Volume 3, Issue 4 (April, 2014)

Online ISSN-2320-0073

Paper Presented in National Refereed Conference on

Corporate Social Responsibility: Towards New Agenda

Published by: Abhinav Publication

Abhinav International Monthly Refereed Journal of Research in

Management & Technology

STUDY OF IMPACT OF CSR PROGRAM ON CONSUMERS

BUYING BEHAVIOR FOR FMCG PRODUCTS IN MUMBAI
Shilpa Shinde
Research Scholar, JJT University, Jhunjhunu,
Rajasthan, India
Email: shindeshilpa81@gmail.com
ABSTRACT
Today the word Corporate Social Responsibility program has become a part of people living in
India. Initiating or executing CSR program, this culture is mushrooming across the countrys
landscape at a faster pace among all industries. This paper explores the customers buying behaviour
towards FMCG companies product with reference to CSR programs. The data for this study are
collected from Mumbai and Suburb Mumbai region. The analysis is done taking into consideration
factors like preference of product as per program, attitude of consumer towards program and
awareness of CSR program among consumer. The paper concludes that CSR program puts significant
impact on consumer buying behaviour. It also serves as an encouragement to the organisations that
cater CSR program for the needs of the Corporate Social responsibility as sustainability factor.

Keywords: Corporate Social Responsibility; Sustainability; Consumer Buying Behavior; FMCG

INTRODUCTION
Earlier organisation is likely to make wealth and employment, although society is likely to provide a
conductive environment for the business to flourish. But in todays world there are number of tasks
that organisation has to achieve to the society. These contain the financial, political, environmental and
social tasks. To achieve these tasks organisation implements various policies and procedures through
various methods. Corporate Social Responsibility (CSR) is the road for business to achieve these tasks.
Corporate Social Responsibility (CSR) is stated as a wide-ranging set of policies, practices and
programs that are combined into business operations, supply chains, and decision-making processes all
over the organization process and practices, all places where ever they do the business and it also
include responsibility for present and past actions as well as future impacts on business Ghosh J.
(2003). The elements which have headed to the development of the concept of corporate social
responsibility (CSR) would be perfect beginning with the theoretical improvement of suitable
corporate business practices for emerging markets and developing countries.
Today companies are expanding their boundaries from the country of their origin to the evolving
markets in the developing countries which have been sometimes referred to as emerging markets due
to this reason the business environment has undergone vast changes in the recent years, in relations of
both the environment of competition and the trend of globalization that has been sweeping across
markets. The current trend of globalization has brought a realisation among the firms that in direction
to participate effectively in a competitive environment; they need clearly defined business practices
with a sound focus on the public interest in the markets (Gray, 2001).
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The word CSR is regularly used interchangeably for other words such as Corporate Citizenship and is
also linked to the concept of Triple Bottom Line Reporting (TBL), which is used as a framework for
measuring an organisations performance against economic, social and environmental parameters,
Subhabrata Ghosh and Pabitra Kumar Ghosh (2011).
However I think the word CSR can also be used to sustainability for companies who want survive in
todays global competition and at the same time companies who want to collaborate with Employees,
Business Partners, Investors, Community, Consumers and Government to implement CSR initiative
programs for ethical purpose with good cause.
Not only this, todays business organisation considered to be social institutions, apart from being
economic entities, for two reasons. Firstly, business organisations exist and operate within a social
structure. They need to win social acceptance, for their survival. Secondly, business organisation needs
to be socially responsible as they exercise a wide influence on the societys lifestyle.
Business, can succeed only if they maintain good relationships with all their stakeholders. These
relations can be strengthened, if organisation fulfills their commitments towards stakeholder and
consumer is one among those stakeholders, hence consumers views, behavior and response towards
organization CSR programs is also plays important role.
LITERATURE REVIEW
Corporate Social Responsibility represents only the social dimension of corporate responsibility,
Schz M (2012). One can connect the main three traditional ethical theories with this dimension,
Virtue ethics strengthens the companys ability for taking responsibility, while the utilitarian ethics
assesses the consequences as beneficial or damaging, and deontological ethics defines the authority
asking for the fulfillment of ethical duties.
Those concepts are not fighting each other, but eventually complementing one another, when linked to
the term of ethical responsibility as mentioned in below diagram.

