How CSR perception relates to brand loyalty: the mediating role of perceived greenwashing and the moderating role of consumer scepticism

Abstract

Corporate Social Responsibility (CSR) has become an essential strategic tool for companies to build consumer relationships and gain a competitive advantage. However, rising doubts about the authenticity of corporate sustainability initiatives have called into question the effectiveness of CSR in fostering long-term brand loyalty. The present study examined the association between CSR perception and brand loyalty, with perceived greenwashing as the mediating variable and consumer scepticism as the moderating variable, in the Indian Fast Moving Consumer Goods (FMCG) sector. The study proposes a moderated mediation framework, grounded in Stakeholder, Signalling, and Attribution theories, that explains how consumers interpret CSR actions and translate these interpretations into loyalty outcomes. The study draws on data from 588 FMCG consumers from the Indian states of West Bengal and Odisha and uses Partial Least Squares Structural Equation Modelling. The findings indicate that CSR perception is significantly associated with perceived greenwashing and brand loyalty. Perceived greenwashing partially mediates the relationship between CSR perception and brand loyalty, indicating that consumers evaluate the authenticity of CSR initiatives when forming brand loyalty judgements. Consumer scepticism is positively associated with perceived greenwashing and negatively associated with brand loyalty. Consumer scepticism significantly moderates the relationship between CSR perception and brand loyalty. The study contributes to the CSR and branding literature by identifying perceived greenwashing as a key psychological mechanism linking CSR perception and loyalty outcomes and highlighting consumer scepticism as an important boundary condition affecting CSR effectiveness in the Indian FMCG context.