Corporate social responsibility and COVID-19 pandemic: an analytical view of community attitude

Abstract

Purpose

In the course of worldwide COVID-19, the phenomenon of corporate social responsibility (CSR) gained more importance and publicity. Many organizations made a significant contribution in dealing with the crisis situation and even increased their spending on the welfare activities. This study aims to evaluate the attitude of community, especially young generation, towards the CSR undertaken by the organization during the pandemic period.

Design/methodology/approach

Descriptive research design has been employed using purposive sampling for data collection through a structured questionnaire. A sample of 550 was taken, and pilot survey was conducted among 100 respondents before administering it at full scale. A model has been proposed and tested by using structural equation modelling in AMOS.

Findings

The results of the study show that compulsory provisions of CSR have enhanced the trust of community and made the organizations more responsive towards philanthropic, legal, ethical and economic responsibility. The respondents were found to be aware about the welfare activities carried out by the organizations and developed a positive attitude towards them.

Research limitations/implications

First, the study is limited to examining the attitude of community towards CSR, especially young generation. Second, it is difficult to say whether outcomes of this study can be generalized for such other potential global crisis. Third, the study is based on the Carroll’s “CSR Pyramid” framework when other such frameworks and approaches could be available to analyse the impact of COVID-19-related CSR initiatives. Last, this study has been conducted only in the state of Maharashtra, and results may not be applicable to other states as well other countries.

Practical implications

The findings of the study may help the organizations to plan their activities in line with the amendments made time to time. This shall also help the regulating agencies to monitor and catch the wrongdoers and take appropriate action. Findings of such studies, based on public opinion, can also help the governments to make further amendments, time to time, in related acts. It can also be said that with the involvement of public/society, more transparency can be brought in the functioning of the organizations, especially in the context of CSR.

Social implications

Earlier, most of the organizations were falsely recording the CSR expenditure in their balance sheets without actually spending it, but the amendment in act has made it compulsory for the organizations to follow it honestly. The pandemic period gave an opportunity to the society to evaluate the organizations on these parameters and to make their opinion about them in real time. Therefore, it is concluded that pandemic has created awareness in the society and significantly influenced their attitude about CSR activities. This shall also help the organizations feel a pressure in future while planning and implementing the activities under CSR.

Originality/value

The results of the study show contribution of the corporate towards social welfare during pandemic. The results would help the policymakers to monitor the execution of practices more closely and organizations to execute their strategies in a more effective manner.

Citation

Singh, P. and Sharma, A.P. (2024), "Corporate social responsibility and COVID-19 pandemic: an analytical view of community attitude", IIMT Journal of Management, Vol. 1 No. 2, pp. 242-263. https://doi.org/10.1108/IIMTJM-12-2023-0068

Introduction

The notion of corporate social responsibility (CSR) has been rooted deeply in the religious and social culture of Indian system, but unexpected outbreak of the COVID-19 pandemic posed a great challenge to its implementation. As a result, corporate companies have adopted action-oriented approaches rather than the traditional philosophical-ethical approach (Frederick, 1994). This new approach and growing social awareness have given rise to a new concept, i.e. development forefront, replacing the age-old concept of charity. The concept of charity provides immediate help without addressing the root cause, whereas development forefront addresses the issues through long-lasting changes (Carroll, 1991). Also “development forefront” needs consonance and coordination with communities, governments and stakeholders in order to create long-term solutions (Eccles and Serafeim, 2013). Moreover, the devastating phase of pandemic has carried the concept of CSR at forefront for organizations. The organizations have been forced to re-orient their CSR strategies to meet the ongoing challenges and amplify the efforts of government in this direction. No doubt, CSR has now become a mainstream institutionalized practice across the globe (Hopkins, 2017).

The companies have been actively emphasizing on CSR activities ordinarily, but they were expected to take more initiatives during a pandemic, both internally and externally. Internal activities may be related to welfare of their own employees by creating hygienic surroundings, norms of social distancing, frequent washing of hands and even providing financial help to needy employees. External activities could be connected to the welfare of local community who are not related directly to organizations. Such activities can be distribution of COVID kits, food and drugs, medical facility, etc.

The COVID-19 epidemic has not only spread the risk of death from infection but also created unbearable psychological pressure on the community. Samji et al. (2022) have revealed that pandemic stress had severe impact on the mental health of the people, even to the extent of emotional disturbances and impairment in cognitive functioning. The changing nature of virus led to an increased risk of infection and lower chances of recovery. In this scenario, local community expects and seeks more help from the government and corporate sector than during normal times. Such help may be related to health, economy or other social issues arising out of the pandemic. During the crisis of COVID-19, companies were expected to support the society through their CSR activities. Companies that are committed to CSR and take proactive measures to support their employees, customers and communities are generally perceived to be more friendly (Pandit, 2023).