We can refer to the term sustainability as it was defined 1987 by the Brundtland Commission:
Sustainable development is development that meets the needs of the present without compromising
the ability of future generations to meet their own needs (Brundtland, 1987). Grayson and Hodges
(2001) point to the interaction of four forces or signposts that make corporate social responsibility a
mainstream business issue, namely:

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The development of technology and communications which result in companies having no

place to hide,

The increased prominence of multinationals globally and the growth in the value and visibility
of their brands which make them more susceptible to scrutiny;

Demographic change and development which encompasses issues such as an ageing

population in the developed world, skewed income distribution, limited access to health,
education and jobs; and

The revolution of values and the decline in deference for institutions.

Social responsibility is increasingly being seen as a necessity for doing business in developing
economies that lack the infrastructure and capacity to build social capital. Investment in local
communities is seen to be a prerequisite in contributing to a sustainable, healthy and stable business
environment in which investments will be protected and produce returns (World Business Council for
Sustainable Development, 2003). Hamann (2003, p.239) notes that (t)o embrace economic, social and
environmental aspects of sustainability in a holistic manner, and to provide maximum development
benefits, corporate social responsibility must be integrated into the core activities and decision making
of a company. Hence, sustainability needs to be seen as a key concern by top management.
FMCG Companies and Their Initiatives in India
Today in India many FMCG companies are spending lot of money on their Corporate Social
Responsibility Programs through their various CSR initiatives directions mode. The below mentioned
are selected companies, who run many CSR activities though out year. The information on activities
mentioned below is sourced from the annual sustainability reports or the CSR section on companies
websites.

Source: Futures cape presentation for CSR on slideshare.com

From above table it look like organisations are taking lots of efforts for CSR program, but we need to
think from consumer perspective also, i.e. why, how, & what type of consumer buy our product, also
which CSR program more influencing from consumer point of view in todays scenario.
An understanding of the buyer behaviour is essential in business planning & programmes. In the final
analysis buyer behaviour is one of the most important keys to successful business.
OBJECTIVES
1. To examine the relationship between corporate social responsibility and the consumer buying
behaviour.
2. To study awareness of corporate social responsibility among consumer.

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RESEARCH METHODOLOGY
The objective is to have an understanding of the relation between corporate Social Responsibility and
Sustainability and to know the consumer buying behavior with reference to the same.
Sample Design
Sample Size is 100, across different demographic category from Mumbai city in Maharashtra State.
For the purpose of present study a related sample of population was selected on the basis of
convenience.
Data Collection
Primary data was collected through Questionnaire and Secondary data through Annual Reports
Magazines, Newspaper, Books, journals and Websites.
Analysis Techniques
The source of analysis is the data provided by the questionnaires. Then a Chi Square Analysis is done
in order to determine significant impact on consumer buying behaviour.
LIMITATIONS
Similar like many other researches, this research has some limitations but that also present openings
for future research.
The research result findings were exclusively based on the respondents perception on the role of
corporate social responsibility, which influence their buying behavior. Therefore, the results could be
prejudiced. To answer this weakness is only one, i.e. future research is undoubtedly needed to study
the relationships of the variables utilising more diverse samples.
DATA ANALYSIS
Table 1. Demographic Characteristics of Respondents
Demographic
Gender
Male
Female
Age (Yrs)
15-25
26-36
36-45
46 & above
Qualification
HSC
Graduate
Post Graduate
Professional
Profession
Student
Salaried (Office workers)
Entrepreneurs (Businessman)
Senior Citizen
Others
Income
1000-5000
5000-20000
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% of Respondent
86%
14%
6%
38%
46%
10%
15%
45%
10%
30%
1%
54%
23%
18%
4%
1%
44%
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Management & Technology
21000-35000
36000-50000
51000 & above
Do you know about various CSR program runs by FMCG companies?
Yes
No
Do you know about CSR Initiatives taken by FMCG companies for?
Health
Stakeholders
Environment
Society
Others
Which sector you prefer for CSR Initiative?
Education Sector
Health Sector
Environment Sector
Society
Others
What is Preference % of your CSR responsibility?
Economic Responsibility
Legal Responsibility
Ethical Responsibility
Philanthropic Responsibility
Do you purchase product on the bases of Companies CSR program?
Yes
No
Which CSR activity sector product do you prefer to purchase?
Education Sector
Health Sector
Environment Sector
Society
Others
Why do purchase product those who are running CSR Program
Want be a part of program
Want to contribute in good cause
Want to acknowledge the efforts taken by company
others
Sources of CSR program information
Newspapers & Magazines
News channels
Friends & Family
Others
Internet

39%
11%
5%
55%
45%
38%
15%
20%
17%
10%
25%
30%
20%
15%
10%
15%
30%
45%
10%
52%
48%
26%
32%
4%
36%
2%
30%
40%
20%
10%
13%
35%
27%
10%
15%

Which CSR Activity Sector Product Do You Prefer To Purchase?

