The influence of corporate social responsibility on the loyalty of customers depositing money at Vietnamese commercial banks

Chapter 3: Actual situation of deposit mobilization and corporate social responsibility of Vietnamese commercial banks in Ho Chi Minh City. Chapter 4: Research model of the influence of corporate social responsibility on the loyalty of depositors at Vietnamese commercial banks in Ho Chi Minh City.

Chapter 5: Conclusion & some suggestions.

CHAPTER 2: THEORETICAL OVERVIEW AND PRIVATE RESEARCH ON CORPORATE SOCIAL RESPONSIBILITIES AND CUSTOMERS' Loyalty.

2.1 Corporate Social Responsibility

2.1.1 Concept of corporate social responsibility

Corporate Social Responsibility (CSR) is a topic of great interest at business seminars and forums today. The origins of CSR can be traced back to developed countries. The person who is considered to be the father of the concept of CSR is Bowen. Bowen (1953) said that corporate social responsibility is the pursuit of policies, decisions, and actions according to objectivity and social value.

Following this idea, McGuire (1963) gave a definition of corporate social responsibility as the company's not only economic and legal obligations, but also other responsibilities to with society. This is the part of responsibility that must be extended and transcended other obligations and obligations.

Carrol (1979) generalized corporate social responsibility into four main groups. CSR is a tool that “includes economic, legal, ethical and social contribution expectations from organizations at a given time.” Carrol’s concept is broader and should be studied more. used to measure the concept of CSR.CSR includes:

+ Economic responsibility: ie businesses must operate profitably , produce goods and services for society.

+ Liability: that is, the enterprise pursues its economic goals within the framework of compliance with the provisions of domestic and international laws.

+ Ethical responsibility: businesses follow social norms and rules that have not yet been codified into legal documents. Ethical responsibility is seen as embodying standards, norms, and expectations that reflect the concerns of customers, employees, shareholders and other stakeholders.

Charitable responsibility: businesses have a responsibility to actively participate in activities or programs that promote human welfare.

Table 2.1 Some definitions of CSR over time

Author	Define
Bowen (1953)	CSR is the pursuit of policies, decisions, and practices based on objectivity and social value.
Frederick (1960)	CSR means that entrepreneurs should monitor that the business is responsive to public desires, the means of production of the economy will enhance socioeconomic well-being, resources are used for larger social goals that are not merely the interests of individuals individuals and businesses.
McGuire (1963).	Corporate social responsibility is the company's not only economic obligations and compliance with the provisions of the law, but also other responsibilities towards society. This is the responsibility section that must be opened wide and beyond other obligations and obligations.
Johnson (1971)	CSR is a company whose managers balance the diversity of operational goals, instead of striving for greater profits for shareholders, a responsible business must also take into account its suppliers, representatives, and suppliers. management, staff, community local and national.
Carrol (1979)	CSR includes four main groups, namely economic, legal, ethical and social contribution expectations from organizations at a given time. some point.
World Business Council for Sustainable Development (1999)	CSR is an enterprise's commitment to operate ethically and contribute to economic development while improving the quality of life of its workforce and their families. as of the local community and society at large.
BSR (2000)	An enterprise has CSR when making business decisions

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	business related to ethical values, compliance with legal requirements legislation and prospects for people, communities and the environment.
EU (2001)	CSR is a business taking responsibility for its impact on all its stakeholders. It is a business commitment to behave fairly and responsibly and contribute to economic development while improving the quality of life of workers and their families. as of the local community and society at large.
Lea (2002)	CSR can be defined as the combination of social and environmental concerns in business operations, including relationships with related parties.
BSR (2003)	CSR is business success by upholding ethical values and respecting people, communities and natural environment.
Nordisk (2003)	CSR is concerned with people, they are employees, customers, local communities and global society. Social responsibility is a requirement in business.

Source: Low (2016) and author's synthesis Thus, there are many different concepts of CSR, but in general, these concepts are all geared towards responsible business activities for stakeholders including including Mazurkiewicz (2004) argues that there are differences in the concept of corporate social responsibility in the private sector, public sector or social organizations. festival. But look

In general, CSR usually includes:

+ Responsible business operations to internal stakeholders (shareholders, employees, customers, suppliers).

