Analysis of Corporate Social Responsibility Execution Effects on Purchase Intention with the Moderating Role of Customer Awareness

Abstract

Corporate social responsibility (CSR) in management domains is a well-known concept that links corporate interests and environmental/community values. CSR is considered a strategic policy that offers environmental and social competitive advantages. Organizations consider that CSR-based goodwill provides a tactical competitive edge and sustainable growth. The goal of this paper is to show how CSR programs affect consumers’ purchasing intention in the context of Pakistan. In addition, the effect of customer awareness has been studied as a moderator between CSR and purchasing intention. To this end, the study has conducted a survey and gathered Pakistani customers’ responses, and structural equation modeling has been used to evaluate the results. The study concludes that CSR activities favorably affect customer purchasing intentions directly as well as indirectly through improving brand image and trust, and customer awareness of CSR activities plays a moderating role. The implications and future research directions are discussed.

1. Introduction

Practitioners now agree that businesses are liable for the societies in which they operate and that they ought to meet certain moral responsibilities, including pro-environmental programs and being good to their employees, the community, and the society. This underlines the principle of corporate social responsibility (CSR), not only debated extensively in the literature but also now known in business practices. For planning, execution, and coordination of CSR programs, some businesses use consulting services [1]. There is a rising emphasis on this topic in scientific literature, and an increasing number of articles, books, and journals are dedicated to this subject. Such reports deal with a range of topics pertaining to CSR operations, including the motives behind CSR activities of businesses, investment returns, and the interactions and execution of CSR activities. Nevertheless, the level of return from CSR operations to the business could not be certain based on existing studies [2]. Some observers see strong customer reactions to the CSR activities of companies [3,4,5], while others have indicated that consumers are not associated with socially responsible practices [6,7]. This requires further study on the effects of consumer reactions to CSR activities. Thus, the article examines the CSR activities of Pakistani businesses as their services and goods are broadly distributed throughout the population of Pakistan. This study explores the consequences of firms’ CSR activities on their customers’ behaviors. It also examines the interactive effects of companies’ CSR activities and customer CSR awareness on customer purchasing intention.

Currently, socially responsible activities are not well established due to their complex nature [8,9]. Many of the studies that have examined the customer perceptions and behavioral effects of CSR were experimental [10,11]. Responses have been evaluated in fictitious/simulated conditions. The reactions in the reality may differ from those gathered in an artificial context. Thus, it is interesting to consider the level of consumer awareness and the consequent impact of CSR practices on consumer purchasing intention in the real world. Furthermore, the majority of studies have been carried out in advanced markets such as the U.S. and the United Kingdom; however, studies are limited in developing markets such as Pakistan. Moreover, CSR has now become a universal phenomenon and needs greater comprehension of consumer reactions in both developed and developing markets [12]. This research aims to address this gap in the literature by examining CSR initiatives in the context of Pakistan.

This paper has been organized as follows: in Section 2, a literature review examines the different approaches and theories. The hypotheses of the study are posed in Section 3. Section 4 includes the research methodology. Section 5 provides the results of empirical analysis. Section 6 presents the discussion, and Section 7 sets out the conclusions.

2. Literature Review

2.1. CSR

From Friedman’s classical approach toward enhancing shareholders’ return to the modern point of view of CSR as perceived social commitments or, at least, stakeholder commitments, CSR has always been defined in the literature from different perspectives [13,14]. The phrase CSR shows that firms are responsible for the society they operate in, but the concept may not imply the same for all [15,16]. In some cases, it is about legal liability, whereas in other cases, it constitutes ethical and philanthropic liability. The word responsibility here refers not explicitly to a contract or obligation but tends to be in effect on a voluntary basis. While the definition of CSR is diversified and complex, several conceptualizations remain in CSR literature, particularly those that imply this to be a societal or stakeholder responsibility [17,18].

CSR is an organizational operation linked to its assumed responsibilities to society or stakeholders [19,20]. CSR refers to the responsibilities of a business to support and protect the business’s best aspirations and the good of society. The CSR operation covers integration initiatives, composting services, societal/regional outreach programs, and contributions to charity events [11,21]. CSR helps a corporation to align its business priorities with social progress, which eventually contributes to the company’s sustainable development [19,22]. Park et al. [23] advocated CSR as an integral part of the strategies of an organization. If a business has solid CSR measures, a positive image could be developed of the business to its stakeholders [24,25].

