Corporate Social Responsibility and Consumer Behaviour

1. Introduction

This introductory chapter provides a comprehensive background to the survey of the research subject follow up by using scientific methods. In deepness, this chapter includes research background, job statement, research aims, research inquiries, hypotheses of the survey, significance of the survey, and chapter layout. This research is aim to analyze the impact of corporate societal duty ( CSR ) on consumer behavior in Malayan decorative industry. Specifically, we examine the relationship between 4 independent variables, economic duty, legal duty, ethical duty, philanthropic duty and the dependant variable, consumer behavior.

1. Research background

The usage of corporate societal duty ( CSR ) initiatives to act upon consumers and distinguish merchandise offerings has become rather common. Corporate Social Responsibility ( CSR ) has become a chief subject in recent old ages, particularly within the cosmetics industry. The consumers are going more concerned with CSR and the demand for socially responsible trade names is increasing. On the other manus, cosmetics trade names are implementing more and more CSR activities. The consumers are acquiring more witting of the company involved in corporate societal duty ( CSR ) through better instruction and the increased influence of the media. Howard Bowen ( as cited in Matthias S. Fifka, 2009 ) mentioned that enterprisers have a duty to see societal aims, purposes, outlook and values when they make determinations. But, the definitions of CSR have a larger term of duty today. The CSR today is define as a construct, and which is the footing for companies to incorporate societal and economical demands in their corporate activities and the interrelatedness with the stakeholders is really popular. Most of the companies had already understand that their socially responsible behaviors have a direct impact on the consumer purchasing behavior.

Consumers find CSR an of import issue in the cosmetics industry and would trust to see more socially responsible cosmetics trade names. They would wish to be informed more about what the cosmetics trade names are really making in footings of societal duty. Consumer would besides wish to cognize on how the CSR activities of the cosmetics trade names are genuinely meant to better the society and the environment, non merely to utilize as a selling tool. When it comes to purchasing cosmetics trade names ; quality, monetary value and ingredients are considered to be the chief purchase factors by consumers. However, it can be stated that even though CSR is non considered to be a purchase factor, it does hold a important impact on the purchase determinations. In decorative industry, when it comes to buying cosmetics merchandises, the merchandise quality is the chief ground that affects the consumer behavior. Functional properties like breathable, water-resistance, easy to wash are other factors are use to make up one’s mind the quality of the merchandise. For case, some consumers use cosmetics for work and some for leisure and athleticss, as they need a batch of motion, while lastingness is an of import consideration in buying cosmetics. The public presentation of the ware besides consequence client mind since a ware holding immense gross revenues would do the client think that the quality of the merchandise must be good to bring forth such gross revenues ( Hamza S.K. , 2011 ) . Under merchandise quality were included facets like good quality of merchandises presented by the trade name, lucifer between product-consumer tegument type, handiness of a broad scope of merchandises under the same trade name name and contents of harmful chemicals in the merchandises ( Chitralekhah H.D. , 2009 ) . The bulk of the consumers are seeking for merchandises that are fragrance free and allergy tested, and that do non incorporate unhealthy chemical additives.

The decorative industry has received a batch of unfavorable judgments on immoral and irresponsible concern activities such as utilizing of animate beings for merchandise trial, chemical pollution, unethical sourcing and unsustainable ingredients. Companies of the decorative industry have understood the importance of CSR and have started working on the bar and minimisation of the negative impacts by their concern patterns. Previous surveies on consumers’ attitudes on CSR and CSR’s impact on consumer behaviour and purchasing determinations are rather general. We found that many research workers explore that CSR have impact on consumer behavior in the decorative industry. So, we see this as an chance and have the thought to get the better of the job ( Zhao.G, 2012 ) .

2. Problem statement

Consumers view decorative companies as net income maximizing companies instead than socially responsible companies that emphasizes on seting corporate societal duty into pattern to do the universe a better topographic point to populate ( McNeal, n.d. ) .

There is a controversy issue that decorative companies use carnal testing in the procedure of bring forthing decorative merchandises ( Mohamed, 2010 ) . In this twenty-four hours and age, consumers start to concern about the animate being rights ( Mohamed, 2010 ) . Consumers have raised issues such as the humanity of Cosmetics Company for deliberately poisoning animate beings in order to prove the decorative merchandises that they produce where the ethicalness of cosmetics companies has been questioned ( McNeal, n.d. ) . Consumers are non willing to purchase decorative merchandises marketed by cosmetics companies that have a bad repute in footings of animate being testing ( McNeal, n.d. ; Mohamed, 2010 ) .

