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MGT 605 Impact of Corporate Social Responsibility on Business Performance: A Case Study of Woolworths

Executive Summary

In the era of rising competition in business, reputation and brand value are quite important factors. Businesses are putting tremendous efforts and funds in improving their market position that would ultimately generate profits for the company. The Corporate Social Responsibility is a very broad term that comprise employee volunteering, donations, conducting environment-friendly processes and much more. All these initiatives taken by the company says a lot about its intentions, community concerns, and operations. Many researchers have tried to prove that organisations that show interest and commitment to CSR are determining their capabilities to help and develop community and working on such areas. According to the report of Fortune for the year 2016, 55% of the customers in the global market are willing to spend more on products offered by socially responsible organisations. CSR not only benefits the business but also helps in developing the community.

The following paper examined the impacts of the Corporate Social Responsibility (CSR) on the business. For that purpose, Woolworths’s CSR policies and initiatives were examined and discussed in details. For the research purpose, qualitative research approach has been selected and data from company’s website, annual reports, and Australian Bureau of Statistics has been collected and referred for reaching the depth of the topic. Furthermore, certain recommendations have been provided based on the analysis followed by the conclusion.


Many companies are putting their resources in improving the market position and profits while taking care of the communities. This is called Corporate Social Responsibility. This report focuses on analysing the impact of CSR on business. For that purpose, Woolworths is selected and secondary data related to the company is analysed and recommendations are also provided.

Methodology and Theoretical Approach

A qualitative study approach was brought into use for conducting this analysis. For collecting the facts and data, annual reports of the company, and other secondary sources. The research has two variables, namely independent and dependent (McCusker&Gunaydin, 2015). The former variable is Corporate Social Responsibility Targets which is available in the sustainability report of Woolworths ( These data consist of targets related to environment, economic, and community. For instance, in 2019, the Woolworths set 20 CSR targets to achieve, out of which 8 targets are for community, 6 targets are for environment, and 6 are for economic sustainability of the company. The dependent variables in sales of the company. This data is available in the annual reports of the company uploaded on the website of the company.

For better understanding of the topic, a qualitative analysis of the gathered data was done. The data was entered into MS Excel and presented in thematic forms for better conclusive remarks and to provide logical recommendations (Bernard, 2017). Also, the literature review was done to form arguments and understand the topic in-depth. The existing work on CSR supported the statement that it is beneficial for the organisations in maintaining long-term benefits. These works have conceptualised customer engagement as an outcome of the CSR initiative taken up by the firm (Schrempf-Stirling,, 2016). Authors like Schrempf-Stirling et al. (2016) have worked out the relationship between CSR and competitiveness of the company in the market. Cui, (2015) argue that CSR is a sort of developed business model that emphasises on regulation of services and policies. It makes the firm accountable to public, stakeholders, and environment. All these literatures helped in forming the analysis theme and basing the outcomes of the data analysis for Woolworths.

It is important to note here that the following report is based on Relationship Marketing Theory. The theory is characterised by the idea of attracting consumers and keeping them for a longer period with the business. The overall aim of this theory is gaining loyalty of people. This theory is most rationale than other. Organisations’ sole purpose is to earn profits while contributing in the development of the society. Wang,, (2016) mentioned that CSR helps companies in acquiring best talents, thereby providing the best customer experience to people by understanding their needs and wants. This would help in ensuring the organisation makes the maximum profits and helps in attaining success.

On the other hand, experts like Arli and Lasmono (2010) have criticised CSR due to its many downsides. For instance, implementing CSR policies and processes costs funds. Smaller businesses may not be able to provide much funds and it also requires extra personnel. This disturbs the bottom line of the business and company might end up losing it market position. Cahan, (2015) mentioned that CSR policies may contradict the profit-making motive of shareholders who want maximum returns for their investment in the business.

Overall, from the theoretical analysis of literature review, there are some positive and a few negative characteristics of CSR initiatives have been outlined. This shows even CSR is not perfect for all organisation.


