Bodo B.
brands. They found that external sources—for instance, notices of prizes and awards
Schlegelmilch for CSR initiatives—generated higher credibility than social media and certain corporate
Vienna University of
internal-communication methods.
Economics and
Business, and Sun
Yat-sen University, China INTRODUCTION and to attract new talents (Nidumolu, Prahalad,
bodo.schlegelmilch@ In recent years, corporate sustainability has and Rangaswami, 2009).
wu.ac.at continued to gain importance in industry prac- Moreover, customers have rewarded companies
tice (Chabowski, Mena, and Gonzalez-Padron, with CSR programs and, consequently, many CSR
2011). Investors, suppliers, and other business initiatives have had a positive impact on behavior
partners require environmentally friendly and toward brands (Luo and Bhattacharya, 2006; Marin,
socially acceptable practices from firms. And Ruiz, and Rubio, 2009; Page and Fearn, 2005; Sen
the benefits are clear: awareness of corporate and Bhattacharya, 2001).
social responsibility (CSR) initiatives of a com- Consumers increasingly spend money for
pany is important both for employee satisfaction sound corporate practices—such as fair labor
• Consumers find specific information about the impact of CSR more credible than broad
references. An “amount-of-CO2-saved” attribution is preferable over a “protects-the-
environment” claim.
• Consumers attach greater credibility to information originating outside the focal company.
• Awards for CSR efforts have a stronger impact on consumers than messages delivered through
social media and/or internal channels.
Received (in revised form) • Further research is needed to assess the effectiveness of different social-media strategies for
December 13, 2014; accepted
disseminating information about CSR.
January 8, 2015; published online
December 14, 2015
practices—and, thereby, exert bottom-up • Which initiatives should be Brands need to take their customers’
pressure (Mohr and Webb, 2005). Some 1
communicated? opinions seriously because they appear to
fast-moving consumer-goods (FMCG) • What is the appropriate message? be willing to reward sustainable corporate
retail chains already have responded • What are the most credible channels? behavior. Previous research has demon-
to such incentives. To respond to the strated a positive impact of CSR on:
demands of the various stakeholders, Country-sustainability rankings (e.g., Yale
companies need to evaluate carefully Environmental Performance Index2) have • purchase intention (Sen and Bhattacha-
how to inform them about their sustain- placed Austria among the top countries rya, 2001),
able fabric and initiatives (Polonksy and worldwide in terms of the country’s focus • customer loyalty (Marin et al., 2009),
Wood, 2001). In response to the global on sustainability. The EPI ranks the per- • customer satisfaction (Luo and Bhat-
farm-to-table movement, for example, the formance of countries on high-priority tacharya, 2006), and
German supermarket Aldi has expanded environmental issues. Some scholars also • corporate reputation and thus consumer
its inventory by offering sustainable prod- contend that Austria is a country with a brand equity (Page and Fearn, 2005).
ucts under its own label and regional population keenly conscious of social and
products from small companies or farm- environmental aspects (e.g., Thøgersen, One study reinforced those findings:
ers (Aldi, 2015). 2007). Indeed Austria has many large- “Managers can be confident that green-
To the current authors’ knowledge, scale activities to strengthen awareness ing their marketing programs can have
scholars have paid scant attention to the about CSR. In fact, respACT—an Austrian a beneficial effect on their firm’s future
topic of corporate-sustainability com- business council for sustainable devel- performance” (Leonidou, Katsikeas, and
munication (CSC; Du, Bhattacharya, and opment—provides a platform for CSR Morgan, 2013, p. 167).
Sen, 2010; McDonagh, 1998; Öberseder, and sustainability. For these positive outcomes to material-
Schlegelmilch, and Gruber, 2011). At the The Austria-based research team used ize, however, consumers’ knowledge about
same time, because CSR has had a positive the set of assumptions about the efficacy companies’ socially responsible behavior is
effect on consumer behavior, there have of CS in their homeland as sound footing imperative (Öberseder et al., 2011). Indeed,
been growing calls for managers to learn to investigate opinions about CSR com- sustainability has introduced new com-
how to improve the effectiveness of CSR munication. As such, their study drew on plexities to the marketing mix, especially
messaging (Öberseder et al., 2011). a large, nationally representative sample when it comes to corporate communication
The current study seeks to fill that gap. of Austria to examine how consumers strategies (Leonidou et al., 2013). Informa-
The authors propose that managers need want to be informed about corporate- tion about a company—including its CSR
to improve both the “what” (i.e., the spe- sustainability initiatives. efforts—is an important, active means to
cific content) and “how” (the method or The authors believe the findings from attract consumers’ attention.