Stakeholder theory promotes the CSR activities of the organization [26,27] and discusses their functions for creating effective policies and CSR activities of the business [28]. The stakeholder theory describes how a company interacts with its stakeholders consumers, vendors, staff, creditors, societies, etc. [29]. Freeman (p. 46) referred to a stakeholder as “any person or group that may influence, or is influenced by, the endeavor of the goals of the organization”. Russo and Perrini [26] advocated the applicability of the stakeholder theory to analyze CSR strategies in a big organization. Wood and Jones [30] also suggested that the positive impact of CSR interventions on its ties with the stakeholders will add to the benefit of an organization. Carroll [31] further highlighted the advantages of CSR: “The idea of corporate social responsibility and the partners in an enterprise is a perfect match”. One of the most significant stakeholders is the consumer in the CSR program of the organization across the different stakeholder classes [32,33].

As a central guide to CSR operation, Carroll’s [31] concept of corporate social performance (CSP) has been commonly used to evaluate the value of CSR [34]. The CSP model encompasses the economic, legal, ethical, and philanthropic four dimensions. It clarified income development, job-creation, and the production of new technologies and goods for stakeholders. The legal aspect concentrated on dealing with the legal specifications of a corporation. The ethical aspect has defined the actions of an organization as a business participant to meet the objectives of a company and prevent social damage. Finally, the philanthropic aspect clarified the numerous charitable efforts of a corporation to promote educational institutes and the neighborhood living standards. Based on a CSP model by Carroll, Windsor [35] interpreted the four key parameters as socially related: the economic and legal aspects are needed in a societal context, the ethical aspect is anticipated in a community, and philanthropic obligation is socially beneficial. The beneficial effects on companies are identified from socially desired CSR practices. Cheung et al. [36] and Weber [37] discussed the environmental CSR (i.e., corporate environmental policy or interacting with consumers utilizing a socially responsible brand image) will enhance a firm’ profit. Successfully applied CSR improves a business provider’s credibility [38]. Taking into account Carroll’s CSP model and Windsor’s definition, this analysis defines three dimensions for the company’s CSR –economic (socially needed), ethical (socially anticipated), and environmental (socially wanted).

2.2. Stakeholder View on CSR

The secret to CSR is the stakeholder idea [39]. The word “stakeholder” is specific and describes “any organizations and persons who may impact the achievement of an organizational task or are influenced by it” [29]. Stakeholders have been categorized as main or minor, willingly or unwillingly, and external or internal by researchers [40]. Stakeholders who “act whether formally or publicly, personally, or jointly are a central component in the company’s external climate that may impact the enterprise positively or adversely” [41]. The main challenge for theorists is, in the opinion of stakeholders, how to enhance the industry friendship by offering collective advantages [42]. Such advantages can include a conflict of interest between those involved; one stakeholder may have a gain and another stakeholder may not find it as beneficial [42].

One of main stakeholder classes responsive to the CSR practices of an organization is its customers [43]. A Cone Corporate Citizenship Survey (2004) showed that 80 percent of respondents are likely to help socially responsible businesses. Existing studies show that consumers are rewarding businesses for taking part in CSR practices [44,45]. A lack of awareness of stakeholder gains is important to fully appreciate the effects of CSR operations [46]. The psychologic mechanism guiding the intervention of stakeholders on CSR practices by corporations is minimal in literature [47]. According to the means-end chain approach, customers adopt buying decisions based mostly on practical advantages of the product/service attributes, psychological advantages of the individual’s mental well-being, and their personal beliefs [42]. Although there is no clear picture of the impact of customer CSR awareness on buying decisions, an organization’s CSR practices might affect its consumers’ mental well-being and the welfare of communities.

CSR is considered as “a process for integrating social, environmental, ethical, human, and consumer concerns into the business activities to maximize the sharing of value for its owners and their other stakeholders, as well as for society as a whole” [48,49]. This conception of CSR is well in keeping with stakeholder theory, which considers CSR a corporate governing extension by extending the duties of a business to an expanded community of stakeholders beyond their shareholders [50,51].

While prior empirical research has seen CSR practices under a single metric, the various dimensions of CSR have varying impacts on the firm and should, thus, be studied independently [52]. Additionally, it has been contended that the multidimensionality of CSR can be better evaluated through a stakeholder framework that assesses how businesses accomplish its ties with their stakeholders [27,51].

