CSR INFLUENCE ON CONSUMER WILLINGNESS TO PAY PREMIUM AND BRAND LOYALTY: THE MEDIATING ROLE OF BRAND CREDIBILITY AND BRAND IDENTIFICATION

Abstract

In the era of increasing global focus on sustainable industrial practices, Corporate Social Responsibility (CSR) has evolved from a philanthropic obligation to a strategic imperative. This study empirically investigates the impact of Environmental CSR and Social CSR on Brand Loyalty within the Pakistani textile sector. Grounded in Social Identity Theory and Signaling Theory, the research further examines the moderating role of Brand Identification to determine the boundary conditions under which these ethical signals are most effective. A quantitative research design was employed, utilizing a self-administered questionnaire to collect data from 300 consumers of major fashion and textile brands in Pakistan. The proposed structural model was tested using Partial Least Squares Structural Equation Modeling (PLS-SEM) via SmartPLS 4. The statistical analysis reveals that both Environmental CSR and Social CSR are significant positive predictors of Brand Loyalty, with Environmental CSR demonstrating a slightly stronger effect size, reflecting a shift in consumer priorities towards ecological sustainability. The moderation analysis confirms that Brand Identification significantly amplifies these relationships. The findings suggest that CSR initiatives do not operate in a vacuum; they generate maximal loyalty only when consumers psychologically align their self-concept with the brand’s ethical persona. This research contributes to the literature by decomposing CSR into distinct "Planet" and "People" dimensions and validating a "Dual-Path" loyalty model in a non-Western context. It empirically proves that in the modern textile landscape, Brand Identification acts as a catalytic psychological mechanism that transforms ethical approval into deep-seated behavioral loyalty.