As per the data provided on CSR hub, the CSR Ranking of Woolworths among 17, 989 companies of 141 countries in the world is 87. Looking into the graph of the supermarket industry’s average, Woolworths’s rating is always above the average (see figure 1). The company is continuously working on areas, such as gender diversity, pay parity, community development, compensation & benefits, energy& climate change, corporate governance, transparency & reporting, training, health & safety, resource management, and human rights.

leadership and organizations

Increased Market Share

In today’s day and age of digital technology, it has been noticed that organisations that reflects corporate social responsibility are being praised by community and other stakeholders for their involvements. This also increases market value and goodwill of the company. The target consumers would feel good while purchasing products and might feel that they are contributing to the development of the community. Woolworths publicises its CSR initiatives through its events, sustainability reports, and spreading words about them. This has helped the company in reaching the top position in terms of market share (see figure 2)

leadership and organizations

Customer Satisfaction:

As per the Neilson’s 2016 survey, 56% of the respondent said that a brand is known by its social works and values it reflects. In addition to this, 53% of respondents believed that they would purchase the products of brands having high community commitment (Cahan,, 2015). It has been seen that the CSR programs of Woolworths showcase its community commitment, team work, and engagement in social work. All this increases the customer satisfaction and build healthy and trusted relationship with them. All these efforts ultimately leaad to higher customer satisfaction.

leadership and organizations

Improved Sales:

From the figures shown in the figure 4, it can be seen that the sales of Woolworths are continuously improving year-by-year. Also, the company’s efforts towards CSR are also increasing. This shows that there is some relationship between the sales of the company and CSR initiatives taken up by Woolworths.

leadership and organizations

Increased Employee Retention:

According to ***,younger generation are more concerned about the community and therefore, they would like to work in organisations that take CSR initiative as its top priority. An effective CSR program helps in the development of leadership and employees. It has been noticed that if employees perceive that their leaders are concerned for workers’ development and promotes training and skill development, then they get more engaged and stay with the company for a longer period. Woolworths take necessary efforts in such directions and as a result, the employee retention is quite good (see figure 5).


In the complete analysis, many new things related to CSR initiatives. The first and foremost was that CSR helps organisation in improving its brand image along with its goodwill in the market. Consumer purchases commodities of the brand that takes social responsibilities. It was also highlighted that company’s CSR helps in increasing sales, market share, and also employee retentions. For that purpose, qualitative analysis was carried out in the report.


  • More awareness among the target consumers about the CSR efforts and programs run by the company can be very helpful (Schrempf-Stirling,, 2016).
  • Strengthening the partnership between all stakeholders including employees, private sector, government agencies, local communities, and NGOs can remove barriers in implementing CSR (Wang,, 2016)
  • Woolworths can also join hands with smaller businesses and SMEs as they can employ their resources too and work jointly with large firms (Jha& Cox, 2015)
  • CSR should not only stays in urban areas of the world. In fact, Woolworths should take the efforts in rural areas too (Cahan,, 2015).


  • Annual Report Woolworths. (2019). Retrieved 13 November 2019, from
  • Arli, D. I., &Lasmono, H. K. (2010). Consumers' perception of corporate social responsibility in a developing country.  International Journal of Consumer Studies,  34(1), 46 51.
  • Bernard, H. R. (2017). Research methods in anthropology: Qualitative and quantitative approaches. Rowman&Littlefield.
  • Cahan, S., Chen, C., Chen, L., & Nguyen, N. (2015). Corporate social responsibility and media coverage.  Journal of Banking and Finance,59, 409-422. doi:10.1016/j.jbankfin.2015.07.004
  • CSR Hub. (2019). Corporate Social Responsibility and Sustainability Reports | CSR Ratings. Retrieved 13 November 2019, from
  • Cui, J., Jo, H., & Li, Y. (2015). Corporate social responsibility and insider trading.  Journal of Business Ethics,130(4), 869-887. doi:10.1007/s10551-014-2113-z
  • Jha, A., & Cox, J. (2015). Corporate social responsibility and social capital.  Journal of Banking and Finance,60, 252-270. doi:10.1016/j.jbankfin.2015.08.003
  • McCusker, K., &Gunaydin, S. (2015). Research using qualitative, quantitative or mixedmethods and choice based on the research. Perfusion, 30(7), 537-542.
  • Schrempf-Stirling, J., Palazzo, G., & Phillips, R. A. (2016). Historic corporate socialresponsibility. Academy of Management Review, 41(4), 700-719.
  • Sustainability Report. (2019). Woolsworth. Retrieved 13 November 2019, from
  • Wang, H., Tong, L., Takeuchi, R., & George, G. (2016). Corporate social responsibility:An overview and new research directions: Thematic issue on corporate socialresponsibility.
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