2.3. Customer Responses to CSR

To date, some studies have investigated the impact of CSR practices on consumer behaviors [4,45,53,54]. However, the findings are incomplete [53]. Several studies show that CSR practices have a positive impact on consumer behavior outcomes, including product assessment [14], assessment of the firm [11], word of mouth [54], intent to buy [4], and brand equity [19]. Luo and Battacharya [20] also established a constructive association between the businesses’ CSR score and consumer pleasure. In a MORI (2000) poll, 70 percent of customers regarded the business’ moral image while purchasing a good or service. “So many companies and social workers accept customer polls at face value,” said Boston’s College’s Center for Corporate Citizenship, assuming that if they claim to like socially responsible products, they must be willing to do the necessary if the time arrives to buy them [55] (www.csreurope.org, accessed on 15 December 2020). Such findings show that consumers react favorably to businesses engaging in socially responsible practices relative to some least socially responsible firms [56]. Such favorable reactions of customers are also called consumer social responsibility in literature [57].

Nonetheless, some tests have shown that the CSR practices do not contribute to consumer behavior findings [58]. Socially irresponsible firms will be punished by consumers for their actions [11]. Sen and Bhattacharya [9] re-affirmed the likelihood of the CSR practices contributing to a reduction in the purchasing intention of consumers if consumers assume that these practices increase the company’s cost and might thus reduce the quality of the product. While there is substantial literature on CSR and customer reactions, the results are inconsistent.

2.4. CSR in a Developing Economy

CSR originated in developed countries and appeared as a trend in some emerging developing countries such as China, Brazil, India, and South Africa in recent years [59]. Such nations face socioeconomic problems such as deprivation, urban degradation, hunger and illness, and structural inequality. CSR denotes “the formal and informal means in the way businesses relate, while being responsive to prevailing political, geographical, and cultural backgrounds, to improving the governmental, financial, legal, and the environmental factors of nations within which they work” [60]. Many firms in developed countries are going global and increasing exposure to the world economy, thus embracing the CSR code and reporting sustainability. Ali et al. [61] and Jamali and Karam [62] observed that the majority of CSR work was carried out in Western countries (e.g., the U.S., the UK, Australia), and little is known in emerging economies regarding CSR, which suggests that more CSR study is required in emerging economies [39].

2.5. CSR in Pakistan

Emerging economies such as Pakistan are new to the concept of CSR [63]. The CSR concept is still in its initial phase in Pakistan. Corporations and the public are less conscious of their rights and responsibilities, and businesses believe CSR is a liability rather than a means of long-term gains for companies and the public in general [64].

Majority of CSR work in Pakistan is conducted in the area of corporate philanthropy. Corporate donations have been used as an effective way to boost the reputation of companies in a competitive environment [65]. Almost every company reports on its diverse social activities and concerns, such as charity, aid, environmental projects, education, the provision of hospitals and health services, community/society improvement programs in Pakistan under the heading of donations, which is made available in its audited annual financial reports. These businesses care well about their workers in order to create confidence and trust. In exchange, these social expenditures help businesses pursue economic growth on a consistent, long-term basis in addition to financial returns [66].

In comparison to the marketing of the product line, companies are now more inclined to create a favorable picture for CSR for stakeholders [63]. This particular study is intended to examine the impact of CSR on purchase intention in the context of Pakistan.

3. Conceptual Model and Hypotheses Development

The role of CSR was previously identified from the employees’ perspective (e.g., [67,68]), the consumers’ perspective (e.g., [69,70]), and the business’s perspective (e.g., [71,72]. Past study suggests that, while a business engages in CSR activities, the organization becomes more likely to be financially successful because of the positive impact of CSR on its consumers [44]. For example, Cha et al. [69] explored the effects of CSR and brand fit on service brand loyalty through personal and social identity. Therefore, it is valuable for both academics and professionals to study how consumers interpret and react to CSR initiatives in a business.

As shown in Figure 1, a conceptual model is proposed that relates CSR to trust and brand image, and further to consumer purchase intention. The model also explores the moderating effect of customer CSR awareness.

3.1. The Relationship between CSR and Purchase Intention

Carroll and Shabana [73] claimed that competitive edge arguments suggest that a CSR-conscious organization will build good partnerships with its customers and gain their help in the form of consumers’ willingness to pay a premium price, and thus achieve customer satisfaction by the implementation of CSR practices. Many studies have shown that CSR practices affect the purchasing intention of customers when they are involved in and aware of these activities [74,75,76]. CSR practices carried out by an organization will establish a positive partnership with stakeholders and provide assistance as evidenced by low employee turnover and consumers’ loyalty. This helps a consumer to start repurchases. Consumers can consider their goods better when an organization implements CSR.

