The mediating impact of airlines’ image in relation of corporate social responsibility and customers’ loyalty: An empirical in Vietnam

Abstract

Corporate social responsibility (CSR) towards sustainable development has been identified as a marketing philosophy that businesses in developed countries should pursue in the post-Covid-19 era as these practices deal with urgent global social and environmental challenges. Such efforts contributing to sustainable development will enhance corporate image and reinforce strong bonds with customers. In developing countries like Vietnam, how CSR affects consumer behaviour and the mechanism regulating the relationship between CSR and consumer behavior are the research gaps that have not been widely investigated. This study explores the relationship between CSR and customer loyalty, with the emphasis on the mediating role of corporate image. Focusing on the Vietnamese aviation industry, the author surveyed 514 passengers and analyzed them using structural equation modeling. Our findings show that CSR has a positive impact on corporate image and customer loyalty. In addition, CSR also affects customer loyalty through enhancing corporate image. Research results have provided research implications and management implications for the future.

Keywords:

• airline’s image
• corporate image
• corporate social responsibility
• customer’s loyalty
• Vietnam

JEL Classification:

• M14
• M16
• L93.

PUBLIC INTEREST STATEMENT

This study examined previous scientific research on the topic of corporate social responsibility (CSR), corporate image, and customer loyalty in the aviation industry. Accordingly, the research proposed safety as an additional CSR component in the aviation industry. By conducting expert survey and customer group interview, the research has confirmed that CSR in aviation industry consists of four components and proposed research model and hypotheses. Our findings have shown that social, environmental, and safety CSR components have a direct influence on corporate image and customer loyalty; in which safety has the strongest effect on customer loyalty. Although economic responsibilities do not directly affect customer loyalty, they could affect customer loyalty indirectly through corporate image and corporate image plays a mediating role in the relationship between CSR components and customer loyalty. The research has proposed a number of policy implications to help the Vietnamese aviation industry develop appropriate CSR strategies to enhance corporate image and strengthen customer loyalty in the future.

1. Introduction

The COVID-19 pandemic has had a global economic impact on several industries. Among those, the aviation industry is one of the most severely affected, which is shown by the dramatic drop of 60% in air passengers and 371 billion USD of airlines revenue loss. The International Civil Aviation Organization (ICAO) (2020) forecasts that total loss in 2021 will maintain at 314 billion USD. According to He and Harris (2020), the short-term negative effects of the Covid-19 pandemic have been immediately noticeable due to the lockdown and social distancing orders. However, in the long term, the pandemic will have a profound socio-economic impact. At the international level, the United Nations has called for efforts to build sustainable post-Covid-19 economies that are flexible in dealing with economic, social, and environmental issues (United Nations, 2020). At the corporate level, the pandemic has had a strong effect on corporate social responsibility (CSR) and marketing philosophy as many businesses have realized that their prosperity is closely related to the well-being of stakeholders and sustainable development of the whole society. The pandemic opens up opportunities for ethical businesses to build corporate image and strengthen relationships with customers and the public since the sustainable CSR practices make customers believe that these businesses are ethical and they are willing to patronize businesses’ services (He & Harris, 2020; Liu et al., 2020).

Having encountered the same situation as the global aviation industry, Vietnamese airlines are experiencing the toughest period and trying to get out of the disastrous downturn. As suggested by S. Lee (2020), to restore prosperity once the Covid-19 pandemic is over, airlines should strive to preserve their decent image and win customers’ hearts by implementing genuine CSR practices. In Vietnamese socio-economic context, CSR initiatives are relatively new to Vietnamese consumers, so, certainly, Vietnamese customers’ understanding and reactions to CSR policies may significantly differ from those of customers in developed countries. The findings in developed countries should not be generalized to developing countries but should be reviewed by conducting new research in the local country. In the case of Vietnam, whether customers are deeply impressed by authentic CSR practices and are willing to commit to a long-term relationship with ethical airlines? This study aims to explore the influence of CSR on corporate image and customer loyalty for the case of the Vietnamese aviation industry, and thereby proposing theoretical implications for future research and managerial implications for businesses in the post-Covid–19 period.

2. Literature review and theoretical research model

2.1. CSR and CSR dimensions in the aviation industry

CSR was first mentioned by Bowen as the basic rules of conduct that a decent business should treat its stakeholders (Bowen, 1953). To date, scholars have not agreed on the CSR definition and its measurement components (Dahlsrud, 2008). However, researchers often consider CSR from three popular viewpoints. (1) Carroll’s CSR pyramid proposes that CSR includes four components of economic, legal, ethical, and philanthropic responsibilities (Carroll, 1991). (2) The stakeholder perspective suggests that businesses should behave responsibly to internal and external stakeholders and create shared value for the business and all parties (Freeman et al., 2010). (3) The sustainable development viewpoint proposes that CSR should include all the moral practices to ensure sustainable economic growth, environmental protection, and social value enhancement (Van Marrewijk, 2003). Since the aviation industry seriously affects the environment, the sustainable development perspective is considered the most suitable approach for the current study.