CSR Program Sector Product Preferred By Consumer
Sector
Education Sector
Health Sector
Environment Sector
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% of respondent
26%
32%
4%
Online ISSN 2320-0073

Abhinav International Monthly Refereed Journal of Research In

Management & Technology
CSR Program Sector Product Preferred By Consumer (Contd.)
Sector
Society
Others

% of respondent
36%
2%

Hypothesis
Null Hypothesis (Ho):- There has been no significant impact on consumer buying behavior through
CSR program sector.
Alternate Hypothesis (H1):- There has been significant impact on consumer buying behavior through
CSR program sector.
Probability of CSR Program in any sector =1/5. On the basis of this hypothesis the expected number of
respondents preference (E) =100/5=20
Expected and Observed Respondent
o(Observed)
26
32
4
36
2

e (Expected)
20
20
20
20
20

Chi-Square test or X2 test=

Chi-square

Calculated value
50.8

Degree of freedom(n-1)
4

Tabulated value
9.48

The table value of X2 for 4 degree of freedom at 5 per cent level of significance is 9.48. The calculated
value of X2is much higher than this table value and hence we reject the hypothesis and accept H1,
which provides sufficient evidence that CSR program has significant impact on consumer buying
behavior.
CONCLUSION
The industry of current century will have no choice but to implement CSR. Investments in CSR
programs are under analysis. Stakeholders are demanding now increasingly that results from these
programs be measured to know if and how they positively influence the profitability of the
organisation. Not surprisingly, a significant amount of research has been undertaken to understand the
relationship between CSR and profitability, which leads them to sustainability in the Global Market.
Due to the increase in importance of consumers among business as a stakeholder, marketing research
that examines the effects of CSR on profitability is particularly informative to organization for
profitability and sustainability. This study shows that CSR leads to results such as improved customer
loyalty, readiness to pay premium prices, and lower reputational risks in times of crisis.
RECOMMENDATIONS
Periodic evaluation of the CSR prgrams should be conducted by every industry so as to identify the
difficulties and the areas which are missing out as per consumer expectations.
REFERENCES
1. Brundtland Commission (1987). Our Common Future Towards Sustainable Development, chap.
2, World Commission on Economic Development (WCED), [accessed September 24, 2012),
[available at http://www.un-documents.net/ ocf-02. html].

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2. Ghosh J. (2003) Strategy for Development , Frontline Vol. 20, No, 18, India.
3. Gray, R. (2001). Social and Environmental Responsibility, Sustainability and Accountability, Can
the Corporate Sector Deliver? , Glasgow, Centre for Social and Environmental Accounting
Research, University of Glasgow, Retrieved on August 14, 2004 from www.agendascotland.org/documents/ Can%20business%20deliver%20Gray.pdf
4. Hamann, R. (2003). Mining companies role in sustainable development: The why and the how
of corporate social responsibility from a business perspective. Development Southern Africa, 20
(2), 237-254.
5. Schz, M ( 2012) sustainable corporate responsibility The foundation of successful business In
the new millennium, CENTRAL EUROPEAN BUSINESS REVIEW, VOLUME 1, NUMBER 2,
OCTOBER 2012, pp.715
6. Subhabrata Ghosh and Pabitra Kumar Ghosh (2011), Role of Corporate Social Responsibility in
Inclusive Growth Considering the Government Expenditure in Developing Social Infrastructure,
Conference on Inclusive & Sustainable Growth, Role of Industry, Government and Society,
Conference Proceedings: 2011 conducted at Institute of Management Technology.
7. World Business Council for Sustainable Development (2000). CSR: making good business sense.
http:www.wbcsd.ch/DocRoot/5mbUksfWpqAgPpPpUq/Ue/csr2000.pdf (accessed 13 May 2003).

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