H1 (Hypothesis 1).

CSR has a direct positive relationship with purchase intention.

3.2. The Relationship between CSR and Trust

CSR-conscious organizations will improve their integrity and credibility by proving that they will satisfy the conflicting needs of their stakeholders. They will strengthen the trust of all stakeholders involved, including customers, by incorporating ethical and responsible values into their strategic decision-making [77]. This argument demonstrates that CSR will boost the credibility and trust of an organization and illustrate the organization’s willingness to satisfy the needs of its stakeholders. Initiatives that are socially responsible provide information about their character and values, which helps to create interest in the business [78]. Carroll and Shabana [73] clarify the connection between CSR and customer trust. Borges et al. [79] also support this position: “Social responsibility policies are related to strategic benefits such as recruiting qualified employees and enhanced brand identity and credibility”. Consumers show high levels of trust in socially responsible businesses [80]. CSR can offer a strategic edge as it will render workers appealing and improve the prestige and image of businesses and, thus, improve customer trust.

H2 (Hypothesis 2).

CSR has a direct positive relationship with trust.

3.3. The Relationship between CSR and Brand Image

CSR has been documented to influence customer brand reactions both explicitly and implicitly [81]. This argument demonstrates that CSR influences the reaction of customers to a brand. Brand image is one of the leading communication myths that apply to customer views of brands as reflected in public memory by company associations [82]. A good brand image is indeed an advantage, as it affects the expectations of consumers regarding the contact and activities of the business [83]. Rashid et al. [84] report that a sense of identity and commitment among consumers is encouraged by philanthropic activities on particular humanitarian efforts, e.g., healthcare, schooling, and involvement in community-building programs. According to Caroll [31], there is “need” of economic and legal obligation, ethical responsibility is “anticipated”, and philanthropic obligations are “desired”. Therefore, the businesses must take care of philothropic responsibility in order to fullfill the needs of community. It should be understood that the content of CSR and what it actually applies to is the corporation’s legal and philanthropic duties toward society go beyond its economic and legal responsibilities [85]. They indicated it might be more influential when the company had a strong corporate image with CSR activities.

All corporate activities will shape brand images, but CSR has a strong impact on brand image among these corporate activities [86]. CSR’s favorable results are higher sales, stronger brand image, improved customer loyalty, and increased market value [87]. CSR initiation could allow the customer to engage strongly with the brand [88] and create a positive brand image in the consumers’ minds [89].

Likewise, Liu et al. [90] claimed that the economic, financial, and stakeholder efforts or programs of CSR have a beneficial impact on consumers’ brand choice. Deegan (2002) showed that CSR perceptions provide a significant addition to brand images, enhancing brand identity and credibility [91]. The longitudinal study of Ricks [92] involving 293 undergraduate students has confirmed these findings by suggesting the optimal partnership between corporate philanthropic efforts and consumer labels. Likewise, in a research involving iconic products or various people, Ramesh et al. [93] found that CSR programs aimed at increasing social awareness are strongly correlated with the brand image. Mohammed and Rashid [94] named CSR activities as the ability of an organization to distinguish its products/services by building a positive brand identity, which helps to retain a good recognition. In view of CSR’s important position in improving brand identity, Coles et al. [95] suggested that there is a positive effect of CSR interventions on brand image.

H3 (Hypothesis 3).

CSR has a direct positive relationship with the brand image.

3.4. The Relationship between Trust and Purchase Intention

Trust was also considered a substantial element in the decision of the consumer to buy or repurchase from the same supplier [96]. The work has been carried out online; yet, the same is evident that trust greatly impacts the consumers’ purchasing and re-purchasing plan. Khudiyev and Szabó [97] indicated that purchasing intention requires subjective judgment of future behavior. Purchase intention stands for what we would like to buy in the future. According to the authors of [98], purchase intention refers to the attempt to buy a product or to visit a store offering services. Akbar and Parvez [99] illustrate this argument by presenting a clear connection between the perceived service quality trust and the consumer loyalty. If buyers are loyal, they have a probability of purchasing, thus the desire to purchase is strong.

H4 (Hypothesis 4).

Trust has a direct positive relationship with the purchase intention.

