Can vice be virtuous? : an examination of CSR engagements and communication of 'vice companies' and the effect on corporate image

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Can Vice be Virtuous?

An examination of CSR engagements and communication of 'vice companies' and the effect on corporate image.

Yarin Ploum

Student number: 6145167 27-05-2016

University of Amsterdam

Faculty of Economics and Business

Master: Business Administration - Strategy track Supervisor: Lars Moratis

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Statement of originality

This document is written by Yarin Ploum. I declare to take full responsibility for the contents of this document. I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been used in creating it.

The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents.

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Abstract

Corporate image can be seen as the most strategic, critical, and enduring intangible asset of a company (T. Brown, Dacin, Pratt, & Whetten, 2006). CSR engagement has been recognized as one of the most

essential factors influencing corporate image (Worcester, 2009). Firms in controversial industries also known as vice companies are having difficulty with improving their image from their CSR engagement due to stakeholder skepticism (Godfrey, Merrill, & Hansen, 2009). The main research question therefore is: to what extent can vice companies improve their company image by engaging in and communicating about CSR according to Dutch CSR managers?

This qualitative research consists of a multiple case study in which 14 Dutch CSR managers from vice and non-vice companies are interviewed. The research indicate that vice companies could improve their image by engaging in CSR on a transactional level emphasizing transparency and on an instrumental level by showing the quality of the product by being more sustainable. Secondly is indicated that the bare minimum or nothing at all should be spent on the marketing of the CSR activity. Thirdly that it’s

important when engaging in CSR activities to have a low-fit to the negative effects of the vice product. Fourthly is it important for a vice company to communicate the realized CSR outcomes. Lastly to only communicate CSR aspirations with a low-fit to the negative effects of the core product. It should be kept in mind that when a vice company communicates its aspirations there’s a reasonable chance that people will think that the aspiration not aspirational enough is.

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1. Introduction

1.1 Research context

Corporate image has been getting a lot of interest from marketing practitioners and academics for the last 55 years (Manto Gotsi & Alan M. Wilson, 2001). If we look at the literature on this subject we see that it’s the most strategic, critical, and enduring intangible asset of a company (T. Brown et al., 2006). It can be a source of competitive advantage (Gray & Balmer, 1998) and eventually will lead to longer lasting profits (Fombrun, 1996). It has even been acknowledged that a good image is an important factor in the success or failure of all big corporations (Worcester, 2009). A good image is therefore extremely important.

Corporate social responsibility (CSR) engagement has been recognized as one of the most essential factors influencing corporate image (Worcester, 2009). Finding out in which way companies’ CSR involvement affects stakeholders’ perception of the corporate image, identity and reputation has therefore been an important topic in the academic debate (Bhattacharya, Korschun, & Sen, 2009; Sen, Bhattacharya, & Korschun, 2006). CSR is an essential concept in modern business discourse. The concept can be identified and defined in many different ways (Okoye, 2009). McWilliams and Siegel (2001) describe CSR as “actions that appear to further some social good, beyond the interests of the firm and beyond that which is required by law”. One of the problems companies face is that stakeholders are getting more sceptical about the involvement of companies in CSR (Vlachos, Tsamakos, Vrechopoulos, & Avramidis, 2008). They might see it as just merely a marketing practice of a firm instead of sincerely doing good (Luo & Bhattacharya, 2006).

Firms in (Godfrey et al., 2009). The term vice company will be used in this research for a firm in a controversial industry. Cai, Jo, & Pan (2012) see firms in this industry as those that are subject of moral debates, social taboos, political pressures, or environmental, social or ethical issues. Examples are tobacco, gambling, alcohol, adult entertainment, weapons, nuclear, oil, and biotech firms.

The goals of this research are two-fold. Firstly to investigate which CSR activities

vice-companies should undertake to improve their company image. Secondly how these vice vice-companies should communicate about this CSR-engagement to improve their company image.

Vice companies in the tobacco industry are having trouble improving their image via CSR. Palazzo & Richter (2005) note that this industry has begun to position themselves as good corporate citizens and is engaging in CSR more and more. This development is being heavily criticized by the

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anti-tobacco NGOs (Palazzo & Richter, 2005). Even the World Health Organization (WHO) has questioned if it would be possible for a company with the goal of making profit by selling a deadly product to engage in CSR at all, which goal is to contribute to a greater social good (World Health Organization, 2003). Yoon, Gürhan-Canli, & Schwarz, (2006) look at various vice companies and if they should or should not support a cause that has a connection to their core business i.e. a low or a high fit. They give an example of a high fit a tobacco company that supports the National Cancer Association, or a beer company that supports an anti-drinking and driving campaign. Very few articles were found in the literature on CSR engagements of vice companies. This research therefore complements this rather unknown subject. Furthermore it is looked if the findings in the two articles above still hold up 10 years later, and if they are applicable to other Dutch vice companies.

This research also looks at two opposing communication strategies named greenwashing (Forehand & Grier, 2003) and CSR as aspirational talk (Christensen, Morsing, & Thyssen, 2013). These two theories have a different view about how you should communicate. Greenwashing is a concept that explains the gap between the communicated CSR promises and the actual CSR implementation.

Following the theory of greenwashing vice companies should only stress their realized CSR outcomes to improve their company image. Christensen et al., (2013) advocate that corporate messages can also encourage positive CSR developments within the company. Following the theory of Christensen et al. (2013) and Luhmann (2001), but in contrast to the theories about greenwashing (Furlow, 2010), vice companies should definitely express their CSR plans even if they haven’t yet implemented them.

1.2 Research question

To what extent, can vice companies improve their company image by engaging in and communicating about CSR according to Dutch CSR managers?

To answer the research question Dutch CSR managers from vice and non-vice companies will be interviewed.

1.3 Academic and practical relevance

This research complements the academic knowledge by shedding more light on how vice companies can improve their image by engaging in CSR. According to Cai et al. (2012), this topic is still in its infant stage and undeveloped. This research will help to develop the knowledge on this subject.

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The research of Palazzo & Richter (2005) on CSR engagement in the tobacco industry was performed 10 years ago. A lot has changed in the business world since then. In this research we will investigate if the findings still hold today. We will also take another approach that lead to the theory of Palazzo & Richter (2005). Namely, we will ask Dutch CSR managers from vice and non-vice companies about their thoughts on this matter. This also answers Du’s & Vieira Jr’s (2012) request for a more structured method of qualitative data to better understand CSR related matters in controversial industries. Du & Vieira Jr (2012) also state that it is necessary to look at other vice companies to find similarities between the CSR practices. This research will add a new perspective to the general debate on CSR practices in vice companies

The two opposing communication strategies named greenwashing (Forehand & Grier, 2003) and CSR as aspirational talk (Christensen et al., 2013) will be compared and an attempt will be made to find out which of them will increase the image for vice companies most positively when communicating about their CSR engagement. Looking at the literature, this has not been done yet.