Moreover, Sec 135 of New Companies Act 2013 legally binds the companies to prioritize activities related to welfare of local community. Any contribution towards the activities related to pandemic relief was also included in the CSR activities of the companies under Schedule VII. As per the CSR Amendment Rules, 2020 under Schedule VII of Companies Act 2013, the expenditure incurred on healthcare, sanitization and disaster management during the pandemic period can be accounted under CSR activities. The amount spent on producing new vaccines, medicines and medical instruments to meet out COVID-19 crises could also be included under CSR activities. According to the Ministry of Corporate Affairs, the funds donated to the Prime Minister’s Citizen Assistance and Relief in Emergency Situations (PM Cares) could also be accounted under CSR expenditure. Such amendments in the Companies Act allowed the companies to spend more for creating additional facilities and providing relief during the pandemic (Gokarna and Krishnamoorthy, 2021). Gareis and Hiebl (2020) observed that companies have prioritized the needs of diverse stakeholders and extended all their support to the community during the pandemic. The emergence of pandemic increased the importance of activities (covered under CSR) for practitioners, industrialists and even the researchers.

There seems an augmentation in CSR spending after the enactment of mandatory provision under Sec 135 of Companies Act 2013, which was implemented in April 2014. It is pertinent to mention that 90% of the S&P 500 companies in 2019 released their sustainability report, which is significantly higher that just 20% in 2011 (Governance and Accountability Institute, 2020). Despite many social, health and economic difficulties during the COVID-19 pandemic, organizations continued their activities under CSR. According to Rathore (2023), there is significant increase in the overall CSR spending of the companies of India listed at Bombay Stock Exchange (BSE) from financial year 2015 to 2022 (Figure 1).

During COVID-19 pandemic, the companies have donated CSR funds to government-incubated start-ups providing preventive, diagnostic and supportive treatment to meet the health-related issues. Under preventive measures, the funds were invested in providing masks, sanitizers, PPEs kits, RT-PCR kits, portable kits, IR thermometers and antibody testing kits. The companies have voluntarily invested a substantial amount over the mandatory limit towards the pandemic relief initiatives, and this helped the companies in gaining competitive advantage (Hasan et al., 2024; Bhatia and Dhawan, 2023). The start-up incubators through CSR funding highlighted the agility of an innovative system to face the challenges of COVID-19 pandemic (Choudhary et al., 2020).

The COVID-19 virus was first identified in Wuhan, China, as “SARS-COV-2”. After inhabiting the human body, the virus showed symptoms of high fever with rapid short breath together with pneumonia, resulting in demise of billions of susceptible lives (Atzrodt et al., 2020). It had also posed significant impact on businesses, resulting in challenges to their commitment towards CSR. This led to unemployment and hardships worldwide. In order to deal with the COVID-19 crisis, the governments and companies collaborated and participated in planning, funding and taking necessary relief initiatives to recover from the pandemic.

CSR has now become a mainstream institutionalized practice across the globe, and more and more organizations have started involving themselves in the activities under CSR (Hopkins, 2017). As discussed earlier, the importance of such activities was more apparent in the time of COVID-19 when government support was not enough and the organizations extended all types of support to the community in collaboration with governments. In this context, it becomes important to study the attitude of the people who benefited from such help from the corporate sector. Therefore, study related to attitude towards activities under CSR in the time of COVID-19 becomes significant.

Despite a big role played by the governments across the globe, CSR studies are limited to developing countries (Balqiah et al., 2023). This provides an opportunity to the researchers to measure the attitude of community towards initiatives taken by the companies under CSR. Moreover, the pandemic (COVID-19) has occurred after the amendment in Section 135 of New Companies Act; this study would highlight the compliance and its impact on image building of the corporate sector with community perspective. Many studies have covered other aspects of community such as attitudes towards CSR message (Perez et al., 2020) and influence of pandemic on business models (Buheji, 2020), which built a new analogy for opportunities across the cultures to transform the processes in a collaborative manner. During crisis, even the literature lacks in providing adequate answers to the concerns and expression of CSR (Ursic and Cestar, 2022), but attitude towards welfare activities carried out under CSR during COVID-19 crisis has not been exclusively and empirically studied yet. The current study has attempted to bridge this gap.

To address this gap, Carroll’s (1991) CSR Pyramid has been taken into consideration which is generally considered as a “Central Prism” model. Indeed, the CSR model of Carroll has always been a central feature in all CSR research studies when applied in various perspectives (Lu et al., 2020a, b; Nurunnabi et al., 2020). Schwartz and Weber (2006) have also used Carroll’s CSR Pyramid to focus on the COVID-19 crisis and CSR through qualitative research. Therefore, this study would contribute to the existing literature in terms of changing community attitude towards companies, based on their contributions to the welfare activities, especially during crisis times, through quantitative analysis. The study specifically strives to achieve the following objectives:

RO1.

The study explores the initiatives undertaken by the companies under CSR activities during pandemic in collaboration with Indian government.

RO2.

The study examines the effect of CSR initiatives undertaken during COVID-19 crisis on the community attitude.

