Overview:
Are corporate social responsibility initiatives worth the effort and investment? How can companies maximize their return on investment with these programs? How important are marketing efforts to the success of corporate social responsibility campaigns? 

Method: 
The study analyzed six types of corporate social responsibility investments to determine whether marketing of these efforts increased long-term firm value and stock price. Included were CSR investments in environment, products, diversity, corporate governance, employees and community. Researchers defined CSR as discretionary activities of the firm aimed at enhancing social well-being. 

Results: 
The study results showed that a combination of marketing and corporate social responsibility activities can provide shareholders with a 3.5 percent gain in stock returns. 

“Our hope is that firms see that it is important to be socially responsible,” Modi said. “Firms have to do multiple aspects of being socially responsible. Different types of CSR will have different benefits for firms. Some will be more critical, and some will give firms more bang for their buck compared to other types of CSR.” 

As companies choose what initiatives they get involved with and make decisions on charitable giving, they may want to focus on those that are more easily verifiable by customers, Modi said. “Firms might do things to be socially responsible but won’t see a return unless they take those extra steps to market those efforts,” he said. The biggest payoffs from marketing come from letting shareholders know about a firm’s effort to improve products, be environmentally friendly, create a diverse workplace and use sustainable resources, the study found.

Conclusion:
The decision to give to a charity or to develop a more sustainable product should not depend solely on a corporation’s bottom line. A return on corporate social responsibility activities depends greatly upon the strength of the company’s marketing efforts around those activities. 

Resources: 
Published in the January 2016 issue of Journal of Marketing: http://tinyurl.com/zjv4ps6