In the article 'The means and end of greenwash' by Lyon & Montgomery (2015), the authors make a good start in reviewing and synthesizing the progress that has been made in the last years on greenwash literature. In their review they don’t mention having found any theory about greenwashing in vice companies. This research can therefore add an extra perspective to the greenwash literature by specifically looking at vice companies.

Christensen et al. (2013) suggest further exploring of the delicate borders between talk and action in the broader context of CSR. This research will add to the general debate on aspirational talk especially by vice companies. Vice companies are often accused of talking but not doing. This research is therefore expected to give interesting thoughts on this matter.

As a practical relevance, this study offers insights in how vice companies can engage in and communicate about their CSR. This should help vice firms better understand what to do and what not to do when engaging in CSR. This can result in better a better CSR policy for these companies, which can positively influence the overall image of these firms.

1.4 Readers’ guide

The next chapter provides a review of relevant literature. We will take a closer look at the relevant concepts on corporate image, CSR and vice companies. We will also discuss the relevant articles on CSR engagement and communication. Then, we will explain the data and method of the research. We will

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explain how the respondents were selected, how the data was gathered and analysed and we will discuss methodological issues. The results of the interviews will be presented and these will be followed by a discussion. Finally, we will answer the research question, make a few concluding remarks and we formulate a number of suggestions for future research.

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2. Literature review

2.1 Introduction

In this chapter we will take a closer look at the relevant literature for the research question of this paper. First, we will discuss the importance of company image and the general factors that influence them. Second, we will give a short description on CSR and vice companies. The article of Palazzo & Richter, (2005) on the levels of CSR engagements for tobacco companies will be discussed, followed by the article by Yoon et al., (2006) about the fit between the CSR engagement and the core business. The last part of the literature review will be about the communication of these CSR engagements. This section will explain the concepts of greenwashing and of aspirational talk.

2.2 The importance of company image and reputation

Corporate image and reputation has been getting a lot of interest from marketing practitioners and academics for the last 55 years (Manto Gotsi & Alan M. Wilson, 2001). The Marketing Science Institute even called in their research priorities from 1992-1994 for more research on corporate reputation and image (T. J. Brown & Cox, 1997). Managers are now also placing more importance on positively sustaining these two concepts (van Riel, Stroeker, & Maathuis, 1998).

Even though a lot of research has been conducted on these concepts there hasn’t been a clear distinction, or a generally accepted definition for corporate image and reputation. Depending on the adopted viewpoint, these concepts have appeared as completely different, interrelated or as the same concept in the academic debate (Manto Gotsi & Alan M. Wilson, 2001). In the review article by Manto Gotsi & Alan M. Wilson (2001) on the literature on corporate reputation and corporate image, the authors broadly found two dominant schools of thought. In the analogous view, image is seen as synonymous to reputation. The differentiated view sees them as different concepts but still as interrelated. In this latter view, reputation is seen as “a snapshot that reconciles the multiple images of a company held by all its constituencies” (Fombrun, 1996, p. 72). In this definition, corporate reputation is thus seen by most as a reflection over time and it is greatly influenced by the corporate image that is formed from day to day by the stakeholders. The difference can thus be found in the fact that the image is about a certain moment in time while reputation is about a longer period (Manto Gotsi & Alan M. Wilson, 2001). Similarly, Balmer & Greyser (2003, 4) state that image is about how we are perceived now and reputation is about how we are perceived over time. For this research, the distinction between these two concepts is not so relevant.

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Therefore, the choice is made to take the analogous view and see corporate image and reputation as the same concept.

The following definition for corporate image and reputation is used: The mental picture that a stakeholder has of an organization, and a value judgment about a firm's attributes which evolves over time as a result of consistent performance, established and reinforced through effective communication (Yeo, Goh, & Tso, 2011). In this research corporate image will mostly be used to refer to these concepts.

Looking at the literature on corporate image it is seen as the most strategic, critical, and enduring intangible asset of a company (T. Brown et al., 2006). It can help a firm recover from bad publicity (G. Dowling, 1993). It can be a source of competitive advantage (Gray & Balmer, 1998) and eventually it will lead to longer lasting profits for companies that have a better image (Fombrun, 1996). It has even been acknowledged that a good image constitutes an important factor in the success or failure of all big

corporations (Worcester, 2009). If companies have a negative corporate image in the eyes of customers, it negatively influences the willingness of these customers to support the product or the company.

Consequently sales and profits will decline (Gray & Balmer, 1998). Corporate image also has an effect on the morale and productivity of employees (Dr. Sherril H. Kennedy, 1977). A good image is therefore extremely important.

2.3 General factors influencing company image

In order to manage the corporate image of a firm the factors that have an influence on it should be known. In the academic literature there are a lot of different ways how corporate image is measured but there seems to be no consensus on valid scales (Nguyen & Leblanc, 2001).

According to Berens & van Riel (2004), there are three key views on the measurement of corporate image. The first one is about the social expectation on firms. The second one is about which personality traits people give to firms. The third one is about the motivation of people to distrust or trust a firm. Fombrun & Gardberg (1999) developed the Fombrun Reputation Quotient. In this scale, a total of twenty attributes are spread over the categories in order to measure the reputation of firms: workplace environment, vision and leadership, social responsibility, financial performance, product and services, and emotional appeal. Spector (1961) looks at six other dimensions that influence the corporate image. Based on the personality dimensions of a company he looks at whether a firm is withdrawn, successful, of good character, business-wise, co-operative or dynamic. Dowling (2004) divides the attributes of corporate

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image in two categories. On the one side the emotional factors like the uniqueness or the firms’ personality. On the other side the factual drivers like financial performance and corporate capabilities.