+ Comply with local, state and national regulations in business activities.

+ business activities that are meaningful to society and the global community.

2.1.2 Approach to corporate social responsibility

2.1.2.1 Benefit-cost-oriented approach

In this approach, businesses will calculate investment costs and efforts in implementing corporate social responsibility activities. In addition, they will measure the impact of this CSR on businesses through calculating financial indicators related to operational performance (ROE, ROI, ROA), evaluating market efficiency (sales, growth rate, company development, company reputation).

2.1.2.2 Stakeholder-oriented approach

Corporate social responsibility activities are studied using a stakeholder-oriented approach, also known as multilateral theory. Multilateralism theory proposes that business activities not only satisfy shareholders but also stakeholders such as customers and suppliers (Clarkson, 1995, quoted in Nguyen Hong Ha, 2016). This is the research direction most approached by many authors.

CSR researchers tend to link CSR with other related topics such as stakeholder theory, theory of business ethics, corporate nationality, and social performance theory of enterprises (CSP). ) and sustainable development. Perrini (2005) in a study found eight groups of people involved, namely: (1) Human resources; (2) Shareholders; (3) Customers; (4) Suppliers; (5) Financial partners; (6) Public authorities; (7) Community; (8) Environment. Perrini believes that there are many topics related to customer-oriented CSR. In this study, the author builds a customer-oriented concept of CSR, specifically analyzing its influence on customer loyalty. This orientation focuses on the influence of corporate social responsibility on customer satisfaction, trust, customer loyalty in using banking products and services for banks. According to McDonald and Rundle-Thiele (2008), CSR is customer-oriented

are often valued higher than community-oriented CSR because customers often focus on personal interests over consideration of community interests.

Table 2.2: Stakeholder-oriented CSR approach

Stakeholders	Topics approaching CSR
(1) Human Resources	Staff composition; income; employee equality; educate; work time; salary programs; permission mode; employee benefits; labor relations; internal communications; occupational health and safety; employee satisfaction; workers' rights motion; Disciplinary action and litigation
(2) Shareholders	Equity; shareholder; performance evaluation; corporate governance; benefits and services; investment relations.
(3) Customers	Market development; customer loyalty; customer satisfaction; products/services; product information; Ethical and environmental product services; main promotional book.
(4) Houses provide	Supplier management policy; Contract conditions
(5) Finance partners main	Relationship with banks, insurance companies, financial institutions.
(6) Agencies the right	Taxes and corporate obligations; relations with public authorities; comply with the law; grant or sponsor
(7) Community	Relations with the media; direct contributions to various fields; commitments of related parties; relations with the community; Anti-corruption
(8) Environment	Energy consumption; amount of waste, exhaust gas; lip strategy school and community relations.

Source: Perrini (2005)

2.1.3 Customer-oriented corporate social responsibility

Customer-oriented CSR also includes four components namely economic responsibility, legal responsibility, ethical responsibility and charitable responsibility. According to Caroll (1979), these components have a decreasing level for enterprises pursuing customer-oriented CSR.

Firstly, economic responsibility, it is not a profitable operation for the community and society, but this orientation emphasizes that banks must offer deposit products that must be associated with the interests of customers, meeting the needs of customers combined with information, product prices are transparent, clear, consistent with the quality of that service, products and services must bring the most satisfaction and satisfaction to customers. customer.

Second, the legal responsibility, when the bank implements customer-oriented CSR on the basis of respecting national and local legal regulations in the process of serving customers. Normally, the bank's business activities must comply with the laws of the state as well as the internal regulations of the bank.

Third, the ethical responsibility for customer-oriented CSR directs ethical values to depositors directly as banks must treat customers fairly, transparently and honestly in the process of interaction. between the bank and the customer.

Fourth, philanthropic responsibility. The bank performs well its charitable responsibility by combining with customers in community and social programs.