3.5. The Relationship between Brand Image and Purchase Intention

The phrases brand identity and company relationship are synonymously used [100]. Brand connections are ideas that link the identity of consumers to a particular brand name [101,102]. The decisions to purchase by consumers often take place based on the impression of the brand image. A strong brand image positively relates to consumers’ willingness to pay premium prices [103]. A distinctive brand image identifies the company and its meaning that takes up a certain place in the mind of the customers and, thus, leads to the future purchases [104]. From a semantic point of view, the brand image represents tools that draw visitors with their practical features. When customers have such a favorable brand image, they usually equate the brand with advantages and optimistic product perceptions [105], and, thus, are more likely to purchase the corresponding products.

H5 (Hypothesis 5).

Brand image has a direct positive relationship with purchase intention.

3.6. Moderating Role of Awareness

Customer awareness of CSR is a requirement for rewards of a company’s CSR activities, including consumers’ recognition of these activities [38] and purchase intention [106], but the awareness level is different among consumers [44]. Many findings suppose that consumers are either aware or that cognition is generated artificially within experimental conditions [107]. In reality, consumers have been considered largely unaware of firms’ CSR operations [3], but strong contact will increase their awareness [108]. Carrington [109] reported that customers has indicated that they need details on general actions of the business, not only the legal but also the behavioral activities. When customers are unaware of firms’ CSR activities, CSR will generate less effects on customers’ purchase intention [110]. Despite its significance, researchers have noted the lack of knowledge of CSR in most CSR strategies [47]. Although businesses aim to make the best of their CSR plans, lack of knowledge of CSR programs makes it hard to do so [111]. As businesses report their CSR plan, they act as a vehicle for public relations and create a strong corporate identity [112]. Moreover, since public disclosure of the negative social behavior of a corporation harms corporate image, a way to fix the issue is to illustrate the constructive social actions of the company [47]. Servaes and Tamayo [113] found that the strength of CSR with high consumer awareness as a result of advertising expenses is positively linked to the firm value. When customers are more aware of CSR programs, this translates to a favorable disposition and behavior in the purchasing of the brand [114]. Customers are willing to buy and even pay more for the CSR products in favor of a company’s CSR activities once customers are aware of them [4,5]. The following hypothesis is then suggested:

H6 (Hypothesis 6).

CSR awareness moderates the relationship between CSR and purchase intention.

4. Research Methodology

4.1. Instruments’ Development

The questions included in this research have been established and modified from prior studies centered on the literature review. The five-component questionnaire—CSR, Trust, Brand Image, Purchase Intention, and Awareness—covered a total of 21 items. The responses were separated from (“strongly disagree”) to (“strongly agree”) by a five-point Likert scale.

Table 1. Constructs and items.

Construct	Item	Source
CSR	The company tries to sponsor pro-environmental programs. The company tries to protect the environment. The company tries to carry out programs to reduce pollution by controlling emissions. The company has established ethical guidelines for business activities. The company tries to become an ethically trustworthy company. The company provides a wide range of indirect benefits to improve the quality of their employees’ lives. The company emphasizes the importance of their social responsibilities to society. The company contributes to campaigns and projects that promote the well-being of society.	[115]
Trust	The services of the company make me feel a sense of security. I trust the quality of the company. Hiring services of this company guarantees quality assurance. This company is interested in its customers. This company is honest with its customers.	[116]
Brand Image	Using the company’s products is a good thing to do. Using the company’s products is valuable for me. The company offers a high level of service.	[117]
Awareness	Are you aware of any initiatives the company is involved in that are aimed at improving the social conditions in the community? Are you aware of any initiatives the company is involved in that are aimed at improving the environmental condition?	[118]
Purchase Intention	I shall continue considering the company as my main brand. I would keep being a customer of the company. I would recommend the company if someone asked my advice.	[117]

shows the items.

4.2. Sample and Data Collection

The data were collected using convenience sampling in different cities of Pakistan. The survey was split into two parts, and we asked individuals about their gender, age, education, and occupation in the first section. The second part included 21 question items for the five constructs. The respondents were first asked to choose a company that they are familiar with, and then all the questions were related to that company. The data were gathered by means of personal visits in Pakistan. Our research assistants went to companies, restaurants, banks, and universities to distribute questionnaires directly to research subjects and then collected them after respondents answered. In all, 1137 were returned out of 1500 questionnaires. Of these, 135 were incomplete, resulting in 1002 completed questionnaires. The population features of the respondents are seen in

Table 2. Respondents’ demographic profile.

