Corporate social responsibility and its effect on image and reputation: The case of L’Oréal and its acquisition of The Body Shop

Abstract

This paper studies the effect of Corporate Social Responsibility (CSR) on image and reputation in the case of L’Oréal and its acquisition of The Body Shop. L’Oréal was suffering from negative headlines claiming that its products were animal tested and they expected that the acquisition of The Body Shop in 2006 would change this image. This study investigates whether CSR practices of The Body Shop helped L’Oréal to rebound from the negative headings. Using a sample of 321 respondents for The Body Shop and a sample of 289 respondents for L’Oréal, it is concluded that CSR is an important factor for a company’s success since the results show that CSR campaigns have a statistically significant impact on a company’s reputation and image. Since a CSR strategy is the key to success, this paper ends with recommendations to successfully implement CSR strategies.