CSR engagement has been recognized as one of the most essential factors influencing corporate image (Worcester, 2009). Finding out in which way companies’ CSR involvement affects stakeholders’ perception of the corporate image and identity has therefore been an important topic in the academic debate (Bhattacharya et al., 2009). Looking at the stakeholder model of strategic management of a firm it is seen that different groups a legitimate stake in the firm have (Joep Cornelissen, 2000). How the firm is perceived is different for each stakeholder group because each one has its own interests and assigns different degrees of importance to the image of a company (Joep Cornelissen, 2000). Most firms see their customers as their key stakeholder (Isabelle Maignan, O.C. Ferrell & Linda Ferrell, 2005). This research therefore looks at how the CSR engagement of vice companies affects the image that customers have of these firms. One of the problems companies face is that stakeholders are getting more sceptical about the involvement of companies in CSR (Vlachos et al., 2008). They might see it as just merely a marketing practice of a firm instead of them sincerely doing good (Luo & Bhattacharya, 2006). Forehand and Grier (2003) explain scepticism with the help of attribution theory. This theory tries to explain how individuals think about the motives of others and that the perception of these motives influences behaviour and attitude of the individual. To companies, individuals attribute two kinds of motives. Firm-serving motives are about the benefit to the firm. Public-serving motives are about the benefits to individuals outside of the firm. Consumers that are under the impression that a firm has firm-serving motives but that they act as if they have public-serving motives get the perception that the firm is being deceptive. In this case

scepticism is likely to develop (Forehand & Grier, 2003). Elving (2013) defines scepticism as “a

tendency towards disbelief”. Vice companies are having difficulty with improving their image from their CSR engagement due to stakeholder scepticism (Godfrey et al., 2009). When Exxon started to get involved in environmental issues (public-serving) after they caused a major oil spill (firm-serving), consumers were very sceptical about their actions (Forehand & Grier, 2003). This research contributes to the literature on corporate image by focusing on how vice companies can improve their image by

engaging in CSR activities.

2.4 Corporate Social Responsibility

The concerns from business communities to society can already be found centuries ago. The formal writings on the concept of corporate social responsibility are mostly from the past 50 years (Carroll, 1999). McWilliams and Siegel (2001) describe CSR as “actions that appear to further some social good,

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beyond the interests of the firm and that which is required by law”. Jeurissen (2000) thinks that a business is socially responsible when it prospers economically, lives up to the environmental quality and takes social justice in to account. Friedman (2007) introduces an opposite view and states that the only social responsibility of the firm is to increase its profits. This is on the same page as Karnani (2010) who believes that CSR is just a financial calculation for executives and that companies shouldn’t be convinced to be socially responsible because their CSR will almost always be ineffective.

Looking at the effects of CSR, Orlitzky et al. (2003) find a positive relationship between CSR and Corporate Financial Performance (CFP) based on their meta-analysis of 52 studies. Other authors state that there is a complex and nuanced relationship between CSR and CFP. Still also they found in their research that companies that met the criteria of social-responsibility in general have a financial performance at least the same if not better than companies that don’t engage in CSR (Pava & Krausz, 1996). These conclusions might be one of the big reasons why vice companies are now engaging more and more in CSR.

2.5 Vice-companies

The term vice company will be used in this research for a firm in a controversial industry. Cai, Jo, & Pan (2012) see firms in this industry as those that are subject of moral debates, social taboos, political pressures, or environmental, social or ethical issues. Examples that are given are tobacco, gambling, alcohol, adult entertainment, weapons, nuclear, oil, and biotech firms. The definition of Cai, Jo, & Pan (2012) has several conceptual problems as it has room for many interpretations and it becomes clear that the line between vice- and non-vice companies cannot be easily drawn. For instance, a bank could also be seen as a vice-company in this respect, because of the moral debate. However, the activity of banking itself doesn't necessarily have to be malevolent for society, as this strongly depends on the action and organization of such a bank. In this thesis therefore a bank isn’t seen as a vice company. In the dictionary “vice” refers to all illegal and immoral activities such as gambling, drugs and prostitution. Managers from ethical funds vary a lot in their definition on vice companies. In general they see the tobacco, alcohol, defence, guns and nuclear energy firms as vice companies. General manager Charles Norton of The Vice Fund (VICEX) talks about an alternative sector that includes the tobacco, alcohol, defence and gaming industries (Altucher, 2006). In this research there will be a focus on the following vice companies: tobacco, gambling, alcohol, adult entertainment, weapons, nuclear, oil, and biotech firms.

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the value of these company. In their research Cai et al. (2012) looked at US vice firms between 1995 and 2009 and found a positive relation between their CSR involvement and the companies’ value. According to these results vice companies should definitely engage in CSR. Cai et al. (2012) don’t mention in which way these companies can do this most successfully. They note that the CSR engagement of vice

companies is still in its infant stage and that it’s still not known how firms in this industry gain or seak legitimacy (Cai et al., 2012). So the question remains what the best way is for vice companies to engage in CSR. This research will try to help answer this question and shed a light on this still rather unexplored area.

2.6 CSR engagement in the tobacco industry

A good example of growing CSR engagement at vice companies can be found in the tobacco industry. Palazzo & Richter (2005) note that this industry has begun to position itself as good corporate citizen and is engaging more and more in CSR. This development is heavily being criticized by the anti-tobacco NGOs (Palazzo & Richter, 2005). Even the World Health Organization (WHO) has questioned if it would be possible for a company with the goal of making profit by selling a deadly product to engage in CSR (World Health Organization, 2003). This question of the WHO shows that the subject of CSR

engagement of vice companies is rather undeveloped.

While it seems difficult for vice companies to successfully engage in CSR, the tobacco

companies are doing their best. One way of doing this is that they’re asking for an open dialogue. They are now seeking to have a constructive dialogue with national governments and the WHO (World Health Organization, 2003). Burchell & Cook (2013) find that NGOs are getting ‘dialogue fatigue’ because they are getting a lot of requests to engage in conversations with firms that just use them as a talking shop. NGOs are now more selective in choosing whom to engage with because interaction without action doesn’t lead to successful stakeholder engagement. A lot can be found about CSR on the website of tobacco companies. For example on that of British American Tobacco (BAT), the second largest tobacco group, they have a CSR committee and a sustainability program. Also statements like the following show their intent to be engaged with CSR: “Our continued commitment to robust sustainable business

practices is reinforced by the significant progress made across corporate processes and practices, as documented in this Report. We continue to address our social, environmental and economic impacts to build value for the business, for our shareholders – and for all stakeholders affected by our business” (British American Tobacco, 2013). It is clear that tobacco companies are engaging more and more in CSR, but a lot of critique on this engagement is present. The question therefore remains how they and

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other vice companies can do this most successfully.