Customer-oriented corporate social responsibility assumes that corporate strategies focus on customer satisfaction, satisfaction. Businesses seek to profit by providing better, more valuable products and services to customers. According to Carroll (1979), customer-oriented CSR shows that economic responsibility is the core of business activities, businesses must focus on increasing economic values for customers such as the price of products and services. services must be appropriate, commensurate with the quality, promotional programs

service provision must be responsible to the community, the environment,... Companies implementing a customer-oriented CSR strategy closely associate marketing and marketing activities with other activities. CSR of enterprises. CSR performance is calculated by tracking customers' perceptions of charity activities, community activities and especially customers' perceptions of the direct benefits that customers receive from the product. of the business, the customer's perception of the customer's attitude, communication and behavior between the customer and the bank and consider its influence on customer satisfaction and customer loyalty. Rashid (2010, cited Rashid et al., 2013) in a study proved that banking is one of the four sectors significantly affected by customer-oriented CSR. In this study, The concept of CSR is customer-oriented. By consideration, the bank is interested in the direct interests of customers through product information; price or cost of a product or service; preferential policies, promotions; customer care, communication, treatment, as well as social activities that the bank has carried out for the community connected with customers.

Customer-oriented social responsibility

Economic Responsibilities:

- Customer needs and interests.

- Information, product prices

- Satisfaction and satisfaction for customers.

Legal responsibility:

- to respect

Ethical Responsibilities:

- public treatment

Good Responsibilities:

from

national laws

family law,

equal, white, real

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with

- combined with

guests in

rows of

customer.

programme

social community.

copper,

local.

- NH's internal regulations.

Figure 2.1 Customer-oriented CSR approach

2.1.4 Consequences of corporate social responsibility

In the banking sector, customer-oriented CSR studies have proven that CSR will impact customer satisfaction, customer trust, customer emotions, customer identification, purchase intention In turn, intention to introduce products and services to others, reputation, image of the business, etc. Inheriting the results of previous studies, in this study, the author focuses on analyzing 4 systems. The result is customer satisfaction, customer trust, customer emotion, customer identity.

2.1.4.1 Customer satisfaction

Yi (1990) defines customer satisfaction with a product or service as the expectations of continuing to purchase the product and not boycotting it. If the actual value received is higher than the value spent, the product receives a positive support effect. Satisfaction level is higher when customers have to spend less but receive high utility benefits (Jamal & Naser, 2002).

Oliver (1999) argues that customer satisfaction is an enjoyable satisfaction. That is, customers feel that the behavior they are performing meets their own needs, wants, and goals, and completing this behavior helps them feel happy and interesting.

Sayani (2015) identified three dimensions of satisfaction in the service industry: satisfactory interaction with employees, satisfaction with core services, and satisfaction with the organization.

Many academic studies demonstrate a direct link between CSR and customer satisfaction, showing that corporate CSR initiatives increase customer satisfaction (McDonald and Rundle-Thiele, 2008; Luo and Bhattacharya, 2009; Martínez et al., 2013; Pérez and Bosque, 2015a), that is, when this business implements CSR well, it will make customers feel more satisfied.

2.1.4.2 Customer's trust

Customer trust is defined as the belief that the product or service they receive can stay with them for a long time (Crosby et al., 1990).

Trust in a service provider is closely related to that business' perception of integrity, honesty, confidentiality, and ethics. Customer trust is a key factor in building and maintaining long-term customer relationships (Coulter & Coulter, 2002). According to Martínez & Bosque (2013), by including ethical principles in their operations, banks can enhance the trust of all stakeholders, including customers. The perception that a bank is ethical and socially responsible will enhance the bank's image, thereby increasing customer confidence in the bank.

2.1.4.3 Emotions of customers

In psychology, emotion is a concept that gets more attention when doing research related to organizational behavior. It is impossible to separate human emotions from any natural activity (Subba and Rao, 2016). Currently, there is no exact definition. However, emotions are mainly described by some psychologists as how a person feels about something. More simply, emotions are defined as an individual's subjective feelings that can lead to physiological changes (Subba and Rao, 2016).

