Do CSR Activities Influence Corporate Reputation? Evidence from India

Many firms today value corporate social responsibility (CSR) because it can boost their reputation in a competitive market. Many studies have shown that CSR practices affect a company’s reputation, but few have examined specific CSR elements affect Indian corporate reputation. Thus, this study explores how economic, governance/legal, social/ethical, and environmental CSR variables affect business reputation. A mailed survey of mid-level and senior managers at 403 Bombay Stock Exchange-listed companies in six major industry categories was used to gather data. Using the Likert scale with five points, 51 items were scored on the four CSR dimensions and five items were scored on corporate reputation dimension. Descriptive statistics, reliability tests (using Cronbach’s alpha), principal components/factor analysis, Pearson correlation analysis, and multiple linear regression were used to examine the survey data. Governance, legal, social (including ethical), and environmental CSR factors boost firm reputation. The four dimensions of CSR (economic, governance/legal, social/ethical, and environmental) are positively and significantly predictive of corporate reputation. The environmental factor of CSR (β = 0.425; t = 7.935; p < 0.001) was the strongest predictor of business reputation, while the economic dimension (β = 0.119; t = 2.378; p = 0.018) was the weakest predictor, but still statistically significant. This research will add to strategic management literature by showing how CSR dimensions affect corporate reputation in a developing economy and giving managers advice on how to execute effective CSR programs.