Role of corporate social responsibility towards brand equity

By Priya Chetty on June 11, 2014

‘Corporate social responsibility is a commitment that a business makes towards the betterment of the society at large’ (Uddin, M, et al 2008 ). Corporate social responsibility has received increasing importance in the past few decades (Abdolvand, M & Charsetad, P 2013, p. 273). This is a philanthropic activity. In the twenty-first century, the market is made of homogeneous products; as a result, companies have started to invest heavily in corporate social responsibility so that they stand out in the market. Also, there have been various surveys that have proved that corporate social responsibility adds to brand equity.

Corporate social responsibility not only improves the brand name in the minds of the customers but also does leave a positive mark in the minds of the employees and society. In a nutshell, the aim of applying  corporate social responsibility strategies is to earn:

  1. Positive reputation in the market.
  2. Protect the environment from destruction.
  3. Reputation from local communities.
  4. Increase employee job satisfaction, and stakeholder theory (Creel, T 2012).

Brand equity, brand association, and brand loyalty are the lifeline of a company

The 1980s were marked as the critical phase in the changing concept of brands. Organizational management realized then that the brand name is one of the vital assets for a business (Abdolvand, M &Charsetad, P 2013,p. 276).

Brand name, brand equity, brand association and brand loyalty are all interlinked.

Brand equity is a set of brand assets and liabilities linked to a band, its name and symbol, that add to or subtract from the value provided by a product or service to a firm and/or to that firm’s customers.

Aaker, D 1991

Brand equity is the perception of the customer about a product. Brand equity has elevated the importance of the brand in the marketing strategy and provided a focus for managerial interest and research activity. According to Keller, K, et al, 2011, it is because of brand equity that a customer becomes so accustomed to the product of one brand that he fears or doesn’t prefer products of another brand. This scenario is also known as brand loyalty. It is very important for the company to not just attract new customers but also to retain the ones they already have. The word of mouth in the market by the existing customer also plays a vital role in convincing prospective customers to buy their product.

Identify key formative works in 20 days with a comprehensive research paper order. Use 5EFDB474F3A68 to get a discount of 4000 for 4001 - 6000 words standard delivery.
Order now

How corporate social responsibility contributes to brand equity?

It is likely that customers will talk highly about the companies they perceive to be socially responsible (Bhattacharya, C &Sen, S 2004). It is based on their identification with the company (Bhattacharya, C &Sen, S 2004).

The Aditya  Birla Group has come up with a unique idea of corporate social responsibility.  Each company under this group has taken up some villages, on which they are working to give complete makeovers to the villages in proximity to their plants. Their makeover plan is such, that plan ensures that the villages are self-reliant. To help them become self-reliant the Aditya Birla group is providing them with education, health care, watershed management, and infrastructure facilities in these villages  (The Aditya Birla Group, official website, n.d.).

Another initiative – “Project Shakti” by a renowned FMCG company; HUL changed the face of this industry (Hindustan Unilever, official website, n.d.). Project Shakti was started in late 2000 with a strategy of killing two birds with one stone, that is:

  1. Through Project Shakti, HUL tapped the unexplored market of rural India, which has a great scope for expanding one’s business.
  2. Through this initiative, HUL provided great employment opportunities to the villagers. They not only got to work for a big company but were also exposed to business opportunities in urban areas.

Positive word of mouth is the outcome of a customer’s ability to identify the company through its corporate social responsibility activities (Bhattacharya, C &Sen, S 2004). Maintaining and expanding brand equity is a tough task (Keller, K, et al, 2011).  Hence, effective brand management would require keeping a check on the marketing decisions because consumers’ responses depend on what they know and remember about a brand (Keller, K, et al 2011).

As the business world is becoming increasingly complex, only good corporate social responsibility practices can help them penetrate the untapped markets. Corporate social responsibility is not a waste of money and it is a publicity gimmick rather it has a slow return on investment.


  • Aaker, D 1991, Managing Brand Equity, Simon and Schuster, NY.
  • Abdolvand, M &Charsetad, P 2013, ‘Corporate social responsibility and brand equity in industrial marketing’, International Journal of Academic Research in Business and Social Sciences, Vol. 3, No. 9, p. 273.
  • Bhattacharya, C &Sen, S 2004, ‘Doing Better at Doing Good: when, why, and how consumers respond to corporate social initiatives’   California Management Review, vol.47, no. 1, p.9.
  • Creel, T 2012, ‘How corporate social responsibility: influences brand equity’, Management Accounting Quarterly, Vol. 13, No. 4.
  • Hindustan Unilever, official website,
  • Keller, K, et al, 2011, Strategic Brand Management: Building, Measuring, and Managing Brand Equity, Pearson Education India.
  • The Aditya Birla Group, official website,, n.d.
  • Uddin, M, et al 2008, Three Dimensional Aspects of Corporate Social Responsibility, Daffodil International University Journal of Business and Economics, Vol. 3, No. 1.