The Impact Of CSR Type On Retail Investors’ Investment Intentions: A Comparison Of Embedded And Peripheral CSR

Details

Supervisors

Hericher, Corentin

Faculty

Louvain School of Management

Degree label

Master [120] en sciences de gestion, à finalité spécialisée

Abstract

This master thesis explores how different corporate social responsibility (CSR) types, categorized as either peripheral (philanthropic, external) or embedded (strategic, internal), influences retail investors’ investment intentions. Signalling theory is used to examine whether CSR types contribute to shaping the perceptions of perceived long-term commitment and corporate motives (genuine vs. instrumental intent), and how these mediate investment intentions. Building on Aguinis and Glavas' (2012) comprehensive review of 588 journal articles and 102 books and chapters, which identified a lack of research on mediating mechanisms in the CSR context, this study addresses that gap by focusing on retail investors’ interpretations of CSR through three mediating factors. A quantitative survey-based experimental design was used, including vignette-based survey scenarios presenting randomly either the embedded or peripheral CSR condition. Based on the answers of 151 respondents, the results show no significant direct effect of CSR type on perceived intent, nor a mediating effect of perceived genuineness or instrumentality on investment intention. However, there is a significant positive effect from genuine intent on investment intention, implying that regardless of the CSR type, retail investors who perceive the effort to be genuine experience increased investment intention. Furthermore, the results show that perceived long-term commitment has a significant positive mediation effect of embedded CSR on genuine intent, thus increasing investment intention. This suggests that retail investors associate embedded CSR with more sustained engagement than with corporate motive. As the manipulation check for perceived time commitment was unsuccessful, these results would be considered exploratory more than confirmatory. Based on the results, the findings highlight an increased importance of signalling perceived commitment, thus offering practical implications for communication of CSR initiatives. Future research is encouraged to address CSR types as a continuum rather than two extremes in order to reflect better the complexity of CSR strategies, as discussed by Aguinis and Glavas (2013).