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Impact of Corporate Social

Responsibility on Consumer Buying
Behavior in Egypt
Nevine Eshra

World Review of Business Research

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 World Review of Business Research
Vol. 7. No. 1. March 2017 Issue. Pp. 32 – 44

Impact of Corporate Social Responsibility on Consumer

Buying Behavior in Egypt
Nevine Eshra1 and Noha Beshir2
To survive today’s competition, business organizations
must not only take care of the quality of life of their
employees and their families, but also take care of their
community and society at large. Corporations give more
attention to their social responsibility through their four
dimensions, economic, legal, ethical, and philanthropic.
Many studies have been conducted in CSR taking into
consideration corporations’ point of view, however,
limited studies considered CSR from consumer's
perspective. This study will enhance the literature about
the theory of consumer perception of CSR and its impact
on consumer buying behavior. Practically speaking, this
study will apply the impact of CSR on consumer’s buying
behavior in Egypt. The results showed that Egyptian
consumers are adequately aware of CSR concept, but,
at the same time, all CSR elements have insignificant
relation to consumer behavior. This means that the
Egyptian consumers do not think about any of CSR
elements when they take their buying decision.

Field of Research: Marketing

1. Introduction
Corporate social responsibility (CSR) is increasingly considered vital for organizational
success and sustainable growth across industries, especially in view of corporations
operating in an environment with multiple stakeholder interests. Investment in CSR
should not be seen as an expense, but rather an allocation of resources to strengthen
relationships with stakeholders and a source of gaining competitive advantage. CSR has
been evolving as early as the 1930s (Carroll 1979). It can be defined as treating the stakeholders
of the firm ethically or in a responsible manner. CSR is a concept whereby organizations consider
the interests of society by taking responsibility for the impact of their activities on stakeholders as
well as the environment. This obligation extends beyond the statutory obligation to comply with
legislation and makes sure organizations voluntarily taking further steps to improve the quality of
life of employees and their families as well as the local community and society at large.

Carroll (1991) suggests that CSR should be divided into four responsibility levels:
economic, legal, ethical and philanthropic responsibilities. Economic responsibility refers
to the profitability of the organization, while legal responsibility is complying with laws and
regulation. As for the ethical perspective, the organizations should go beyond the law and
contribute to social wellbeing. Philanthropic responsibility refers to voluntary giving and
servicing the society. Throughout time, entities' environmental responsibility has emerged
as the most discussed issue in today’s CSR literature. Carroll’s definition does not specify

1
Dr.Nevine Ibrahim Abd El-Salam Eshra, Marketing & International Business Department, Arab Academy
for Science, Technology & Maritime Transportation, Alexandria, Egypt. E-mail: nevineeshra@hotmail.com
2 Dr.Noha Beshir Mohamed Beshir, Marketing & International Business Department, Arab Academy for

Science, Technology & Maritime Transportation, Alexandria, Egypt. E-mail: nohabeshir@yahoo.com

 Eshra & Beshir
the environment as a distinct domain, just as Dahlsrud (2006) places it, but rather as a
social issue among practices conducted in a philanthropic manner. The definition of CSR
for this study is based on Carroll’s pyramid of CSR.

Today, consumers are more aware of the corporations' responsibility through better
education and through the influence of the media. It may no longer be accepted for
business organizations to ignore CSR. The role of businesses in society does no longer
focus only on creating wealth, but rather on acting responsibly towards stakeholders
(Harrison & Freeman, 1999).Some researchers found that consumers generally have
positive responses towards companies that have social, responsible activities (Saleh et
al. 2015). At the same time, there is still a lack of consensus over consumer behavior
towards CSR activities (Rahim et al. 2011; Safi & Ramay 2013, Saleh et al. 2015), so this
study investigates whether consumers’ purchase decision is affected by CSR activities or
they are not put into consideration when making such a decision.

As the education level increases, consumers become aware of the need for prosaically
corporate behavior. A lot of work has been done in Western countries to identify an
organization's behavior regarding consumer purchasing decisions. However, limited
studies examine the relationship between CSR and consumer buying behavior, especially
in emerging markets such as Egypt. This research contributes to the limited CSR studies
that examine its effect on consumer buying behavior (Rahim et al. 2011; Min et al. 2012;
Safi & Ramay, 2013). This research also examines to what extent the Egyptian
consumers are aware of CSR?’ and ‘what is the impact of CSR elements on Egyptian
consumers behavior?’