These objectives have been achieved through the following questions:

RQ1.

What types of activities have been undertaken by the corporate during COVID-19 under CSR initiatives?

RQ2.

What is the community attitude towards the CSR initiatives undertaken by corporate?

The research paper is organized as follows. Primarily, a review of literature covering pre-industrialization era of CSR, changes in the nature of activities, etc. are narrated. Next, the methodology used for the study has been described, especially its design, sample and measurement scales. Furthermore, the major findings of the study have been discussed. Moreover, discussion, policy and social implications, limitations and suggestions for future research have been detailed towards the end of the paper.

Literature review

Although there is a plethora of definitions and methods of CSR (Bowen, 1953; Dahlsrud, 2008; Jiang, 2021), the widely renowned amongst them has been given by Carroll (1979). The CSR Pyramid of Carroll has been widely accepted for all major social issues in management (Wood and Jones, 1996; Lee, 2008). The latest article of Carroll (2021) states that organizations continued and remained committed in the course of pandemic also.

The notion of CSR has been well imbibed in the businesses from the pre-industrialization era (Sundar, 2000). Several affluent business families (e.g. Tata and Birla in India) passionately undertook a number of social initiatives for the welfare of community, and as a result, the age-old concept of wealth maximization has been replaced by wealth distribution. At present, companies are making a lot of tangible contribution for the welfare of the society, and same has been duly acknowledged by the communities (Pillai, 2017). The organizations have invested not only in creating resources for CSR activities, but such resources have been fully utilized during COVID-19 pandemic (Schwartz and Kay, 2023).

The shift in the nature of pursuing CSR activities, from passive motive to active role, has influenced the behaviour of community to a great extent (Frederick, 1994). The active role of companies was apparent more during the pandemic period where they extended social services such as distribution of free medicines, free medical check-ups and awareness programs to improve the health and hygienic conditions in the vicinity of the companies. Even the hotel chains provided accommodation during the quarantine period and demonstrated their CSR by supporting local governments and communities. In addition to this, the disclosure relating to community development activities has also been made an important part of annual reports of the companies. Such responsible behaviour of companies towards the society has been supported and duly recognized by the users (Maignan, 2001; Ramasamy and Yeung, 2009). COVID-19 has also impacted CSR reporting and transparency of the organizations. The pandemic-related accounting decisions for CSR had a positive impact on the investors’ decision and financial performance (Humphreys and Trotman, 2021; Arora et al., 2021).

The assessment of such responsible behaviour can be done by evaluating the activities carried out for the public welfare with beneficiaries’ perspective. This can give an idea about what public perceives about such organizations. In recent past, a significant shift (sceptical to objective) in the perception of community has been observed towards the CSR activities (Narwal and Sharma, 2008). This shift has been perceived in different ways by different people and the organizations (Swanson and Zhang, 2012).

Some studies have clearly shown users’ dissatisfaction towards the CSR activities because they could not understand the approach of the companies (Chai et al., 2015). Although companies have started investing more than the prescribed limit of CSR activities, the criteria selected for such investments are not appropriate and adequate. This may be under the vail of ignorance. Rawls (1999) observed that organizations generally select the activities and areas as per their visibility and comfort, which leads to ineffectiveness. To overcome this problem, Nan and Heo (2007) found that promotional activities are very crucial to create awareness and positively influence CSR activities. Perez et al. (2020) also concluded that content and design of CSR messages create and improve social awareness among communities. They further observed that increased awareness can influence the attitude of community about the firms. Conscious consumers are likely to develop positive attitude as compared to consumers having low level of consciousness (Lee and Shin, 2010). Sharma and Singh (2022) observed that irrespective of the size of firms, pursuance of CSR activities leads to positive impact on the organizational performance. So, a proper communication channel needs to be developed to make the consumers aware about the CSR activities undertaken by the firms. The clarity and authenticity of communication create positive attitude and influence the behaviour of users towards the company (Perez et al., 2020). It was observed that companies have followed response strategy, driven by values and commitment, to change their communication processes during COVID-19 pandemic (Farmaki et al., 2023).

During the period of COVID-19 pandemic and rising environmental and social pressure, corporates have included sustainable aspects in their strategies to protect and preserve the environment. The COVID crisis put the organizations under pressure to continue their obligation towards CSR. The pandemic had created crisis in the healthcare and economic sector and has affected the global society, including all businesses (Lee, 2022). Even the moral disengagement has led to unethical decisions during this crisis period (Kay and Brender-IIan, 2022). Taking advantage of this crisis, some organizations have undertaken CSR activities as a measure to increase their influence in the society (Antwi et al., 2021). The companies came out with creative ways to address social needs through their mainstream business. In order to generate sustainable shareholders’ value, even many CEOs had to modify their companies’ strategies to respond to the COVID-19 pandemic (George (2020). COVID-19 has challenged CSR on various areas like stakeholders, societal risk and supply chain management (Crane and Matten, 2021).The impact of this pandemic crisis has been observed not only on the businesses but also on the mental health of the public across the globe (Lu et al., 2020a, b; Wang et al., 2020). Long stay at home (during COVID-19) created psychological distress for women, but it proved to be an enabler for men. The pandemic crisis created value for healthy food and improved the food literacy as well (De Backer et al., 2021). Even after recovering from COVID-19, the community is still facing small cognitive deficits (Hampshire et al., 2024). Most of the companies adopted work from home policy for their employees and modified their schedules by combining altruistic actions with business interest (Zhang, 2021).