2.7 CSR activities that improve the image of vice-companies

Palazzo & Richter (2005) investigated the CSR engagement in the tobacco industry. They believe that because there is such distrust toward the tobacco industry caused by the lethal character of cigarettes, conventional CSR strategies won’t work. Still these firms do try to obtain societal acceptance of their activities through their CSR engagement (Palazzo & Richter, 2005). The central aspects of a CSR

approach that are important to achieve this societal acceptance are corporate philanthropy, CSR reporting, stakeholder collaboration and self-regulation. These four aspects do not seem to be working or have even been counterproductive for the tobacco companies. Philanthropic CSR engagement is basing your CSR involvement on your core competencies to improve your image. The difficulty for tobacco companies is that the specifics of its products do not allow basing it on their core competencies. CSR reporting is mostly about the positive effects the company brought about. Self-criticism is mostly seen as things that still need to be done. The difficulty for tobacco companies is that it can’t be completely transparent because their product harms people. CSR collaboration can have positive effects on image. Working together with firms that have a good image can even lead to image spill-overs. Due to the image of the tobacco industry there are not many partners that want to collaborate. Self-regulation is also a problem because the tobacco industry won’t easily be trusted to self-regulate (Palazzo & Richter, 2005). Based on these point Palazzo & Richter, (2005) argue that the characteristics of the tobacco industry don’t allow for image building via CSR engagement

Palazzo & Richter (2005) explain that tobacco companies can’t engage in CSR to show to their stakeholders that they are doing the right thing. They can’t try to obtain societal acceptance of their activities, through the regular aspects of CSR engagement. Palazzo & Richter (2005) therefore suggest looking at the three levels of CSR performance used in the leadership literature: the instrumental, the transformational and the transactional. The instrumental level of CSR is about the ability to deliver products at a quality level expected by the customers. The transformational level of CSR is about the organizations demonstrating the willingness to go beyond self-interest and to think about the common good. It is very difficult for vice companies to be perceived as contributing to the well being of society and this common good. The transactional level of CSR is about the integrity to comply with the moral and legal rules of society. It’s about transparency, fairness, keeping their promises and acting with

consistency. Palazzo & Richter (2005) believe that tobacco companies have to accept that when engaging in CSR activities they can only focus on the transactional level (Palazzo & Richter, 2005). Their CSR

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strategy has to be completely transparent and should have a dilemma-oriented approach. As long as tobacco has negative health consequences, a tobacco firm can only realize an image improvement via transactional CSR activities (Palazzo & Richter, 2005). This research investigates if this theory is also applicable to other vice companies.

Proposition 1: Vice-companies should refrain from engaging in instrumental or transformational CSR activities and engage in transactional CSR activities, directed at improving transparency and following the rule of law in order to improve their image.

Vice companies struggle a lot with their image due to the controversial nature of their products. Yoon et al. (2006) investigated the effect of CSR activities from various vice companies on the

evaluations of these companies by consumers. According to the attribution theory perspective, firms engage in CSR because they hope that consumers will attribute a positive image to the company if they observe that firms support worthwhile causes. However it is shown by psychological research that this positive image won’t be given to the firm if consumers are under the impression that the company is engaging in CSR mostly for ulterior motives (Yoon et al. 2006). In one experiment they conduct, a tobacco company and an oil company are used as a case. They find that consumers take the ulterior motives of firms, like image-promotional reasons, for granted but focus mostly on how serious the company is about its CSR activities. In case this seriousness is perceived as low, consumers become suspicious about the CSR activities. Yoon et al. (2006) therefore recommend firstly supporting a cause that has a low fit with the core business. They give as a high fit example a beer company supporting an anti-drinking-and-driving campaign or a tobacco company that supports the National Cancer Association. Because the support of this cause is at odds with the negative health effect of their core business it will cause deep suspicion about the motives of the firm. It would be less suspicious if a tobacco company would support a cause that concerns the environment this would be an example of a low benefit salience. The second finding of Yoon et al. (2006) is that it’s better to spend more money on the CSR cause than on advertising that you are supporting a specific cause. Spreading the word about the good deeds should be left to others. Thirdly, that low benefit salience improves the firms’ evaluations even more when consumers hear about the CSR activity from a neutral source instead of from the company itself. Fourthly, in case of a high fit between a firm with a bad image and its CSR it can be helpful if the sincerity is shown in other ways. For example that the money spent on the CSR cause is way more than the money spent on spreading the word. The research of Yoon et al. (2006) offers valuable thoughts in which way vice companies should or should not engage in CSR.The following propositions were made based on the theory of Yoon et al. (2006)

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Proposition 2: Vice companies should undertake low-fit activities to increase their company image

Proposition 3: Vice companies should spend more money on the CSR activities themselves than on advertising about the engagement, because spending too much on advertising will cause deep suspicion about the motives of the firm

2.8 Communicating CSR engagements of vice companies in order to improve

company image

It is a certainty that whenever companies communicate about their CSR involvement, critical NGOs will react by emphasizing and criticising the shortcomings (Palazzo & Richter, 2005). There has been ample research on CSR communication strategies for non-vice companies, but only one article from Du & Vieira Jr. (2012) that was found on CSR communications for vice companies. Percy (1980) states that people will first assess the trustworthiness of the communicator before it will accept its content. For vice companies this makes it even more important to think about their communication because their

trustworthiness is lower than most other firms (Palazzo & Richter, 2005). There is an urgent need for practitioners and academicians to better understand how to communicate CSR more effectively to relevant stakeholders (Du, Bhattacharya, & Sen, 2010).

Du & Vieira Jr (2012) analysed the website content of six oil companies to look how they try to foster positive stakeholder attitudes through their CSR practices and communication. Du &Vieira Jr (2012) firstly state the importance of having a proactive and long-term approach in finding ways to minimize the negative externalities of the business operations. Secondly Du & Vieira Jr (2012) advise to have in-depth consultations with relevant stakeholders like non profits and local communities. Thirdly they identify different framing mechanisms that make the CSR communication more effective. Fourthly is to show that the firm is the leader in promoting collective action to tackle the concerns of society. The fifth point is to show awards and or certificates that the firm has won with their CSR initiatives (Du & Vieira Jr, 2012). Du &Vieira Jr. (2012) suggest a more structured method of qualitative data for future research to better understand CSR-related matters for vice companies. In this thesis Dutch CSR managers of vice and non-vice companies will be interviewed and are therefore approaching these CSR related issues in these industries in a new way. Secondly Du &Vieira Jr, (2012) believe that it’s necessary to look at other vice companies next to the oil industry that they investigated to find similarities between the CSR practices. This research responds to that request and is therefore expected to add a new perspective to the general debate on CSR practices in vice companies.

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In this research there will be a focus on two opposing communication strategies named greenwashing and CSR as aspirational talk. These two theories have a different view about how you should communicate. These theories will be compared and an attempt will be made to find out which of them will increase the image for vice companies when communicating about their CSR engagement most positively.