In addition, due to the specific characteristics of the aviation industry, The International Air Transport Association (IATA) and The International Civil Aviation Organization (ICAO) have developed action programs for sustainable aviation practices including safety, COVID-19, customer experience, environment, operations, and efficiency. In which, safety is the top priority in IATA’s action program (IATA, 2020) and the key to the effective operation and sustainable development of the industry (ICAO, 2018). According to ICAO, safety is closely related to the implementation of 11 out of 17 United Nations’ sustainable development goals (ICAO, 2016b). Along with the environment, safety has been placed at the heart of sustainable aviation by IATA and ICAO (Chang et al., 2015; IATA, 2009; ICAO, 2016a). At the corporate level, senior leaders of major airlines have recognized safety as the most important criterion for CSR strategy, and from customers’ viewpoint, safety is the crucial attribute that they perceive about airlines’ CSR (Asatryan, 2013) (Liou & Chuang, 2008). Based on the above arguments, the author suggests that when considering CSR dimensions from the perspective of sustainable development in the aviation industry, safety should be incorporated in airlines’ CSR programs as an industry-specific responsibility. Thus, in the current article, CSR consists of four constructs including economic responsibility, social responsibility, environmental responsibility, and safety responsibility.

Firstly, the aviation industry has rapidly developed and become an integral part of tourism and transportation for decades (Yang et al., 2020). Airlines play a key role in developing a sustainable and integrated transport system so that other means of transport can be used efficiently to create favorable conditions for the logistics development. The aviation industry creates jobs for society, promotes local cuisine and tourism, facilitates the development of entertainment service businesses, and stimulates sustainable economic growth (ICAO, 2012; Vietnam Airlines, 2021). Therefore, economic responsibility is considered as one of the first important components to be considered of corporate social responsibility.

Secondly, ICAO (2012) affirms that airlines create worldwide connections between urban centers and remote islands, provide educational opportunities for the younger generation, and contribute to the advancement and empowerment of women. In times of disasters, famine and war, airlines are responsible for delivering food and medical supplies and providing rescue services (Park, 2019a, 2019b; Park et al., 2015). Repatriation and rescue flights transporting refugees back home have contributed to minimizing losses and alleviating grief for the community during floods and the Covid pandemic (Vietnam Airlines, 2021).

Thirdly, according to ICAO (2016b), IATA has set targets to reduce CO2 emission and noise pollution about environmental responsibility. It required the member airlines to comply by effectuating four strategies including new generation aircraft, efficient operation, modern infrastructure, and carbon offsetting scheme. Vietnamese airlines, as IATA members, assess emission control and fuel consumption and prioritize the implementation of environmental policy to achieve sustainable environmental goals.

Fourth, airlines are responsible for ensuring absolute safety in operation through strict adherence to safety practices prescribed by ICAO, IATA, and the Civil Aviation Authority. All IATA members must register for an IATA operational safety audit (IOSA) to maintain IATA membership. They must address the issues of cabin safety, runway safety, fatigue, loss of control in-flight, aircraft handling, and manual flying skill reports to improve operational safety.

2.2. Corporate image

Corporate image is the distinctive overall impression of a company in a customer’s mind (Gray & Balmer, 1998). According to Dowling (1986), corporate image is formed based on customers’ beliefs and feelings about the company and it is influenced by media and corporate philosophies. In the context of an economic downturn where the unemployment rate is high and public services are neglected, CSR emerges as an important element in the company’s short-term and long-term action plans because the responsible practices are perceived by the public and generate a positive impression to the customers (Waititu, A. 2011; Han et al., 2019; Juntunen et al., 2013; Lee et al., 2015; Rashid et al., 2014; Siahaan & Masdupi, 2019). In addition, Virvilaite and Daubaraite (2011) stated that marketing communication conveying corporate attitudes and behaviors would contribute to image enhancement. Therefore, companies often combine business performance and external communication to build a good corporate image.

