Unbelievably green : the credibility limits of sincere CSR communication

Unbelievably green

Ike Stolk | 10003351

MSc. in Business Administration | Marketing Track

Faculty Business and Economics | University of Amsterdam

First supervisor | Lars Moratis Final version | September 5, 2015

1 Statement of originality

This document is written by student: Ike Stolk who declares to take full responsibility for the contents of this document.

I declare that the text and the work presented in this document are 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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Index

Chapter 2. Literature Review ……….. p.16 Chapter 2.1 The traditional view of greenwashing ………. p.16 Defining greenwashing ……….. p.17 Greenwashing and consumer skepticism ………... p.18 Other causes of consumer skepticism ……… p.19 Consequences of consumer skepticism ……… p.23 Reducing consumer skepticism ………. p.24 Chapter 2.2 The CCO view of greenwashing ………. p.25 Chapter 2.3 Green-highlighting ……….. p.28 Chapter 2.4 The credibility limits of sincere CSR communication ………... p.29 Sincere CSR communication ……….. p.30 Chapter 2.5 Factors that influence the credibility limits ………. p.35 Industry sector ………... p.36 CSR history………. p.39 Corporate heritage ……… p.40 CSR leaders and followers ……….p.41 The company’s CSR reputation ………. p.42

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Chapter 2.6 How to shape sincere CSR communication ……… p.45 Awards and certificates ………. p.45 Communication message ………... p.47

Chapter 3. Method ……… p.49

Sample ……… p.49 Procedure ……….. p.51 Analysis ……….. p.53 Strengths and limitations of the research method ………. p.53

Chapter 4. Results ……… ……... p.55 Chapter 4.1 CSR and sincere CSR communication ………... p.55 Chapter 4.2 Credibility limits of sincere CSR communication ……….. p.58 Chapter 4.3 Companies’ characteristics that influence credibility limits ………... p.69 CSR history ……… p.70 Corporate heritage ……… p.72

CSR followers and leaders p.72

CSR reputation ………...p.75 Chapter 4.4 Characteristics of the sincere CSR communication ……….... p.78 CSR awards and certificates ……….. p.79 CSR motives in CSR communication ………. p.83 CSR benefits in CSR communication ………. p.84 Other CSR communication strategies ……… p.85 Chapter 4.5 Other causes of consumer skepticism ………. p.88 Chapter 4.6 A solution for consumer skepticism ……… p.89

4 Chapter 5. Discussion ………... p.91

Findings of the study ……….. p.91 Limitations and recommendations for further research ……… p.99

Chapter 6. Conclusion ……….. p.103 Summary ………... p.103 Contributions of the study ………... p.104

Chapter 7. References ……….. p.107

Appendixes………. p.114

Appendix 1 Overview of theoretical propositions ………. p.114 Appendix 2 Interview guide ………... p.116 Appendix 3 Code book ……….. p.118

5 Abstract

In the past decade corporate social responsibility (CSR) has become increasingly relevant for companies. However, research shows that the credibility of the company’s CSR

communication is questioned by consumers. Companies’ greenwashing behavior is mentioned as one of the causes of this consumer skepticism. The aim of this study is to identify whether these credibility limits also exist for companies that communicate sincerely about their CSR activities. To answer the research question a qualitative research method was used. An

amount of 23 B2C companies from five different industry sectors were purposefully selected. The CSR managers of these companies were interviewed face-to-face or by phone. The results show that B2C companies face credibility problems regarding their sincere CSR communication. However, the results differ between industry sectors. Companies within the financial, energy and food and consumer goods industries face more consumer skepticism than companies within the ICT and services industries. Two variables: CSR history, and the company’s CSR reputation, influence the credibility of the company’s sincere CSR

communication. The results also show different perspectives from CSR managers on the use of awards, certificates, motives and benefits in sincere CSR communication. This study informs CSR managers about the consumers’ reactions and consumer skepticism that companies face. Additionally, CSR managers that develop a CSR communication strategy may learn from the different perspectives on credible CSR communication. The study concludes with the limitations of the study and suggestions for further research.

6 Chapter 1. Introduction

In the past few years, corporate social responsibility (CSR) has received more attention in businesses. It has even become a standard business practice. More and more companies engage in CSR because of external pressures (Illia et al., 2013a). These external pressures come from consumers and stakeholders which force companies to become more accountable for their business practices (Bromley & Powell, 2012). Moreover, consumers and

stakeholders want “greener” products (Terrachoice, 2009). Mohr, Webb and Harris (2001) describe CSR as “a company’s commitment to minimizing or eliminating any harmful effects and maximizing its long-run beneficial impact on society” (p. 47). Corporate social

responsibility includes five dimensions, namely the environmental, social, voluntariness, economic and the stakeholder dimension (Dahlsrud, 2008). Therefore, a company’s CSR activities focus on the environment, the relation between business and society, voluntary actions, the economic development, the relation with stakeholders or a combination of these five dimensions.

A company’s CSR activities may have beneficial outcomes, such as positive consumer feelings towards the company. If a company wants to arouse these positive consumer feelings it is necessary that consumers are aware of the company’s CSR activities. Besides the

companies’ own CSR communication there are many alternative ways to ensure awareness, such as word of mouth communication and communication by others instead of the company itself. However, if companies do not communicate about their CSR activities to the public, increased consumer awareness will not be developed (Pomering & Dolnicar, 2009). Therefore, companies should communicate about their own CSR activities to create awareness (Du, Bhattacharya & Sen, 2010).

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CSR communication is defined as “communication that is designed and distributed by the company itself about its CSR efforts” (Morsing, 2006, p. 171). However, the way in which companies communicate their CSR initiatives affects various factors, such as the consumers’ perceptions of the company (Beckmann, 2007). Additionally, different characteristics, such as the company’s reputation and the industry sector influence the effectiveness of CSR

communication. Furthermore, the effectiveness of CSR communication depends on the receiver of the information. In fact, there are several stakeholders with various interests and social value orientations. All of the factors above influence the internal and external outcomes of CSR communication, such as trust, loyalty and purchase intentions (Du, Bhattacharya & Sen, 2010).

Previous research focused on the content of messages, the different communication channels and the influence of the company’s CSR motives on the outcomes of CSR communication (Trumbo & McComas, 2003; Van de Ven, 2008; Du, Bhattacharya & Sen, 2010). More research on CSR communication will help to gain better insight into effective CSR communication (Kim & Lee, 2009). This kind of research is necessary because a study conducted by Globescan determined that not all CSR communication is effective. They found that consumers question the honesty of CSR communication. In 2012, 72% of the people were interested to learn about CSR but only 38% of the people thought that companies

communicated honestly about their social and environmental performances (see Figure 1). As a consequence, companies acknowledged the credibility problems of their CSR

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Figure 1. Interest in vs Credibility of CSR Communications. Reprinted from Globescan website, by Globescan, 2012, retrieved from http://www.globescan.com/news-and-analysis/blog/entry/credibility-gap-persists-around-companies-csr-communications.html. Copyright 2012 by Globescan.