channel) of CSR communication. the survey not only could benefit Aus-
Note that CSR and corporate sustainabil- trian companies but also serve as a guide The Challenges of Communicating
ity (CS) have been used interchangeably to for companies around the world to About CSR
denote the efforts and initiatives of a com- develop appropriate and effective CSR- The goal of CSR—CS-related commu-
pany to contribute to the social or envi- communication strategies. nication should be to provide credible
ronmental situation (Hildebrand, Sen, and information on corporate initiatives to
Bhattacharya, 2011, p. 1353). Accordingly, LITERATURE REVIEW various interested stakeholders. The
the authors of the current article refer to Public interest in CSR and CS has risen current authors believe brands should
these as “CSR” and “CS” interchangeably tremendously among various stakehold- act proactively because these stakehold-
throughout this article. ers (e.g., consumers, employees, and inves- ers mostly wait to be “educated” about
The authors propose that marketing tors). A full 89 percent of global consumers the respective sustainability initiatives
managers need to address a series of ques- indicate their willingness to purchase (Öberseder et al., 2011) rather than seek
tions about CSR communication: products based on companies’ responsible it out. At the same time, there are a large
practices (Sustainable Brands, 2015). number of skeptics who are doubtful
1
“Doing Well by Doing Good,” Nielsen, June 17, 2014.
about a company’s sustainability poli-
Retrieved August 14, 2015, from http://www.nielsen.com/ Yale Environmental Performance Index. “2014 EPI.”
2
us/en/insights/reports/2014/doing-well-by-doing-good.html Retrieved August 14, 2015, from http://epi.yale.edu/ cies, motivations, and the credibility of
Retrieved August 14, 2015, from http://epi.yale.edu/ knowledge and importance ascribed to more likely would consider the CSR
communication of a company to be cred- Factors loadings all were between 0.7 communication channels (r = 0.74 as com-
ible (Mfemale = 3.21) than males did (Mmale = and 0.9 with the exception of one item on pared with an AVE of 0.59). To this end,
3.06, p = 0.002). “cooperation with NGOs” with a factor the results fulfilled the Fornell-Larcker Cri-
loading of 0.635. terion, which supports discriminant valid-
Exploratory Analysis Next, to assess internal consistency, the ity (See Table 3).
The following exploratory analysis was researchers calculated the composite reli- Additional support for discriminant
conducted with PLS-SEM (Hair, Ringle, ability, which consistently exceeded 0.80 validity came through the examination
and Sarstedt, 2011) in SmartPLS (Ringle, in all constructs, as well as the more con- of indicators’ cross-loadings, which were
Wende, and Will, 2005). servative Cronbach’s α values, fulfilling highest on their designated constructs
First, the psychometric properties of all the strict reliability benchmark (Nunnally, (See Table 4).
items were examined to assess how well 1978; See Table 2).
they related to the latent constructs. The Moreover, there was support for dis- Assessment of the Structural Model
researchers considered construct-to-item criminant validity as the average vari- A bootstrapping procedure (1,055 cases
loadings of the latent constructs (demon- ance extracted (AVE, between 0.57 and and 5,000 samples, individual changes)
strating acceptable standardized loadings) 0.79) exceeded squared correlations of was run to obtain the standard errors of
as well as measures to gauge the internal the latent variables, except for the cor- the estimates and assess the significance of
consistency of the independent constructs. relation between internal and external path coefficients:
TABLE 2
Psychometric Properties and Measurement Statistics
1. Construct 2. Item 3. Loading 4. CR 5. AVE 6. Cronbach’s α
Information Concrete information concerning corporate sustainability initiatives
IC1 0.703
Content are credible
By means of facts and figures, companies can demonstrate their 0.802 0.575 0.631
IC2 0.829
corporate sustainability in a credible way
Broad information concerning corporate sustainability are unreliable IC3 0.736
Information Information from external organizations concerning corporate
IS1 0.901
Source sustainability are credible 0.884 0.792 0.737
Independent information sources on corporate sustainability are credible IS2 0.879
Information Prizes and awards for companies’ sustainability ICE1 0.844
Channels: Cooperation with NGOs ICE2 0.635
External
Independent coverage in TV or newspapers ICE3 0.822 0.879 0.596 0.829
Independent social media pages (e.g., Facebook, LinkedIn, Twitter, etc.) ICE4 0.781
Labels (e.g., Fair Trade, Marine Stewardship, etc.) ICE5 0.762
Information Company internal reports (e.g., sustainability report) ICI1 0.788
Channels: Company website ICI2 0.755
Internal
TV advertisements ICI3 0.796 0.879 0.594 0.829
Radio advertisements ICI4 0.785
Social media pages of a company (e.g., Facebook, LinkedIn, Twitter, etc.) ICI5 0.726
Fit The CSR initiatives of a company should fit its core business Fit 1.000 1.000 1.000 1.000
• The influence of content and source Furthermore, the structural model was blindfolding procedure issued the Stone-
was significant at the 1 percent level, assessed through a blindfolding proce- Geisser’s Q, postulating the model’s ability
whereas dure with an omission distance of seven to correctly predict the indicators of each
• the other constructs did not show a (i.e., every seventh data point was omit- endogenous latent construct, which was
significant influence on “credibility of ted and the resulting parameter estimates above 0.36, thereby providing support
CSR communication.” were used to predict the omitted ones). The for the predictive relevance of the model
(CCC; See Table 5).