2.8.1 Greenwashing

The public has increasingly been criticizing the environmental efforts of a lot of companies because they believed that they were merely public relations campaigns (Lyon & Montgomery, 2015). This phenomena is called greenwashing, and is defined by Furlow (2010) as: “the dissemination of false or incomplete information by an organization to present an environmentally responsible public image”. Ramus & Montiel (2005) complement this definition by explaining that greenwashing is about a perceived gap between the CSR promises and the implementation of these promises. Greenwashing has been getting a lot of concern from the media and the public (Lyon & Montgomery, 2015). This growing attention has been paralleled by academic research. Since 2011 there’ve been a huge increase in articles about greenwash and it’s now an increasingly important subject (Lyon & Montgomery, 2015). Ogilvy and Mather, one of the biggest advertising firms in the world, are stating that greenwashing is now reaching ‘epidemic proportions’ (Hsu, 2011).

Greenwashing is a concept that explains the gap between the communicated CSR promises and the actual CSR implementation. One of the effects of greenwashing is that it can lead to consumer scepticism (Furlow, 2010). Vice companies are having a difficulty with improving their image from their CSR engagement due to stakeholder scepticism (Godfrey et al., 2009). Vice companies should therefore try to avoid this gap between CSR promises and implementation to prevent scepticism.

Proposition 4: vice-companies should only stress their realized CSR outcomes to improve their company image to avoid scepticism among consumers due to greenwashing

Delmas, Burbano, & Vanessa (2011) indicate the organizational and external drivers as the most important drivers of greenwashing. Organizational drivers include ethical climate, incentive structures, firms’ disinterest and intra-firm communication effectiveness. External drivers include pressures from NGOs, regulators, consumers, competitors and investors. The main and most important indicator of greenwashing is uncertain and lax government regulations. The reason is that it diminishes the chance to get punished for greenwashing (Delmas et al., 2011).

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Firms that are greenwashing can have intended and unintended impacts, but they probably do so in order to benefit in a certain way from it (Lyon & Montgomery, 2015). One of the reasons that are offered to why firms’ greenwash is that it presumably can weaken the support to environmental

legislation and delay regulatory protection (Hsu, 2011; Delmas & Montes-Sancho, 2010). But looking at various studies there’s not always a benefit to greenwashing. Walker & Wan, (2011) for example looked at top Canadian companies that were active in highly polluting industries and their greenwash activities. The result they found was that greenwashing had a negative effect on the financial performance of the company.

In the article 'The means and ends of greenwash' of Lyon & Montgomery (2015), the authors make a good start in reviewing and synthesizing the progress that has been made in the last years on greenwash literature. In their review they do not formulate any theory about greenwashing by vice companies. This research can therefore add an extra perspective to the greenwash literature by specifically looking at these firms.

2.8.2 Aspirational talk

A rather new theory believes that it shouldn’t always be bad if the stated objectives of the firm are not yet fully reflected in the organizational practices. In the article of Christensen et al. (2013) titled ‘CSR as aspirational talk’, they explain how communication can enact positive CSR developments. Christensen et al. (2013) recognize that due to the many cases of organizational misconduct, the public is sceptical to CSR messages. BP, for example, rebranded itself with a new slogan ‘beyond petroleum’ to appear eco-friendly. This was very hard to believe after the oil spill in the golf of Mexico where one of BP’s drilling rigs exploded because of a lack in their security, which resulted in tremendous damage to the eco-system and tourist sector. Because of this kinds of misconduct, people get suspicious and don’t accept

discrepancies between the words and actions of a firm (Forehand & Grier, 2003). Vice companies especially experience this problem due to the controversial nature of their product.

Christensen et al. (2013) however advocate that corporate messages can also encourage positive CSR developments within the company. Taylor & Every (1999) are on the same page as Christensen et al. (2013) and argue that ‘firms emerge in communication’. They suggest that the manner in which a firm talks about their surroundings and itself are formative undertakings that enact, form, reproduce and transform the reality of the company. Communication is such an essential part of a company that it has the power to establish organizational life. In the literature this is known as Communication Constitutes Organization (CCO). The systems theory of Luhmann (2001) elaborates on CCO and according to him,

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organizations are (re)created by communication. He focuses on decisions as the building block for companies. All decisions are based on other decisions and develop the firms’ goals and practices. Even when decisions aren’t realized they advance the company (Luhmann, 2001). If you regard communication as the base of the company there isn’t really a difference between what a company does and says.

Additionally this does mean that it’s impossible not to do what is said, because of the consequential nature of communication (Taylor & Every, 1999).

Following this line of thought, if an organization presents their CSR program, it can be assumed that their actions and decisions will be based on the presented CSR program. Which actions, which decisions and in which timeframe they realize this won’t always be clear but words often come before decisions. To present the CSR program is the beginning of a journey to a desired future (Christensen et al., 2013). Consequently ‘aspirational talk’ that is encountered very often in CSR programs should not be disapproved. Plans, intentions and ideas about the CSR of a company that aren’t yet part of the

organization should be seen as actions and not as an insincere way to fool the public in being more responsible than they are (Christensen et al., 2013).

Managers also work with this communicational discrepancy. They talk about where they want the firm to be and are trying to minimize this difference in the process. These discrepancies are therefore an essential part of organizational change. Descriptions and statements from a company are therefore seldom an exact image of the current reality (Christensen et al., 2013). A manager is a motivator who shows us where a company can be in the future. If he’s telling us where the company is now it can prevent the company from growing (Christensen et al., 2013).

After a long period of criticism on Shell in the 1980s, Shell wanted to change. The eco-talk of Shell, where they explained how they viewed their environmental responsibility, was the beginning of this transformation. Livesey & Graham (2007) studied this transformation and found that the eco-talk was the creative force to allocate resources of the company into sustainable practices. They indicate that the talk had pragmatic and performative aspects that slowly changed the firms’ views and priorities which (re)created the company (Livesey & Graham, 2007). A lot of people will object and state that Shell and other oil companies have mostly ‘black’ instead of ‘green’ activities (Sharon M. Livesey, 2002). Christensen et al. (2013) nevertheless argue that aspirational talk is very important to push firms in the right direction. ‘It is in these spaces of difference that alternative ways of thinking (rethinking) and acting emerge’(Sharon M. Livesey, Hartman, Stafford, & Shearer, 2009).

