Consumers' moral licensing of firms' CSR transgressions

Despite corporate social responsibility (CSR) engagement, firms may be implicated in CSR transgressions. Research is equivocal on whether CSR buffers negative consumer responses to subsequent firm transgressions. This research extends the observer moral licensing framework to consumer‐firm contexts and examines under what conditions consumers license transgressions following firms' CSR engagement. Study 1 demonstrates that consumer responses to firm transgressions depend on whether the transgression occurs in the same (vs. different) domain relative to CSR engagement and on transgression ambiguity. Study 2 shows that consumer responses to transgressions are less negative when a firm has (vs. has not) previously engaged in CSR. It replicates a shielding effect of CSR that is contingent on transgression domain relative to prior CSR and transgression ambiguity, and finds that blatant same domain transgressions generate hypocrisy perceptions and mitigate licensing effects. Study 3 further extends the moral licensing framework and shows that firm communication that situates CSR efforts on a continuum (continuous CSR positioning) before a transgression moderates, and insincere firm motive attributions mediate, the detrimental effect of blatant same domain transgressions.