The Effects of Corporate Social Responsibility on Employee Engagement: Evidence from China

Size: px

Start display at page:

Download "The Effects of Corporate Social Responsibility on Employee Engagement: Evidence from China"

Isabella Bates
5 years ago
Views:

1 2015 International Conference on Management Science & Engineering (22 th ) October 19-22, 2015 Dubai, United Arab Emirates The Effects of Corporate Social Responsibility on Employee Engagement: Evidence from China LIAO Yong-zhong 1,CHEN Xiao-chun 2 1 School of Economics and Management, Hebei University of Technology, Tianjin , P.R.China 2 School of Humanities and Law, Hebei University of Technology, Tianjin , P.R.China Abstract: Engaged employees are the valuable resources of every organization, and raising employees engagement levels is the crucial issue of human resource management of all organizations. As an important contextual variable, corporate social responsibility (CSR) may influence the levels of employee engagement in workplace. From the perspective of the employee perceptions, the effects of seven aspects of CSR behaviors on employee engagement were tested based on the survey data of 1837 employees in a variety of occupations and organizations in China. The empirical results showed that not all aspects of CSR behaviors except CSR to its shareholders and to the environment could have significant positive effects on the engagement levels of their employees. The implication might be that it is not enough for an organization to merely flatter their employees to raise their engagement levels. Keywords: corporate social responsibility, employee engagement, stakeholder theory, social exchange theory, Chinese employees 1 Introduction Since William Kahn (1990) firstly proposed the concept of personal engagement in his seminal paper [1], there has been a steadily growing stream of research that has sought to further explore the meaning and significance of engagement [2]. The reason that engagement has garnered so much attention lies in its dual promise of enhancing both individual well-being and organizational performance [3]. Many researchers have found that engagement has significantly positive impacts not only on task performance [4], organizational effectiveness [5], and organizational citizenship behaviors [6][7][8], but also on individual s life satisfaction [9][10]. Now the engaged employees are regarded more and more as the valuable resources by all the organizations. Due to the importance of engagement, researchers have paid more attention on the antecedents which may influence the levels of employee engagement. Job characteristics (such as task variety and task significance), leadership (such as transformational leadership), and dispositional characteristics (such as conscientiousness and positive affect) all may have significantly positive effects on employee engagement [4]. Shuck, Reio Jr, and Rocco (2011) confirm that job fit, affective commitment, and psychological climate are all significantly related to employee engagement [11]. He, Zhu, and Zheng (2014) argue that procedural justice can enhance employee engagement through employee organizational identification [12]. Menguc, Auh, Fisher, and Haddad (2013) find that supervisor support has a positive effect on engagement [13]. Saks (2006) points out that job characteristics, procedural justice, and perceived organizational support can predict the level of employee engagement [14]. Although existing many studies focusing on the antecedents and drivers of employee engagement, there are few researches about the relationship between corporate social responsibility (CSR) and employee engagement. Many researchers argue that CSR may explicitly and implicitly influence the attitudes and behaviors of employees in workplace. Aguinis and Glavas (2012) [15] summarize that at the individual level, the outcomes of CSR include employee identification with the organization [16], organizational citizenship behavior [17][18][19], retention and in-role performance [17], organizational commitment [20], employee engagement and employee creative involvement [21]. Why can CSR impact employee engagement? We may explain this question using social exchange theory. Social exchange theory can provide a theoretical foundation to explain why employees choose to become more or less engaged in their work and organization [14]. According to social exchange theory, when an organization is responsible genuinely for its employees, the employees may receive fair well-being and feel obligated to repay the organization with greater levels of engagement. Meanwhile, when the employees perceive that their organization is also responsible for its other stakeholders, they can receive positive socioemotional exchange resources, feel pride working in such an organization, and feel obliged to bring themselves more deeply into the role performances as repayment for the resources they receive from their organization [14]. Stakeholder theory provides us a useful framework for investigating the relationship between CSR and employee engagement. According to stakeholder theory, /15/$ IEEE

2 an organization may have several stakeholders, such as its employees, its customers, its shareholders, its business partners, the government, the local community, and the natural environment. An organization should be responsible for all its stakeholders, and this may obtain repayment of its employees in form of higher level engagement. Some researchers argue that all aspects of CSR for its stakeholders may have significantly positive effects on employee engagement [22]. Is that true? In this paper, we used the investigated data of 1837 employees in a variety of occupations and organizations in China to test the hypotheses we proposed as follows: H1 CSR to the employees has significantly positive effects on employee engagement. H2 CSR to the customers has significantly positive effects on employee engagement. H3 CSR to the environment has significantly H4 CSR to the government has significantly H5 CSR to the local community has significantly H6 CSR to the shareholders has significantly H7 CSR to the business partners has significantly 2 Methodology 2.1 Participants The study was conducted at a large scope located in 25 province in China. The questionnaire was designed to measure the employee s perceptions about their organizations CSR policies and actions, their jobs, and their feelings during their working hours. The questionnaires were mailed by post, ed by internet, and also released on a professional survey website. All variables were measured by five-point Likert-type scales (1 means strongly disagree and 5 means strongly agree ). We excluded 845 participants because of too many blank answers in their questionnaire, and the final samples were Among the final 1837 participants, there were 983 male (53.51%) and 854 female (46.49%) ; 1070 workers (58.25%) and 767 managers (41.75%); 618 employees in state-owned firms (33.64%), 1000 employees in private firms (54.44%), and 219 employees in foreign invested firms (11.92%). We used SPSS17.0 to test the validity and reliability of the CSR scale and employee engagement scale in this study. Due to the more advantage of AMOS than SPSS in estimating the effects of multiple antecedents on the dependent variables, we used AMOS17.0 to calculate and assess the effects of CSR on employees engagement levels in this research. 2.2 Measures Corporate social responsibility There are numerous efforts to bring about a clear and unbiased definition of CSR [23]. In this paper, we used the definition of CSR adopted by Aguilera and Glavas, which means context-specific organizational actions and policies that take into account stakeholders expectations and the triple bottom line of economic, social, and environmental performance [15]. Although there are many approaches to measure CSR, the existing CSR scales can not be able to measure all the aspects of CSR. Therefore, we developed a 52 items CSR scale which included seven subscales by referencing the works of Abbott and Monsen (1979) [24], Turker (2009) [25], Remišová and Búciová (2012) [26], Zheng (2007) [27], