Effects of corporate social responsibility on brand value

This study analyses the impact of corporate social responsibility (CSR) on brand value, with the sample being a select group of US corporations with the best global brands. On the basis of the instrumental stakeholder theory, we confirm that CSR is a valid source of intangible competitive advantage. It is not used, however, to its full potential, given that CSR has a lesser impact on business performance than the size of the company and other conventional financial indicators. We contend that this undervaluation is because of the non-alignment of CSR initiatives with corporate strategy. The value added of this study in terms of methodology is the successful employment of panel data technique and the introduction of brand value as a measure of corporate performance. We also provide empirical evidence of the long-term nature of the impact of CSR initiatives on corporate performance.