One of the reasons why consumers question the honesty of CSR communication is that a significant amount of companies engaged or still engage in greenwashing activities (Lyon & Montgomery, 2015). Between 1987 and 2008 the amount of green advertisements grew by almost tenfold. Unfortunately, these green advertisements were not free of greenwashing (TerraChoice, 2009). TerraChoice (2009) formulated seven sins of greenwashing: Sin of the Hidden Trade-off, Sin of No Proof, Sin of Vagueness, Sin of Irrelevance, Sin of Lesser of Two Evils, Sin of Fibbing, and the Sin of ‘Worshiping False Labels’. In 2010, 95% of the ‘green’ products recorded in United States and Canada included one or more sins of

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greenwashing. Even though this percentage is 3% lower than the year before, greenwashing is still widely used (TerraChoice 2010). The use of greenwashing is a significant problem because it makes consumers jaded and skeptical towards CSR claims (TerraChoice, 2009). The increase of corporate green claims also makes consumers more skeptical about the authenticity of these green claims (Lyon & Montgomery, 2015).

Greenwashing exists in multiple forms (Lyon & Montgomery, 2015). Therefore, it is described in multiple ways. This is shown by the research of TerraChoice (2009) in which various sins of greenwashing were distinguished. In general, the purpose of greenwashing is to mislead consumers about the company’s environmental performances to create a positive corporate image in other words, the CSR claims are not aligned with the real CSR actions. The CSR claims exceed the CSR actions. Greenwashing can be distinguished into two types, namely disproportionate greenwashing and false green claims (Lim et al., 2013). The first type exaggerates the greenness of the product. Companies disclose positive information about the environmental and social performance but they avoid disclosing negative information. Companies that engage in the second type, false green claims, take it one step further. They claim that their products are green when they are not. Additionally, some companies even communicate about CSR activities when they do not engage in CSR at all (Illia, et al. 2013, Lyon & Maxwell, 2011, Lyon & Montgomery, 2015, Delmas & Burbano, 2011).

As previously mentioned, one of the dangers of greenwashing is that consumers question the environmental claims companies make (Terrachoice, 2009). These perceptions of

greenwashing have a negative influence on consumers’ attitude towards companies (Papasolomou et al. 2009). In addition, the increase in greenwashing activities makes consumers skeptical towards CSR communication. This skepticism is negatively related to

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consumers’ attitudes towards the company and to consumers’ purchase intentions (Elving, 2013a). Therefore, reducing consumer skepticism should be a priority. Du, Bhattacharya and Sen (2010) describe this as a key challenge of CSR communication.

In conclusion, research shows that greenwashing is one of the causes of consumer skepticism and that it has negative consequences for CSR communication outcomes. However, next to the first perspective there exists a second perspective that perceives CSR communication as aspirational talk. This perspective focuses on the beneficial outcome of greenwashing. Christensen, Morsing and Thyssen (2013) argue that greenwashing, talking about CSR even when actions are not aligned, possibly functions as aspirational talk. This talk stimulates social change and CSR improvements. They argue that greenwashing might bring the CSR field forward. Therefore, the discrepancy between words and actions, CSR communication and CSR initiatives, should not necessarily be avoided regarding this certain perception.

Within the first and second perspective of greenwashing the CSR claims are bigger than the CSR actions of the company. From these perspectives a third viewpoint emerges, namely the credibility limitations of sincere CSR communication. According to this perspective, CSR managers do not communicate all of their CSR activities. This differs from the first and second perspective. The company’s CSR actions are bigger than their CSR claims, which raises the question of how consumers perceive sincere CSR communication. Previous research found mixed results about the credibility limits of sincere companies. Illia et al. (2013) suggest that sincere companies are probably subjected to consumer skepticism. They argue that it is reasonable that companies—due to people’s distrust in big companies—fear that their CSR communication is depicted as greenwashing. In other words, even though these companies are sincere and their CSR claims do not exceed their CSR actions, consumers may

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perceive the company’s CSR claims as an exaggeration of their CSR actions. Yet, Illia et al. (2013) concluded their research by a contradictory claim concluding that the risks of CSR communication are overstated; moreover, that companies that communicate honestly should not be afraid of greenwashing accusations. In addition, Fassin and Buelens (2011) claim that even when companies are genuine the sincerity of their CSR motivations is questioned. This inconsistency in the scientific literature raises the question whether sincere CSR

communication has credibility limits.

Research question

As the Globescan study shows, consumers question the honesty of CSR communication. Various studies show that greenwashing is one of the causes of this disbelief of consumers and consumer skepticism towards CSR communication. Even though there are various forms of greenwashing the general term is used, which comprises the deceitfulness of consumers about the company’s environmental performances in order to generate a positive consumer perception of the firm. However, it is also argued that CSR communication is aspirational talk which stimulates CSR developments by the existence of debates about greenwashing. Based on these contrasting perspectives, the question is raised whether sincere companies, (i.e. companies that do not engage in greenwashing) experience consumer skepticism and credibility limits to their sincere CSR communication.

The purpose of this research is to investigate whether companies that communicate sincerely about CSR face consumer skepticism, and to what extent. The study incorporates factors that may influence the credibility limits of sincere CSR communication, such as greenwashing behaviors. If CSR managers experience consumer skepticism, it is necessary to know how these CSR managers think they can diminish this skepticism and what practices they

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incorporate to reduce it given that the reduction of consumer skepticism makes CSR communication more effective (Pomering & Johnson, 2009).

Therefore, the following research question is proposed:

‘Are there credibility limits to the sincere CSR communication of B2C companies?’

This study takes into account different factors that possibly influence the credibility limits of sincere CSR communication. Du, Bhattacharya and Sen (2010) developed a conceptual framework of CSR communication (Figure 2). This framework incorporates the elements that possibly influence the CSR communication outcomes. This study focuses on the message content and the message channel of CSR communication. Furthermore, this study explores the influence of the company’s reputation and industry on the credibility limits of sincere CSR communication. The company’s reputation is included in this study because the company’s reputation influences how people perceive the company’s CSR communication (Elving, 2013a). The industry sector of a company is addressed because some sectors are more susceptible to consumer skepticism due to their controversial character than others (Parguel, Benoît-Moreau & Larceneux, 2011). This study focuses on the external outcomes of CSR communication on consumers.

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Figure 2. A framework of CSR communication. Reprinted from “Maximizing Business Returns to Corporate Social Responsibility (CSR): The Role of CSR Communication,” S. Du, C. B. Bhattacharya and S. Sen, 2010, International Journal of Management Reviews, 12, p.11.