Besides carnal rights, there is besides an issue sing the decorative industry’s packaging which causes negative impact on the environment ( Danley, March 2012 ) . The decorative industry has been known in utilizing big sums of stuffs in its packaging, ensuing in an addition use of landfill infinite required for its waste disposal ( Danley, March 2012 ) . Furthermore, a significant sum of energy input is needed in fabrication, production and transit of those packaging stuffs taking to a big sum of natural resources and energy ingestion, every bit good as ensuing in the emanation of nursery gases and harmful pollutants into the ambiance which may do planetary heating ( Danley, March 2012 ) . Harmonizing to Mohamed ( 2010 ) , consumers are non willing to pass money on decorative merchandises produced by Cosmetics Company which have undergone unfriendly production procedure.

In the present twenty-four hours, consumers have become more environmentally concerned every bit good as being more selective and accountable in their picks ( Mohamed, 2010 ) . They care about how, where and why the decorative merchandises are produced ( Mohamed, 2010 ) . In add-on, consumers have shown a high involvement in decorative merchandises which are made from natural ingredients such as botanical infusions, oils and minerals ( Mohamed, 2010 ) .

When consumers are more cognizant of the CSR of the cosmetics companies, their purchase determination will look different. The determination statement here is in what ways decorative companies can better consumer purchasing behaviour towards decorative merchandises. This research was done on Malayan decorative industry as there was no or small research done antecedently by other research workers sing this peculiar field. In order to make full the research spread, we have used a series of research methodological analysis such as informations processing, informations analysis and other methods to carry on the trial to find whether there is any impact of the four degrees ( pyramid ) of CSR on consumer purchasing behaviour in Malayan Cosmetics Industry.

3. Research Objective

1. General Aims

The aim of this research is to look into the impact of the Four Levels of Corporate Social Responsibility ( CSR ) on Consumer Behaviour in Malaysian Cosmetic Industry.

2. Specific Aims

1. To look into the impact of Economic Responsibility on Consumer Behaviour in Malaysian Cosmetic Industry.
2. To look into the impact of Legal Responsibility on Consumer Behaviour in Malaysian Cosmetic Industry.
3. To look into the impact of Ethical Responsibility on Consumer Behaviour in Malaysian Cosmetic Industry.
4. To look into the impact of Philanthropic Responsibility on Consumer Behaviour in Malaysian Cosmetic Industry.
5. To look into the impact of the Four Levels of Corporate Social Responsibility on Consumer Behaviour in Malaysian Cosmetic Industry.

4. Research Questions

2. How Economic Responsibility impact Consumer Behaviour in Malaysian Cosmetic Industry?
3. How Legal Responsibility impact Consumer Behaviour in Malaysian Cosmetic Industry?
4. How Ethical Responsibility impact Consumer Behaviour in Malaysian Cosmetic Industry?
5. How Philanthropic Responsibility impact Consumer Behaviour in Malaysian Cosmetic Industry?
6. How Four Levels of Corporate Social Responsibility impact Consumer Behaviour in Malaysian Cosmetic Industry?

5. Hypothesis of the Study ( for quantitative research )

H1: There is important impact of Economic Responsibility on Consumer Behaviour in Malaysian Cosmetic Industry.

H2: There is important impact of Legal Responsibility on Consumer Behaviour in Malaysian Cosmetic Industry.

H3: There is important impact of Ethical Responsibility on Consumer Behaviour in Malaysian Cosmetic Industry.

H4: There is important impact of Philanthropic Responsibility on Consumer Behaviour in Malaysian Cosmetic Industry.

H5: There is important impact of the Four Levels of Corporate Social Responsibility ( CSR ) on Consumer Behaviour in Malaysian Cosmetic Industry.

6. Significance of the Study

There is an increasing demand on a healthier and better life style among Malayan consumer. As these population continues to turn, consumer are more concerned in the merchandise that they buy or consume and how the merchandise are produced every bit good as delivered from the warehouse to the terminal consumer. Therefore, it causes an addition in demand of Corporate Social Responsibility ( CSR ) among Malayan consumers in assorted industries.

Similarly in Malayan Cosmetic Industry, consumers are deriving consciousness on how makers are bring forthing goods ( cosmetics ) through assorted agencies. An increasing demand and “wants to know” behavior among consumers in decorative industry has leads to a more careful behavior among manufacturers in bring forthing goods to managing the goods. On the other manus, turning societal media that reveals unethical behavior of organisations has besides helps in consumers’ consciousness towards unethical behavior conducted by an organisation.

Nowadays, many consumers are against carnal testing and hapless wastage direction. They are besides eager to cognize how a corporation performs societal duties such as giving back to the society. By and large, this research is conducted to place how consumers react to the house CSR which consequences in their purchase determinations. This research besides aims to place the impact of the four degrees ( economic, legal, ethical, philanthropic ) of CSR in consumer behavior in Malayan Cosmetic industry and the positive impact of CSR that consequences in consumers’ positive behavior such as higher buying power and trueness every bit good as increasing corporate societal image.

