The Important Role of Corporate Social Responsibility Capabilities in Improving Sustainable Competitive Advantage

Abstract

Purpose - This study examines the effect of corporate social responsibility (CSR) capabilities on corporate association and, consequently, customer orientation and price premium, which are key to competitive advantage. Design/methodology/approach - This study adapts survey instrument targeting employees of a Korean firm. A total of 168 usable questionnaires were collected from seven Korean firms that were conducting CSR and public relations (PR) activities. Findings - CSR and PR capability induce positive CSR and corporate ability (CA) associations, which improve customer orientation and increase price premium. The results of our empirical study indicate that a company should consider both CSR and PR capabilities to enhance its employees' positive attitude to its CSR activities and CA association. Research limitations/implications - This study has undertaken a holistic examination of important role of CSR and PR capability and their outcomes, namely customer orientation and price premium. Originality/value - Understanding of CSR capabilities in terms of competitive advantage is imperative to the establishment of strategic CSR initiatives. This study attempts to answer whether corporate capabilities for social responsiveness improve a company's competitive advantage.