Background of research

Discuss about the Impact of Corporate Social Responsibility on Brand Image of the organisation: Study based on Rio Tinto, Australia.

Corporate Social Responsibility is an important factor for the organisation in establishing the reputation and public image. Of late, CSR with non-profit effort has become significant in the eye of the common people. CSR is the continuing commitment by an organisation to dedicate not only to profit-making but also the organisation also does something to improve the community and the environment. This report aims to bring out the relationship between corporate social responsibility and branding of the organisation. In this report, corporate social responsibility issue will be identified and research questions will be set in order to meet.

Corporate Social Responsibility has brought the new resonance in the global economy and this has resulted to call the urge of increasing the transparency as well as corporate citizenship (Bhattacharya et al. 2017). Consumers purchase products and it reflects the values of the consumers. Consumers buying behaviour recently shows that the consumers want the organisations to help change the world. A famous brand is the reflection of the price, quality and attributes that make the difference. A large organisation can develop the public image through supporting non-profit causes and by doing the monetary donations or through by strong partnership (Schwartz 2017). Corporate social responsibility increases the media coverage as it makes sure about solid relationship bonding with the media. Moreover, CSR helps to the branding of the organisation as customers observe the social responsibilities and community engagement programmes done by the organisation.

Rio Tinto is multinational organisation and it is working in the metals and mining industry. Rio Tinto was established in the year 1873 and it has its headquarters in London and Melbourne. Rio Tinto is the world leader in extracting the iron ore, copper, bauxite, uranium and coal. Rio Tinto recently has engaged itself in the refining process. Revenue of the organisation touched $40.30 billion and the total equity of the organisation was $44.711 billion in the year 2017 (Riotinto.com 2018). Rio Tinto employs more than 50,000 employees and Rio Tinto is the dual listed company that has stock in both London and Australian stock exchanges.

The organisations in recent time are trying to be more transparent by publishing the Corporate Social Responsibility report each year. The sole aim of the organisations is to publish the CSR report in order to aware the customers about their responsibilities regarding society, environment and economic profit. Nielsen survey (2016) stated that more than half of the online consumers pay more heed to the companies that are environmentally and socially responsible. Rio Tinto is associated with the mining and metal industry; therefore, this organisation has to deal with the non-renewable resources. Rio Tinto has been criticised widely for the mining activities. Mining activities can lead to environmental degradation and it can contribute towards the global warming (Rull et al. 2017). Therefore, the business environment has been changing with the rapid development of China and the demand is increasing more than the supply of the metals. Rio Tinto’s recent extraction of the metals creates the issue nearby communities regarding environmental damages and leaking harmful gases. Current CSR rating of the organisation is 54, community (48), employees (57), environment (57) and governance (54) (Bainton 2017). As stated by Lasslett (2017), Rio Tinto was criticised regarding the unethical conduct of the business by doing the damage through the mining operation. The news of stopping the mining operation in the Panguma mine has created several issues in Papua New Guinea. Rio Tinto decided to walk away from the mining operation in Panguma mine and the organisation has side-stepped demands for a billion-dollar clean up (Smh.com.au 2018). Rio Tinto refused to clean up the area and it has made many significant damages to the environment and the society that lead to the severe consequences. Mining company should not leave the place without compensating what they have damaged environmentally and socially as it can adversely affect the reputation and brand image of the organisation; this incident may harm to create a win-win situation of the organisation.   

Overview of Rio Tinto

Therefore, this report will try to bring out the issues of corporate social responsibility of Rio Tinto that they have been facing recent time and how it can cause the harm brand value of the organisation.

The aim of the research is to show the impact of corporate social responsibility on the branding of the organisations; this research will narrowly focus on Rio Tinto.

Research objectives 

The objectives are:

• To find out the importance of corporate social responsibility of an organisation
• To explain the strategies of the branding of organisations
• To explore the relationship between corporate social responsibilities and branding
• To recommend some possible solutions regarding issues of corporate social responsibilities and branding

Research questions

The research questions are:

• What is the importance of corporate social responsibility of an organisation?
• What are the strategies of the branding of organisations?
• What is the relationship between corporate social responsibilities and branding?
• What are the possible solutions regarding issues of corporate social responsibilities and branding?