Against the background of pandemic crisis, this research attempts to achieve the following objectives: first, it explores the companies’ initiatives undertaken during pandemic through CSR activities in collaboration with Indian government; second, the study examines the effect of CSR initiatives during COVID-19 crisis on the community attitude.

Hypothesis development

Based on the literature review and identified variables, Carroll’s CSR Pyramid framework has been proposed as a theoretical lens for examining the community attitude towards social activities undertaken by the companies. Taking four responsibilities from the Carroll model, the items of the questionnaire are also framed considering these major responsibilities. The suggested model (Figure 2) has four independent constructs as major responsibility areas of CSR (Carroll, 1991) and one dependent construct depicting the attitude of the community towards CSR activities undertaken by organizations (Calabro, 2020; Fang and Ma, 2020). Since the COVID-19 pandemic posed a great challenge to the corporate sector, organizations decided to have a paradox approach while making strategies for investment in CSR activities. To match this, health awareness, re-skilling of employees and knowledge of digitalization were put on the high-priority list of CSR activities (Mahindrakar, 2021). Considering Carroll’s model (1991) as a base for independent factors, various hypotheses have been proposed.

Philanthropic responsibility (first variable) of the proposed model comprises seven items representing the contribution of companies towards welfare of community (Carroll, 1991; Fang and Ma, 2020). Such activities include distribution of ration, free medical check-ups, health awareness programs, free medicines, distribution of smartphones to students and promotion of sanitation in the vicinity of the companies. It also includes the support extended to migrant workers in the form of distribution of masks, sanitizers and PPE kits. In addition to these activities, companies pursued several other initiatives under philanthropic responsibility for the welfare and survival of local community. Based on this responsibility, the first hypothesis has been framed as follows:

H1.

Pursuing philanthropic responsibility leads to development of positive attitude in the community.

The second construct of the model (ethical responsibility) comprises items related to moral accountability and obligations of corporate during pandemic. Ethical responsibility can be defined as a measure to protect the social and cultural standards by implementing transparent practices on humanitarian grounds (Saeed and Arshad, 2012). Incorporating ethical practices at workplace creates a sense of belongingness not only for the business but for the society as well (Vahdati et al., 2015). The principles and values also include the participatory approach of the society in dealing with their issues by maintaining public accountability and transparency (Carroll, 1991). This literary finding leads to development of the second hypothesis:

H2.

Ethical responsibility of corporate leads to development of positive attitude in the community.

Legal responsibility, as the third construct, comprises laws, provisions and regulations which are essential to govern the organizations. Since the boundaries of business operations are prescribed by the society, laws become a requisite social compulsion for the corporate (Vahdati et al., 2015). This construct consisted of items such as equal treatment with employees, respect for human rights and safe and hygienic working conditions. It is also binding for the organizations to comply with the guidelines and regulations of all labour laws (Eccles and Serafeim, 2013). Based on this, the third hypothesis is postulated as follows:

H3.

Legal responsibility of corporate leads to development of positive attitude in the community.

The fourth construct, i.e. economic responsibility, includes items which show monetary rewards earned by organizations by pursuing CSR in the right direction. In a cut-throat competitive environment, monetary rewards are essential for growth and existence for any organization. In CSR model given by Carroll (1991), the base responsibility of any organization has been the economic responsibility, and all other responsibilities depend on it. This also helps the organizations to have goodwill among the shareholders and also profitability in the long run (Saeed and Arshad, 2012). This leads to development of the fourth hypothesis.

H4.

Economic responsibility of corporate leads to development of positive attitude in the community.

Attitude has been taken as a dependent variable consisting of items which measure the opinions of community towards CSR initiatives undertaken by companies during the pandemic period. It also includes behavioural aspects of society during the crisis of pandemic (Calabro, 2020; Fang and Ma, 2020). The corporates have undertaken various social initiatives to help and improve the circumstances of unprivileged sections of the society, especially related to monetary, mental and physical health issues. These initiatives have been taken by them without having any economic motive. As per the argument, the following fifth hypothesis has been proposed:

H5.

Effective implementation of CSR responsibility leads to development of positive attitude in the community.

