Browsing by Author "Nel, Kara"

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    Assessing the role that perception of corporate identity and corporate social responsibility practices play in the investment intention of potential individual investors
    (Stellenbosch : Stellenbosch University, 2020-12) Nel, Kara; Erasmus, Pierre D.; Mans-Kemp, Nadia; Stellenbosch University. Faculty of Economic and Management Sciences. Dept. of Business Management.
    ENGLISH ABSTRACT: Worldwide, an increasing number of companies are using corporate social responsibility (CSR) activities as a business tool to promote financial returns, cultivate a favourable reputation, and enhance workforce productivity. Given the growing importance of sound CSR practices and considerable corporate investment in CSR activities, it is essential to understand how these activities impact on decisions made by different stakeholders. Previous researchers mainly focused on the effects of CSR on customers’ intent to purchase. Very limited research has been conducted to understand the effect of CSR on other key stakeholders, including investors. While traditional finance theories are based on the assumption that rational investors evaluate investment decisions purely on risk-return considerations, behavioural finance theory proposes that investors’ attitudes towards a particular firm could influence their decision to invest in the firm. This study was undertaken to address the identified knowledge gap by assessing the role that perception of corporate identity and CSR practices play in the investment intention of potential individual investors, by adapting a dual-process model that was developed based on consumer behavioural constructs. The first part of the model accounted for the bond between an investor and the selected company (Nedbank) in terms of corporate identity. The second part of the model incorporated investors’ perceptions of the specific CSR practices of Nedbank. The model was assessed by an electronic questionnaire distributed to all students registered at Stellenbosch University during the second semester of 2019. In response to this invitation, 1 649 usable questionnaires were received. The descriptive statistics revealed that the respondents had a positive perception of Nedbank’s corporate identity. They perceived Nedbank to perform better on the corporate expertise than the corporate values dimension. Although the respondents had a very favourable attitude towards CSR initiatives in general, they were concerned that Nedbank performed poorly regarding some of their CSR practices. The results furthermore indicated that the respondents were not really familiar with Nedbank’s CSR practices. The partial least square structural equation modelling inferential analysis indicated that discretionary and relational CSR practices had more predictive relevance towards corporate values than corporate expertise, while moral CSR practices strongly predicted the perception of both dimensions. In turn, the perception of both corporate values and corporate expertise strongly predicted investment intention. Although corporate expertise and corporate values acted as mediators between all the types of CSR practices and investment intention, the significance was weak. The effect of CSR familiarity on investment intention was neither mediated by corporate values nor corporate expertise. The results revealed that CSR familiarity had a strong positive direct effect on investment intention. Based on the results, the researcher recommends that CSR programmes should effectively be communicated and promoted to investors as it plays a significant role in their investment decision-making. Furthermore, companies are encouraged to commence their CSR journey by addressing moral CSR practices as it was shown to be the most beneficial in enhancing potential investors’ perceptions of corporate identity and, therefore, their investment intention. Companies should continuously focus on their CSR behaviour to attract potential investors.