The reference-independence of CSR expectations for luxury firms

Abstract

Consumers actively look to and expect businesses to engage in charitable donation activities. While past research has demonstrated the strategic benefits that corporate social responsibility (CSR) affords to firms, little is known about the way consumers apply subjective (or objective) ethical standards for corporate donations. Our research focuses on the way expectation standards of CSR are applied to luxury (versus non-luxury) companies. Do consumers hold a belief that luxury firms are expected to donate more? Four experimental studies find robust and converging evidence that consumers do not hold luxury firms to a higher standard; instead, they take on the normative belief that companies are obligated to donate equal amounts. This reference-independence holds stable across different product categories (Studies 1a and 1b), perspectives (Study 2), and attempts to alter the belief (Study 3). However, individual differences do exist among consumers regarding the level of donation expected, particularly for materialists and spendthrifts. Specifically, moderation analyses reveal that materialists and spendthrifts (compared to non-materialists and tightwads) expect higher levels of corporate donations regardless of the type of firm (i.e., luxury vs. non-luxury). This research extends the discussion of subjective ethical beliefs in the context of luxury CSR.