In order to answer the research question CSR managers from B2C companies are interviewed. Hereby, in-depth insight is obtained in the experiences of CSR managers with consumer skepticism and credibility problems on their sincere CSR communication. Subsequently, the study gives insight when companies face consumer skepticism, what factors influence these credibility limits and what the possible solutions are.

Relevance

Most studies that investigate CSR communication in relation to consumer skepticism are quantitative studies. These studies measure consumer skepticism by conducting experiments.

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This study contributes to the scientific literature because it is a qualitative study and it tries to answer the research question based on the experiences and perceptions of CSR managers. Lafferty (2007) argues that there is a lack of exploratory empirical studies about CSR in relation to marketing. Therefore the need for an exploratory nature on this topic was

incorporated as it describes whether CSR managers face credibility limits to their sincere CSR communication. As a result, this sheds a new light on the existing studies about CSR

communication. This study also gives insight into whether CSR managers follow the

propositions and recommendations to reduce consumer skepticism that are made in previous research about CSR communication. Previous research found that different factors influence how people perceive CSR communication. By conducting this study it is investigates whether these factors influence consumer skepticism in the eyes of CSR managers. Furthermore, previous research showed that various forms of CSR communication may have positive or negative consequences. To extend the literature, this study also investigates if this applies to sincere CSR communication.

The results of this research are beneficial for CSR managers because it indicates whether competitive companies face consumer skepticism and to what extent. Moreover, this study gives insight into the existence of consumer skepticism in different industries and whether other factors influence the credibility limits of sincere CSR communication. CSR managers may take this information into consideration when designing effective and credible CSR communication to reduce consumer skepticism. Additionally, this research gives insight into the different perspectives of CSR managers about the appearance of credible sincere CSR communication and the way in which consumer skepticism could be constrained. CSR managers learn from each other when they read about the different perspectives. The possible contradictory perspectives may inspire CSR managers to think differently about their current

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CSR communication or how they should develop their CSR communication.

Structure of the research

In the literature review, relevant theories and studies that are related to the research question are explained. Based on theories and findings of previous studies, propositions are derived. In the method section it is explained how the data is collected, analyzed, and how the interviews are structured. Thereafter, in the result section the results are explained and the propositions are accepted or rejected. In the discussion section the outcomes of the findings are explained by referring back to the literature review. Furthermore, points of improvements and

suggestions for further research are given. In the conclusion section a short summary of the study is given and the contribution of the study is explained.

16 Chapter 2. Literature review

In this chapter the traditional view of greenwashing which relates greenwashing to consumer skepticism is discussed. Furthermore, other causes of consumer skepticism are explained and the possible consequences of skepticism to understand the problem are described.

Additionally, it is explained how skepticism can be reduced according to the existing literature. This perspective shows the relevance of credible CSR communication and the restriction of greenwashing.

Chapter 2.1 The traditional view of greenwashing

Companies communicate about their CSR initiatives, such as their collaborations with non-profit organizations and their CSR policies. For example, TNT’s collaboration with the World Food Program of the United Nations or the donation of a certain amount of money to a social cause. Nevertheless, companies find it hard to communicate about CSR issues (Schmeltz, 2012). This is not surprising because communication managers should think about the content of the message, the different recipients of the information, and the use of communication channels. According to Trumbo and McComas (2003), objectives and channels should be defined and the communication context should be understood to overcome communication problems. A manager has to decide which communication channels he or she wants to use. The corporate website can be used to publish information about CSR activities and the ethical codes of their CSR activities. Additionally, CSR communication comprises marketing

communication like sponsoring, advertising, packaging, promotions, and direct marketing. Besides the choice of certain communication channels, managers should think about the content of the messages. It is difficult for CSR managers to create effective CSR

communication and to determine the right content of the messages. Kim and Lee (2009) found that people might disbelieve an ad claim and question the sincerity. The traditional view of

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greenwashing illustrates that greenwashing is one of the causes of this disbelieve.

Defining greenwashing

There is no consensus in the literature regarding the definition of greenwashing (Lyon & Montgomery, 2015). Illia et al. (2013) argue that greenwashing broadly covers the idea of “giving the false impression that a corporation is genuinely engaged in CSR” (p. 16). Elving (2013a) states that this coincides with ignoring harmful practices. Lyon and Maxwell (2011) describe greenwashing as “the selective disclosure of positive information about a company’s environmental or social performance, without full disclosure of negative information on these dimensions, so as to create an overly positive corporate image” (p.5). Delmas and Burbano (2011) state that this positive communication is combined with a poor environmental performance. A company that engages in greenwashing behavior practices these two

behaviors at the same time. Laufer (2003) describes three elements of greenwashing, namely confusing, fronting, and posturing. These three elements, or strategies, are used to portray the company as ethical when the company is not. Confusion is created by controlling the flow of information to external parties. Within the fronting strategy the company questions the severity of the problem. The company publishes exaggerated claims and a company rebrands itself to escape from former associations. By employing the last strategy, posturing,

companies use front groups, such as a public relations company, to pretend they get support. According to Lyon and Montgomery (2015) greenwashing is an umbrella term that

incorporates various communications tactics to mislead the consumer about the environmental activities of a company. Within various disciplines, such as organizational theory, economics and marketing the use of misleading communication is common. Various communication tactics are symbolic management, costly state falsification and halo effect. Symbolic

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takes place when a company promises to engage in more sustainable activities, but does not undertake action. The second example is costly state falsification. This is described as “expending effort to distort the ability of others to verify the state of the world”. An example is fraudulent ecolabels. Finally, the halo effect is the inability to distinct individual attributes from an overall impression. An example is given of consumers that learn that the firm’s products are organic. These consumers now also assume that the company must use renewable energy. The communication tactics show that companies can deliberate cause imaging that is not in line with the reality. Even though there are various definitions and forms of greenwashing they have in common that the real CSR actions are exaggerated. All companies that engage in greenwashing communicate more about CSR than that they undertake actions.

Greenwashing and consumer skepticism

Lim et al. (2013) state that greenwashing leads to disbelief among consumers about the purchase of ‘green’ products and services. According to Elving (2013a), companies create consumer skepticism when they engage in greenwashing behavior. Nyilasy, Gangadharbatla and Paladino (2014) also state that consumers become skeptical towards companies that fail to show prove of their environmental actions in their claims. Delmas and Burbano (2011)

differentiate various drivers of greenwashing. They describe two types of firms, namely brown and green firms. Brown firms are firms that have a bad environmental performance and green firms have a good environmental performance. Within their research, they specifically focus on the various drivers of greenwashing for brown firms. These drivers are divided into three levels, namely institutional, organizational and individual (Figure 3). One of the drivers of greenwashing is a loose and uncertain regulatory environment. The limited regulation and the uncertain control of the regulation contribute to greenwashing activities. This driver also

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indicates that consumers are skeptical towards green claims because of the uncertain control of the regulation. Hereby, consumers are not sure if companies that engage in greenwashing are punished and dismantled. It also means that companies that engage in greenwashing are free to do so because they are not controlled. If this situation continues consumers cannot trust any company and they become cynical towards green claims (Delmas & Burbano, 2011 & Cherry & Sneirson, 2011).

