The Corporate Citizenship Scale

The Corporate Citizenship Scale – Consumer Intentions and Perceptions

Ground-breaking research in South Australia has developed a Corporate Citizenship ‘scale’ that demonstrates the relationship between citizenship ‘practices’, community ‘perceptions’ and corporate reputations. And the researchers say the differences are both high and significant indicating that corporations have much to gain from ‘good’ corporate citizenship.

The research by Alison McKinnon, the Director of the Hawke Institute at the University of South Australia and Research Associates Debra King and Caz Batson addresses the question of how to encourage corporations to adopt socially responsible corporate citizenship practices.

The research looked at 40 different corporate citizenship practices and for each practice, consumers were asked two questions – whether knowing about these activities would influence how they think about a corporation’s reputation and if it would influence their decision in dealing with the business in the future?

The results were broken down into four sub-categories of community, workplace, management and environment practices.

The results made it possible to compare the extent to which corporate citizenship practices would have an impact on ‘reputation’ and ‘intentions to deal’. In terms of increasing reputation and their intentions to deal with the business in future the top five practices were for corporations to:
1: Re-train employees to avoid redundancies
2: Assist in the development of employment programs for the unemployed in the local region
3: Focus on increasing the use of recyclable materials in their manufacturing processes
4: Become industry leaders in developing environmentally sustainable business practices
5: Subsidise and maintain services to rural communities

In terms of decreasing reputation and intentions to deal, the top five practices were for corporations to:
1: Employ children under 10 years old in offshore factories
2: Disregard scientific evidence indicating that they were polluting a
major water source
3: Disregard evidence that there could be safety implications for customers using one of their products
4: Sell their customer list to an advertising company
5: Decrease the quality of their products to retain their price competitiveness

The ‘scale’ also illustrates the differences in the relationship between the change in reputation and the change in intentions to deal for each type of corporate citizenship practice.

For example, sacking a ‘whistle-blower’, generated equivalent scores in the change in perceptions of reputation and change in intentions to deal, while acting quickly to recall contaminated stock, generated a large change in perception of ‘reputation’, but a much smaller change in ‘intentions to deal’.

The researchers concluded that while the overall relationship between ‘reputation’ and ‘intentions to deal’ is very high, there is variation between practices that needs to be considered if the aim is to change a corporation’s reputational value, rather than simply its reputation.

The researchers found that by differentiating between practices, it would be possible for a corporation to either stagger or target its take-up of corporate citizenship and still achieve an increase in its reputational value.

The research has now been published in the UK Journal of Corporate Citizenship and has been accepted for publication in a book about stakeholder relationships to be released next year. However, Caz Batson says the scale is still being developed and requires further testing.

Batson says the Hawke Institute is currently looking for new funding sources to continue its Corporate Citizenship Project and is also keen to hear from organisations that would like to participate in the scale’s development.

The original work has been sponsored by The Heart Foundation of Australia.

If you would like a copy of the research results (Word file) and the accompanying graphs including the Scale (PDF file) send an e-mail to us at corpnews@probonoaustralia.com.au.

To contact Caz Batson about involvement in future research send an e-mail to carol.batson@unisa.edu.au.