The objective of this study is to examine the effect of food scandals on trust towards the corporate brand and purchase intention in Japan. Drawing on Mayer, Davis and Schoorman’s Model of Organizational Trust (1995) this study explores the effects of perceived trustworthiness, trust, and perceived risk on a consumer’s intention to purchase. In Japan, consumers were outraged when some top hotels and department stores were found to have mislabeled foods, selling cheaper alternatives instead of the expensive foods offered on the menu and using expired products (Grace, 2007; Japan Today, 2013; Kageyama, 2007; Onishi, 2007; Spitzer, 2013). The various food scandals have led to product shunning, fear, distrust and suspicion among consumers (Garretson & Burton, 2000; Niewczas, 2014; Smith & Riethmuller, 1999; Yeung & Morris, 2001). Thus this research was conducted to identify the influence of food scandals involving well-established Japanese supermarkets on consumer trust and risk perception. The influence of culture in shaping purchase intention was also explored. Trust itself is a concept that is elusive with myriad definitions ranging from Luhmann’s (1979) sociological theory of trust that looks as trust being a function of high perceived risk and experience to Deutsch (1973) who defines it as the willingness to be dependent on others in the belief that the other party will not disappoint intentionally. Luhmann (1979) argues that in order for trust to be apparent there has to be high-perceived risk. Various studies have also focused on trust being operational when there is risk‐taking behavior (Anderson & Narus, 1990; Canning & Hammer‐Llyod, 2007; Doney & Canon, 1997; Morgan & Hunt, 1994). In the food sector, as consumers lose control over knowing about the food we eat due to the increasing complexity of the food system trust becomes an essential component. Consumers have to trust food producers ranging from farmers to food companies as well as the public authorities to ensure food safety, quality and adequate supply. Consumers display different and inconsistent reactions regarding food safety that affects the perception of quality and their willingness‐to‐pay (Berg, 2004; Brewer & Rojas, 2008).

This study explores the role of corporate involvement and brand perception in moderating the Cause Related Marketing on consumer purchase intention in the luxury product category among Japanese consumers. This research examines three core cause attributes - cause scope, cause type and cause acuteness developed by Vanhamme, Lindgree, Reast and van Popering (2012) as well as an additional component of duration – with corporate involvement and brand perception moderating the effect on purchase intention. The general public places judgment on a corporation based on how much of positive or negative impacts its business has on environment or society (Sheikh & Beise-Zee, 2011). In fact, more corporations have been developing corporate social responsibility (CSR) programs, no matter how big their business sizes, big or small, are (Brinkvan, Odekerken-Schroder, & Pauwels, 2006). The general public loses its faith in corporations, especially after a financial crisis or malfeasances of big corporations and as a result, corporations are under stronger pressure to contribute to environmental or societal causes in order to reclaim lost faith from the general public (Sheikh & Beise-Zee, 2011; Berglind & Nakata, 2005). One way corporations contribute to society has been to employ marketing strategies that link product sales to the support of specific charities to create and maintain favorable brand images known as cause related marketing or CRM. CRM has been growing faster as a type of marketing that allow corporations to contribute to environment or society (Brinkvan et al., 2006). Various factors have been extensively researched on and identified as pertinent in the success of cause-related marketing campaigns such as brand-cause fit (Bigne-Alcanniz, Currase-Perez, Ruiz-Mafe and Sanz-Blas, 2011; Nan and Heo, 2007; Samu and Wymer, 2009), donation size (Dahl and Labvack, 1995; Pracejus, Olsen and Brown, 2003), types of causes (local causes are preferred to national ones) (Ellen, Mohr, and Webb, 1996; Smith and Alcorn, 1991) and product type with luxury products found to be more effective (Strahilevitz and Myers, 1995).

This research was conducted in order to examine the influence of corporate reputation in terms of as an employer towards both brand reputation and customer purchase decisions represented by brand perception, purchase frequency and category of items purchased. In this study, customers’ perception of the brand was also explored to identify the core blocks that form customers’ perception of the brand. The results indicate that corporate reputation did not have a strong influence on brand reputation, as customers viewed them as separate entities. Customers tended to form their brand perception based on the product features as opposed to the corporate reputation. In terms of purchase decision, the results showed that they were made and driven based on the customers’ brand perception with category of items purchased reflecting aspects of the brand perception. The study demonstrates that customers’ awareness of the corporate reputation does not affect purchase behavior, while brand perception is hardly impacted by the awareness of corporate reputation based on a survey focusing on a renowned domestic fashion-clothing retailer conducted among Japanese shoppers. Reputation is formed from a synthesis of the perception, opinions and attitudes of an organization’s stakeholders including employees, customers and community (Post and Griffin, 1997). It basically is a perceptual representation of a company’s past actions and future prospects that describe the firm’s appeal to all of its key constituents (Fombrun, 1966). Corporate reputations and brands are important assets in enabling organizations to exploit opportunities and mitigate threats (Argenti and Druckenmiller, 2004). A favourable reputation correlates with superior overall returns (Robert and Dowling, 1997; Vergin and Qoronfleh, 1998) as it encourages investments from shareholders, attracts good staff and retains customers (Markham, 1972). While corporate reputation is a stakeholder’s perception and evaluation of the organization over an extended period of time, corporate brands involve the organization’s efforts and initiatives in the form of corporate expression. Literature states that corporate brand comprises of two aspects: first corporate expression, which covers all mechanisms employed by the organization to express its identity and second, stakeholder images that are formed from interaction and experience with the brand (Abratt and Kleyn, 2011). Consumers judge brands based on trust that is developed from the way consumers view brand reputation, brand competence and brand constituent (Lau and Lee, 1999). The intricate relationship between reputation and brands leads to the heart of the study whether both are positively correlated, where the more positive the reputation, the stronger the brand is. In the fashion industry, labels play an important role hence among other aspects this study covers an interesting point where it looks at a fashion brand that has a fairly bad reputation and examines the extent of which the reputation is able to influence the brand perception as well as the customers’ purchase decisions.