The CSR-Quality Trade-Off: When can Corporate Social Responsibility and Corporate Ability Compensate Each Other?

Guido Berens, Cees B. M. van Riel, Johan van Rekom

Journal of Business Ethics · 2007 · Volume 74 · Issue 3

Abstract

This paper investigates under what conditions a good corporate social responsibility (CSR) can compensate for a relatively poor corporate ability (CA) (quality), and vice versa. The authors conducted an experiment among business administration students, in which information about a financial services company’s CA and CSR was provided. Participants indicated their preferences for the company’s products, stocks, and jobs. The results show that for stock and job preferences, a poor CA can be compensated by a good CSR. For product preferences, a poor CA could not be compensated by a good CSR, at least when people thought that CA is personally relevant to them. Furthermore, a poor CSR could be compensated by a good CA for product, stocks, and job preferences.

Keywords

applicant attitudes, consumer attitudes, corporate ability, corporate social responsibility, investor attitudes, personal relevance, trade-offs

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