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Corporate Ethics and Corporate Social Responsibility in Reinforcing Consumers Bonding: An Empirical Study in Controversial Industry

Corporate Ethics and Corporate Social Responsibility in Reinforcing Consumers Bonding: An Empirical Study in Controversial Industry
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Author(s): Ari Setiyaningrum (Diponegoro University, Indonesia) and Vincent Didiek Wiet Aryanto (Dian Nuswantoro University, Indonesia)
Copyright: 2018
Pages: 18
Source title: Business Education and Ethics: Concepts, Methodologies, Tools, and Applications
Source Author(s)/Editor(s): Information Resources Management Association (USA)
DOI: 10.4018/978-1-5225-3153-1.ch053

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Abstract

Corporate ethics (CE) and corporate social responsibility (CSR) have been considered as the main determinants of companies' success as well as sustainability for company's viability. Both of them potentially affects on consumer buying behavior. This study aims at exploring the basic issue on CE and CSR. In addition, this study examines whether good corporate ethics and CSR engagement of companies always lead to positive consumer response in the context of controversial tobacco's company. Data collected by distributing questionnaires to the 318 respondents. By means of structural equation modeling (SEM) to examine the proposed model, it indicated that the more well-defined of corporate ethics lead to the better evaluation of CSR activities, the more well-defined of corporate ethics and the better evaluation of CSR activities lead to the good corporate reputation. In addition, the good corporate reputation leads to the higher corporate trust, and the higher corporate trust lead to the stronger consumers bonding.

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