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This paper aims to examine the relationship between corporate social responsibility (CSR) and sales revenue of two retail companies (Marks & Spencer and Tesco) in the UK to understand how CSR activities can influence retail sales growth. Prior studies have used different theoretical and methodological approaches to report the relationships between CSR and financial performance generally as positive, negative, mixed or neutral, and these are yet to be conclusive.

Clarifying the existing inconclusive results, the authors deduced donations, community work and environmental responsibility CSR activities from the literature and mapped them out onto sales revenue to formulate conceptual propositions. The authors extracted the corresponding data from the companies’ websites and financial reports, focusing on their 2006-2014 CSR and sales activities, and statistically analysed the longitudinal data with Pearson correlation coefficient.

The findings revealed positive correlations between donations and sales revenue for the two companies, which suggest that retailers’ philanthropic activities can boost sales levels overtime. Whereas the findings on the community work and the environmental-friendly activities relate either positively or negatively to sales revenue for the companies.

There is an indication for retail managers to pursue philanthropic activities to effect sales growth. Retailers exhibiting features of Marks & Spencer can commit to community investment to increase revenue over time, whereas those showing features of Tesco can pledge environmental-friendly strategies to influence a stronger correlation between carbon emissions and sales revenue levels.

The outcomes support the extant findings that donations can improve retail sales performance, while community work and the environmental-friendly activities do not necessarily improve sales growth in the retail sector but suggest that retailers can exploit more of the ones that benefit their sales revenue levels. Theoretically, the study supports the stakeholder theory’s influence on firms’ obligation to charitable cause, community investment and environmental-friendly responsibility as CSR activities that make retailers morally responsible to their customers and society in general, whereas the sustainable development model was instrumental in retailers’ CSR activities relating to environmental protection.

The turbulent phase of COVID-19 has caused uncertainty as governments fail to develop coherent strategies for cutting emissions and are struggling to match the rhetoric of sustainable activities with actions (Barbier & Burgess, 2020; Cawthorn, Kennaugh, & Ferreira, 2021). In the recent past, firms have failed in their plans to decarbonise their key sectors such as the retail sector in the United Kingdom So far, retailers' commitment to achieving net zero emissions has been an important pledge but delivery is nowhere closer to their promises (Henriques, 2020). The firms' climate targets are not going to be met by magic as serious action is needed to fulfil the promises.

Fossil fuels have led to a drastic increase in carbon emissions in the world over the last decade. Firms championing cleaner energy and low carbon technologies are needed to cut emissions. Renewable energy sources such as wind energy can help reducing the dependency of fossil fuels (Boretti, 2020; Ebhota & Jen, 2020). Wind is an indirect form of solar energy which can provide environment-friendly option in uncertain times and can provide long-term sustainability of global economy. Solar energy technologies have the potential to decrease climate change through energy-related emissions (Li, Dai, & Cui, 2020). Increasing energy demand has initiated a focus on using hydrogen from water as a substitute for oil and fossil fuels (Boretti, 2020).

The first part of the chapter discusses theoretical perspectives of sustainable development and environmental performance with regards to three main issues: energy, water and carbon emissions, whereas the later part highlights the importance of solar technology as a low-polluted alternative to fossil fuels in the retail sector. Sustainable development of energy, water and environmental precautions such as reducing carbon emissions are of interest to wider branches of industries including retail, energy and water sector, governmental policymakers, researchers, educators and society. The purpose of this chapter is to increase the debate of the key issues of sustainable development regarding environment, energy and water in the modern times.

Corporate social responsibility (CSR) has been consistently discussed by the retail companies as a key factor of their strategic plan. The widely divided literature on the link between CSR and financial performance has distracted the researchers to focus on the important variables of CSR, that is donations, community work and environmental performance. This chapter provides a reflection on why retail companies make these variables of CSR as the integral part of their core strategy and pinpoint the underlying benefits of adopting these variables. In the CSR disclosures, donations, community work and environmental performance are highly focused by the retail companies. Thus this chapter paves the way for the discussion for the highly significant variables of CSR in the retail industry. The chapter not only presents a framework on which future studies can be based but also improves the understanding of the concept that why donations, community work and environmental performance are important for the retail industry in the United Kingdom. The retail companies and the policy makers at the global or local level develop effective and relevant strategies by drawing on the multiple aspects of CSR. Despite having an extensive body of knowledge about CSR, there is however little known about the importance of community work, donations and environmental performance in relation to the UK retail industry.