How does corporate social responsibility transform brand reputation into brand equity? Economic and noneconomic perspectives of CSR

Abstract

The concept of corporate social responsibility (CSR) has been embedded across psychological and physical frontiers of organizations building up on philanthropy, ethics, regulation, and economy. However, there is a lack of empirical evidence that how CSR gears up various aspects of an organization. The major objective of the present study is to explain the multidimensional catalytic role of CSR in transforming brand equity from brand reputation in the fast-food industry. The study has been designed to get responses through a structured questionnaire to analyze the data through descriptive and inferential statistical techniques. Sample size of 420 consumers and employees of international fast-food chains, located in Pakistan, with diverse demographical profiles have been involved for the survey. Three models were developed to understand the aforementioned phenomenon; the first model examines the impact of brand reputation on brand equity, and the second model reassesses the same relationship with moderating role of CSR, while the third model evaluates the associations with each dimension of CSR. The results indicate that brand reputation is a significant predictor of brand equity, and its predictive power boosts up in the presence of CSR activities. It was also ascertained that CSR initiatives related to ethics, economy, and philanthropy expedite the process of conversion from brand reputation to brand equity. The legal aspect of CSR in developing economies could not prove to be fruitful in this particular context. The research would provide great insight to the managers of fast-food retail chains to evaluate investments for CSR activities in raising equity of their organizations.