Concept of corporate social responsibility 

Corporate social responsibility (CSR) is the concept where organisations need to integrate environmental and social concerns of the business operations as well as the interactions with the stakeholders of the organisation. As stated by Ruggie (2017), corporate social responsibility is understood when the companies make strive to achieve the balance among environmental, economic and social imperatives while the companies need to address the expectations of the stakeholders and the shareholders. Today’s organisations need to take CSR in a way that must fit the capacities and needs of the business and it does not adversely affect the economic viability of the business (Grayson and Hodges 2017). CSR can be taken as an attempt to align the goal of the organisation towards the sustainable development.

Theoretical understanding of corporate social responsibility 

Triple Bottom Line Theory

Triple Bottom Line method uses in the business to see the objective of the organisation is not just to make the business for profit-making purposes, but to do the business for benefits of the society as well as the environment. At first, social sustainability tries to measure the business profits in capital use of human resources including the local society and community. The business must not harm the community and the business process must provide benefits to the corporate community that must impact on the local economy as well. As opined by Carroll (2015), social responsibility is the business where the company must make a desirable workplace to operate in the future where the workforce should strive to make the difference. In addition, environmental sustainability is about doing better for the environment with using fewer natural resources and using the cost-effective measure of the business. Moreover, economic sustainability is about making a profit for the organisation in terms of the business must impact on the economic development.

CSR pyramid model

CSR pyramid speaks about four responsibilities of the business. In economic purpose, the business must make it profitable and it is the only way to survive in the market for long time. In addition, legal responsibility of the business is about making the business to obey the laws with regulations. In addition, the business must abide by the competition, employment, and Health and Safety. Moreover, as pointed out by Cheng, Ioannou & Serafeim (2014) ethical responsibilities of the business are to act ethically and morally in order to be responsible for business to go beyond from the laws. An organisation needs to treat ethically to employees and suppliers. Lastly, philanthropic responsibilities of the business are to be responsible to give back to the society and responsibility is the discretionary and it is important. The organisations use Carroll’s CSR pyramid to provide social and environmental benefits to the organisation and they emphasise on making profit.  

Problem statement

Concept of the branding of organisations and theoretical understanding of branding 

Brand is the service or products or concept that must have characteristics like symbol or name to make the company differentiate from the others in the market. Lins, Servaes & Tamayo (2014), supported this by saying brand can make the products differentiable and identifiable. Brand can also be defined as the combination of the properties outside or within the products that give an identity to the products and it makes the products or service separate from others. In addition, as stated by Leekha, Chhabra & Sharma (2014), brand association is the tangible products feature like the colour scheme, logo, owners and ambassadors that are associated with the service or company. Brand attributes are the characteristics of the brand with core values and these make the brand consistent and relevant in the market (Herstein et al. 2017).

According to Pai et al. (2015), brand is a concept that is associated with the mind of the customers and it is the perception of the customers. The first stage of branding is the design where the companies use colours, logo and slogans. This designing process of branding is heuristic and it is the short-cut process to let the customers know about the organisation. Value proposition is the process of what the company offers to the customers. At last, the company need to offer the positioning statement in order to impact on the perceived value of the customers.  

Importance of corporate social responsibility for the organisation 

Corporate Social Responsibility of the organisation can be taken positive outlook for the nearby community. CSR activities make able to the organisations to have positive impact on the community. The minds of the people encourage always making purchase from the organisations that do various social activities. Today’s organisations cannot avoid the detrimental impact of the organisations on the community and it supports the public value of the outcomes. As stated by Rezvanpour & Bayat (2017), public value is about the contribution to the society with philanthropy and volunteerism. CSR supports the employees to both personal and professional development of the organisation to make the company socially responsible for activities. As stated by Edinger-Schons et al. (2018), CSR activities attract and retain the investors for the organisation as the investors may impress with the social activities of the organisations. Eteokleous, Leonidou & Katsikeas (2016), supported this by saying that the companies can increase the media coverage by doing social responsibilities and the name of the organisation will be published on media to gather extra attention. When an organisation shows that it is dedicated to the communities, it would make the employees more engaged in corporate giving programmes.