Results of this study indicate that Egyptian consumers are actually aware of the concept
of CSR that goes with the study of Kolkailah et al. (2012). On the other hand, all CSR
elements have insignificant relation to consumer behavior while Rahim et al. (2011) in
Malaysia and Safi and Ramay (2013) in Pakistan indicate a significant relation. In
addition, Min et al. (2012) in Malaysia find that there is no relation between economic and
legal responsibility and consumer behavior. The rest of this study is structured as follows:
the next sections discuss the literature review and the methodology. The discussion and
analysis are presented in the fifth section and followed by conclusions in the final section.

2. Literature Review
2.1 Corporate Social Responsibility

Many scholars and researchers have approached the concept of corporate social
responsibility from several perspectives. Initially, the concept was mainly associated with
economic aspects, understood as the organization’s obligation to maximize shareholder’s
value. Corporate social responsibility depends on the stakeholder theory which states
that the main purpose of any business is maximizing value for stakeholders (Kiran &
Sharma 2011). For example, in 1999, Phillip Morris made $75 million in charitable
contributions and then launched a $100 million campaign to publicize these charitable
contributions to increase their visibility in the society (Vlachos et al. 2009).

Another research flow appears relating the concept of marketing activities with a social
dimension in areas such as environment protection, community development, resource
conservation and philanthropic giving (Liu & Zhou, 2009). According to Wood (1991), the
basic idea of corporate social responsibility is that business and society are interwoven
33
 Eshra & Beshir
rather than separate entities’. Organizations can improve their corporate prestige by
fulfilling their CSR because its’ activities can strengthen organizations’ prestige, promote
consumers’ impression of them, increase trust between organizations and consumers,
and influence consumers’ purchasing behavior (Nochai & Nochai 2014).

CSR should be understood as a broad concept. Carroll’s (1999) framework is significant

as the most widely accepted and used framework to explain the construct. Many
definitions have been given for CSR, but the most common and most conclusive definition
is Carroll's (1979) definition that identified four main responsibilities organizations should
fulfill: economic, legal, ethical and discretionary that is also known as philanthropic
responsibilities (Nochai & Nochai 2014; Saleh et al. 2015).

Carroll (1999) terms the four dimensions of CSR as the four faces of corporate citizenship.
Economic responsibilities pertain to the necessity for corporations to be profitable and
grow. Legal responsibilities require organizations to operate within the boundaries of laws
and national policies. Ethical responsibilities demand that organizations operate morally,
fairly, justly and follow the norms placed on them by society. Philanthropic responsibilities
oblige organizations to contribute financial and other resources for the welfare and
betterment of the society and the national community. The impact of business activities
on people’s quality of life leads to increase concerns about CSR. Nowadays, individuals
consider CSR as a necessity and this belief has resulted in businesses which have been
expected to define their roles in society in applying social, ethical, and legal
responsibilities to their operations (Onlaor & Rotchanakitumnuai 2010).

2.2 Consumer Behavior towards Corporate Social Responsibility

The behavior of a consumer who is socially conscious and looks for social change is
known as social responsibility consumer behavior. Such consumer searches for more
information or details pertaining to the products or services, purchase, and use and
disposes of the products in a way that maximizes the advantages and minimizes any
harmful effects on the society (Min et al. 2012; Mohr et al. 2001).

Consumer behavior includes mental, physical and emotional activities which people do
when they want to select, purchase, use or throw away the product or the service that
fulfills their needs and demands (Vahdati et al. 2015). Understanding consumer buying
behavior can support marketers become more familiar with their customers. In addition,
it could be the root for marketers to develop applicable marketing strategies (Safi &
Ramay, 2013). If marketers are aware of the consumer buying process, they know how
consumers get information to buy and what factors influence their decision to buy (Vahdati
et al. 2015).