2.3. Customer loyalty

Jacoby and Chestnut (1978) regarded customer loyalty as the psychologically biased behavior of consumers to one or more alternative brands out of a set of available brands in the market. Even though the typically loyal customer can be described as the one who purchases continually, customer loyalty should not be measured only by purchase behavior since the purchase can be swayed by situational factors. Thus, the attitudinal dimension should be included in the loyalty concept (Nguyen & LeBlanc, 2001). Dick and Basu (1994) believed that customer loyalty reflected by both repeated purchase behavior and psychological commitment would reflect a more complete view of loyalty and could distinguish between true loyalty and spurious loyalty. Dick and Basu (1994) defined true customer loyalty as a combination of preferential attitude and repeated patronage behavior. Therefore, in the customer loyalty topic, researchers often measure loyalty through the integration of behavioral and attitudinal dimensions. Behavioral loyalty is measured by repeated purchases, while attitudinal loyalty is measured by customer commitment, positive word of mouth, product recommendation, and willingness to pay for the service at a higher price (Chonsalasin et al., 2020; Dimitriadis & Zilakaki, 2019; Gürlek et al., 2017).

2.4. Relationship between CSR, corporate image, and customer loyalty

CSR towards sustainable economic development has been proven to have a positive impact on the attitude and satisfaction of tourists (Hoang, 2021) and passengers (Park, 2019a, 2019b; Park et al., 2015). The efforts to contribute to the national economic development by investing and generating profit, creating jobs for the society have enhanced the airline’s reputation and aroused a good impression in the mind of customers. From such positive sentiments, customers feel satisfied after flying with the profitable airline and consider using its services as a wise idea. Moreover, they will recommend the airline’s service to their relatives and friends who intend to fly (Park, 2019a, 2019b; Park et al., 2015).

CSR initiatives support the sustainable development of the community and society by raising funds for social activities, sponsoring cultural and sports events, encouraging employees to participate in volunteer activities in the local community (Alvarado-Herrera et al., 2017; Park, 2019a, 2019b; Park et al., 2015), striving to improve community welfare and treating employees fairly (Hoang, 2021; Martínez et al., 2014). They have also shaped a good and lasting impression about the business and generated both attitudinal and behavioral loyalty. Customers continue using the brand in the future and consider the brand as their first choice (Martínez et al., 2014).

Previous studies have shown that customers are always in favor of businesses that behave responsibly to protect the sustainability of the environment. Pro-environmental programs, including recycling, reducing the consumption of natural resources and pollution, conducting annual environmental audits, are the activities that businesses in the tourism and aviation industry usually implement to protect the environment (Alvarado-Herrera et al., 2017; Martínez et al., 2014; Park, 2019a, 2019b; Park et al., 2015). These authentic CSR initiatives have evoked positive feelings about a healthy business and increased perceived value and emotional attachment (Hwang & Lyu, 2019).

In the aviation industry, safety is a vital requirement that airlines must guarantee. It is the factor that has the strongest impact on an airline’s image (Jeeradist et al., 2016) and is considered as the decisive CSR dimension for customer trust and loyalty (Latif et al., 2019). Thus, airlines have the responsibility to strictly comply with safety regulations and procedures, they should also prevent, control, and eliminate risks to ensure safe flights for passengers and crew.

Corporate image is one of the antecedents of customer loyalty since it induces beliefs and positive emotions (Asatryan & Asamoah, 2014). In the aviation sector, corporate image has been closely related to the willingness to pay higher prices and positive word of mouth in Korea (Cho et al., 2017; Park, 2019a, 2019b) and in Nigeria (Geraldine, 2013); and the intention to continue using the service in Taiwan (Wang, 2018).

Previous studies have shown that CSR has an indirect influence on customer loyalty in Indonesian banking industry (Andika et al., 2017), Taiwanese bicycle business (Wang, 2018), Taiwan insurance sector (C.-Y. Lee, 2018), Spanish and Turkish hospitality industries (Gürlek et al., 2017; Martínez et al., 2014), Vietnamese jewellery industry (N. T. Tran, 2022), Vietnamese dairy industry (Anh & Nguyễn, 2021). Even though the above studies have confirmed the mediating role of corporate image in the relationship between CSR and customer loyalty, CSR in these studies is a second-order latent variable. Studies on the mediating role of corporate image in the relationship between CSR construct and customer loyalty have not been widely investigated. So far, a study by Irwani et al. (2015) for the retail industry evaluating the mediating role of a corporate image between customers’ perception towards three CSR constructs—customers, community, and the environment—and their loyalty to the retail brands. The study of Irwani et al. (2015) showed that corporate image has a role of full mediator in the relationship between CSR community and customer loyalty and a role of partial mediator in the relationship between CSR constructs (customers and environment) and customer loyalty. It can be said that exploring the mediating role of corporate image in the relationship between various CSR constructs and customer loyalty could help identify the influencing strength of each CSR construct and corporate image to customer loyalty. In the Vietnamese aviation industry, the author expects that there is an impact mechanism from CSR to customer loyalty with the mediating role of corporate image.

This study aims to explore the relationship between CSR and customer loyalty, with the emphasis on the mediating role of corporate image. Based on the literature review, a theoretical research model is proposed in Figure 1, and the hypotheses are developed as follows:

Figure 1. Model and hypotheses.

H_1a: Economic responsibility has a positive influence on corporate image

H_1b: Economic responsibility has a positive influence on customer loyalty

H_2a: Social responsibility has a positive influence on corporate image

H_2b: Social responsibility has a positive influence on customer loyalty

H_3a: Environmental responsibility has a positive influence on corporate image

H_3b: Environmental responsibility has a positive influence on customer loyalty

H_4a: Safety responsibility has a positive influence on corporate image

H_4b: Safety responsibility has a positive influence on customer loyalty

H₅: Corporate image has a positive influence on customer loyalty.

H_6a: Corporate image mediates the relationship between economic responsibility and customer loyalty.

H_6b: Corporate image mediates the relationship between social responsibility and customer loyalty.

H_6c: Corporate image mediates the relationship between environmental responsibility and customer loyalty.

H_6d: Corporate image mediates the relationship between safety responsibility and customer loyalty.

3. Data and research methodology

In developed countries, CSR has been acknowledged as an important part of corporate competitive strategy. However, it is a relatively new category in developing countries like Vietnam. To assess the influence of CSR on corporate image, and customer loyalty, the author developed and validated the scale of CSR, corporate image, and customer loyalty for the case of the Vietnamese aviation industry before conducting formal quantitative research. Thus, the research procedure follows four steps: (1) identification of the domain of the construct; (2) scale generation for each construct; (3) preliminary quantitative research for scale finalization; (4) formal quantitative research.

3.1. Step 1: construct domain identification

The domains of the constructs in the present paper are CSR, corporate image, and customer loyalty. More precisely, the proposed scale is aimed at measuring customer perceptions of CSR initiatives implemented by Vietnamese airlines to enhance airline image and improve customer loyalty.

3.2. Step 2: scale generation for CSR, corporate image, and customer loyalty constructs

To generate the rigorous scale items, the authors combined several different methods including literature review, expert survey, and group discussion. Initially, based on the reviewing of existing literature, 32 items were drafted with a focus on CSR initiatives (related to economic, social, environmental, and safety responsibilities), corporate image, and customer loyalty. Furthermore, the study involved a Delphi survey with academics and professionals specialized in the field of aviation industry and marketing. They validated items to measure corporate image, customer loyalty, and CSR constructs for the case of Vietnamese airlines. The process resulted in several items being modified for better understanding and several items being added to the scale. The Delphi survey was completed with a total of 37 items being finally included in the scale. Additionally, a group discussion with the participation of airline passengers was held to assess passengers’ understanding and perception about airlines’ CSR practices, corporate image, and loyalty and to confirm the clarity and conciseness of the items in the questionnaire. Step 2 concluded with the pilot questionnaire for the next step.

3.3. Step 3: scale finalization

Preliminary quantitative research was conducted by surveying 150 passengers in December 2020 to finalize the items for the constructs they were supposed to measure. The results of Cronbach’s Alpha coefficient for ECO (0.908), SOC (0.898), ENV (0.871), SAF (0.846), IMG (0.885), LOY (0.842), and the item-total correlations ≥3 evidenced the internal consistency of items as a group. The EFA analysis performed for the first time excluded 1 ECO variable and 2 SOC variables since the factor loadings were lower than 0.5. The second EFA analysis showed that all loading factors were greater than 0.5, six components were extracted and the figures for KMO, Bartlett’s test, and Eigenvalues were satisfactory. The formal questionnaire was finalized with 34 items for 6 components as shown in Table 1.