Figure 3. Drivers of greenwashing. Reprinted from “The drivers of greenwashing,” M.A. Delmas and V. Cuerel Burbano, 2011, California Management Review, p. 68.

Other causes of consumer skepticism

A general description of consumer skepticism is “consumer skepticism makes consumers doubt or question a company’s claims regarding its involvement in trying to improve or mitigate social and environmental issues” (Anuar & Mohamad, 2012, p. 99). As

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demonstrated, greenwashing is one of the causes of consumer skepticism. In relation to the first cause, greenwashing, Gallicano (2011) argues that the excessive use of green marketing campaigns confuses consumers. This confusion arouses by the ambiguity of the concept green. As so many companies claim to be green a consumer does not understand what companies mean when they claim to be green. However, this consumer skepticism is also attributed to several other causes.

Another cause of skepticism towards CSR communication is the consumers’ dependency on reports of the companies. Consumers rely on what a corporation reports because they do not have the knowledge to understand environmental issues. Furthermore, acquiring knowledge to understand these issues is hard because it is complex and it changes quickly (Furlow, 2010). A second reason why consumers rely on the company’s claims is that they have poor insight into green products (Lim, Ting, Bonaventure, Sendiawan, & Tanusina, 2013). Additionally, consumers can not witness a corporation’s initiative (Illia et al., 2013). All these issues cause skepticism towards CSR communication.

Moreover, studies relate consumer skepticism to the company’s motives to engage in CSR. Within these studies the attribution theory is used to explain the relation between consumer skepticism and the perception of the company’s CSR motives (Elving, 2013a). The attribution theory clarifies how people perceive CSR communication and how the perceived motives influence consumers’ attitudes and behaviors (Parguel, Benoît-Moreau, & Larceneux, 2011; Forehand & Grier, 2003). The attribution theory by Heider (1944) states that people make attributions of others’ behavior, in this case a company’s motive to engage in CSR. People make internal and external attributions towards the companies’ CSR motives. Internal attributions are made towards companies that are perceived as public-serving. These

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companies are honest, they engage in CSR because it is the right thing to do and because it is beneficial for individuals and the environment. External attributions are made towards companies that are perceived as self-serving. These companies engage in CSR because of profit motives, the company’s reputation or because of stakeholder pressure (Elving, 2013a; Forehand & Grier, 2003). If a consumer perceives the company’s motives as self-serving, for example profit driven, then the consumer questions the sincerity of the motives and is

skeptical towards the motives (Elving, 2013a). The general belief is that consumers would like to see public-serving motives (Forehand & Grier, 2003). These public-serving motives ensure consumers that companies do not engage in CSR activities in order to increase prices and lower the product qualities (Mohr, Webb & Harris, 2001). If consumers perceive CSR motives as sincere these CSR initiatives have a positive influence on the consumers’ attitude towards the company (Elving, 2013a).

Additionally, when it is hard to determine the motives of a company or when various conflicting motives exist, consumers can be suspicious about the company’s intentions (Szykman, Bloom & Blazing 2004). Forehand and Grier (2003) use the discounting principle to describe how consumers make attributions when multiple motives are at play. The

discounting principle states that when external reasons for a company to engage in CSR are not obvious, consumers perceive the company’s behavior as internally motivated. However, when external reasons are expressed consumers perceive the company’s motives as self-serving. This means that when the benefits of CSR activities are salient, consumers perceive a company’s activities as self-serving instead of public-serving when benefits are not salient (Forehand & Grier, 2003).

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Forehand and Grier (2003) argue that consumer skepticism is not only driven by external attributions but also by situational variables that draw attention to the motives of companies. Forehand and Grier (2003) investigated if skepticism is induced when consumers think that a company is ambiguous about its real CSR motives. They state that consumers should engage in causal attribution in order to acknowledge the company’s self-interest. Consequently, without this causal attribution consumers do not develop skepticism. Indeed, Forehand and Grier (2003) found that the firm evaluation was much lower for companies that only showed public-serving motives than for companies that showed also firm-serving motives when benefits became salient. This means that a company possibly inhibits skepticism if it is honest about the benefits the company gains from their CSR activities. However, this effect was only found among consumers that engaged in causal attribution prior to the firm evaluation.

Another variable, fit, also influences consumer skepticism. Fit is defined as “the overall perceived relatedness of the brand and the cause with multiple cognitive bases” (Nan & Heo, 2007, p.72). These cognitive bases are the company’s product, image, positioning and/or target groups (Varadarajan & Menon, 1988). Elving (2013a) found that small fit between a brand and a cause leads to more skepticism than a large fit between a brand and a cause. In case of large fit between a brand and a cause, consumers think less critical about the

company’s motives. The reason is that consumers understand the relation between the brand and the cause and incorporate the CSR communication earlier.

According to Elving (2013a) the level of skepticism about a company’s CSR motives is an important forecaster of the success of the company’s CSR initiatives. Therefore, there is a need to overcome consumer skepticism and to create favorable CSR attributions. These are key challenges in CSR communication (Du, Bhattacharya, & Sen, 2010). To endorse this

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statement the consequences of consumer skepticism are explained.

Consequences of consumer skepticism

Studies showed various consequences of consumer skepticism. Rising consumer skepticism towards CSR campaigns makes them risky initiatives (Dahl, 2010). It affects brand

evaluations and organizational credibility (Nyilasy, Gangadharbatla & Paladino, 2014; Pomering & Johnson, 2009). Additionally, it makes communication less effective (Pomering & Johnson, 2009). Anuar and Mohamad (2012) show that skepticism make consumers disbelieve CRM claims made by companies. CRM, cause-related marketing, is a CSR initiative type whereby a company has an agreement with a charity (Anuar & Mohamad, 2012). A CRM claim is used to communicate that for each product that is sold the company donates a certain amount of money to the charity.

The effect of skepticism on consumers’ purchase behaviors is not clear. Studies are not congruent in their findings. Elving (2013a) state that skepticism towards a company’s CSR motives has a negative influence on the purchase behaviors of consumers. In addition, Singh, Kristensen and Villaseñor (2009) found that a repetition of CSR claims diminish consumer skepticism because it creates familiarity and it contributes to the campaign credibility. Furthermore, the repetition of CSR claims create awareness which may lead to more

purchases. In contrast, Gupta and Pirsch (2006) state that consumer skepticism has no effect on purchase intentions. Their findings show that consumers are still willing to buy the product even when they perceive a company’s CSR motive as altruistic and self-served. Consumers expect companies to have multiple reasons to engage in CRM campaigns.

