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Brand equity and firm performance: the complementary role of corporate social responsibility

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Abstract

Previous studies have demonstrated the impact of corporate brand equity on firm performance but have not yet investigated moderating effects on this relationship from other dimensions of firm strategy. This study puts forward a contingency model of the relationship between corporate brand equity and firm performance and investigates the moderating effect of one important contingency variable which is the firm’s corporate social responsibility (CSR) strategy. It is tested on a panel dataset of 62 US firms/corporate brands. The results of this study corroborate previous evidence that corporate brand equity has a significant positive impact on market-based performance, measured by market share, as well as on financial performance, measured by Tobin’s q. In addition, the findings indicate that CSR plays a complementary role, positively moderating the relationship between corporate brand equity and firm performance. That is, there is a synergistic connection between brand equity and CSR which increases long-term value over and above the direct impact of corporate brand equity.

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Authors and Affiliations

  1. Department of Marketing, Rennes School of Business, Rennes, France

    Mahabubur Rahman

  2. Department of Business Organization and Marketing, University Pablo de Olavide, Seville, Spain

    M. Ángeles Rodríguez-Serrano

  3. Smurfit Graduate Business School, University College Dublin, Blackrock, Co Dublin, Ireland

    Mary Lambkin

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  1. Mahabubur Rahman
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  2. M. Ángeles Rodríguez-Serrano
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  3. Mary Lambkin
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Correspondence to Mahabubur Rahman.

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Appendix: KLD CSR ratings criteria

Appendix: KLD CSR ratings criteria

Strengths

Concerns

Community

Charitable giving

Investment controversies

Innovative giving

Negative economic impact

Non-US charitable giving

Tax disputes

Support for education

Other concerns

Support for housing

 

Volunteer programs

 

Other strengths

 

Corporate governance

Compensation

Compensation

Ownership

Ownership

Political accountability

Political accountability

Transparency

Transparency

Other strengths

Accounting

 

Other concerns

Diversity

Board of directors

Controversies

CEO

Non-representation

Employment of the disabled

Other concerns

Promotion

 

Women and minority contracting

 

Work/life benefits

 

Gay and lesbian policies

 

Other strengths

 

Employee relations

Health and safety

Union relations

Retirement benefits

Health and safety

Union relations

Retirement benefits

Cash profit sharing

Workforce reductions

Employee involvement

Other concerns

Other strengths

 

Environment

Beneficial products and services

Agricultural chemicals

Clean energy

Climate change

Recycling

Hazardous waste

Pollution prevention

Ozone depleting chemicals

Other strengths

Regulatory problems

 

Substantial emissions

 

Other concerns

Human rights

Labour rights

Labour rights

Relations with indigenous peoples

Relations with indigenous peoples

Other strengths

Other concerns

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Rahman, M., Rodríguez-Serrano, M.Á. & Lambkin, M. Brand equity and firm performance: the complementary role of corporate social responsibility. J Brand Manag 26, 691–704 (2019). https://doi.org/10.1057/s41262-019-00155-9

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  • DOI: https://doi.org/10.1057/s41262-019-00155-9

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