Respondents		Frequency	Percentage
Gender	Male	610	60.8%
	Female	392	39.12%
Age	18 to 30 years old	391	39.02%
	31 to 40 years old	265	26.44%
	41 to 50 years old	230	22.95%
	51 years old and above	116	11.57%
Education	Primary Education or Lower	70	6.98%
	Middle School Education	145	14.47%
	High School Education	235	23.45%
	Bachelor Degree	215	21.45%
	Diploma/Certificate	135	13.47%
	Postgraduate Degree	202	20.15%
Profession	Students	545	54.39%
	Self Employed	157	15.66%
	Job Holders	135	13.47%
	Businessmen	165	16.46%
Income	0–15,000 Rs.	570	54.39%
	15,001–30,000 Rs.	181	18.06%
	30,001–50,000 Rs.	151	15.06%
	50,001–80,000 Rs.	55	5.48%
	80,001–100,000 Rs.	28	2.79%
	More than 100,000 Rs.	17	1.69%

.

5. Data Analysis and Results

5.1. Analysis Techniques and Common Method Bias

The data were evaluated with a partial least squares (PLS) approach since it was superior to the other structural equation models [119]. In addition, it can calculate the dynamic models with different relationships [120] since the purpose of population estimation is not presumed [121]. Two integrated versions, the inner and the outer, are available in PLS. The inner model describes the interactions between latent variables, while the outer model discusses the similarities between latent variables and their indicators [122]. In comparison, PLS provides the slimmest loads on variable positioning. PLS, thus, decreases the bias caused by software covariance approaches such as LISREL and AMOS based on factors [123]. We used the bootstrapping function to track the statistical value of path coefficients. All concepts were defined as meditative in the validated model because their measuring elements demonstrate these concepts [124]. For data processing, the SmartPLS (version 3.2.1) was used.

In PLS-SEM, the measuring method used in the SEM analysis and not the network of causes, consequences, and results in the model being tested are responsible for the phenomena. The above guidelines will, for example, impact the responses made by many respondents in the same general context such that the measures show some shared variance. The implied social bias in combination with the questionnaire’s answer is also a potential explanation for shared choice contributing again to a certain level of heterogeneity in the indicators. Therefore, if all VIFs resultant from a complete collinearity evaluation are equal to or less than 3.3, the model may be called free of common method bias [125].

Table 3. Collinearity statistics (VIF).

Items	VIF
Awr1	1.310
Awr2	1.310
Brd1	1.517
Brd2	1.510
Brd3	1.569
CSR * Awareness	1.000
CSR2	2.352
CSR3	1.650
CSR4	2.548
CSR5	1.790
CSR6	1.724
CSR7	1.818
CSR8	1.895
PI1	1.942
PI2	2.204
PI3	1.831
Tr1	1.769
Tr2	1.919
Tr3	1.632
Tr4	1.643
Tr5	1.235

indicates all latent variables in both of our models based on the complete collinearity measure. As can be seen, the model depicts a latent variable VIF below 3.3. Based on the complete collinearity test framework, no common method bias was found.

5.2. Measurement Model

The internal consistency and relevance of the reflecting paradigm are the most significant elements of the assessment. A score of more than 0.7 suggests reliability appropriate for Cronbach’s alpha (CA) and composite reliability (CR) (Nunnally and Bernstein, 1994), and the value of the average variance extracted (AVE) should exceed 0.5 [123,126]. The variables’ loading, CA, Dillon–Goldstein’s rho (rho A), CR, and AVE are shown in

Table 4. Factor loadings, Cronbach’s alpha (CA), Dillon–Goldstein’s rho (rho_A), composite reliability (CR), and average variance extracted (AVE).

	Loadings		CA	rho_A	CR	AVE
Awareness	Awr1	0.840	0.713	0.710	0.852	0.742
	Awr2	0.882
Brand Image	Brd1	0.801	0.759	0.762	0.861	0.674
	Brd2	0.827
	Brd3	0.834
CSR	Csr1	0.811	0.851	0.862	0.885	0.524
	Csr2	0.780
	Csr3	0.662
	Csr4	0.793
	Csr5	0.720
	Csr6	0.691
	Csr7	0.683
	Csr8	0.729
Purchase Intentions	PI1	0.864	0.837	0.836	0.902	0.754
	PI2	0.885
	PI3	0.855
Trust	Tr1	0.798	0.807	0.814	0.867	0.569
	Tr2	0.814
	Tr3	0.757
	Tr4	0.776
	Tr5	0.609

for all reflective designs. All CA, CR, and AVE settings were greater than 0.70 and 0.5, showing that the overall deviation and efficiency were excellent for all constructs. Table 4 lists loadings of individual objects that match their requirements. Both internal consistency values (reliability), CR and CA values, obtained are far higher than 0.70 in each construct, suggesting appropriate reliability requirements [118,120,124]. Social science experiments endorse our observations [123,127].

