Some firms undertake CSR activities as public relations and marketing strategy. Franketal (2011) argues that CSR can be branded as a new invention of public relations. Building a firm’s public relations takes a long time and is expensive. Public relations management is important for the firm’s corporate image which is a crucial ingredient of firm competitiveness. Fombrum and Shanley (2010) argue that CSR can be part of a firm’s reputation building strategy. Kotler and Lee (2010) stress the importance of community relations to a firm when likened to a marriage where the business as the husband, marries the community and takes inherent responsibilities associated with the union- the responsibilities which go beyond just financial.
Product advertising is very expensive especially when media coverage is used. Firms can be motivated to spend on CSR and receive free media coverage and public relations exposure (Vaaland, Heide & Kell , 2009).
Conversely, CSR can also be used to overcome negative effects of a corporate product or past publicity problems.
In this case, CSR will be used to repair bad publicity of the company. Barnett (2012) argues that good management of a company’s CSR programme can help stakeholders “ignore past firm’s misconduct”. Focussing on the alcohol and tobacco industries, Gulyás (2011) argues that CSR can turn “demons into angels” if it is properly communicated. Yoon and Lam (2013) argues that CSR has a cognitive constraint on stakeholders who might be unable to see past firm’s “smokescreens” or “green washing” efforts.
According to Greening, Daniel and Turban (2000), CSR has also been viewed as a strategy to improve the company’s publicity in terms of attracting quality employees.
Mahroum (2000) argues that organisations are competing to attract highly skilled personnel in various professional areas and postulates that in the future, competition for best employees will be as fierce as competition for customers. Companies seek to attract new employees and retain existing staff through employment advertising and employment branding (Bir, Süher, Altınbaşak, 2009). CSR is considered as an essential tool for enhancing the firm’s ability to attract quality workers (Berthon Ewing and Hah, 2005). Kortler and Lee (2006) argue that employees are significantly interested in and loyal to companies that have proven commitment to CSR.
According to Crampton & Patten, (2008), recognition of the importance of CSR as a marketing and strategic tool has risen radically since 2001. In the year 2012 in USA, corporates, individuals, and foundations gave more than three hundred and sixteen billion United states dollars to charitable activities (Giving USA Foundation, 2013), such as support of NGOs, cause-related promotions, employee volunteerism in community programs, employment opportunities for disabled people and members of the minority ethnic groups, and sponsorship of charitable events and activities (Vlachos, Tsamakos, Vrechopoulos, & Avramidis, 2009). In addition, it was found that sponsoring sport activities planned for philanthropic causes is amongst the most effective CSR activities (Chakraborti & Roy, 2013). Also sponsoring charitable sporting occasions gives organisations a substantial foundation in competitive advantage through the increase in customer loyalty (Bortoleto & de Moura Costa, 2012), brand equity (Menon & Kahn, 2003), and influencing consumers buying behaviour (Kim, Smith, & James, 2010). Moreover, to substantiate this argument, in a survey of Korean consumers it was stated that 78% of participants were willing to pay more money for products which were bought from socially responsible companies (Garcia, 2010).