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(Furlow, 2010). If there is nothing to gain but a lot to lose, companies do not have a reason to engage in CSR activities. However, there is a positive outcome of skepticism. Lim et al. (2013) mention that consumers use their skepticism as a defense mechanism and are more careful when they buy green products and services. They secure themselves from believing dishonest and ambiguous CSR claims that some companies only use as a marketing tool (Kim & Lee, 2009).

Reducing consumer skepticism

In general, companies want to avoid and suppress skepticism because of its negative

consequences (Pomering & Johnson, 2009). Different studies pay attention to how companies can avoid skepticism. Forehand and Grier (2003) argue that companies inhibit skepticism when they are honest about the benefits they gain from CSR activities like CRM, corporate sponsorship and corporate volunteerism. Pomering and Johnson (2009) state that diagnostic CSR communication reduces skepticism. Diagnostic CSR communication makes it easier for consumers to process information because a diagnostic text is explicit and multiple

interpretations are differentiated from each other. To achieve diagnostic CSR communication three elements are important. Firstly, a company should add information about the social cause because consumers often lack knowledge. Secondly, information about a company’s long-term CSR commitment improves CSR communication. Thirdly, information about the impact of a company’s CSR initiative should be added. Pomering and Johnson (2009) propose that adding these elements to CSR communication inhibit consumer skepticism. Chen and Chang (2013) state that the solution to reduce consumer skepticism lies in the reduction of greenwashing behavior. With the reduction of greenwashing behaviors companies improve the consumers’ green trust. They also found that greenwashing behavior is positively related to green consumer confusion and green perceived risk. This later comprises the idea that a

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consumer expects negative environmental consequences when purchasing a “green” product. According to Chen and Chang (2009) a company should reduce greenwashing behavior, consumer green confusion, and green perceived risk in order to inhibit skepticism. Delmas and Burbano (2011) argue that managers, NGO’s and policymakers have an important role in the reduction of greenwashing behavior. They can make a firm’s environmental performance transparent, which reduces the greenwashing behavior of these firms. Policymakers can force companies to disclose the product environmental characteristics and they can create ecolabels that reduces consumers’ green confusion. NGO’s can spread information about a firm’s environmental performance and they can create attention for firms that engage in

greenwashing. Finally, CSR managers of the companies can reduce greenwashing behavior by establishing collaborations with NGO’s, by increasing the centralization of decisions about CSR activities, by sharing information about the practices with other companies, and by avoiding the overestimation of the importance of certain CSR activities. In addition, the company’s employees are important to reduce greenwashing behavior. The employees should be informed about the risks of greenwashing and they should be rewarded when they identify greenwashing claims (Delmas & Burbano, 2011).

Thus, consumer skepticism and the causes of consumer skepticism are important to keep in mind when communicating about CSR initiatives. Research shows that greenwashing is one of the main causes of consumer skepticism. Another perspective states that discrepancy between words and actions does not necessarily leads to skepticism but can have a positive consequence.

Chapter 2.2 The CCO view of greenwashing

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between words and actions stimulates the CSR debate and that it contributes to the

development of CSR in the field. Therefore, this perspectives shows that greenwashing has a positive consequence.

According to Dawkins (2004) companies exaggerate the level of skepticism towards their CSR communication. The negative consequence of greenwashing is not a major problem as companies claim it is. Dawkins (2004) substantiates this claim with the results of his research, namely out of ten persons six of them trust the communication of companies compared to the 66% who trust the communication of NGOs. Here, NGOs are described as campaigning organizations and charities, such as Amnesty International. The results between companies and NGOs are not very different. Therefore, Dawkins (2004) states that companies should not focus too much on the negative consequence of greenwashing, namely the consumer

skepticism towards the CSR communication. In addition, greenwashing has some positive outcomes. Even though Elving (2013b) focused more on the negative consequences of greenwashing he acknowledged some benefits of greenwashing to CSR. First of all,

greenwashing behaviors increased the demand for independent certification organizations. It increased the knowledge and sophistication of consumers and greenwashing encouraged transparency by companies about their behaviors and in their communication. The increased transparency of companies was demonstrated by the increased amount of companies that published a sustainability rapport.

Christensen, Morsing and Thyssen (2013) go even further with their nontraditional view of CSR communication. They refer to CSR communication as aspirational talk, which

incorporates intentions and ideals but does not reflect the company’s CSR behavior. According to Christensen, Morsing and Thyssen (2013) aspirational talk causes a positive

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social change. It stimulates CSR improvements and the debate about CSR and it moves the CSR field forwards.

The explanation for this perspective lies in the term CCO. In the typical view of CSR

communication, communication is subordinate to action (Grant, Keenoy & Oswick, 1998). In the second perspective communication is perceived as the starting point for change. This meaning of communication for a firm is defined as CCO, which stands for communication as constitutive of organization (Christensen, Morsing & Thyssen, 2013). In general, it comprises the idea that the way in which corporations communicate about themselves shapes and

develops the organization. Luhmann’s systems theory explains this in more depth. Luhmann (1995) describes an organization as a social system. Each social system uses communication to develop itself. Within organizations this concerns the communication of organizational decisions. These decisions moves the organization forward to set new goals and practices (Luhmann, 1995). Regarding CSR communication, if a company communicates the decisions it made about its prospective CSR initiatives the CSR field moves forward.

Christensen, Morsing and Thyssen (2013) acknowledge that discrepancy between words and actions is related to hypocrisy. However, they distinguish two types of hypocrisy. The first form of hypocrisy is called duplicity and comprises the idea of lying about your actual actions. It is possible that this creates cynicism. Christensen, Morsing and Thyssen (2013) focus on the second form of hypocrisy, which is called aspiration. This form of hypocrisy tries to stimulate an audience by the use of ideals in CSR communication and by the minimization of differences between words and actions. In contrast to the first form of hypocrisy, which creates cynicism the second form stimulates new practices in the CSR field. If a company communicates ideals, it creates differences between their words and their real actions. Within

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these differences there is space for different ways of thinking and acting (Livesey et al., 2009). The development of new ways of thinking enables businesses to become better and it pushes the company to higher CSR standards.

Chapter 2.3 Green-highlighting

The first perspective of CSR communication focused on greenwashing as a cause of consumer skepticism. The second perspective focused on the positive consequence of greenwashing, namely CSR communication as aspirational talk. In this chapter the concept of green-highlighting is explained. Green-green-highlighting is a moderated form of greenwashing and should therefore be taken into account.