Many studies which have been conducted in developed countries to identify the influence
of CSR on consumer behavior (Creyer & Ross 1997; Maignan 2001; Mohr et al. 2001).
Creyer and Ross (1997) mention that consumers consider ethical behavior as an
important indication through their purchase decisions. Maignan (2001) conducted studies
in Germany and France, found that the respondents viewed legal concerns as the most
significant responsibility, subsequently ethical, philanthropic and then economic
responsibilities. Mohr et al. (2001) examine the impact of CSR knowledge on consumers'
attitudes and purchase decisions as well as whether CSR affects consumers' decisions
and why. Their findings indicate a significant relationship between CSR and behavior
intention.

34
 Eshra & Beshir

On the other hand, there are some studies conducted in developing countries such as,
Pakistan, Nigeria, Malaysia, Bangkok, Iran and Egypt (Yam 2013; Ali 2011; Kolkailah et
al.2012; Nochai & Nochai 2014; Sarfaz 2014; Saleh et al. 2015; Vahdati et al. 2015). Ali
(2011) and Sarfraz, (2014) study the influence of CSR on consumer intention. Ali (2011)
finds that CSR has a significant positive influence on consumer purchase intentions while
Sarfaz (2014) finds that consumers are satisfied with the CSR policies of the telecom
companies, but CSR policies have no influence on the intention of the consumers.
Kolkailah et al. (2012) reveal that consumers in Egypt are actually aware of the CSR
concept and even tend to develop a positive attitude towards socially responsible
companies and economic criteria are apparently still given a priority over the social
criteria. Saleh et al. (2015) suggest that CSR, especially the social and economic
activities, has a significant impact on word-of-mouth and both have a significant effect on
sustainability when word-of-mouth mediates the relationship.

Nsikan et al. (2015) demonstrate the influence of CSR on competitive advantage in the
Nigerian telecommunication industry. The study concludes that CSR has a significant
positive influence on competitive advantage and a statistically significant relationship
exists between corporate social responsibility and corporate competitiveness. This can
be accomplished by being environmentally conscious, awarding scholarship, funding
charitable causes, adopting transparent recruitment practices, and striking a balance
between work and family roles.

Some studies find that consumer made buying decisions depending first on traditional
criteria such as price, quality, and convenience and then based on damage or benefits to
the society (Yam 2013; Gigauri 2012; Su et al. 2015). Nochai and Nochai (2014) find that
the legal responsibility is the most important dimension that affects consumer buying
behavior followed by ethical responsibility. Vahdati et al. (2015) indicate that consumers
have a positive attitude towards CSR and it has a direct impact on their buying behavior.

Other few studies have been conducted in Egypt and taken into consideration each
dimension of CSR individually rather than its global construct. This research focuses on
exploring whether Egyptian consumers consider CSR initiatives before making any
purchasing decisions. The study also tries to find out the dimensions of CSR which have
the significant effect on consumers buying behavior based on Carroll’s CSR pyramid.

2.3 Independent Variables

In this study, the independent variables were developed from Carroll’s CSR pyramid,
indicating the economic, legal, ethical, and philanthropic responsibilities.

2.3.1 Economic Responsibility

According to Carroll (1991), economic responsibility is the basic unit in a corporation to

carry the responsibility that corporations should provide goods and services that society
wants at reasonable prices taking into consideration making profits and increasing the
value for their shareholders. According to Onlaor and Rotchanakitumnuai (2010), the
price is the most important factor that affects consumer satisfaction and buying behavior.
Consumers feel unsatisfied when the prices of goods or services are high, which in turn,
influence the consumers’ buying behavior towards the company. Consequently, the first
research hypothesis is:

35
 Eshra & Beshir

H1: Economic Responsibility has a significant effect on consumer buying behavior

2.3.2 Legal Responsibility

The society expects from corporations to work within the framework of laws and
regulations while carrying out their business operations. The purpose of the legal
responsibility is to ensure that the activities and performances of the companies are
acceptable by the stakeholders. Furthermore, a successful corporation should be
recognized as one that fulfills its legal obligations. The consumer, one of the stakeholders,
is expecting the companies to meet the legal requirement for product safety, quality, and
accurate information and so on. Failing to comply with these aspects, company
performance will be adversely affected (Carroll & Shabana 2010). Hence, the second
research hypothesis is:

H2: Legal Responsibility has a significant effect on consumer buying behavior

2.3.3 Ethical Responsibility

Ethical responsibility refers to those standards, norms, or expectations that are related to
what consumers, employees, shareholders and the community regard as fair and just or
protect the stakeholder’s moral right and they extend beyond the legal responsibility
(Carroll 1979).Balancing economic, legal and ethical responsibilities are important. If the
corporation does something that is appropriately economic and legal, it must also be
appropriately ethical. Creyer and Ross (1997) find that consumers are willing to pay
higher price for products with ethical companies as they build trust with their consumers.
Thus, the third research hypothesis is:

H3: Ethical Responsibility has a significant effect on consumer buying behavior

2.3.4 Philanthropic Responsibility

Society desires corporations to contribute their money, facilities and employee time to
humanitarian programs or purposes including arts, education, or communities, all of which
refer to philanthropic responsibility. According to Carroll (1991), it is important for
managers and employees to participate in voluntary and charitable activities within their
local communities, especially in projects that enhance a community's quality of life. The
distinguishing characteristic between philanthropic and ethical responsibilities is that
philanthropic responsibilities are not viewed in an ethical or moral sense. Philanthropy is
located at the most voluntary and discretionary dimension of corporate responsibility and
has not always been linked to profits or the ethical culture of the firm (Ferrell 2004).
According to Rahim et al. (2011), philanthropy will not directly gain the economic return,
but it can help create and build up the image or reputation of the companies and enhance
the firm’s long-term competitive position in the market. In addition, it also helps increase
employee loyalty and customer satisfaction. That means that engaging in philanthropic
activities create win-win situations for both the business sector and the societies around
them. Therefore, the fourth research hypothesis is:

H4: Philanthropic Responsibility has a significant effect on consumer buying behavior

36
 Eshra & Beshir
3. Conceptual Framework
Based on the literature review, research hypotheses, and research objective, the
conceptual framework of this study is developed and shown in figure 1.

Figure 1: Conceptual Framework

Independent Variables Dependent Variable

CSR Dimensions

Economic
Responsibility H1

Legal
Responsibility H2
Consumer’s
Buying
Ethical Behavior
H3
Responsibility

Philanthropic
H4
Responsibility

4. Methodology
This research is a quantitative research using a questionnaire survey. The questionnaire
is proven to have high reliability and consistency. This survey instrument allows the
researcher to examine the impact of CSR on consumers’ buying behavior. Simple random
sample was carried out to collect the view of consumers in Egypt. Egypt has a population
that exceeds 90 million people, due to time constraints, a total of 140 consumers were
selected as our respondents and questionnaires were distributed to consumers in
Alexandria only during March 2016. Roscoe (1975) recommends that sample sizes larger
than 30 and less than 500 are appropriate for most studies.

The questionnaire is adapted from Rahim et al. (2011) and it consists of three major
sections. Section A gathers information on consumers' awareness of CSR. This section
covers some general questions to obtain the respondent's understanding of the term
CSR, which indicates the ability of the respondent to complete the rest of the
questionnaire. The respondents who indicated having no knowledge of CSR were not
included in the data analysis. Section B covers statements on consumer behavior
(dependent variable) towards CSR activities engaged by the business organizations. The
statements were divided into four subsections based on Carroll's pyramid of CSR, which
include economic, legal, ethical and philanthropic responsibilities with eight measurement
items again adapted from Rahim et al. (2011).

37
 Eshra & Beshir
Section C gathers demographic information of the respondents such as gender, age,
education level and monthly income level. Section A (consumers’ awareness)and Section
C(demographic information)were designed using nominal scales, whereas Section
B(consumer behavior) was designed using a five-point Likert scale ranging from “1” for
"strongly disagree" to "5" for "strongly agree". A pre-test was conducted to refine the
survey questions and a questionnaire was given to 30 respondents in this stage.
Cronbach's Alpha coefficient was used to evaluate the reliability of the measures. The
Cronbach's Alpha coefficient for the four independent variables and one dependent
variable was 0.736. According to the rule of thumb of Cronbach's Alpha coefficient
(Zikmund 2003), the reliability of data set is acceptable if Cronbach's Alpha is above 0.7.
The data obtained were analyzed using the SPSS software, where descriptive and
multiple linear regression statistics were used to analyze the data. Descriptive statistics
were used to analyze the data in Sections A and C of the questionnaire, whereas multiple
linear regressions were used to analyze the data in Section B.