Research methodology

Research and Sampling Design: To evaluate the attitude of community towards CSR activities undertaken during the period of COVID-19, descriptive research design has been used. The target population for the survey was the young people from the Maharashtra, selected using purposive sampling. In India, Maharashtra is one of the leading states which reflect strong commitment and spend a lot of budget on CSR activities for the upliftment of the society. The state spent a whopping amount of Rs. 3439.30 crore during the fiscal year 2021–22 (India CSR, 2023).

There were two main reasons for selecting Maharashtra as a state for this study. First, as per the Times of India, it was the state most affected by coronavirus in India (TOI, 2020) and, moreover, a centrally located educational institutional hub, where a variety of institutions are located, e.g. medical, engineering, management, law, agriculture and social development. All these institutions constitute young people. Second, being an educational hub, the awareness level of the people of that region, especially the young, about CSR and its related activities is expected to be higher. It is also true that it was the young people who were most affected during the pandemic period, and they were compelled to learn and use different electronic gadgets for their study. This made their learning rich, including about the COVID-19. Cao et al. (2020) also found students were the most affected group of the society from pandemic. This justifies the selection of young generation as a sample from the state of Maharashtra.

Based on the calculation of Bartlett et al. (2001) formula, a sample size of 550 was chosen for analysis. Before making a full survey, a pilot survey was conducted online among 100 respondents from the targeted population. The suggestions received from the pilot survey were incorporated in the final questionnaire.

Data Collection Instrument and Technique: A structured questionnaire was used to collect the data using independent and dependent variables taken from the Carroll Pyramid Framework (1991). The items for measuring the attitude of community towards CSR activities were taken from various studies (e.g. Galbreath, 2010; Oberseder et al., 2013; Buehm, 2003). Keeping in view the pandemic situations, some items were added to the questionnaire to make it contemporary. The four main aspects of CSR activities during the time of COVID were identified from a wide study of available literature.

The proposed model has been tested using structural equation modelling through AMOS for simultaneous calculations of various causal relationships.

Respondent Profile: From the descriptive statistics, it has been found that the ratio of male to female respondents is almost equal (Table 1). Regarding educational qualification, a majority of respondents are postgraduates and fall in the age group of 21–35 years. It was also observed that a majority (68.5%) of respondents were aware of the term CSR.

Moreover, the sample of 550 fulfilled the requirements of this model to be processed in AMOS for further analysis. Also, the sample size of 550 has been considered after excluding the incomplete and unengaged responses from the respondents. The number of incomplete and unengaged responses was 16, which was excluded.

Analysis and result

The proposed model has five constructs, with each construct having more than three indicators with a commonality value of >0.5 (Hair et al., 2006).

Testing of reliability and validity

For checking the reliability of items, Cronbach alpha and construct reliability were taken into consideration. In the data set of this model (Table 2), all five constructs have an alpha value > 0.7, which confirms the suitability of data for construct and composite reliability (Hair et al., 2006).

After checking the reliability, validity of the model was checked. Each item of the questionnaire was easily understood by the respondents, confirming the content validity of the questionnaire. The construct validity has been tested by considering convergent and discriminant validity through confirmatory factor analysis (CFA). The factor loading of more than 0.5 confirms the convergent validity (Figure 3). Average variance extracted (AVE) was found to be more than 0.5 (Malhotra and Dash, 2017) (Table 2). Factor loadings of all the factors of the model were statistically significant at p-value less than 0.5. The value of square root of AVE is more than its corresponding inter-construct correlation, which shows discriminant validity for the model fit (Table 3).

Evaluation of measurement model

Figure 3 depicts the measurement model representing the values of measured variables separately for every construct. Mahalanobis test has been adopted with no outliers identified in the given model. The values of goodness and badness of fit indicators of the measurement model (Figure 3) are CFI = 0.911, TLI = 0.902, GFI = 0.839, RMR = 0.03 and RMSEA = 0.07. All values are found to be in the acceptable range and are statistically significant at p-value <0.001. The threshold value of more than 0.9 is considered as a goodness of fit indicator such as AGFI, CFI, TLI, GFI, etc. (Malhotra and Dash, 2017). Even some authors have accepted the value > 0.8 as a goodness of fit indicator (Yu and Choi, 2014). The value < 0.1 is considered as a badness of fit indicator and is represented by the calculated values of RMR and RMSEA (Hair et al., 2006).

In the model, CSR with four broad dimensions of CSR (Carroll, 1991) is taken as a second-order construct (Schumacker and Lomax, 2010).

Evaluation of a structural model

The model (Figure 4) shows that all given constructs are associated with each other. The second-order construct, i.e. CSR, is connected with the attitude in order to judge the opinion of the respondents towards CSR during the pandemic times.

The structural coefficients (Figure 4), which link the four constructs with CSR as a second-order construct, are found to be significant at p value less than 0.001. The values of goodness and badness of fit indicators of the structural model (Figure 4) are CFI = 0.908, TLI = 0.900, GFI = 0.836, RMR = 0.03 and RMSEA = 0.07, which confirm that the values are in the acceptable range and also statistically significant at p value <0.001.