Green-highlighting includes, inter alia, that the company’s internal CSR activities correspond to what a company communicates about it. Furthermore, it contains information about what a company plans to do in the future (symbolic action) and information about what it does at the moment or did in the past (substantive action). This is done in order to present an

environmental responsible image. Walker and Wan (2012) describe this as talking the talk and walking the walk. In contrast, greenwashing includes a discrepancy between talk and walk. Such that CSR communications do not comply in regards to CSR activities. The difference between green-highlighting and CSR communication as aspirational talk is that the latter does not include communication about substantive actions. According to, the last perspective CSR communication includes solely information about the company’s CSR ambitions and ideals.

In their study Walker and Wan (2012) investigated the relation between green-highlighting and the financial performance of a company. Green-highlighting comprises symbolic actions and substantive actions. Walker and Wan (2012) found that symbolic actions alone harm the

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financial performance of a company. The explanation is that if companies communicate solely about their future plans, symbolic actions, consumers perceive this with suspicion. Consumers perceive this communication as a means to distract them of the fact that the company is not currently working on CSR actions. Furthermore, Walker and Wan (2012) found that the communication of substantive actions alone does not have a positive or a negative effect on the company’s financial performance. Moreover, the addition of substantive action to the communication cannot counteract the effect of symbolic actions on the firm’s financial performance. Thus, green-highlighting, the use of symbolic actions and substantive actions in CSR communication, is not positively or negatively related to the company’s financial

performance. This is contrary to the negative relation that was found between greenwashing and the financial performance of a company. The company’s financial performance is negatively influenced if companies talk about their “greenness” without the existence of this green behavior.

Research by Walker and Wan (2012) illustrated that green-highlighting is better than greenwashing because green-highlighting is not positively nor negatively related to the company’s financial performance. Additionally, the communication of solely substantive actions is better than greenwashing due to the influence on the company’s financial performance. However, green-highlighting is still not comparable to sincere CSR

communication. In the next paragraph the meaning of sincere CSR communication and the possible credibility limits of sincere CSR communication are addressed.

Chapter 2.4 The credibility limits of sincere CSR communication

In this chapter the third perspective, sincere CSR communication is described. The meaning of consumer skepticism is explained. Furthermore, it is argued whether CSR managers that

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use sincere CSR communication possibly face consumer skepticism and thus whether sincere CSR communication is related to credibility limits. In addition, within this chapter the first proposition is formulated.

Sincere CSR communication

As shown, CSR communication may have various forms. Companies can engage in greenwashing, green-highlighting or they can use CSR as aspirational talk. In both forms, greenwashing and CSR as aspirational talk, CSR claims transcend CSR actions. The perspective that is central to this study is sincere CSR communication. Sincere CSR

communication differs from the various forms of greenwashing and CSR as aspirational talk because within this form of CSR communication the CSR actions transcend the CSR claims. This means that within sincere CSR communication the companies undertake more CSR activities than what they communicate. These companies do not lie about their CSR actions and they do not communicate solely about CSR to create a positive environmental image.

Fassin and Buelens (2011) also illustrate that the gap between words and actions is small for sincere companies. They developed a hypocrisy-sincerity continuum. This continuum is helpful to classify companies on their degree of congruence or dissonance between words and actions. The classifications on the continuum are idealism, sincerity, realism, skepticism, opportunism, hypocrisy and cynicism. On the continuum sincerity includes positive intent or drivers, a high best effort implementation and high communication (Table 1). A positive intent or driver means that a company voluntarily engages in CSR. This stems from the belief in the common good and the belief in proper operations. The continuum shows that a

company is classified as sincere when both implementation and communication are high, thus when the gap between words and actions is small.

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Table 1

The sincerity-hypocrisy continuum

Note. Reprinted from “The hypocrisy-sincerity continuum in corporate communication and decision making: A model of corporate social responsibility and business ethics practices,” Y. Fassin and M. Buelens, 2011, Management Decision, 49, p. 594.

Furthermore, the perceptions of the various forms of CSR communication are different. The aim of companies that engage in greenwashing and CSR as aspirational talk is that consumers perceive the CSR actions as bigger than that they really are. These forms of CSR

communication induce a perspective of the companies’ CSR activities that does not correspond to the reality. However, within sincere CSR communication the aim is not to create such a perspective. Companies that are sincere in their CSR communication undertake more CSR activities than that they communicate.

Within various studies a description is given of sincerity. Fassin and Buelens (2011) describe sincerity as “the degree of congruence and does not relate to how ethical a company is but how true that company is to its mission statement, value declarations or corporate charter”

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(p.587). Reynolds and Yuthas (2007) state that sincerity is hard to determine because it focuses on the subjective beliefs of CSR claims. They describe it as “the subjective truth of the propositions” or in other words meaning what you say. Van de Ven (2008) mentions that if companies want to be perceived as sincere, their real CSR motives should be obvious. Furthermore, CSR managers should communicate these motives clearly. This means that even companies with self-serving motives can be sincere when they are honest about their motives and do not hide their true motives. However, Van de Ven (2008) argues that it is better to communicate a combination of public-serving and self-serving motives. Too much attention to self-serving motives may influence the positive relation between CSR activities and the consumers’ attitudes towards the company.

The studies show that sincerity may be hard to determine and Van de Ven (2008) shows that sincere CSR communication may be vulnerable to undesirable consumers’ attitudes.

Additionally, research showed that consumers question the honesty of CSR claims and become skeptical towards CSR communication (Papasolomou et al. 2009). Furthermore, research showed that variables like the companies’ motives, and the fit between a company and a charity, influence the degree of consumer skepticism. “Consumer skepticism makes consumers doubt or question a company’s claims regarding its involvement in trying to improve or mitigate social and environmental issues” (Anuar & Mohamad, p.100). Obermiller and Spangenberg (1998) describe skepticism as “the tendency toward disbelief of advertising claims” (p.160). This tendency of disbelieve may also refer to the company’s motives to set up a CRM program (Mohr, Eroǧlu & Ellen, 1998). Consumer skepticism arises when consumers think a company engages in CSR activities out of self-interests instead of the importance for society (Elving, 2013a).

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A few studies mention the vulnerability of genuinely responsible or sincere companies. However, the conclusions differ from each other. As mentioned earlier, Illia et al. (2013) conclude that companies that communicate honestly about their CSR activities should not fear greenwashing accusations. In contrast, Parguel, Benoît-Moreau and Larceneux (2011) state that companies who genuinely contribute to CSR activities suffer from the greenwashing activities of other companies. As a consequence, the benefits of CSR communication, like a positive brand evaluation, are questionable for these responsible companies. In addition, Lyon and Montgomery (2015) argue that greenwashing perceptions can also be raised by

consumers. They argue that people filter communication through their own mental constructions. These are subjective and thus people can comprehend the company’s CSR communication wrong. This means that sincere CSR communication can be perceived as greenwashing because people perceive the CSR communication subjectively.

