The Importance Of Corporate Social Responsibility

Research suggests that corporations of the 21st century can be benefit prodigiously when they are perceived as socially responsible by their stakeholders, however much of that research fails to examine the difference between sectors. Studies about the growth of ethical consumption have primarily focused on commodities such as food products, clothing, or other goods consumers buy on regular basis (Auger et al., 2013). Buying patterns of everyday commodities are subject to increased perception of peer pressure, which can lead to consumers choosing socially responsible products than not. What we hope to discover through hypotheses two is whether CSR differs from luxury purchases and commodities. In prior work attributing to the awareness of

A study done by Dolores Gallardo-Vasquez and Isabel Sanchez-Hernandez in 2014 proved this to be true, they hypothesised that there is a positive correlation between corporate social responsibility and success (Gallardo-Vazguez and Sanchez-Hernandez 2014). In the Ratner case, he jokes the company profits falling and within six weeks of his “total crap” speech, his company began to lose sales (Ratner, 2007). Because of his poor corporate social responsibility, it led to the company losing a significant amount of sales. However, in some cases, adequate corporate social responsibility does not always yield more profits. Amy Hillman and Gerald Keim studied how a company’s corporate social responsibility is indirectly correlated to its profits and success (Hillman and Keim, 2001). Therefore, if a company has negative corporate social responsibility, then the company’s sales will remain the same or increase. For example, companies like Apple who utilise inexpensive labour and poor working conditions for their employees still have high profits (Oppenheimer, 2011). Foxconn is the company that manufactures Apple’s products. The organizational culture for Foxconn is ‘‘Profit maximisation is the ultimate corporate principle, under which workers’ dignity and well-being are of no concern’’. Within Foxconn, many people have committed suicide because of their poor working conditions that their workers had to face (Lucas, Kang, and Li, 2012). Regardless of what inhumane events that happen within Foxconn, consumers will still buy Apple