Christensen et al. (2013) suggest that to make sure aspirational talk is performative it should be held publicly. This creates expectations from journalists, interest groups, activists, employees and other

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important stakeholders, which can exercise pressure when companies do not conform to their statements. Unfortunately, this isn’t a guarantee but the public involvement and inspection for aspirational talk is very essential to make sure companies try to ‘walk the talk’. Christensen et al. (2013) therefore suggest that these talks should always be put on the agendas of the big media firms. Continuing these thoughts discrepancies between the ‘talk’ and ‘walk’ should be more accepted, because it can lead to new opportunities and solutions. March (1988) advocates that companies should be able to express their corporate ideals unrestrictedly. He doesn’t think that hypocrisy should be a strategy but believes that it is an unavoidable part of organizing. Especially when it’s about improving the company. Luhmann (2001) agrees and thinks it’s better that companies have a lot of aspirational talk even if they can’t live up to their word right away. This would be a better situation according to him than companies not expressing their CSR ideals at all because of the fear that people will disapprove the inconsistency between the words and reality. So even in the case of BP rebranding itself to ‘beyond petroleum’, it can be advocated that this was necessary to do, to create new CSR expectations within this firm and their industry (Christensen et al., 2013).

The eco-talk of Shell is a case where aspirational talk changed the identity of the company towards more sustainable practices. Corporate communication is not only to confirm your identity but it’s also to inspire its members and itself in order to improve its corporate identity (Christensen et al., 2013). According to Yoon et al. (2006), Shell did successfully change their image by emphasizing their social and environmental initiatives. It can therefore be concluded that aspirational talk improves the corporate identity of the firm. An improved corporate identity can lead to a better corporate image. Christensen et al., (2013) recommend aspirational talk because it can change the company in the long term, which will have an influence on the company image over time. Greenwashing is a concept that is about a more direct effect that people have on CSR communications. This research confirms that aspirational talk can

improve the identity of the company but it is also believed that communicating your aspirations will have a direct effect on how your consumers will see your company image. Looking at aspirational talk in this way hasn’t been done as far as the researchers know. It is expected that, in contrast to the literature on greenwashing, being aspirational will have a positive influence on the company image.

Proposition 5: Vice-companies should stress their aspirations because this has a positive effect on company image.

Christensen et al. (2013) suggest further exploration of the delicate dividing line between talk and action in a broader context. This research will add to the general debate on aspirational talk and

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3. Data and method

3.1 Introduction

In the previous chapters, a close look was taken at the relevant literature on the concepts related to our research question. In this chapter the research method is explained. The overall approach is discussed, an elaboration on the research population and selection of respondents is given, followed by how the data was collected and analysed, the reliability and validity are also explained and finally the limitations will be discussed.

3.2 Overall approach

First, a literature review was conducted. In the databases of Google Scholar, PiCarTa and UvA library articles about CSR engagement in controversial industries were reviewed and a literature gap was found on how vice companies can improve their company image by engaging in CSR. From this research gap the research question was formulated: “To what extent can vice companies improve their company image by engaging in and communicating about CSR according to Dutch CSR managers”?

Only little research has been conducted on CSR engagement of vice companies. Only some case studies have been undertaken. Jonker & Pennink (2009) recommend using qualitative research as the best approach when addressing incomplete or ineffective theoretical knowledge about a phenomenon. Hence, this research is exploratory and qualitative in nature (Yin, 2011). Nonetheless, this research builds on various theoretical insights and combines them into propositions based on literature.

This research will take a thematic approach based on ‘deductive coding’, as semi-structured interviews with Dutch CSR managers from vice and non-vice companies will be used to assess to what extend the propositions as postulated based on the literature review are applicable (Fereday & Muir-Cochrane, 2006). This approach differs from ‘inductive coding’, where often no propositions are formulated a priori and theory is developed during the coding process going through the stages of open, axial and selective coding (Saunders, Lewis, & Thornhill, 2012).

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3.3 Research population and selection of respondents

For this research, eight Dutch CSR managers from vice companies and six Dutch CSR managers from non-vice companies were interviewed. This distinction was made because it was expected that this

separation would give a more complete answer to the research question. The term CSR manager is used in this thesis but it should be noted that the exact job title would differ within each company. For practical and anonymity reasons the term CSR manager will be used.

CSR managers at different companies in the following vice industries were contacted via telephone and/or email: tobacco, gambling, alcohol, adult entertainment, weapons, nuclear, oil, and biotech firms. Interviews with two CSR managers were arranged with the four major tobacco producers in the Netherlands. The gambling industry is controlled by the Dutch government and entails therefore just one company named Holland Casino. Holland Casino doesn’t have a CSR manager and could not free time to explain their thoughts on responsible gaming. The alcohol industry was divided in soft and strong liquor. The soft liquor area mainly consists of wine and beer companies. Due to the weather, Holland isn’t very suitable for wine production. It was therefore not possible to find any wine producing companies with a CSR manager. The beer market in Holland is very prominent. For this research interviews were conducted with three major breweries and their CSR managers. Four major players dominate the market with strong liquor. Contact was made with one CSR manager of these companies. The other three companies didn’t reply or didn’t have time. In the adult entertainment industry, no CSR manager was found. The weapon industry is not legally present in Holland. Guns are prohibited, and therefore no company with this product exists. The nuclear industry was also very difficult to get in contact with. Emails were sent to the four big players in this industry but only one reaction was received stating that they were too small a company and that they didn’t have a CSR manager. Within the oil industry an interview was conducted with one CSR manager. Lastly, in the biotech industry no replies were received to the emails. One extra interview with the CSR manager of a gas company in Holland was added. Similarly to the oil industry, this company is subject to moral debates and political and environmental pressures. In total, eight interviews with CSR managers from vice companies were held; one oil, one gas, two tobaccos, three beer and one strong liquor company.

In order to get in contact with Dutch CSR managers from non-vice companies the advice from the research coordinator was followed and firms that were connected to ‘MVO Nederland’ (translation: CSR Netherland) were contacted. ‘MVO Nederland’ tries to connect different stakeholders in order to

collectively make the world more sustainable. For this research it was decided to contact the big

companies connected to ‘MVO Nederland’. These are companies with more than five hundred employees and a strong CSR focus. Seventeen companies were contacted and eventually six CSR managers agreed to

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an interview. The other eleven companies didn’t have time, didn’t react or didn’t want to cooperate because they believed that they wouldn’t benefit from the results. The six non-vice companies were two banks, an airline, a transport, an advisory and an employment agency.

3.4 Data-gathering

In the data gathering process the three principles of Yin (2011) were applied to be able to ensure the reliability of the case study and the validity of the constructs. Firstly, the annual CSR reports of the interviewed companies were read, which allowed for triangulation. Secondly, a case study database was created where all the evidence that was collected could be stored. Thirdly, a chain of evidence was maintained.