Table 1. Measurement summary

Symbol	Scales	Sources
Economic responsibility
ECO1	X is trying to maximize profits to guarantee its continuity	Alvarado-Herrera et al. (2017); Martínez et al. (2013); Park (2019b); N. K. H. Tran (2019); Maignan (2001); Pérez and Del Rodríguez Bosque (2013), Expert survey
ECO2	X is trying to continuously improve the quality of the services that they offer
ECO3	X is trying to do its best to be more productive
ECO4	X is trying to build solid relations with its customers to assure its long-term economic success
ECO5	X is trying to create jobs for the economy
ECO6	X is trying to contribute to national economic development by promoting regional specialties and tourism
ECO7	X is trying to contribute to the development of a sustainable and efficient integrated transportation system
Social responsibility
SOC1	X is trying to play a role in society that goes beyond mere profit generation	Alvarado-Herrera et al. (2017); Park (2019b); Maignan (2001); Pérez and Del Rodríguez Bosque (2013); N. K. H. Tran (2019); Martínez et al. (2013); Chen et al. (2012)
SOC2	X is trying to sponsor educational programmes
SOC3	X is trying to sponsor cultural programmes
SOC4	X is trying to sponsor public health programmes
SOC5	X is trying to be highly committed to well-defined ethical principles
SOC6	X is trying to volunteer the services of rescuing, transportation and supply in times of disaster
SOC7	X is trying to contribute to the improvement of life quality in the local community
SOC8	X encourages employees to participate in volunteer activities in the community
Environmental responsibility
ENV1	X is trying to sponsor pro-environmental programmes	Alvarado-Herrera et al. (2017); N. K. H. Tran (2019); Öberseder et al. (2014); Park (2019b); Martínez et al. (2013); Expert opinion
ENV2	X is trying to carry out programmes to reduce air and noise pollution
ENV3	X is trying to allocate resources to offer services compatible with the environment
ENV4	X is trying to protect the environment
ENV5	X is trying to use only the necessary natural resources
ENV6	X is trying to conduct its business activities in accordance with the environmental regulations and policies stipulated by the government and international covenants.
Safety responsibility
SAF1	X is trying to prevent safety-accident.	Cho et al. (2017); Expert opinion
SAF2	X is trying to build and operate a safety management system.
SAF3	X is committed to airline operation safety
SAF4	X is doing well in safety-related guidance.
SAF5	X always puts safety as the top priority and the basis of all activities
Corporate Image
IMG1	I have always had a good impression of X	Nguyen and LeBlanc (2001)
IMG2	In my opinion, X has a good image in the minds of consumers.
IMG3	I believe that X has a better image than its competitors.
Customer Loyalty
LOY1	If I need to fly now, X would be my first choice.	Nguyen and LeBlanc (2001); Expert opinion
LOY2	I will continue to do fly with X.
LOY3	I would recommend X as the best airline in Vietnam.
LOY4	I would encourage friends and relatives to fly with X.
LOY5	I am willing to pay a higher price for the service of X

3.4. Step 4: formal quantitative research

The formal research was conducted in January 2021 by interviewing VNA Group passengers who have already experienced flying with the carriers. After asking questions to screen the subjects, the field interviewers invited them to participate in the survey. Passengers who agreed to take part in the research spent approximately 15 minutes answering it. Of 525 questionnaires distributed, 520 were returned to the field interviewers. After checking, six questionnaires were removed due to insufficient information. The unusable questionnaires were 514 copies. According to Hair et al. (2009), the minimum number of necessary samples to meet the statistical constraints should be at least 5 times the total items (5x34 = 170). Thus, a sample size of 514 participants in the current study is acceptable. Descriptive statistics about the samples are presented in Table 2.

Table 2. Descriptive statistics about the samples (Source: Author’s survey, 2021)

Characteristics	Frequency	Percentage
Gender	N = 514	100
Male	255	49.6
Female	259	50.4
Marital Status	N = 514	100
Single	195	37.9
Married	319	62.1
Monthly Income	N = 514	100
Under 5 million VND	72	14.0
From 5 to 10 million VND	136	26.5
From 10 to 15 million VND	99	19.3
From 15 to 20 million VND	121	23.5
Over 20 million VND	86	16.7
Age	N = 514	100
From 20 to 29 years	96	18.7
From 30 to 39 years	127	24.6
From 40 to 49 years	113	22.0
From 50 to 59 years	96	18.7
Over 60 years	82	16.0

4. Results

4.1. Testing of research model

To test the validity and reliability of the constructs and the convergence of their items, Cronbach’s Alpha value (satisfactory level ≥0.7), KMO = 0.911, Bartlett's test of sphericity has sig = 0.000, factor loadings (satisfactory level ≥0.5), composite reliability (satisfactory level ≥0.7), and average variance extracted (satisfactory level ≥0.5) were computed (Hair et al., 2009). In addition, the author also conducted a discriminant test to verify that the square root level of AVE for each construct is greater than its correlations with other constructs, being qualified for discriminant validity (satisfactory level ≥0.5; Fornell & Larcker, 1981). The figures in Table 3, Table 4 demonstrate that the current study satisfies the requirements of the validity test.