The overall result shows that respondents (young generation) have positive attitude towards CSR activities undertaken by the organization during the pandemic period.

Hypothesis testing and discussion

The results of analysis and the significant relationship between four major dimensions of CSR and attitude are depicted in Table 4.

The results of this study corroborate with the findings of Narwal and Singh (2013) and (Vahdati et al., 2015). They also found the same factors in their studies. The CSR undertaken by the organizations have a significant and positive influence on the attitude of consumers (Vahdati et al., 2015). People are able to easily recognize and appreciate the activities undertaken by the organizations during pandemic for their welfare and development. Ethical responsibility has a significant role under the approach of CSR towards developing positive attitude among the respondents. Ethical responsibility having β = 0.72 at p < 0.001 indicate a significant positive influence on the attitude and lines with Hypothesis 2 (Figure 2). Saeed and Arshad (2012) have defined ethical responsibility as a measure for protecting social and cultural standards by implementing transparent practices on the humanitarian ground. The results are in line with the findings of Vahdati et al. (2015), which state that incorporating ethical practices at workplace creates a sense of belongingness. Even during COVID-19, CSR actions were motivated by utilitarianism and deontological factors (Manuel and Herron, 2020). In order to save the consumers from price extorting, companies cut down prices of product as a proactive action (Schwartz and Kay, 2023). Organizations played a key role towards COVID-19 challenges through compliance considerations and ethical practices towards employees and the community to cope up the negative effects of pandemic crisis.

The legal responsibility with β = 0.70 at p < 0.001 contributes positive approach towards attitude and support hypothesis 3 for its sustained obligations to community during the pandemic times. These laws are a requisite on the corporates as a social compulsion because the boundary of business operations is prescribed by the society (Vahdati et al., 2015). However, many a time, legal domain has been compromised due to financial pressure posed by COVID-19 pandemic such as abiding employees’ privacy, safety and human rights obligations (Schwartz and Kay, 2023). In the year 2020, the court filings and administrative complaints exceed 6,000 grievances against US-based firms during COVID-19 (Burtnette, 2021). Some faced various lawsuits for negligence towards non-enforcement of mask requirement, not sanitizing and maintaining hygiene practices at workplace and even not following compulsory social distancing norms (Adamy, 2020). In the light of novel legal issues, there is need of framing additional legal compliances to overcome sudden call for potential health emergency.

Economic and legal responsibility relies on the old social concept of required expectation, but under the new phenomenon of social responsibility, the philanthropic and ethical responsibilities are considered as an expected and desired responsibility (Carroll, 1999). So, the society expects the corporates to fulfil their ethical responsibility, which is even not ordered in the law. Boddy (2011) focuses on ethical values as principles and practices required to be followed in order to safeguard the society from any impairment. Business ethics paved a way in refining the interest of various stakeholders (Kalshoven et al., 2011). The notion of CSR rests on moral practices.

Deigh et al. (2016) state that philanthropic initiatives are considered a preferred and desired activity by the community under CSR. Schwartz and Kay (2023) observed that a huge amount has been invested by the organizations in the philanthropic activities during the pandemic period. The philanthropic responsibility (β = 0.64; p < 0.001) also contributes in shaping the positive attitude of the community towards CSR. This lines with Hypothesis 1 and substantiates with the outcome of Bala and Singh (2014). They are also of the opinion that in India, private as well as public sector companies are taking care of their employees through various welfare activities. In addition to extending help to the needy people during pandemic, many organizations have also made noticeable contribution to the Pradhan Mantri Care Fund. Many organizations extended their hands to underprivileged classes and supported migrant workers (Ramya and Baral, 2021; Dwivedi and Kumar, 2021). According to a US report of 2021 by Candid and Centre for Disaster Philanthropy, more than 20 billion dollars were awarded during pandemic crisis towards philanthropic activities around the world. Out of this, 44% of funding was contributed by the corporate sector (Maurrasse, 2021). Some organizations took philanthropic activities during COVID-19 as an opportunity to stand apart from their competitors and to enhance their goodwill among employees, customers and communities (Chen et al., 2022). Even the family-owned firms also participated in such philanthropic activities during COVID-19 pandemic.

The respondents least preferred the economic responsibility with β = 0.45 at p < 0.001 as compared to other activities, which supports Hypothesis 4. The early phase of pandemic had a severe influence on the corporate revenues besides on the world economy. Various studies show the undesirable impression of pandemic on the business performance of small- and medium-sized organizations, especially tourism, manufacturing and airline industries, resulting in unemployment and layoffs (Rababah et al., 2020; Baker et al., 2020). Coronavirus challenged the corporates and brought CSR to the forefront by re-adjusting their CSR policies. The renaissance of CSR in India has an affirmative influence on a firm’s value creation. It acts as a shield for companies during COVID-19 pandemic crisis. Arora et al. (2021) explored the positive relation between the CSR activities and shareholder value during COVID-19 among Indian firms.

