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Does Ethical Image Build Equity in Corporate Services Brands? The Influence of Customer Perceived Ethicality on Affect, Perceived Quality, and Equity

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Abstract

In the current socioeconomic environment, brands increasingly need to portray societal and ethical commitments at a corporate level, in order to remain competitive and improve their reputation. However, studies that relate business ethics to corporate brands are either purely conceptual or have been empirically conducted in relation to the field of products/goods. This is surprising because corporate brands are even more relevant in the services sector, due to the different nature of services, and the subsequent need to provide a consistent high-quality customer experience across all the brand–customer interactions and touch-points. Thus, the purpose of this article is to study, at a corporate brand level and in the field of services, the effect of customer perceived ethicality of a brand on brand equity. The model is tested by structural equations, using data collected for eight service categories by means of a panel composed of 2179 customers. The test of measurement equivalence between these categories is conducted using generalizability theory. Confirmatory factor analysis marker technique is applied in order to check for common method variance. The results of the hypothesized model indicate that customer perceived ethicality has a positive, indirect impact on brand equity, through the mediators of brand affect and perceived quality. However, there is no empirical evidence for a direct effect of customer perceived ethicality on brand equity.

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Abbreviations

AVE:

Average variance extracted

CFA:

Confirmatory factor analysis

CFI:

Comparative fit index

CMV:

Common method variance

CPE:

Customer perceived ethicality

CSR:

Corporate social responsibility

df :

Degrees of freedom

GC:

Generalizability coefficient

G-theory:

Generalizability theory

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Authors and Affiliations

  1. Department of Operations, Innovation and Data Sciences, ESADE Business School, Ramon Llull University, Av. Torre Blanca, 59, 08172, Sant Cugat del Vallès (Barcelona), Spain

    Vicenta Sierra

  2. Department of Marketing, ESADE Business School, Ramon Llull University, Av. Torre Blanca, 59, 08172, Sant Cugat del Vallès (Barcelona), Spain

    Oriol Iglesias & Stefan Markovic

  3. Department of Marketing, Operations and Supply, EADA Business School, C. Aragó, 204, 08011, Barcelona, Spain

    Jatinder Jit Singh

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  1. Vicenta Sierra
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  2. Oriol Iglesias
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  3. Stefan Markovic
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  4. Jatinder Jit Singh
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Correspondence to Stefan Markovic.

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Sierra, V., Iglesias, O., Markovic, S. et al. Does Ethical Image Build Equity in Corporate Services Brands? The Influence of Customer Perceived Ethicality on Affect, Perceived Quality, and Equity. J Bus Ethics 144, 661–676 (2017). https://doi.org/10.1007/s10551-015-2855-2

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