Table 3. Descriptive statistics, internal reliability, and convergent reliability (source: SPSS output, 2021)

Constructs	Items	Factor Loading	Mean	Cronbach’s Alpha	C.R	AVE
Economic Responsibility (ECO)	ECO1	0.629	2.97	0.872	0.875	0.506
	ECO2	0.938
	ECO3	0.610
	ECO4	0.632
	ECO5	0.773
	ECO6	0.683
	ECO7	0.645
Social Responsibility (SOC)	SOC1	0.916	2.90	0.893	0.892	0.510
	SOC2	0.696
	SOC3	0.648
	SOC4	0.659
	SOC5	0.687
	SOC6	0.753
	SOC7	0.651
	SOC8	0.672
Environmental Responsibility (ENV)	ENV1	0.677	2.82	0.867	0.870	0.530
	ENV2	0.666
	ENV3	0.972
	ENV4	0.614
	ENV5	0.726
	ENV6	0.624
Safety Responsibility	SAF1	0.851	2.56	0.817	0.828	0.528
	SAF2	0.538
	SAF3	0.592
	SAF4	0.524
	SAF5	0.788
Corporate Image	IMG1	0.693	2.57	0.830	0.834	0.627
	IMG2	0.902
	IMG3	0.697
Customer Loyalty	LOY1	0.614	2.83	0.833	0.835	0.504
	LOY2	0.830
	LOY3	0.763
	LOY4	0.724
	LOY5	0.616

Note: CR: Composite Reliability; AVE: Average Variance Extracted

Table 4. Discriminant reliability (source: SPSS output, 2021)

Constructs	ECO	SOC	ENV	SAF	IMG	LOY
1. Economic Responsibility (ECO)	0.712	0.319	0.365	0.352	0.355	0.254
2. Social Responsibility (SOC)	0.319	0.715	0.430	0.364	0.369	0.330
3.Environmental Responsibility (ENV)	0.365	0.430	0.728	0.449	0.417	0.370
4. Safety Responsibility (SAF)	0.352	0.364	0.449	0.727	0.464	0.351
5.Corporate Image (IMG)	0.355	0.369	0.417	0.464	0.792	0.359
6.Customer Loyalty (LOY)	0.254	0.330	0.370	0.351	0.359	0.710

Note: The bold and italic figures are the square root of AVE for the constructs

Model fit indices were calculated to verify the model’s suitability and Table 5 shows that the goodness-of-fit indices are satisfied as all the statistics are greater than the satisfactory level.

Table 5. Fit indices (source: AMOS output, 2021)

Fit Indices	Measurement model	Research model	Satisfactory level	Sources
Chi-squared/df	1.951	1.951	< 3	Bentler and Bonett (1980), Hair et al. (2009), Steiger (1990), Baumgartner and Homburg (1996); Doll et al. (1994)
GFI	0.900	0.900	> 0.8
IFI	0.941	0.941	> 0.9
CFI	0.940	0.940	> 0.9
TLI	0.934	0.934	> 0.9
RMSEA	0.043	0.043	< 0.08
P value	0.000	0.000	< 0.05

5. Hypothesis test—SEM model

Table 6 presents the first nine hypotheses, path coefficients, the p-value, and the decision on hypothesis. The p-value indicates whether the relationship between the independent variables and dependent variable is significant or not. The significant relationship is expected to have the P value below 0.05. Based on the results presented in Table 6, economic responsibility (ECO) was statistically significant in predicting corporate image (IMG), thus supporting H1a, but it is not a significant antecedent of customer loyalty (LOY) as p-value = 0.306; thus, H1b was not supported. Furthermore, social responsibility (SOC), environmental responsibility (ENV), and safety responsibility (SAF) were statistically significant for predicting corporate image (IMG) and customer loyalty (LOY); thus, H2a, H2b, H3a, H3b, H4a, H4b were supported. Moreover, corporate image (IMG) was observed to have a significantly positive effect on customer loyalty (β = 0.162, p-value = 0.011), thus, H5 was supported.

Table 6. Results of structural equation modeling analysis (source: AMOS output, 2021)

Path	Hypothesis	Path coefficient	S.E.	C.R.	P	Decision on Hypothesis
ECO → IMG	H1a	0.151	0.041	3.091	0.002	Supported
ECO→ LOY	H1b	0.054	0.050	1.023	0.306	Not Supported
SOC → IMG	H2a	0.159	0.047	3.143	0.002	Supported
SOC → LOY	H2b	0.134	0.057	2.439	0.015	Supported
ENV → IMG	H3a	0.179	0.053	3.173	0.002	Supported
ENV → LOY	H3b	0.174	0.065	2.839	0.005	Supported
SAF → IMG	H4a	0.333	0.055	6.068	***	Supported
SAF → LOY	H4b	0.160	0.070	2.574	0.010	Supported
IMG → LOY	H5	0.162	0.072	2.547	0.011	Supported