A positive relationship between CSR and stock returns has also been recorded during the pandemic-related crisis (Bae et al., 2021). The time frame of global crisis has shifted the CSR approach towards the activities which proved beneficial in the operating segments of the companies (Koli and Mehta, 2020). It seems flimsy that commercial firms should be exempted from social responsibilities because of their poor financial performance. Yet, a wide set of possible CSR initiatives pursued despite previously mentioned factors like uncertainty and financial pressure that might have rationally impacted the business decisions.

The CSR is like an umbrella and comprises various other initiatives for the welfare and development of society. It has also been observed that organizations became more subtle towards the needs of local community during the pandemic time. This confirms the existence of the age-old traditional concept of dharma in Indian organizations, which works as a supporter and driver of CSR (Dhanesh, 2015). Overall, it was found that respondents, especially young generation, developed positive attitude (β = 0.63; p < 0.001) towards the activities pursued by organizations under CSR during pandemic period. This supports hypothesis 5.

The companies think deeply and act wisely while framing CSR practices during pandemic phase. The effective implementation of activities is very crucial to create a general balance in the economic and social arena of the nation. The companies have opted a strategic approach towards CSR and shifted their orientation from pre-COVID contribution to tackle serious global social and environmental encounters by incorporating various measures. The marketing skills are perfectly applied to surpass the feeling of anxiety, animosity and inbuilt positive emotions among community (He and Harris, 2020). The main sectors receiving maximum CSR fund are health, education, rural development and environmental sustainability (Choudhary et al., 2020). The pandemic has affected each individual in a different way. Pradhan et al. (2023) revealed the negative impact of COVID-19 in the form of stress on the employee’s psychological well-being and affecting their performance. The alarming spread rate of COVID-19 copiously impacted society and the organizations, posing threats to human physical and psychological well-being. There has been a conscious attempt to keep the pace of CSR legislation in India aligned with Sustainable Development Goals. The activities given under Schedule VII of the Companies Act 2013 are intended to be interpreted liberally with the focus on ensuring altogether sustainable development of the nation.

Major outcomes of the study

1. People are now better able to recognize and appreciate the activities undertaken by the organizations during pandemic for their welfare and development.

2. Ethical responsibility, as part of CSR, shown by the organizations developed a positive and significant positive attitude among the respondents.

3. The philanthropic responsibility contributes significantly in shaping the positive attitude of the community towards CSR. It was also found that in India, private as well as public sector companies are taking care of their employees through different welfare activities.

4. COVID-19 pandemic challenged the corporates and brought CSR to the forefront by re-adjusting their CSR policies. The renaissance of CSR in India has affirmative influence on a firm’s value creation.

5. The young generation developed positive attitude towards the CSR activities pursued by organizations during pandemic period.

6. The changing behaviour of organizations, during crisis period, has significantly influenced the attitude of the society

7. Organizations have started honestly reflecting CSR expenditure in their balance sheets; earlier it was not so. Moreover, the amendment in the Act has made it compulsory for the organizations to do it honestly and get it approved from the society. This has helped in image building of the organizations in real time.

Conclusion

The COVID-19 crisis has opened the eyes of corporate towards human values and garnered negative approach towards materialism. The challenges developed during the pandemic period have put stress on the corporates to meet daily needs of their employees, including social and economic needs. The outcomes of the study prove that CSR has substantial influence on the attitude of people. These results corroborate with the results of Narwal and Singh (2013) and Vahdati et al. (2015). Out of the four independent factors (Carroll, 1991) taken in this study, ethical responsibility has been found to have significant influence on the attitude of the community, especially young people. Ethical practices by the organizations act as an instrument to protect the social and cultural dimensions (Saeed and Arshad, 2012). This validates the findings of Vahdati et al. (2015) who claimed that ethical practices are very crucial for creating a sense of belongingness, both for employees and the society. Another aspect of CSR, i.e. legal responsibility, was also found to contribute significantly in creating a positive attitude among the society. Since organizations operate in close proximity of the society, it becomes mandatory for them to follow all norms of the society, may be voluntarily or by compulsion (Vahdati et al., 2015).

Another aspect of CSR, i.e. economic and philanthropic activities, was also found to contribute significantly in influencing the attitude of the society. Society expects the organizations to carry out activities which positively influence their socio-economic status (Kalshoven et al., 2011). Even the customer’s brand preferences also get enhanced by the CSR performance. The main CSR domains, i.e. environment, society and stakeholders, have positively influenced the brand preference among consumers in different degrees (Liu et al., 2014). The present study found that organizations, private as well as public, spend lots of money on the activities related to philanthropic responsibility, and it increased during the pandemic period. This can be supported by the findings of Bala and Singh (2014). Many companies contributed not only “resources” under CSR but also “ideas” focusing how best the resources can be utilized in light of COVID-19 crisis. In light of global pandemic crisis, adequate efforts were made towards corporate ethical and philanthropic activities. For the benefit of customers, even the way of working was changed during the pandemic period. This benefited not only the employees and customers but the community too.

