What is Corporate Social Responsibility? - InnoTrain CSR

Strategic tools for CSR
4.6. CSR and pricing policy
In short
Consumers can save costs and at the same time disburden the environment by
considering energy-efficient products and a sustainable utilisation. This
savings factor analogously applies to the energy efficiency of companies.
However, Corporate Social Responsibility (CSR) in the company can also result
in higher costs and investments which are generally difficult to identify for
consumers. The boom of biological produce is an example that illustrates how
higher standards can be made visible and successfully communicated. In the
especially cost-intensive competition of the food industry, an increasing
number of consumers are willing to pay more for higher standards. As well,
consumers can easily recognise what the "fair" price of fairtrade products
represents. According to estimates, sustainability in Germany is expected to
become the motive to buy for 20 % of the market volume by 2020.
Learning targets
� Reflect the willingness to pay more for CSR using the examples of biological
produce and transfair products.
CSR learning contents
Only when consumers know and value the Corporate Social Responsibility (CSR) of
companies will companies be able to pass on higher financial expenses for CSR
("sustainability costs") with the sales prices. Therefore, companies mainly need to
provide corresponding information to bring across the complex and global
correlations of CSR to the target groups. In some CSR-related areas such as for
biological produce or fair trade products consumers know what the added value is
they are paying for.
The willingness to pay more for fairtrade products has grown significantly in recent
years. Sales are rising globally by an average of 40 % every year. In 2009, the global
sale of fairtrade products was close to 3.4 billion Euro. For the producers in
developing countries, fairtrade means that they are paid a fair share of the sales price
guaranteed in advance. At the end of 2009, more than 800 peasant organisations
and plantations globally were working with the fairtrade standards. An additional 200
were in the process of becoming certified at that point in time. Approximately 70
percent of products originate from peasant organisations and 30 percent from
The project "InnoTrain CSR" is organized by GILDE GmbH and has been funded with support from the European Commission. This publication reflects the
views only of the author, and the Commission cannot be held responsible for any use which may be made of the information contained therein. 12/2010
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