25 Feb Corporate Sustainability is Profitable
When a company makes charitable donations on a consistent basis, consumers are more likely to have a higher opinion of that company’s products, according to a study from the Journal of Consumer Research. The study, titled “Doing Well by Doing Good: The Benevolent Halo of Corporate Social Responsibility,” noted that corporate social responsibility could lead to something that the study’s authors refer to as the “benevolent halo effect.” The effect can lead to “positive attitudes toward a company” which can then ultimately “translate into positive beliefs about the company’s products,” notes authors Sean Blair and Alexander Chernev with the Kellog School of Management, Northwestern University.
Within the study, according to Science Daily, the authors conducted four separate studies concerning how corporate social responsibility might impact consumer opinion of the quality of a given company’s products. For one study, consumers were given the opportunity to taste and rate red wines. Consumers noted one wine as tasting better when informed that the winery that made the wine actively donated to the American Heart Association. In the other studies, consumers noted that products—ranging from tooth whiteners to running shoes—were of a better quality when the products’ manufacturers participated in corporate social responsibility.
Interestingly though, whenever a company actively advertised its corporate social responsibility, that company’s “benevolent halo effect” diminished a bit. In other words, companies shouldn’t focus heavily on advertising about their charitable efforts—instead, the study noted that a company’s PR department should spread the word about the company’s corporate social responsibility via social media and other branding, while keeping advertising and charity completely separate. “Doing good can indeed translate into doing well,” note the authors, adding that corporate social responsibility can ultimately have an impact on a company’s bottom line.
As the study shows, corporate social responsibility can be a wise business move. If you work with a company that’s interested in developing or expanding their corporate social responsibility angle, then consider contacting Good360. We specialize in partnering top firms with charities and nonprofits. Oftentimes, companies have an excess of products or stock that they would to dispose of, so we partner those companies with nonprofits who could utilize those items – benefiting both the nonprofit and the company. If you’d like to learn more, click here.