Accordingly, the results addressed the
TABLE 3
three research questions:
Fornell-Larcker Criterion
Variable 1 2 3 4 5 6 RQ1: How does the fit between a com-
1. CCC 1 0 0 0 0 0 pany’s business and the CSR ini-
tiative impact the credibility that
2. Channel External 0.126 0.596 0 0 0 0
consumers associate with the
3. Channel Internal 0.121 0.739 0.594 0 0 0
CSR communication?
4. Content 0.252 0.178 0.176 0.575 0 0
5. Fit 0.168 0.171 0.134 0.239 1 0 Prior research (Simmons and Becker-
Olsen, 2006) had shown the importance
6. Source 0.363 0.191 0.200 0.435 0.367 0.792
of fit between a company’s core business
and the CSR initiatives it engages in. The
current researchers, however, did not find
TABLE 4 a significant effect of fit on overall credibil-
Cross Loadings ity, indicating that fit is not a necessary cri-
Channel Channel Information Information terion for companies’ CSR communication.
Indicators External Internal Content Source Fit CCC
RQ2: How does the level of detail
ICE1 0.844 0.719 0.378 0.382 0.304 0.325
of the communicated content
ICE2 0.635 0.696 0.323 0.237 0.239 0.199
influence credibility of CSR
ICE3 0.762 0.503 0.207 0.306 0.345 0.227 communication?
ICE4 0.822 0.614 0.306 0.419 0.387 0.324
ICE5 0.781 0.696 0.330 0.306 0.314 0.263 Especially the significant result of the
“content” construct was interesting, point-
ICI1 0.682 0.788 0.330 0.338 0.268 0.286
ing toward the importance to communicate
ICI2 0.626 0.755 0.322 0.380 0.302 0.256 facts and figures instead of merely stating
ICI3 0.679 0.796 0.335 0.340 0.274 0.291 that the company cares about CSR. This
ICI4 0.642 0.785 0.322 0.374 0.269 0.284 result helps to answer RQ2 and shows that
detailed information on CSR initiatives
ICI5 0.698 0.726 0.309 0.285 0.320 0.212
positively impact the credibility of a com-
IC1 0.347 0.371 0.703 0.426 0.384 0.316 pany’s CSR communication. The influence
IC2 0.354 0.340 0.829 0.525 0.367 0.438 of the source also was mirrored in the cur-
IC3 0.264 0.256 0.736 0.543 0.372 0.377 rent findings concerning the most impor-
tant communication channels, further
IS1 0.389 0.419 0.626 0.901 0.553 0.561
discussed hereafter.
IS2 0.389 0.376 0.546 0.879 0.523 0.510
Fit 0.414 0.366 0.489 0.605 1 0.409 RQ3: What are the channels consum-
CCC 0.355 0.348 0.502 0.603 0.409 1 ers consider most credible to
communicate CSR?
Channel Internal → CCC 0.008 0.028 0.291 0.771n.s. further evidence of the positive relation-
ship between information and impor-
Content → CCC 0.161 0.060 2.675 0.008***
tance. This was not surprising, given that
Fit → CCC 0.029 0.055 0.526 0.599n.s. consumers who care about social and envi-
Source → CCC 0.443 0.114 3.882 0.000 ***
ronmental aspects more likely will seek
Note: *ps for a two-tailed test; calculated by means of TDIST (TVERT) function in Excel based on empirical t value and df
relevant information.
