are ranked on performance in eight stakeholder categories: shareholders, community, governance, diversity, employees, environment, human rights, and product.

The disparate CSR perspective held by consumers was developed through research sponsored by the National Consumers League. A telephone survey of 800 U.S. adults showed that the most important proof of good corporate citizenship is how well a company treats its employees. Similarly, the survey found that 76% believe that a company's treatment of its employees plays a big role in consumer purchasing decisions.

The most common responses consumers give to what corporate social responsibility means are: "corporations need to be committed to their employees" (27%), "corporations need to be committed to the public and communities and overall society" (23%), "corporations have a responsibility to provide quality products" (16%), and "responsibility to the environment" (12%).

American consumers also feel strongly about buying products from or working for a company whose values are aligned with their own personal values. Survey respondents say that it's "extremely" or "very" important to work for (79%), buy products from (65%), and socialize with (72%) those who have similar values and principles.

Major employee-related issues cited by consumers include:

* The importance to pay workers inside/outside the U.S. a living wage,

* Salary/wage increases should be placed ahead of making charitable contributions,

* Businesses should employ more people rather than make charitable contributions,

* How well a company treats employees influences what they buy,

* Risks to employee safety influences what they buy, and

* Desire to work for a company that shares similar values and principles.

In contrast to the high importance consumers give to social responsibility, the survey found that only 21% of respondents give U.S. corporations top marks for being socially responsible. When asked whether companies have improved in their social responsibility during the last two or three years, only 30% believe that companies are doing a "somewhat better" or "a lot better" job of being socially responsible.

When asked how they obtain information to form their judgments about the social responsibility of a company, 47% of respondents indicate that they use the Internet. Americans believe the most credible means to shape their opinion of corporate social responsibility is their own online research. Consumers rely on the Internet and word-of-mouth sources because they prefer an unfiltered, unedited view of news and information. Because of the increased availability of online resources, 58% of the respondents believe they or people like them are more informed about companies' records for social responsibility than they were just a few years ago.

The survey also found a positive relationship between active Internet use and engagement in social responsibility. About 40% of those using the Internet have sent e-mail messages to a company about its products or services, and 41% have sent a message to an elected state or federal official about an issue. According to Paul Argenti, professor of corporate communication at Dartmouth's Tuck School of Business, "The American public continues to refine its definition of corporate social responsibility and gain empowerment through online resources in their new role as activists for social change. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Consumers Consider the Importance of Corporate Social Responsibility
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.