H6a, H6b, H6c, H6d examine the mediating role of corporate image in the relationship between four CSR variables (namely economic responsibility, social responsibility, environmental responsibility, and safety responsibility) and customer loyalty. Table 7 shows that the direct effect of economic responsibility (ECO) on customer loyalty increased from 0.054 (p > 0.05) to the total effect of 0.078 (p > 0.05) suggesting that corporate image (indirect effect = 0.024, p < 0.05, 95% confidence interval = 0.005–0.057) fully mediated the effect of economic responsibility on customer loyalty. This finding validated H6a. Furthermore, the direct effect of social responsibility (SOC) on customer loyalty increased from 0.134 (p < 0.05) to the total effect of 0.160 (p < 0.05) suggesting that corporate image (indirect effect = 0.026, p < 0.05, 95% confidence interval = 0.004–0.073) partially mediated the effect of social responsibility on customer loyalty. Thus, H6b was validated. Likewise, with corporate image as the mediator, the effect of environmental responsibility on customer loyalty increased from 0.174 (p < 0.05) to the total effect of 0.203 (p < 0.05) (indirect effect = 0.029, p < 0.05, 95% confidence interval = 0,004–0,071) and the effect of safety responsibility on customer loyalty increased from 0.160 (p < 0.05) to the total effect of 0.214 (p < 0.05) (indirect effect = 0.054, p < 0.05, 95% confidence interval = 0.010–0.119), thereby validating H6c and H6d.

Table 7. Summary of effect decomposition (Source: AMOS output, 2021)

Dependent Variable	Type of effect	ECO	SOC	ENV	SAF	IMG
IMG	Direct effect	0.151*	0.159*	0.179*	0.333*
	Indirect effect	-	-	-	-
	Total effect	0.151*	0.159*	0.179*	0.333*
LOY	Direct effect	0.054	0.134*	0.174*	0.160*	0.162*
	Indirect effect	0.024*	0.026*	0.029*	0.054*	-
	Total effect	0.078	0.160*	0.203*	0.214*	0.162*

Note: Significance level: *p < 0.05, H6a, 6b, 6c, 6d: Supported.

Table 8 presents the bootstrapping results to reaffirm the robustness of the SEM analysis results as stated. The results of the bootstrapping analysis were performed with a sample of 1,000 sample loop. The bootstrapping technique assigns measures of accuracy (bias, variance, confidence intervals, prediction error, etc.) to sample estimates (Efron, 2003). The results show that all C.R. are smaller than 1.96 except for the relationship between ECO -> LOY (C.R. = 2 > 1.96). This indicates that the relationship between the above variables in the estimated model except ECO -> LOY is reliable (unbiased). The results are reliable for sample-to-population prediction.

Table 8. Results of bootstrap analysis (source: AMOS output, 2021)

Parameter			SE	SE-SE	Mean	Bias	SE-Bias	C.R
IMG	<—	SOC	0.05	0.001	0.136	−0.001	0.002	−0.5
IMG	<—	ECO	0.045	0.001	0.127	−0.003	0.002	−1.5
IMG	<—	ENV	0.061	0.001	0.19	−0.001	0.002	−0.5
IMG	<—	SAF	0.058	0.001	0.32	0.003	0.002	1.5
LOY	<—	SOC	0.042	0.001	0.092	−0.001	0.001	−1
LOY	<—	ECO	0.047	0.001	0.034	0.002	0.001	2
LOY	<—	ENV	0.057	0.001	0.152	−0.003	0.002	−1.5
LOY	<—	SAF	0.057	0.001	0.122	−0.002	0.002	−1
LOY	<—	IMG	0.066	0.001	0.167	0.003	0.002	1.5

6. Discussion

The purpose of this study was to examine the influence of corporate social responsibility on corporate image and customer loyalty in the aviation industry of Vietnam. The findings could be summarized as follows: Firstly, economic responsibility has no direct impact on customer loyalty, but this dimension has a direct and positive impact on corporate image. Secondly, social responsibility, environmental responsibility, and safety responsibility have a positive and direct influence on both corporate image and customer loyalty. Thirdly, corporate image has a positive impact on customer loyalty. Fourth, corporate image fully mediated the relationship between economic responsibility and customer loyalty, whereas corporate image partially mediated the effect of social responsibility, environmental responsibility, and safety responsibility towards customer loyalty.

The present study has several contributions to the theoretical implications. Firstly, due to the difference influence of CSR on marketing philosophy, findings in one study may not be applied to other countries or economic sectors (Bondesson, 2012). This study focuses on the aviation industry in a developing country to affirm the role of CSR as a business strategy. The results of this study show that CSR practices strengthen corporate image, encourage customer loyalty and corporate image could enhance customer fidelity. This finding is consistent with the results of previous studies in the aviation industry of Korea (Han et al., 2020), Germany (Hagmann et al., 2015), in the retail industry (Irwani et al., 2015), and the tourism industry (Gürlek et al., 2017; Martínez et al., 2014). Therefore, further study on CSR should examine different economic sectors in different countries, which might provide results to confirm the positive influence of CSR on businesses.