5. Discussion and Analysis

The respondents of this study include 60.7% females and 39.3% males. Age of
respondents was divided into five categories: from 16 to less than 25, from 25 to less than
35, from 35 to less than 45, from 45 to less than 55, and above 55 years old. The majority
of respondents were in the third category between 35 and less than 45 (53.3%). Monthly
income was divided into four categories: from 1000 to less than 3000, from 3000 to less
than 5000, from 5000 to less than 10000, and more than 10000, and most of the
respondents were in last category (42.2%).

The findings of general awareness of CSR in Egypt in this study are shown in Table 1.
According to 140 questionnaires returned, 32.1% of the respondents said that they
understand the concept of CSR properly, while 35.7% respondents indicated that they
moderately understand the concept of CSR, and 28.6% indicated that they do not
understand CSR well. On the other side,3.6% of the respondents mentioned that they do
not understand anything about CSR and because of that, they have been excluded from
the analysis. These results indicate that the majority of the research sample had good
understanding of the concept of CSR, which corresponds with the study of Kolkailah et
al. (2012).

38
 Eshra & Beshir
Table 1: Consumer general awareness of CSR
Knowledge level on CSR Percent
well understood 32.1
moderately understood 35.7
little understood 28.6
not at all 3.6
Definition of CSR Frequency
Maximizing shareholder value(Economic) 64
Complying with law and regulations(Legal) 100
Contribute to charitable organizations(Philanthropic) 127
Participate in community service(Ethical) 111
Keep upholding human rights and minimizing discrimination (Ethical) 116
CSR activities that the organization should be involved in Frequency
Donation (Philanthropic) 123
Community work(Ethical) 81
Sponsor education(Philanthropic) 48
Protect environment and don’t harm it(Ethical) 86
Not wasting natural resources(Ethical) 76
Sponsor sport(Philanthropic) 21
Maximize shareholder value(Economic) 82
Produce safe products(Legal) 114

According to the statement that is related to the definition of CSR, findings show that
contribution of charitable organization has obtained the highest frequency (127 counts),
followed by keep upholding human rights and minimizing discrimination (116 counts)
followed very closely by participating in community service (111 counts), and complying
with law and regulations (100 counts), while maximizing shareholder value ranked the
lowest (64 counts).These findings indicate that from consumers’ point of view
organizations have to fund charitable activities (philanthropic responsibility)rather than
maximizing shareholder value(economic responsibility).The Egyptian pyramid of CSR is
different from that of Carroll’s classical pyramid. According to Carroll (1999), economic
responsibility is the basic responsibility followed by legal, ethical and philanthropic
responsibility. While, according to findings of this study, the philanthropic responsibility is
the basic responsibility from the consumers’ point of view followed by ethical, legal and
economic responsibility. The findings are also different from Safi’s and Ramay’s (2013)
study in Pakistan which shows that consumers give most consideration to economic
responsibility followed by the philanthropic one and at the same time Min et al. (2015) in
Malaysia find that ethical responsibility is the first consideration for consumers followed
by the philanthropic, legal and economic responsibilities.

As shown in the third part of Table 1 that indicates the CSR activities the organization
should be involved in, donations and safe products are the highest (rank 123 and 114)
,followed by protecting environment, maximizing shareholder value, taking part in
community work and use natural resources without waste, which all rank closely between
(86and76). These activities followed by sponsoring education that scored 48 counts, while
the least rank was for sport sponsoring that scored only 21 counts. The findings on CSR
activities seem to be on the same track with the findings of CSR definition, where the
majority of respondents indicated that it is essential for organizations to contribute to
charitable activities in order to be socially responsible.

39
 Eshra & Beshir
5.1 CSR and Consumer Behavior

Multi-linear regression (MLR) analysis is a method used to draw a linear relationship

between some independent variables and a dependent variable. Table 2 shows
regression analysis outcomes that indicate the relation of economic, legal, ethical, and
philanthropic responsibility (independent variables) on consumer purchasing behavior
(dependent variable). The values of multi-correlation coefficients (R) can lie between -1
and +1. According to the model summary of multi regressions in Table 2, the multiple R
is 0.116, this means that there is a positive linear relationship between CSR elements
and consumer behavior.