Fassin and Buelens (2011) claim that even the sincerity of motivations from genuine companies are questioned. Their hypocrisy-sincerity continuum showed that sincerity includes high implementation and high communication, whereby the differences between words and actions are small. This means that sincere companies do not engage in

greenwashing however as mentioned Parguel, Benoît-Moreau and Larceneux (2011) found that the greenwashing behaviors of other companies may negatively influence truly

responsible companies. Additionally, consumer skepticism may arise by other causes. Firstly, when it is hard to discover the company’s CSR motives, even when these are solely public-serving, consumers may become skeptical about the company’s intentions (Szykman, Bloom & Blazing, 2004). Secondly, consumers also depend on the CSR communication of sincere companies. The consumers’ knowledge and reliance do not change because it addresses sincere CSR communication. Lastly, if a sincere company establish a partnership with a

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charity but the fit between the two organizations is not obvious it still may cause consumer skepticism.

Thus, companies that communicate sincerely about their CSR activities do not necessarily avoid consumer skepticism. This consumer skepticism may be caused by the greenwashing behaviors of other companies, the low fit between the company and a cause and the

consumers’ dependency on the company’s communication. Therefore, it is proposed that sincere CSR communication may cause consumers skepticism. Thus, the perception of consumers can be that the CSR claims transcend CSR actions. The differences between the various forms of CSR communication are illustrated in Figure 4. The figure show that

companies with sincere CSR communication do not communicate all their CSR actions, their real CSR actions are bigger than they external CSR claims. However, based on the findings in previous research the perception of this sincere CSR communication may be that the CSR claims transcend the CSR actions.

35 Real CSR actions

Sincere CSR communication

Perception Perception

CSR actions Green-highlighting CSR claims

> CSR claims > CSR actions

Greenwashing

Aspirational CSR communication

External CSR claims

Figure 4 Differences between the various forms of CSR communication

Thus, sincere CSR communication deals with credibility limits. This leads to the following proposition:

Proposition 1:B2C companies face credibility limits of their sincere CSR communication.

Previous research related CSR communication and consumer skepticism to variables like the company’s CSR reputation and the industry sector. The next chapter focuses on the possible influence of these and other variables on the relation between sincere CSR communication and consumer skepticism.

Chapter 2.5 Factors that influence the credibility limits

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communication are discussed. These factors are the industry sector, CSR history, corporate heritage, CSR leader or follower and the company’s CSR reputation. Propositions are formulated about these factors that are based on findings in previous studies.

Industry sector

Researchers that study CSR communication often thoroughly explain why they choose to conduct their study in a specific industry sector. It is remarkable that most researchers use a fictitious company or select industry sectors without a controversial character to use in their studies. Elving (2013a) investigated the relation between fit and reputation and consumer skepticism after exposure to a CRM advertisement. Elving (2013a) selected a fictitious company in order to exclude intervening variables that possibly affect the relation.

Respondents have no associations related to a fictitious company. Parguel, Benoît-Moreau and Larceneux (2011) conducted a study about the effect of independent sustainability ratings on consumers’ responses to CSR communication, like corporate brand evaluations. To

investigate the relation Parguel, Benoît-Moreau and Larceneux (2011) chose to use the furniture and home improvement industry specifically. They argued that this industry is experience-driven. This makes respondents more critical about the corporate brand. They did not select an industry sector with high societal involvement intentionally, like toys and sport products. If these industry sectors were incorporated into the study ceiling effects might occur. Ceiling effects lead to results that all concentrate around a certain value. Therefore, the results are biased. Furthermore, they did not select industry sectors that are intrinsically controversial, because these industries may enhance consumers’ suspicion. Controversial industry sectors are described as unethical and social irresponsible. These industry sectors face political pressures and they are characterized by social taboos and moral debates. Examples are alcohol and tobacco industries. Furthermore, controversial industry sectors

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include industries that are involved with environmental, social and ethical issues. Examples of such industries are oil, cement and biotech (Jo & Na, 2012; Cai, Jo & Pan, 2012).

Nyliasy, Gangadharbatla and Paladino (2014) support that the industry sectors matters in which a study is conducted. They found that pre-existing attitudes towards the chemical industry influence the relation between green advertising and consumer brand attitudes and purchase intentions. They conclude that some industry sectors are more likely to experience environmental failure and as a result are more susceptible to consumer skepticism.

Unfortunately, the researchers did not clarify which industry sectors experience more or less risk to environmental failure. Szykman (2004) did make a distinction between industries in his study. He found that the industry sector influences how people evaluate different CRM campaigns. The CRM campaigns were positively or negatively tied to product sales, they were aimed at sustaining the company’s business or they were completely unrelated to the company. Szykman (2004) distinguished industry sectors based on the type of production and the type of products (see Figure 5).

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Figure 5. Industry sectors distinguished by production and product type. Reprinted from “Who are you and why are you being nice? Investigating the industry effect on consumer reaction to corporate societal marketing efforts.” L. R. Szykman, 2004, Advances in Consumer Research, 31, p. 307.

All CRM campaigns of purely virtuous industries are positively evaluated. These purely virtuous industries have a helpful production and helpful products. In the study

pharmaceuticals are named as an example of a virtuous industry. Beer brewers were

categorized as a mixed industry. Their harmful products and a helpful production were most successful with a CRM campaign that decreases sales. For example, brewers participating in programs that prevent underage teenagers from drinking. This study shows that a company in a specific industry sector should carefully think about the content of their CRM campaign, because the industry sector influences how respondents perceive a CRM campaign.

Overall, the different studies show that the industry sector should be taken into account. Consumers may have pre-existing attitudes toward an industry sector which influences their brand attitude. Additionally, the industry sector influences how consumers perceive some CSR communication, such as CRM campaigns. Finally, controversial industry sectors, such as alcohol, are more sensitive to consumer skepticism due to their unethical and social irresponsible characteristics. Therefore, the following propositions were derived.

Proposition 2: The industry sector influence whether and to what extent companies face credibility problems regarding their sincere CSR communication

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controversial industry sectors.

CSR history

VanHamme and Grobben (2009) investigated whether a company’s CSR history matters when the company uses CSR claims in crisis communication. The aim of the use of CSR claims during a crisis is to counter negative publicity. They found that the CSR history matters. Companies with a long CSR history benefit from the use of CSR claims during a crisis. In contrast, VanHamme and Grobben (2009) do not recommend companies with a short CSR history to use CSR claims during a crisis. To explain the findings VanHamme and Grobben (2009) argued that a company with a long CSR history collected goodwill and earned trust. These companies have something to fall back on. This does not apply to companies with a short CSR history. Consumers may be more skeptical towards companies with a short CSR history that use CSR claims during a crisis to reduce negative publicity. The use of these CSR claims may be perceived as a means to establish their image. The re-establishment of an image is a self-serving motive and previous research showed that these self-serving motives might induce consumer skepticism.

