The effect of corporate ethical responsibility on social and environmental performance: An empirical study

Abstract

In the field of business-to-business marketing, corporate ethical identity and corporate brand identity are crucial subjects for discussion. Business organizations function under social norms, and to establish an ethical identity, they must show corporate ethical responsibility, embrace ethical standards, and maintain open communication with suppliers. While an organization's reputation is impacted by the absence of an ethical identity, its financial success is unaffected. Extant literature has not thrown a spotlight on social and environmental performance which indicates that less focus has been given by academics than by practitioners. To fill the lacuna in the existing literature, this study examines the relationships between corporate ethical identity, corporate brand identity, social and environmental performance. The study uses a deductive research approach and develops hypotheses which are further tested using variance based structural equation modeling. The study offers a distinctive contribution to ethics theory and stakeholder theory by showing that developing an ethical identity requires more than just adhering to moral guidelines and upholding open communication. Companies must show that they are ethically responsible towards society. The study provides evidence of the influence corporate brand identity has on environmental and social performance. The findings can be useful in developing business-to-business marketing strategies.