(see Hair et al., 2011). CCC = credibility of CSR communication. In turn, consumers who have learned
about these aspects—and are knowledge-
able about their potential positive conse-
The path coefficients of both internal and Grounded in the findings of 20 in-depth quences—consider sustainability to be
external channel constructs in the bootstrap- interviews, the authors of the study devel- more important. Although the direction of
ping were not significant, thus the authors oped items for evaluating the credibility causality cannot be determined with the
decided to look at consumers’ responses of companies’ CSR communication, which current data, the data do show that con-
concerning the specific channels to address subsequently were incorporated into a sumers knowledgeable about corporate
RQ3. More specifically, the researchers large-scale pilot study (N = 631) and a main sustainability initiatives are appreciative
examined the credibility associated with study (N = 1,055) representative of the Aus- of them.
each channel used for corporate sustain- trian population. This finding underlines the importance
ability by looking at their mean values. The results of the study produced the of corporate sustainability communication
Among the five most credible communica- following takeaways for marketers: for both companies and consumers.
tion channels, four are external to the com-
pany, indicating that consumers consider
CSR communication disseminated through
Company external channels
independent sources more credible:
Prizes & Awards
• prizes and awards (M = 2.84)
TV/Newspaper Coverage
• television and newspaper coverage (M
= 2.75) Labels
• labels (M = 2.65) Cooperation with NGOs
• cooperation with NGOs (M = 2.39) and
Company (CSR) Reports
one internal channel, namely
• company (CSR) reports (M = 2.19; See Corporate Homepage
Figure 3).
Social Media Coverage
Carefully Choose Your CSR as prizes and awards received, and seek of product packaging (i.e., shoe boxes)
Communication Channel out television coverage about their sus- to provide in-depth information about
The current research elaborated on the tainability efforts. social and environmental aspects. The
central decision of choosing a CSR initia- ImagePower Green Brands Survey
company revealed hard facts, such as,
tive and demonstrated that this choice can reported that consumers particu- climate impact (kg of CO2 per shoe);
be related to a company’s core business. larly use the Internet and television resources used (e.g., whether organic,
Respondents indicated they considered to inform themselves about corpo- nonrecycled, or renewable material
independent sources more credible—one rate sustainability (Landor, 2009). was used; Timberland, 2015).
reason why the authors believe that com- Respondents of the ImagePower
panies should disseminate positive CRM Green Brands Survey reported “that LIMITATIONS AND FUTURE RESEARCH
messages information to the appropriate they trust advertising to inform them The current study only included com-
media channels, consumer groups, and about green products” (Landor, 2009, munication approaches that respondents
other outlets. p. 5). named within the qualitative prestudy—
According to one review of extant liter- prizes and awards, television–newspaper
ature, “Companies should use a variety of Make Your Contribution Explicit coverage, labels, cooperation with NGOs,
communication channels or, alternatively, Professional communication grounded company (CSR) reports, corporate home-
focus on one or two highly relevant chan- in in-depth information and hard facts page, social media coverage, or radio
nels” (Du et al., 2010, p. 16). The results is needed to address a general public advertisements.
of the current field study extended that still largely uninformed about sustain- Other channels that might be used
recommendation, and, by assessing the ability. Scholars have speculated that to communicate sustainability include
respective credibility associated with dif- the low credibility often associated with blogs, consumer-focused newsletters, or
ferent communication channels, the cur- “green” advertising results from those company sponsorship programs that tie
rent research identified specific channels messages’ low information content into (and highlight) the appropriate CSR
for managers: (Iyer and Baerjee, 1993) and that more initiative.
specific information on environmental Similarly, different social-media chan-
• First, companies should provide suf- aspects may lead to enhanced brand atti- nels (i.e., YouTube, Facebook, Twitter,
ficient information about their CSR tudes among consumers (Hartmann and etc.) might offer varying levels of trust
and sustainability initiatives on their Apaolaza-Ibáñez, 2009). and credibility, depending on the depth
websites. Both the quantitative analysis and the of information.
in-depth interviews in the current study The current analysis ended at the point
• Companies need to make sure that revealed an influence of the information of assessing communication credibil-
they have a conclusive, comprehensive content on the communication’s credibil- ity; whether such information—even if
sustainability report available for inter- ity, depending on how the specific mes- considered highly important and cred-
ested stakeholders. This channel will be sage is framed. Consumers stated that ible—will lead to a corresponding behav-
used widely to gauge the importance a program-specific information was more ior cannot be answered. Consumers, as
company ascribes to sustainability. credible than a company’s general claim well as other stakeholders, are prone to
A report by KMPG (2013) on global
to “protect the environment.” attitude–behavior inconsistencies. Nev-
CSR reporting demonstrated that ertheless, given the increasing pressure
most companies understand this • Austrian retailer Hofer has provided a on companies to show their sustain-
necessity: 93 percent of the largest clear message and consumer benefit by ability intent, reassuring consumers
250 Fortune Global companies report displaying details about its private eco- with knowledge about the “what” and
on CSR, and reputational considera- labeled products regarding the amount “how” can provide them with valuable
tions are the prime motivator for vol- of CO2 saved as compared with conven- competitive advantages.