Research aim

Impact of corporate social responsibility on branding 

Organisations do branding in order to influence the customers to purchase their products and use their services. If the brand image of the organisations goes wrong, CSR activities will help the company to get back the lost brand image of the organisation. The organisations need to pick up the right partner to manage the all aspects of the CSR programme and the partner needs to deploy the enthusiasm, energy and resources used for CSR. CSR activities lead the company towards sustainability and the organisations now publish the CSR report in order to be more transparent (Carroll 2016). Making the organisation dedicated towards the social and environment, the organisation plans for the long-term profit of branding. The positive environment and social responsibilities strike into the mind of the customers and they like to purchase from the organisations that are socially responsible. The organisations trust those brands and they see value in the brands those do CSR activities. Therefore, CSR activities are like the promotions of the brands and CSR acts as the counter of unethical behaviour of the companies (Matten & Moon 2014). CSR provides value to the organisations in long-term as companies may face financial losses at first; however, CSR will lead to benefit towards branding.  

Process of Investigations 

Research philosophy is the concept of collecting, analysing and gathering of data about a phenomenon. In this research, I am going to select the positivism philosophy. Positivism philosophy can help me to collect the data in a scientific way and positivism philosophy mainly helps me to collect the factual data. As stated by Taylor, Bogdan. & DeVault (2015), Positivism philosophy assists to collect both quantitative and qualitative data and this data collection process is highly structured.

In addition, research approach is the procedure and plan consisting the steps about a detailed method to collect the data for the research. In this research, I am going to collect the data using deductive research approach. Deductive research approach will help me to collect the CSR based data from the respondents and deductive research approach starts with the theories. There are large amount of CSR and brand image theories are present and I will collect the information about CSR. I will try to develop the concept taking help of the deductive approach.

 Systematic way of collecting data is called research design and there are mainly their types of research design. I shall select the descriptive research design in order to collect the data. Descriptive research design will provide me help to describe the feature of the population being studied.  

Research objectives

Data collection process 

In this research, I am going to collect both primary and secondary data. In order to collect the primary data, I will conduct a survey and I will prepare a set of 15 close-ended MCQ type questionnaire. This questionnaire will consist of two set of questions, demographic and subjective. Each of the questions will have four options and some of the subjective questions will be prepared using Likert Scale. I will prepare the questions using the Google Survey form as it will be easy to send the Google survey form to the respondents. As stated by Flick (2015), primary data are relevant and original as these data provide a high degree of accuracy.

In order to collect the secondary data, the researcher will collect the data through books, online articles, journals, websites, organisational CSR report and government report.

Sampling method

The sample population of the research will be senior level employees of Rio Tinto who work in Australian office. I have already sent a consent form to Rio Tinto Australia office to for asking permission. Size of sample population will be 360. I am thinking to collect the data from four of the departments, Sales and Marketing, HR, Operations and Accounting. Among the sample population, only 80 employees will be used as the sample size. I will also collect the e-mail IDs and names of the employees. Then, I will send the questionnaire to the employees through e-mail. I will ask the employees to revert to 15 days. I will use Simple Random Sampling technique in order to generate the correct sample for this research.  

Sample population	Sample size	Percentage of sample population in sample size	Sampling technique	Sampling frame
360 senior employees of Rio Tinto	80	22.22%	Simple random sampling	E-mail and soft copy

Table 1: Sampling of survey

(Source: Self-developed)

Data analysis 

In this research, I will use the quantitative data analysis technique in order to analyse the survey data. Quantitative data solely deals with numerical data. I will analyse the data collected from the survey through the quantitative process (Silverman 2016). I will use tables to show the collected data. I will also use Excel to make graphs and pie-charts to show the collected data visually.

This social responsibility of the organisation makes the organisation more ‘close’ to the customers. Mining methods also lead to the cutting of trees and the organisation is removing the non-renewable resources that are stored inside the earth. Rio Tinto extracts metals and the organisation is criticised for delivering the uranium for the nuclear technology and environmental damages. The research is expected to find out the loopholes of Rio Tinto about doing social responsibilities. CSR helps to get the branding of the organisation as CSR is the now strategic business management concept where the management is using the philanthropy, sponsorships and charity of the organisation. Brand equity means to value the customers assign to the brand based on the perception of the quality, price and products attributes. The corporate social responsibility of the organisation can improve the public image and it can aware the customers about the good public image. Brand identity comes from the brand image as it completely the customers’ point of view and the organisation tries to make brand personality through taking social responsibility.

Research questions

Reference List 

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