According to the authors of [128], all the items should be loaded heavily on their respective latent variables. All the AVE score ranged more than 0.5 for all constructs (Table 2). According to [129], all the factor loadings should exceed 0.60. They fulfill the need as shown in Table 2.

5.3. Discriminant Validity

The primary objective of discriminant validity assessment is to ensure that a reflective construct has the strongest relationships with its own indicators in the PLS path model [130]. Henseler et al. [131] proposed an alternative approach, based on the multitrait–multimethod matrix, to assess discriminant validity, which is also known as the heterotrait–monotrait ratio of correlations (HTMT). This approach has demonstrated superior performance to the Fornell–Larcker criterion and the assessment of (partial) cross-loadings. Basically, discriminant validity is assessed by observing the indicator loadings and interconstruct correlations [124].

Table 5. Heterotrait–monotrait ratio (HTMT).

	Awareness	Brand Image	CSR	Moderating Effect	Purchase Intentions	Trust
Awareness	0.862
Brand Image	0.172	0.821
CSR	0.216	0.567	0.724
Moderating Effect	−0.010	0.063	−0.071	0.0851
Purchase Intentions	0.394	0.400	0.466	−0.025	0.868
Trust	0.202	0.634	0.733	0.011	0.443	0.754

demonstrates that all indicators load more strongly on their corresponding constructs than on another construct in the model. Rönkkö and Evermann [132] reported the Fornell–Larcker criterion’s inferior performance in PLS. Therefore, we used the HTMT approach to assess the discriminant validity issue in our study. The HTMT standard value should be below 0.90. As shown in

Table 6. Results of path coefficients and confidence interval.

	Original Sample (O)	Sample Mean (M)	Standard Deviation (STDEV)	T Statistics (|O/STDEV|)	p-Values	Confidence Intervals
						2.5%	97.5%
CSR → Purchase Intentions	0.229	0.231	0.054	4.255 ***	0.000	0.127	0.336
CSR → Trust	0.733	0.736	0.016	45.007 ***	0.000	0.699	0.766
CSR → Brand Image	0.567	0.570	0.029	19.783 ***	0.000	0.514	0.622
Trust → Purchase Intention	0.127	0.125	0.059	2.159 ***	0.031	0.007	0.235
Brand Image → Purchase Intention	0.140	0.139	0.050	2.775 ***	0.006	0.042	0.236
Awareness → Purchase Intention	−0.016	−0.017	0.033	0.472	0.637	−0.079	0.045
CSR*Awareness → Purchase Intention	0.294	0.294	0.037	8.033 ***	0.000	0.226	0.363

** p < 0.01, *** p < 0.001.

, all constructs have values lower than 0.90. Overall, the constructs demonstrate strong discriminant validity.

5.4. The Structural Model

The path coefficients for the structural model and the variants explained are seen in Figure 2. All six hypotheses of the study are statistically significant, and therefore, they are supported. Customer awareness has a significant moderating effect on the relationship between corporate social responsibility and purchase intentions.

Similar to [133], with a 1000 re-samples bootstrap, a 95% confidence interval was obtained for the indirect effects. The results of a mediation analysis established the role of mediation of brand image and trust in the relationship between CSR and purchase intentions. Table 6 describes the PLS bootstrapping results.

6. Discussion and Implications

In this research, we have shown the effect of CSR on consumer reactions (particularly on buying intent), which better represents the consumer’s position. In today’s intensely dynamic corporate climate, businesses add socially beneficial or environmental strategies to their efforts to achieve comparative advantage. This research gives a better view of how CSR behaviors affect customer behavior outcomes.

The study collected data from different Pakistani firms and tested the model with SmartPLS. We found that CSR activities have a direct impact on customer purchase intention. Thus the study is in line with [134]. The study also found direct, favorable associations between CSR and brand image/trust. The brand is the result of organizational beliefs, policies, and competences that are expressed consciously in all marketing operations. The customers attempt to equate all these and build trust and a brand image because they have faith in the company’s capabilities and credibility [135], and the trust and brand image offer a strategic advantage and contribute to motives that are beneficial. If customers find CSR to be the best thing to do and if they see a company involved, they prefer to build a good relationship. Since customers are aware of the CSR activities of the company and its brand, their attitudes to both the CSR and the brand can be taken into account [136].

