The buffering effects of CSR reputation in times of product-harm crisis

Abstract

Purpose The purpose of this paper is to examine the role of prior-CSR reputation in protecting a company’s CSR reputation during product-harm crises and how it influences consumers’ crisis-related behavioral intentions (i.e. supportive communication, resistance to negative information and crisis resiliency). The authors test whether the impact of prior-CSR reputation differs by crisis type as well. Design/methodology/approach A randomized 2 (CSR reputation: good vs bad) × 2 (product-harm crisis type: tampering vs preventable) full factorial design in two industry settings (food industry and retail industry) with consumer samples was conducted. Findings The results revealed the determinant role of positive prior-CSR reputation in protecting reputational assets. A company with positive CSR reputation experiences no decrease in its CSR reputation during victim crises and fairly minor decreases during preventable crises. However, a company with a bad prior-CSR reputation experiences a greater decline in its CSR reputation across both crises; the level of decline during victim crises was as substantial as the decline experienced during a preventable crisis. The prior-CSR reputation directly affects consumers’ crisis-related intentions, and indirectly does so through post-CSR reputation. As post-CSR reputation becomes more positive, consumers display greater resistance to negative information, supportive communication intent and crisis resiliency. Originality/value This study advances the understanding of the role of corporate reputation during crises and provides additional empirical evidence of how the buffering effect of CSR can extend beyond product-related intentions among consumers. The findings can induce companies to adopt CSR programs more systematically and proactively under a long-term strategic plan.

CSR Communication, Corporate Reputation, and the Role of the News Media as an Agenda-Setter in the Digital Age

“…Similarly, Y. Kim and Woo (2019) concluded that "a company with positive CSR reputation experiences no decrease in its CSR reputation during victim crises and fairly minor decreases during preventable crises" (p. 21). However, other studies have referred to the communication of CSR activities as a reputational risk.…”

Felt betrayed or resisted? The impact of pre‐crisis corporate social responsibility reputation on post‐crisis consumer reactions and retaliatory behavioral intentions

“…Attribution theory explains how a person interprets all forms of the information presented to them until they have obtained or omitted such information to assimilate to their earlier impression (Kelley & Michela, 1980). This theory has been used to argue how cognitive perceptions of CSR efforts affect consumer‐related outcomes (Skarmeas & Leonidou, 2013) and how the consequential actions of companies relate to their CSR reputation (Kim & Woo, 2019). Attribution theory is particularly useful to understand the hypothesized relationships between pre‐crisis brand CSR reputation and post‐crisis brand perceptions, as further discussed in the following sections.…”

CSR commitments, perceptions of hypocrisy, and recovery

“…In other cases, research has shown that CSR adds robustness to a firm's reputation, a "buffering effect" (Godfrey, 2005;Kim, 2014;Peloza, 2006) or the ability to protect firms against the negative outcomes of an adverse event such as a product recall or environmental misstep. For example, CSR lead to more favorable attributions by consumers following a product crisis (Klein & Dawar, 2004), protected firm value following regulatory action (Godfrey, Merrill, & Hansen, 2009), or positively influenced consumer actions following a negative event (Kim & Woo, 2019).…”