Blomäck and Brunninge (2009) suggest that the use of historical references in communication emphasizes stability and continuance. These historical references comprise information on the website about the company’s history, the development of the company’s name, presentations for new customers, and traditions in commercials. Furthermore, it is used to reduce skepticism and to strengthen trustworthiness. The studies show that a long CSR history and the use of historical references are beneficial for a company. The research of Pirsch, Gupta and Grau (2007) supports this assumption. They investigated the effect of institutional and promotional CSR programs on consumers’ reactions, such as attitude and skepticism. Institutional

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programs are used to incorporate CSR throughout the whole organization. Policies and programs are made to support their social position. These institutional programs are a tool to build long-term customer relations, in contrast to promotional programs that are made to generate short-term effects. The promotional programs are not focused on all company’s stakeholders. These programs use CSR initiatives to drive product sales. Pirsch, Gupta and Grau (2007) found that institutional programs induce more positive reactions. Respondents find companies genuine if they integrate CSR in the whole organization. However,

promotional programs that focus on short-term relationships cause consumer skepticism. This suggests that the implementation of institutional programs in the company may reduce

consumer skepticism. Based on research by Pirsch, Gupta and Grau (2007), Pomering and Johnson (2009) proposed that companies with a long-term CSR commitment perceive less skepticism than companies with a short-term CSR commitment. Additionally, companies with a long-term commitment are observed as more credible. The studies show evidence for the credibility of companies’ with a long CSR history. In contrast to companies with a short CSR history are companies with a long CSR history able to use CSR claims during a crisis. They earned trust by their long CSR history. Moreover, the use of historical references reduces skepticism and increases trust. Logically, companies with a long CSR history have more historical references. In addition, companies with a long CSR history have a long-term CSR commitment. This long-term commitment induces less consumer skepticism. Therefore, the following is proposed:

Proposition 4: Companies with a long CSR history face less consumer skepticism than companies with a short CSR history.

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Corporate heritage contributes to trust and credibility among stakeholders (Urde, Greyser & Balmer, 2007). A company’s heritage incorporates five dimensions, namely the use of

symbols, the relevance ascribed to history, the core values of the company, the longevity, and the existence of track record. Blombäck and Scandelius (2013) argue that heritage make consumers perceive the sustainability practices of the company as genuine and the long-term responsibility as sincere. However, a company should relate the corporate heritage to CSR, which makes consumers perceive the brand as social and environmental responsible. The use of heritage in CSR communication is a signal to consumers that these social and or

environmental values are deeply rooted in the company. This also illustrates the differences between a long CSR history and corporate heritage. Companies with a long CSR history may have a long-term CSR commitment. However, this does not mean that CSR values are integrated in the firm because the company finds CSR intrinsically important. Blombäck and Scandelius (2013) found that these deeply rooted social and environmental values induce trust among customers. Therefore, it is suggested that companies with corporate heritage related to CSR that use this heritage in their communication face less consumer skepticism.

Proposition 5: Companies with corporate heritage and that use heritage in their CSR communication face less credibility problems regarding their sincere CSR communication than companies with no corporate heritage.

CSR leaders and followers

As mentioned before, an increasing amount of companies engage in CSR practices (Illia, et al, 2013). However, the way in which companies engage in CSR activities differs. Some

companies are leaders and other companies are followers. Companies that are classified as leaders develop innovative initiatives. These companies go beyond expectations and

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undertake more activities than what is expected from them (Dunphy, Griffiths & Benn, 2003). Herremans, Herschovis and Bertels (2009) add that leading companies create new trends in CSR and that companies that follow, here laggards, engage in mainstream CSR. Dunphy, Griffiths and Benn (2003) argue that innovative initiatives conducted by the company lead to stakeholder support. Furthermore, CSR leaders try to achieve social, environmental, and economic benefits at the same time. For these companies, CSR becomes value driven. Policies are turned into action and these organizations become proactively CSR oriented (Lindgreen & Swaen, 2010). As mentioned before, Blombäck and Scandelius (2013) found that deeply rooted social and environmental values might induce trust among consumers. Additionally, because CSR leaders go beyond expectations and their innovative initiatives create stakeholder support the following proposition is proposed:

Proposition 6: CSR leaders face less credibility limits to their sincere CSR communication than CSR followers.

The company’s CSR reputation

Szykman, Boom and Blazing (2004) argue that the identity of the sponsor influences how consumers process socially-oriented messages. An anti-drinking and driving message derived from a non-profit organization tended to deduce more positive society-serving motives. On the other hand, the same message but obtained from a B2C company derived more negative, self-serving motives. Kim and Lee (2009) elaborate on this finding. They found that the identity of a source influences if consumers perceive a company as credible. They show that a company known for its socially responsible behavior is perceived as more credible than a source that is perceived as social irresponsible. Additionally, Piercy and Lane (2009) state that CSR efforts and customer value are moderated by the company’s credibility as a social player.

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Low credibility reduces the impact of CSR initiatives on consumers’ perceptions. This corporate brand credibility is defined as “the credibility of a company’s brand as a signal, which is the extent to which consumers believe in the company’s trustworthiness and expertise” (Erdem, Swait & Louviere, 2002, p. 3). According to Lafferty (2007) corporate credibility is positively related to the attitude towards the brand. The studies show that the company’s credibility is an important variable in CSR. Piercy and Lane (2009) state that the company’s credibility as a social player is constructed by the company’s history and

reputation and Acikdili and Jahdi (2009) conclude that if a company is perceived as credible that this may attributed to its CSR reputation. The corporate reputation is “an individual’s collective representation of past images of an organization (induced through either

communication or past experiences) established over time” (Cornelissen, 2008 in Elving, 2013a, p. 280).

Elving (2013a) confirms that a bad corporate reputation influences the level of skepticism. He recommends companies with a bad reputation to stay silent about their CSR initiatives. Only if the reputation improves the company may start with CSR communication. In addition, Nyilasy, Gangadharbatla and Paladino (2014) found that companies with a low corporate environmental performance are better off when they do not engage in green advertising. This green advertising only leads to more positive brand attitudes towards companies with a high or with no corporate environmental performance.

Lii and Lee (2012) observe CSR reputation as a variable that influences the relation between CSR initiatives, consumer-company identification, and brand attitude. Lii and Lee (2012) found significant results for this relation but there is a difference in what type of CSR initiative a company engages in. The research showed that the CSR reputation did not