Semi-structured interviews with Dutch CSR managers from vice and non-vice companies were held. Because the CSR managers were from different organizations, it is a multiple case study design. This adds more confidence to the results and allow for better theory extension and replication (Eisenhardt & Graebner, 2007). During the interviews with the Dutch CSR managers, the objective was to understand their point of view on the research question and related concepts. Open-ended question were asked in the interview and were complemented by other questions that naturally arise during these conversations. The interview questions were be created from the propositions in the literature review. Appendix A shows the interview protocol. The advantage of this research method is that the Dutch CSR managers were able to talk about the subject in great detail and depth. This is very helpful for complex questions and issues such as in this research. It may lead to the discovery of new information and conceptual relationships that might not have been anticipated based on the literature review. This new information can then also be taken to the next interviews (Rynes & Gephart, 2004).

All the interviews except one were recorded and transcribed directly afterwards in MS Word documents. The interview that wasn’t recorded was because the company policy of the interviewee didn’t allow this. Only notes were allowed during this interview. All the documents, sound files, notes and company reports were saved into a research database, to make it possible to audit the data in the future. The interviews were held via Skype or in a face-to-face setting.

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3.5 Data-analysis

The advice of Yin (2011) was followed to immediately start the analysis after all the data was gathered. In this research the analysis already started during the last interviews. All the audio files were first written out after which the transcriptions were uploaded to the qualitative research program Nvivo. Based on the formulated propositions in the literature review, different codes were given to the text. This made it a lot easier to compare all the different answers the interviewees had given. The following primary codes were given: Personal information, CSR fit, CSR level. CSR communication. Those, in turn, were sub-labelled with axial codes. After the coding, all the text was printed and studied. The goal was, on the one hand, to find differences or similarities between the interviews whilst always keeping the relevant literature in mind, and on the other hand, to find differences and/or similarities between the interviews and the literature. This makes it possible to confirm or develop existing theory, or to present new theory (Aguinis & Glavas, 2012).

3.6 Methodological issues

Because this research is qualitative in nature, the results are only valid in the context of the interviewed companies and not directly generalizable. But it is possible to later test these insights in a quantitative research (Saunders et al., 2012, pp. 263-280).

This study is mostly based on the personal opinions of the interviewed CSR managers. Bias might occur caused by how every individual sees concepts in a different way. Also every individual communicates in a certain way, keeping in mind the image they want to convey. By emphasizing the anonymity of the interview and by critically looking at the answers, it is tried to minimize this bias. Additionally is it possible that the interviewed managers misunderstood the questions (Saunders et al., 2012, pp. 106-108).

A bias can also occur at the researcher. The answers might be understood or analysed wrongly. By engaging in triangulation and by reflecting on the subjectivity of the researcher, an effort has been made to minimize this bias.

Lastly, the interviews were held with experts, not with consumers. What these experts believe might not hold up when the same questions are put to consumers.

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4. Results

4.1 Introduction

In this chapter the results will be presented. The propositions that were postulated based on the literature review will be accepted, rejected or complemented. First a look at the proposition on the level of CSR performance will take place. Secondly is the proposition on the use of low or high fit discussed, thirdly is the proposition on the balance of budget for CSR-activities versus CSR-advertising looked at and lastly are the propositions on aspirational talk versus greenwashing discussed.

4.2 Levels of CSR Performance

The first proposition that was created from the theory was: Vice-companies should refrain from engaging in instrumental or transformational CSR activities and engage in transactional CSR activities, directed at improving transparency and following the law in order to improve their image.

The results of the interviews with the Dutch CSR managers of vice and non-vice companies confirm this proposition. Also an interesting addition to the current theory on the instrumental level has been found.

4.2.1 Transactional level

The transactional level of CSR is about the integrity to comply with the moral and legal rules of society. It’s about transparency, fairness, keeping their promises and acting with consistency. The CSR managers of vice and non-vice companies in the Netherlands all agree with the literature that this level is the most important level for vice companies when engaging in CSR.

First a look at several statements from non-vice companies that confirm the proposition: Airline: “You know, all things being equal, I believe that you should just be honest and transparent about the effect of your product.” Bank 2: “ I believe so, because people already look at vice companies in a certain way. So there is more reason to be transparent.” Employment agency: “I believe that transparency is very important, but I can imagine that they don’t want to be as transparent about everything. But it is also about explaining why you’re making certain choices.”

The vice companies are on the same page. The alcohol companies share the same thoughts and believe that by being transparent, even about the negative aspects of the product, they will improve their

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image and the trust that people have in them. Still it is confirmed that being transparent is more difficult for vice companies, but also that if a vice company is non-transparent it can even have a negative effect on their image. Beer 3:“By positioning yourself vulnerable when necessary, it helps with the trust that people have”…“If you stay non-transparent, eventually it will have a negative effect on your image”

The tobacco companies also confirm the proposition and try to be transparent. This industry has had a lot of bad publicity and therefore quite some companies don’t want to have a CSR engagement with them. When a CSR engagement does take place, e.g. a tobacco company financing a good cause, and all the partners of this cause are mentioned they expect to also be mentioned to avoid the appearance of a hidden agenda. The oil company CSR manager that was interviewed explained that transparency is something good but that it isn’t always easy to explain how all oil is made and where it comes from. The CSR manager also questioned whether the Dutch people would really benefit from having all this information.

4.2.2 Instrumental level

The instrumental level of CSR is about the ability to deliver products at a quality level expected by the customers. The results show that most of the CSR managers believe that the quality of the vice product shouldn’t be mentioned in the CSR campaigns. The reasoning is that they believe that products in this day and age should just be of a certain quality, they see it as a basic compliance to have a good product.

An interesting aspect that complements the research of Palazzo & Richter (2005) is that two CSR managers suggested that the quality of the product in the CSR campaign can be emphasized when it is shown that the quality of the product is better by being sustainable. The CSR manager of a bank suggested: Bank 1: “If you talk about food and therefore also about beer, people have an association between sustainable and healthy. Biologically brewed beer, then people will be under the impression that it is more healthy.” And also a beer company confirmed the point that quality of the product can be shown if it is better by being sustainable. Beer 3:“In our case I immediately think about the usage of sustainable energy sources in brewing beer”…“where we brew our white beer, there are solar panels on the roof. These solar panels produce enough power for the total production of ‘beer X’, these white beers you associate with the summer and the terrace.”…”In this way we make a link: this is brewed with sustainable energy sources and you taste it in your glass” Even though this is just a marketing ploy and the taste and quality of this white beer won’t change a bit if the electricity of the brewery is produced by coal, solar energy, water or any other power source, the idea to deliver quality products in a more sustainable way is present. The interview with the CSR manager of a gas company confirms this line of

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thought. Gas is a more sustainable way to produce energy than oil. The CSR manager therefore explained that he emphasized the quality of the product as a transition fuel. Still some difficulty remains as people nevertheless see this company as an evil polluter that tries to defend their own product.