untary reporting. tionally produced alternatives (Hofer,
2015). CONCLUSION AND IMPLICATIONS
• Furthermore, companies should com- • The “nutrition” label of Timberland has The academic contribution of the current
municate external certifications, such demonstrated an effective, innovative use study lay in the consolidation of several
previously examined fragments of CSR The more difficult endeavor is to reach provide detailed specific information.
communication processes in a unified the second group of consumers. In this This current research
investigation. Furthermore, as the current case, large-scale communications—tel-
study was grounded in empirical data, the evision, social media, and radio advertis- • provides insights into the best practices
research team believe their findings offer ing, for example—can be viable means (and missteps) of corporate sustainabil-
important insights into consumers’ evalu- to inform the general public about a ity communication;
ation of CSR communication. company’s sustainable initiatives. As • proposes specific channels as to which
The authors of the current study believe often as possible, these messages should consumers might be considered most
that it is increasingly important for compa- be supported by an external institution credible;
nies to have a reputation for being socially (i.e., federal ministries, nongovernmen- • assesses the influence of information
responsible (Morsing, Schultz, and Nielsen, tal organizations like Greenpeace, and source on overall credibility of CSR
2008) and for stakeholders to be informed consumer protection groups) to increase communication.
about CSR initiatives. The current research the credibility.
addressed this imperative, and it evaluated Advertisers particularly should be care- Overall, the current authors have found that
the necessary aspects for credible and effi- ful with purely emotional approaches to outlined aspects of corporate sustainability
cient corporate sustainability communica- CSR communication as such efforts may communication can help companies reap
tion. Furthermore, the authors believe that evoke skepticism. The current study the benefits of their CSR engagement—and
some marketing managers may need to found that consumers are more willing potentially provide a positive stimulus for
gain a better understanding of how to com- to act responsibly once they see how a the general public to act likewise.
municate their CSR efforts to consumers company leads, in terms of demonstrable
or to assess why existing communication improvements of the environmental and/
approaches might not have led to fruitful or social situations. In such instances, con- Verena Gruber is adjunct professor at HEC Montreal
outcomes. sumers likely will act on their beliefs and in the department of marketing. Her work has been
In the realm of CSR, companies should support the company, in some cases by published in journals such as Psychology & Marketing,
cater to two different types of consumers, becoming its advocates or, in others, by International Marketing Review, and Journal of Business
each with specific needs: purchasing its products. Ethics. She coauthored this research when she was at
Content is an important element of the the Institute for International Marketing Management
• Individuals who already are interested CSR mix, and the current study disclosed at Vienna University of Economics and Business (WU
in sustainability and who might seek that companies should use informative, Vienna). Gruber also consults on marketing research
specific information about the compa- substantial approaches when communi- projects for global corporations, including Philips, HP,
ny’s CSR efforts in this respect. cating their CSR efforts. Such disclosures and Red Bull.
• Consumers without a strong preexist- are important in both legacy and new
ing attitude toward sustainability who media, though often more easily imple-
Magdalena Kaliauer is a senior marketing consultant
still might be positively influenced once mented in the cases of digital services and
at GfK. She focuses on household-purchasing and
they were provided with knowledge report channels.
consumer-panel analyses and consults for leading
about a company’s initiatives. Third-party collaborations with like-
beverage companies in Austria. Kaliauer’s research
minded allies may further increase the
has been published in Journal of Business Ethics, AMS
To reach the first group of consumers, the credibility of communicated content, par-
Review, and Journal of Business Research.
current researchers advise companies to ticularly for large-scale communication
use more subtle channels, such as their channels primarily directed at a general
Bodo B. Schlegelmilch is chair of the Institute for
online home pages and online sustain- consumer prone to skepticism.
International Marketing Management at WU Vienna
ability reports, to inform interested audi- Properly aligned CSR initiatives also
Austria and distinguished research professor at Lingnan
ences about their CSR initiatives. These can serve the best interests of nonprofit
(University) College, Sun Yat-sen University, China.
channels can provide consumers with the organizations and public-policy makers
Previously, he held professorships in the United States
opportunity to retrieve in-depth informa- (Polonksy and Wood, 2001). To get con-
and the United Kingdom. In the private sector, he has
tion and concrete facts on the aspects in sumers involved, the authors of the cur-
worked at Deutsche Bank as a stock advisor and at
which they are most interested. rent paper believe such enterprises need to
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