Doing good together: Do cross-sector CSR engagements in the oil industry pay off?

The importance of environmental sustainability keeps rising, and stakeholders increasingly criticize controversial companies – such as oil companies - for their detrimental actions. So, to counteract their bad reputation, oil companies engage in CSR initiatives. However, those CSR actions can also backfire due to stakeholders being skeptical and often doubting the sincerity of the companies’ motives. To avoid this, companies can connect with NGOs and engage in cross-sector partnerships to implement CSR initiatives. While they can profit from the NGO's expertise, trustworthiness, and good reputation, such cross-sector engagements grant NGOs much-needed funding as well as to exert more influence on companies through long-term partnerships. However, especially in controversial industries, positive outcomes of such CSR actions are not always a given for either of the partners. While oil companies battle with the usual stakeholder skepticism, NGOs risk being accused of hypocrisy and suffering from decreased legitimacy if they for instance were to take a donation from a company they should be a watchdog for. However, literature shows that the CSR fit influences perceptions and outcomes of CSR and should therefore not remain unconsidered, especially because the findings on whether a high or low fit is more profitable for controversial companies are still contradictory. Additionally, literature on cross-sector partnerships differs between different types of cross-sector connections. While short, monetary donations to an NGO might be more feasible, long-term partnerships are expected to have more positive effects on the reputation. Hence, this study aimed to answer the following research question:“To what extent do the CSR fit and the type of connection between a controversial company and NGO influence the image of both parties after a collaborative CSR initiative?”. Additionally, the study intended to shed more light on the mediating role of trust in the company or NGO on how participants evaluate the image of both organizations. Therefore, an online experiment with four experimental conditions and three control groups (N = 210) was conducted. Surprisingly, the findings showed no significant outcomes. The cross-sector CSR engagements did not positively or negatively influence the image of either the oil company or the NGO. Additionally, no significant effects of the CSR fit or the different types of cross-sector connections, as well as the mediating role of trust on how the participants evaluated the organizations were found. However, this research offers potential limitations and explanations for the results. It furthermore suggests possibilities for future research to better understand cross-sector CSR engagements for both parties and additionally tackle the controversy that is still inherent in CSR research in controversial industries.