At the end, it can be concluded that the importance of CSR has been felt immensely and implemented to a great extent, especially during the pandemic period. It can also be said that organizations became more responsible towards the society during the period of crisis, when it needed the most. This also gives a hint that these organizations shall handle such crises, if they arise in future. It can be said that the changing behaviour of organizations, during crisis period, has really influenced the attitude of the society. Although the respondents of this study were the young generation, still the outcomes are equally applicable to the common people.

Social implications of the research

This research has brought out many facts about the responsibility of the corporates towards the society, especially after the amendment in Sec 135 of Companies Act 2013. Earlier, most of the organizations were falsely recording the CSR expenditure in their balance sheets without actually spending it, but the amendment has made it compulsory for the organizations to follow it honestly and get approval from the society. The pandemic period gave opportunity to the society to evaluate the organizations on these parameters and to make their opinion about them in real time. Therefore, it can be said that the pandemic has made the society aware and significantly influenced their attitude towards the activities carried out by the organization operating in their neighbourhood. This shall also help the organizations feeling a pressure in future while planning and implementing the activities under CSR.

Policy implications

The findings of the study may help the organizations to plan their activities in line with the amendments made time to time. This shall also help the regulating agencies to monitor and catch the wrongdoers and take appropriate action. Findings of such studies, based on public opinion, can also help the governments to make further amendments, time to time, in related acts. It can also be said that with the involvement of public/society, more transparency can be brought in the functioning of the organizations, especially in the context of CSR.

Limitations

Obviously all issues cannot be covered in one research article, so is this article. In addition to many good outcomes, this article has some limitations. First, the study is limited towards examining the attitude of community towards CSR, especially young generation. Second, it is difficult to say whether outcomes of this study can be generalized for such other potential global crisis. Third, the study is based on Carroll’s “CSR Pyramid” when other such model and approaches could be available to analyse the impact of COVID-19-related CSR initiatives. Last, this study has been conducted only in the state of Maharashtra, and results may not be applicable to other states as well as other countries.

Future research directions

It has been observed that organizational commitment to CSR initiatives vary widely. Therefore, the way how to identify the areas for investment can be explored in further studies. Since the behaviour of executives of any organization is crucial, a study can be conducted to understand and analyse the behaviour of executives towards prioritizing the CSR initiatives during COVID-19 pandemic. Studies can also be conducted to understand why so much of efforts were put in towards CSR initiative. Was it based on ethical motivation or merely the economic objectives? Towards the end, it is suggested that a comparative analysis can also be done to ascertain the community perception towards CSR initiatives during, pre and post COVID-19 pandemic.

Figures

Figure 1

Companies CSR spending

Figure 2

Proposed model

Figure 3

Measurement model (compiled by authors)

Figure 4

Structural model (compiled by authors)

Table 1

Demographic profile of the respondents

	Frequency	Percentage
Gender
Female	264	48
Male	286	52
Qualification
Bachelor degree	187	34
Master degree	363	66
Awareness of CSR
Yes	377	68.5
No	173	31.5

Source(s): Compiled by authors

Table 2

Reliability and validity of constructs

Construct	No. of items	Cronbach’s alpha	Construct reliability	AVE
Attitude	5	0.829	0.837	0.510
Philanthropic responsibility	7	0.931	0.933	0.667
Ethical responsibility	7	0.938	0.939	0.688
Legal responsibility	6	0.893	0.897	0.595
Economic responsibility	5	0.938	0.939	0.756

Source(s): Compiled by authors

Table 3

Discriminant validity of the measurement model

	ETH.R	PHI.R	LEG.R	ECO.R	ATTI
ETH.R	0.829
PHI.R	0.482	0.817
LEG.R	0.569	0.373	0.771
ECO.R	0.295	0.283	0.374	0.870
ATTI	0.396	0.526	0.429	0.296	0.714

Note(s): The values in italics show the square root of AVE

Source(s): Compiled by authors

Table 4

Path coefficient and its significance for model

Magnitudes	Path	Common construct	Standardized regression weight	P-value	Analysis result
Philanthropic responsibility	←	CSR	0.649	***	H1 is supported (significant)
Ethical responsibility	←	CSR	0.728	***	H2 is supported (significant)
Legal responsibility	←	CSR	0.706	***	H3 is supported (significant)
Economic responsibility	←	CSR	0.457	***	H4 is supported (significant)
Attitude	←	CSR	0.638	***	H5 is supported (significant)

Note(s): *** denotes value statistically significant at 0.001 level

Source(s): Compiled by authors

Statement and declaration: We affirm that the article titled ‘Corporate Social Responsibility and COVID-19 Pandemic: An Analytical View of Community Attitude’ is our original contribution and no portion of it has been copied from any other source, and it would not be sent elsewhere for publication. Further, there is no conflict of interest from both the authors. The authors have not received any financial funding for the given work.