First, this survey will admit Malaysian Cosmetic Industry corporations about the importance of executing CSR activities as it is proved that there is a positive relationship between CSR activities on consumer behavior in this survey. Through this survey, directors in the Malayan Cosmetic Industry should be acknowledged that the degree of CSR will impact consumer behavior in their purchase determination of the merchandises ( cosmetics ) . Therefore, directors will be able to pass on with consumers sing the CSR activities performed by the house every bit good as place how likely consumers will purchase their merchandises ( cosmetics ) if the house actively participates in CSR activities which will in return encouragement both corporate image and gross revenues.

Second, this survey besides contributes to academicians as they will be able to understand the kineticss and function of the four degrees of CSR on consumer behavior in Malayan Cosmetics industry. Besides, academicians or research workers will besides be able to foster the research topic in the close hereafter through the parts and findings of this survey.

Third, this survey will besides lend to policy shapers or regulators of the Malayan Cosmetic Industry such as the Drug Control Authority ( DCA ) which is established under the Control of Drugs and Cosmetics Regulation 1984 ( CDCR ) and managed by the National Pharmaceutical Control Bureau ( NPCB ) where their chief map is to guarantee safe, efficacious and quality of pharmaceuticals that are marketed in Malaysia ( Malaysia: Control of Drugs and Cosmetics Regulation 1984, 2011 ) . Through the consequence of this survey, regulators may promote houses in the decorative industry to unwrap their Good Fabrication Practice ( GMP ) every bit good as CSR activities as it is proved that there is a positive impact of the four degrees of CSR on consumer behavior in Malayan Cosmetics Industry.

7. Chapter Layout

Chapter one of this research undertaking is about the overview of the survey which comprises the debut, research background, job statement, research aims which are divided into general aim and specific aims, research inquiries, hypotheses of the survey, significance of the survey, chapter layout and decision. First, we have to understand the Malayan Cosmetics Industry as a whole and so saying the jobs faced by the industry which leads to the research aims and research inquiries and developing the hypothesis. The hypothesis is so being tested by empirical grounds. Generally, research aims are used to province the chief end to be achieved through the survey whereby research inquiries are inquiries to be solved through the probe of the survey in the Malayan Cosmetic Industry. Hypothesiss are used to prove against the consequences to find whether it is true or false. The significance of the survey by and large is used to explicate the importance and the parts of the survey.

Chapter two, the literature reappraisal, consists of the debut, reappraisal of the literature, reappraisal of relevant theoretical theoretical accounts, proposed theoretical or conceptual model, hypotheses development and decision. In this chapter, the dependent variables and independent variables are developed. The treatment sing the relationship between the independent and dependent variables based on the grounds from past researches such as journal articles are required as it serves as the foundation for the hypothesis development. Hypothesis development is developing statements which will be tested against empirical grounds and to turn out whether it is true or false.

Chapter three, the research methodological analysis comprises subdivisions like debut, research design, informations aggregation methods, trying design, research instrument, concepts measuring ( scale and operational definitions ) , informations processing, informations analysis and decision. In this chapter, the method used in this research is explained. First, the qualitative or quantitative information are specified for the research and explained why such methods are used. Following, the methods used to roll up informations ( primary informations or secondary informations ) are besides stated. In the sampling design subdivision, the mark population, trying frame and location, trying elements, trying technique, and sample size are besides stated. Then, the instrument to be used to obtain informations and grounds utilizing it are stated and the measuring ( operational definitions and primary graduated table of measuring ) which is used in the questionnaires are constructed. Data processing is a description how a set of informations are processed from the respondents. Last, the information analysis tools ( computing machine plans or package used to analyse the information ) are besides stated and justified.

Chapter four, the research consequences comprises subdivisions like the debut, descriptive analysis which are separated into subdivisions like respondent demographic profile and cardinal inclinations measuring of concepts, scale measuring, illative analyses and decision. In this chapter, the consequence of this survey will be derived from SAS Enterprise Guide package. Besides, all information of descriptive analyses is computed in the signifier of tabular arraies and a brief account of all relevant trials and consequences are besides included.

Chapter five, the treatment and decision comprises of subdivisions like the debut, sum-up of statistical analyses, treatment of major findings, deductions of the survey, restrictions of the survey, recommendation for future research and decision. In this chapter, a treatment sing the consequence obtained will be conducted. Besides, recommendations, deductions and decision of the survey are besides included at the terminal of the chapter.

8. Decision

In decision, this survey aims to look into the impact of the four degrees ( pyramid ) of CSR on consumer behaviour in Malayan decorative industry. In the beginning of the research, we had provided the brief background or history of Malayan decorative industry. In this chapter, the job statement, general and specific aims of the survey based on scientific method for the research are provided. Besides, several hypotheses were formed to analyze the relationship between the independent variables and dependent variables. This chapter besides includes the significance of the survey and the chapter layout. Next, Chapter 2 will farther lucubrate or analyze the variables formulated in Chapter 1.