This research adds to the current literature by analyzing customers’ reactions to CSR practices in a developing country such as Pakistan and fills the void, which existed when only developed markets were studied. It is the very first study in which we studied awareness as a moderator in the context of Pakistan. Results demonstrate that strong customer reaction is a definitive predictor for businesses to integrate socially responsible activities in their strategies. As a result, the company has an ability to give back to the environment and to satisfy customer needs with socially responsible production, apart from meeting company goals. Building a socially responsible brand is critical for businesses to have a successful effect on customer behavior. However, communicating these behaviors is highly necessary for customers to have a favorable reaction [137]. This contact may yet again contribute to increased perceptions. CSR actions tend to have favorable results if they are perceived by customers to be trustworthy. If the reported actions do not correspond to the organization’s real conduct and reputation, a derogatory business impression may be formed. Therefore, it must be remembered that suitable CSR tasks need to be identified. Investing in events in good alignment with the company’s mission and principles and even contributing to community growth is advisable. CSR is viewed by customers as value-added but is not a substitution for standard services. Companies should speak to customers about their role in CSR activities to build a good reputation and improve consumers’ purchasing intention. This could contribute to strong customer behavior. The buying purpose cannot be promoted by immediate ads, and it needs long-term planning, comprehensive strategies, and meaningful intervention. In summary, purchasing intent can be improved by the enhancement of market capability and CSR association.

A recent development in CSR literature is the use of the stakeholder approach. It has been seen that businesses concerned with the needs of stakeholders do better than those that are not [137,138,139]. Customers are one of the most prominent stakeholder groups impacted by the operations of an organization [33]. Therefore, businesses must take care of all stakeholder interests to establish and execute a CSR plan. This is also inconsistent, since one program that helps one stakeholder group can result in higher costs for another [42]. According to the theory of social exchange, humans are connected by an analysis of cost–benefit and comparisons of alternatives. If a consumer meets a brand that participates in CSR activities, the brand tends to show a greater value. This gives the customer a stronger assessment of the brand than the possible alternatives; this sense of justice leads to favorable brand interactions, and the customer induces emotions with the brand that contribute to a brand loyalty or purchase intention. The results of the study found similar effects.

It is the first study to include both the corporate social responsibility and customer awareness of CSR activities and investigate their interactive effects on customer purchase intention. Here, customer purchase intention refers to customers’ willingness or readiness to pay for CSR goods/products. With the collected datasets, we have obtained promising results. Ideally, we would like to study the real customer purchase (i.e., realization of purchase intention) rather than customer’s purchase intention. Since whether a company can succeed in CSR activities eventually depends on customers’ response to its CSR activities (i.e., consumer social responsibility [57,140], future studies will explore how corporate social responsibility and consumer social responsibility interact to influence customers’ real purchase and firms’ performance.

7. Conclusions, Limitations, and Direction for Future Research

This study makes some distinct contributions: First, results show that CSR activities have a direct and positive impact on purchase intention. Second, CSR activities have a strong positive impact on purchase intention mediating by trust and brand image. Third, the moderating effect of customer awareness is seen on the buying behavior of the CSR initiatives. Findings show that, if customers are aware of CSR programs, their purchasing intent may be favorably impacted by CSR activities. The findings are measured and validated on an objective basis by previous studies that analyze the association between social intervention and customer behavior outcomes [15]. Despite this, past studies have not taken customer awareness or sensitivity as an influential factor; “past studies have taken or generated knowledge of CSR with scenarios and then assessed customer responses” [118,119]. As a result, the extent of customer awareness of CSR operations was examined in an experimental or artificial setting, and it remains uncertain whether the customer is truly aware of these practices in the market, and this leaves a void in our comprehension. Many scholars have been calling on the degree of market consciousness in the actual scenario [114]. This article deals with this call and contributes to current literature by analyzing the moderating impact of customer awareness of companies’ CSR initiatives on buying intention.

In this study, a range of limitations were identified, aside from important results. This research has tested the model in certain industries where the essence of services is not complex and the risk associated with such services is less considered. In contrast, the conceptual model could also be evaluated in situations where the perceived risk associated with resources and service is complicated. In addition, there is a mentality difference between consumers on the real market; for example, consumers will prefer to claim that they are prepared to pay for socially acceptable firms’ goods/products, but it is uncertain if they really do so. It is because there are differences between customers’ willingness/readiness to pay and the realization of customers’ buying behaviors. Future studies may concentrate on the relation between customer intention and real customer purchase behavior.