Emotions are classified into two categories: positive emotions and negative emotions. This emotion is associated with one's own experience of a certain problem or activity. In the banking sector, customers' emotions can come from the experience and use of banking services. They feel satisfied about products, services, employees, etc. are positive emotions. Conversely, when a customer feels uncomfortable when dealing with a bank, they disagree with the bank's regulations, etc., which can create negative emotions.

According to Chaudhuri & Holbrook (2001), customer emotions are related to the ability of businesses to create positive emotional responses in customers during customer-business interactions.

Cognitive theory of emotions (Tsal, 1985, cited in Pérez and Bosque, 2015b) suggests that customer emotions do not arise unless there is an assessment of perception.

previously awake. When customers are aware of CSR, it will directly affect customers' emotions. As a result, the company is rated positively.

2.1.4.4 Customer identification

Customer identification refers to the psychological state of connection or close relationship between customers and businesses (Pérez and Bosque, 2015a). Based on social identity theory (Hornsey, 2008), customer identification helps to explain the reasons and incentives for individuals to stick with businesses. This occurs through a process of cognitive classification, whereby an individual defines his or her position as a member of an organization by reinforcing similarities with other members and differences with other members. object is not a member.

When corporate social responsibility is properly implemented, it increases customer identification (Salmones et al., 2009; Pérez & Bosque, 2015a), the close relationship between customers and banks. . Customers consider themselves as a member of the bank. This is considered one of the very important consequences of corporate social responsibility.

2.2 Customer loyalty

2.2.1 The concept of customer loyalty

Experience shows that identifying and measuring brand loyalty is extremely difficult, especially in the service sector (Yang and Peterson, 2004).

Oliver (1999) defines loyalty as a deeply held commitment to repeat purchase or recommend a product or service to others in the future, even if they are influenced by the effects to be able to repurchase or recommend a product or service. switch to another brand. Similarly, in 2010, Afsar et al in their study defined customer loyalty to a bank as the continued support of products and services over time and will recommend it when possible for anyone else. Meanwhile, Beerli et al. (2004) argue that loyalty can be understood as the repeat buying behavior on a regular basis or

increase the volume of goods and services of the same brand. Several studies have shown that loyalty is more important than brand.

Thus, in general, the concept of customer loyalty is directed to the fact that customers will repeat the use of products or services of a certain brand or business and will recommend products and services. that is for others to use.

According to Oliver (1999), customer loyalty goes through four stages, including: (1) perceived loyalty: this is the first stage of loyalty. In this stage is known as perceived loyalty or loyalty based solely on brand trust. Through knowledge, referrals, experiences, customers have used products/services more than others.

(2) emotional loyalty: loyalty is based on satisfaction, satisfied with the product after using it a few times, ie a large degree of satisfaction will lead to loyalty.

(3) Loyalty intention: the customer intends to continue purchasing the product or service in the next visit.

(4) action loyalty: the intention to buy will become reality when the customer buys again in the future.

In this study, when it comes to customer loyalty, it means that customers who have chosen to make a deposit transaction with a bank will continue to transact with that bank every time they need to use the service. bank and will gladly recommend that service, that bank to everyone around. Moreover, they consider this bank to be the first choice even though they know they can choose another better bank.

2.2.2 Measuring loyalty

Previous studies have measured customer loyalty in three ways: behavioral loyalty, attitudinal loyalty, and a combination of behavioral and attitudinal loyalty. The combined approach of behavioral loyalty and attitudinal loyalty is commonly used to measure loyalty.

(1) Behavioral loyalty

Raj & Moberg (1997) in a study suggested that behavioral loyalty is associated with the definition of behavior, that is, based on the number of purchases for a particular brand. Brand loyalty is measured by tracking the frequency of purchases or brand switching for a product. Many researchers believe that repeat purchases can confirm consumer loyalty to that product or brand. Gremler & Brown (1996) argue that behavioral loyalty is the fact that customers are biased in choosing a certain product or service among many products or services, or simply that it is a repeat purchase of a particular product or service. Any product. In the same opinion, Srinivasan (2002) argues that behavioral loyalty is based on inertia, i.e. a product, brand is purchased, habitual use just because it saves time hesitating to switch to another brand. This is also the disadvantage when only considering loyalty if only in terms of behavior. Behavioral loyalty cannot fully explain the underlying reasons for loyalty, the attitude loyalty approach considers consumer preferences and intentions to play an important role in determining loyalty. Fort.