As can be seen in Table 2, R-square is equal to 0.013, which is less than 1. This indicates
that there is a very weak linear relationship between CSR elements and consumer
behavior. Approximately 1.3% of the variance in all the CSR elements can explain
consumer behavior. The findings show that there are many other factors that affect
consumer behavior in addition to CSR elements, as for example, price, quality,
promotions, ……etc.

Table 2: Model Summary

Model Summary
Mode R R Adjusted R Std. Error of
l Square Square the
Estimate
1 .116a .013 .017 .49992
a. Predictors: (Constant), Ethical, Legal, Philanthropic,
Economic

The analysis of variance (ANOVA) in Table 3is used to test whether there is a significant
or insignificant linear relationship between the four elements of CSR and consumer
behavior. According to Table 3, the p-value is 0.777 which means that the four CSR
elements are insignificant to consumer behavior.

Table 3: ANOVA of multiple regression

ANOVAa
Model Sum of df Mean F Sig.
Squares Square
Regression .443 4 .111 .444 .777b
1
Residual 32.490 130 .250
a. Dependent Variable: Consumer Behavior
b. Predictors: (Constant), Ethical, Legal, Philanthropic, Economic

The coefficient table is one of the important tables that could be used to explain the
relationship between CSR and consumer behavior and to test the hypothesis.

40
 Eshra & Beshir
Table 4: Coefficient of multiple regressions

Model Unstandardized Standardized t Sig.

Coefficients Coefficients
B Std. Error Beta
(Constant) 1.606 .498 3.222 .002
Economic -.022 .029 -.072 -.755 .452
1 Legal .041 .065 .059 .635 .526
Philanthropic -.007 .072 -.009 -.097 .923
Ethical -.055 .048 -.103 -1.145 .254
a. Dependent Variable: Consumer Behavior Toward CSR

Therefore, the multiple regression equations of this study is:

Consumer Behavior = 1.606 – 0.022 Economic Responsibility + 0.041 Legal

Responsibility – 0.007 Philanthropic Responsibility –0.055 Ethical Responsibility.

As can be seen in Table 4 based on significance (Sig.) column, the p-value for each CSR
element is greater than 0.05 which means that all CSR elements do not contribute to
explaining the variance of the dependent variable (consumer behavior) so the hypothesis
is not supported. In contradiction with Nochai and Nochai (2014) study in Bangkok that
indicates a significant relationship between consumer buying behavior and legal and
ethical responsibilities. Min et al. (2005) in Malaysia indicate a significant relationship
between consumer buying behavior and ethical and philanthropic responsibilities.

The multiple regression equations represents that when consumer behavior (dependent
variable) changes by 1 unit, the economic, philanthropic, and ethical responsibility will
change negatively with (0.022, 0.007, and 0.055, respectively) while legal responsibility
will change with 0.041 in the same direction of consumer behavior.

6. Conclusion
This study aims to investigate the awareness of Egyptian consumers of CSR and whether
they are taking into consideration CSR activities when they are taking buying decisions
or not. Findings indicate that it is a good understanding of CSR in the Egyptian society
that is similar to Kolkailah et al. (2012). Findings also indicate that Egyptian consumers
seem to view CSR differently from other countries. Philanthropic responsibility is the basic
element of CSR from the Egyptian consumer point of view which is contradictory with
Carroll’s pyramid, Safi and Ramay (2013) and Min et al. (2015). As shown in the results,
all CSR elements have insignificant relation to consumer behavior. Moreover, this study
differs from Rahim et al. (2011) and Safi and Ramay (2013), who indicate that CSR has
a significant impact on consumer response, while Nochai and Nochai (2014) indicate that
philanthropic and economic responsibilities have insignificant relation with consumer
buying behavior. Moreover, this study finds that there is an insignificant relation between
consumer buying behavior and CSR elements, which means that Egyptian consumers do
not think about any of the CSR elements when they take their buying decision. Due to the
low level of income Egyptians do not consider elements of CSR, but they only consider
prices concerning purchasing decisions.

41
 Eshra & Beshir
This study has some limitations such as that it was conducted only in Alexandria. In
addition, sample size might limit the external validity of the findings, which may be
extended for a larger sample in future researches to improve the validity of findings. This
study explains the effect of CSR on consumer purchasing behavior without specifying any
industry. So the researchers recommended that this type of studies be applied to
industries which are related to consumer purchasing decisions.

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