The problem for the tobacco companies in the Dutch market is that they are prohibited to advertise their product in any way to the people. This includes letting people know that a cigarette brand is engaging in CSR. Tobacco companies in the Netherlands therefore can’t emphasize the quality of their product when engaging in CSR.

4.2.3 Transformational level

The transformational level of CSR is about the organizations’ willingness to go beyond self-interest and to think about the common good. It is very difficult for vice companies to be perceived as contributing to the well-being of society and the common good. When asked if firms should demonstrate this willingness to go beyond their self-interest, the overall response confirmed the literature that vice companies should not emphasize their altruism as can be seen in several statements. The CSR manager of the employment agency saw it as a contradiction with the core product, and the CSR manager of bank 2 didn’t believe that the image of vice firms could be improved by showing they thought about the common good. This person did see a possibility to show a reduction of harm, like an E-cigarette. The CSR manager of the

employment agency: “I think [CSR is] a contradiction within such a company. Only if you are really making the transition to improve certain products, then you can say something about this. For example: ‘On the one hand we still pump oil, but we are busy with the transition to wind and solar energy’”.

The alcohol industry is in a way an exception to these results. They try to go beyond their self-interest by actively promoting people not to drink too much. This might negatively affect their alcohol sales but it is a way to show that they think about the common good. Therefore it could be said that the alcohol industry is engaging in CSR on the transformational level.

4.3 Use of low-fit and high-fit CSR activities

The second proposition is about the fit between the CSR activity and the negative effect of the core business: Vice-companies should undertake low-fit activities to increase their company image. The results confirm this proposition for most vice companies but are only partially accepted in the alcohol industry.

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It’s indicated by the employment agency that it’s more difficult for vice companies to engage in CSR activities: “I believe it’s very hard because sustainability should be very close to your core business, but if your core business isn’t sustainable, then you have a challenge.” Most of the CSR managers confirmed the proposition that the company image won’t be improved by supporting a cause that is about the negative effects of the core business i.e. a high-fit. Nevertheless, to avoid window dressing, the recommendation was to always have a high-fit between the CSR activity and the company, but a fit that was not related to the negative effects.

All CSR managers except one agreed that a tobacco company supporting a CSR cause about cancer would not improve their image. It was expected that it would appear hypocrite and that it wouldn’t be accepted. Only the CSR manager of the airplane company thought otherwise: “The fact that you are openly supporting a cancer cause, you are actually confessing, and I can imagine that this would be very strong”…”By doing this you are open about the harm you are causing”. The tobacco companies

themselves don’t try to have a fit. The causes they supported were not health related. The CSR causes they supported were also not for image enhancing reasons. Because of the strict regulations on tobacco marketing they can’t use their CSR causes to improve their image. They still engage in CSR but do this mostly in order to make their employees proud. The employees of one tobacco company could spend four hours a month during company time on helping a good cause, as long as it wouldn’t be on the subject of health, because that would be too far away from their core product. They state that even if the intentions are good, it will be attacked from all sides of society. The following statement of tobacco company 1 confirms this: “If you’re the reason [of the problem], you can’t be part of the solution”.

One of the discussions in the alcohol industry is whether for example they should support the Alcoholics Anonymous (AA). Beer company 2 explains how it’s a difficult situation. They even get visits from certain hospitals that tell them how much harm alcohol has done to people. When the thoughts were asked to beer company 3 about this discussion the CSR manager explains that by donating a certain amount of money to the AA people will think that it is done to get rid of the discussion. The alcohol companies therefore don’t believe that openly supporting the AA or an anti drink-and-drive campaign would enhance their image. They advise in this case to not have a fit. When asked whether they believed supporting the AA would improve their image, a beer company responded: “I believe that you should just do it as a company, we also do this, you just should never emphasize this.”…”If you do this you actually confirm that what you do isn’t good” Beer 2: “We’ve donated money to the AA, they reached out to us for a certain congress”…”We’ve worked together with ‘Safe Traffic Netherlands’.”…”But we will never promote that we work with these programs, because then you become hypocrite. You should be very careful with that.”…”With alcohol and traffic, and alcohol under 18 and pregnancy you should watch

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out. You do this with the parent company. Not with the brand. Because if you do this with the brand people will see it as disguised commercials to attach people to your brand”. On the other hand, alcohol companies are extremely proactive and open in supporting responsible drinking campaigns. This is a case where they do have a fit with the negative effects on the product. They are indicating that drinking too much is not healthy. The thoughts of beer company 3 are that they try to let people consume alcohol responsibly to begin with, so that they don’t have problems later and they need to intervene. “It’s important that the problem is being tackled, because it goes at the expense of our company and the branch”. An example in the alcohol industry can be found in the campaign of beer company 1 on responsible drinking. They put a moveable floor in the toilet of a bar to show the effects of drinking too much. Beer company 3 explained that in order to be able to engage in CSR with a fit as a vice company, the important thing is to go all in, else people will not believe it. The example that was given is that the general public is under the impression that a beer company just wants to sell as many beers as possible. It therefore needs to go the extra mile. What this company did was to make a campaign where nice and handsome young people actively declined a beer. They even did this during Christmas, the period of the year that people drink most. The CSR manager explained that in this way, even most of the critics could be convinced. Another example that was given by beer company 3 in the interview was the

recommendation to oil companies to make a campaign that encourages people to take the bike instead of the car when travelling a short distance. When this advice was discussed with the CSR manager of an oil company, they responded that they have a program that stimulates biking and the safety of cyclist in traffic. They do this by making a kind of circuit for the highest classes of primary schools where the kids can practice and test their biking knowledge. An estimate of 15.000 children were reached with this activity. When asked why they didn’t undertake a national TV campaign, which would reach the most of the Netherlands, the answer of the CSR managers was that the public perception wasn’t yet ready for this. “The latest energy report of the Dutch government reported that people believed that between 30% and 40% of the energy was sustainable while the actual number is 5%”. Therefore the CSR manager of this oil company thought that making a TV spot would be throwing money away. According to the CSR manager of the oil company, there are studies showing that the public would rather see the oil company engage in CSR activities that focus on renewable energy.

The CSR manager of the gas company explained that they now have a very bad image because of the earthquakes that are caused by the extraction of shale gas in the Netherlands. During recent years they’ve been struggling with the question which CSR activities they should or should not undertake. One of the things they undertook was to make a replication of two common houses in the area where the earthquake took place and put them on a vibratory plate to see where theses houses are weak and where

Can vice be virtuous? : an examination of CSR engagements and communication of 'vice companies' and the effect on corporate image