(2) Loyalty attitude

Attitudinal loyalty is also considered to be the level of psychological attachment of customers and excessive support for products and brands. Attitude loyalty represents a psychological constraint including willingness to repurchase favorite products, positive word-of-mouth intention through willingness to recommend others and encourage others to use them. use of a company's products and services (Rundle-Thiele, 2005).

Chaudhuri and Holbrook (2001) defined attitudinal loyalty as a consumer's degree of commitment towards a brand or product or service. Attitude loyalty often includes: positive word-of-mouth about the product; introduce services and brands to others; protect the reputation of the service provider.

However, attitudinal loyalty is inclined towards psychology, sometimes buying behavior is based only on excessive liking for that product or brand.

If you don't make a purchase or don't buy it again, this loyalty will also make no sense for the business.

(3) Mixed Loyalty

Mixed loyalty is a combination of behavioral loyalty and attitudinal loyalty, that is, a combination of conscious purchasing behavior and positive attitudes towards brands and products.

Dick and Basu (1994) developed a theoretical framework for customer loyalty by combining both measures of attitudinal loyalty and behavioral loyalty.

Table 2.3: Relationship between attitude and buying behavior

		Repeat purchase behavior
		High	Short
Related attitude	High	Sustainable loyalty: High repeat purchase behavior and relatively high attitude are the ultimate goal for marketers.	Potential Loyalty: a strong preference or attitude towards the product/brand, but low repeat purchases due to some externalities.
Related attitude	Short	Fake loyalty: Repeat buying behavior with low relevancy attitude, possibly due to location convenient.	Unfaithful: Do not repeat buying behavior

Source: Dick and Basu (1994)

2.2.3 Factors affecting customer loyalty

Loyalty studies often approach in two main directions, one is to analyze the premises affecting customer loyalty to a certain product or service or brand. Antecedent factors affecting customer loyalty can be mentioned as customer satisfaction (Beerli et al., 2004; Afsar et al., 2010; Sayani, 2014), switching costs (Beerli et al., 2004; Afsar et al., 2010; Sayani, 2014). Bearden and Teel, 1983; Beerli et al., 2004), perceived value or service quality

(Afsar et al., 2010), beliefs, commitments (Afsar et al., 2010), or personal values (Pham Ngoc Thuy and Le Nguyen Hau, 2010; Henrique, 2015). The second approach is to analyze the consequences of a certain factor, and the impact of those consequences on customer loyalty. These consequences are seen as antecedents of loyalty. In this study, the author analyzes the consequences that corporate social responsibility brings and its influence on loyalty. The four consequences that the author considers are customer satisfaction, customer trust, customer emotion, and customer identification.

2.2.3.1 Customer satisfaction

Customer satisfaction is a premise of customer loyalty. In today's fiercely competitive market, customer satisfaction can be seen as a significant factor affecting the performance of a bank. Especially, for depositing customers, now the deposit products of banks are very diverse, which means that if a customer feels unsatisfied with the service or the bank he is using, it is very maybe they are willing to switch to another bank. Customer satisfaction will help build relationships with customers so that the bank can maintain operations on a regular and stable basis.

Customer satisfaction can be formed from personal experiences when dealing with the bank, from the opinions of relatives and friends, information and promises of bank staff and competitors. compete. If customers think that the cost is more than it is useful, initially try to compromise with banks, but at some point they will decide not to use the service anymore and will switch to other banks. other goods. Today, there are many alternatives for customers and the cost of switching is also low, these factors make it possible for customers to switch whenever they feel unsatisfied. Customer responses play a pivotal role in the bank's customer satisfaction relationship. Many studies indicate that there is a positive relationship between customer satisfaction and loyalty.