Secondly, there are more CSR-related studies considering CSR as a multidimensional construct including economic, social, and environmental aspects than ones that have considered economic construct, social construct, and environmental construct separately. This study filled in the research gap by examining each construct distinctly and its impact on corporate image and customer loyalty and found that each construct has a different effect on corporate image and customer loyalty. This finding not only shows the different influences of each CSR construct but also suggests further approaches when researching CSR.

Thirdly, studies on CSR in the aviation industry often focus on environmental responsibility due to its negative impact. To date, few studies have examined safety responsibility even though it is an industry-specific CSR component towards sustainable development in the aviation industry. This study filled the research gap by examining safety responsibility and proved the vital role of safety responsibility in enhancing corporate image and tightening the bond between airlines and customers.

Finally, this study examined the mediating role of customer image to clarify how CSR affects customer behavioral intentions. It has indicated that the implementation of CSR could enable businesses to form a positive image and purchase commitment. Furthermore, all CSR constructs could directly affect corporate image and the mediating role of corporate image between each CSR construct and customer loyalty. Accordingly, the implementation of CSR can make a good impression on customers and encourage them to be attached to the business. This explanation agrees with the argument of Nguyen and LeBlanc (2001).

From the research results, safety responsibility stands out as the CSR dimension that has the strongest impact on corporate image and customer behavioral intentions. The finding is completely consistent with the psychology of passengers because safety determines the lives of passengers and crew, and it is an ethical factor that airlines must commit to the passengers. Even though the airlines have received the highest safety rating from the competent authorities, the airlines are still undervalued by customers due to small incidents, which make customers feel insecure about airline safety. This study confirmed the findings in Taiwan and Thailand (Jeeradist et al., 2016; Liou & Chuang, 2008) and implied that Vietnamese airlines must place safety at their core value since public reviews on airlines focus primarily on flight safety information rather than any other news, and airlines should pursue safety record to retain the excellent reputation. Therefore, Vietnamese airlines must strictly control pilot qualifications, aircraft maintenance, aircraft operation, and medical isolation procedures to avoid transmission of SARS-CoV-2 from flight attendants to the community.

In addition to safety responsibility, Vietnamese airlines should focus on implementing environmental responsibility, social responsibility, and economic responsibility practices. In which, priority should be given to environmental responsibilities and social responsibilities due to their significant impacts on the corporate image and customer loyalty. This has been the trend that major airlines in the world have followed and prioritized over the past decade (Cowper-Smith & de Grosbois, 2011). In the context of Vietnam, Vietnamese customers are expecting airlines as large conglomerates to take more actions for the sustainable development of the environment and society.

The study findings also imply that airlines should actively communicate their CSR efforts so that customers and the public could understand and update information about the business. Such communication should not be limited to the corporate annual reports and official website but should be widespread on other popular media. As the driving force of the economy, airlines and their CSR activities will have a spillover effect on businesses in other economic sectors and the public so that all can join hands to act for sustainable development in the future.

7. Conclusions

This study explores the influence of perceived CSR on corporate image and customer loyalty. Based on the theory of person-organization fit and social identity theory, the author has studied the mechanism regulating the influence of CSR on corporate impression and consumers’ behavior. The study confirms that Vietnamese customers support CSR practices towards sustainable development and CSR initiatives can be a promising and important marketing strategy to enhance customers’ patronage of the businesses. They can promote corporate ethos and image, strengthen the strong bond between customers and companies while creating spillover effects to other businesses.

Acknowledgements

The authors would like to thank the Editor-in-Chief and a reviewer for their helpful comments that in our view have helped to improve the quality of the manuscript significantly. This study was conducted based on decision No. 3057/QD-ĐHDT dated 26 August 2020 of Duy Tan University, Vietnam.

Disclosure statement

No potential conflict of interest was reported by the authors

Additional information

Funding

The authors received no direct funding for this research.

Notes on contributors

Hai Phan Thanh

Hai Phan Thanh is an Associate Professor, PhD, Provost, School of Business and Economics at Duy Tan University, Danang, Vietnam. He took a short-term course in business and management at the University of Pennsylvania State, Pennsylvania, USA. He has published over 100 publications in a variety of fields: published textbooks, international journals, national journals, domestic and foreign yearbook workshops. His research interests include independent audits, corporate accounting systems, corporate management activities, training, and economic management. He is interested in researching the accounting and auditing, business administration, marketing, hospitality and tourism and so on.

Thu Hoang Anh

Thu Hoang Anh is a lecturer at Faculty of Economics, International School, Duy Tan University, Vietnam Her major research interests are corporate social responsibility, marketing, business and management.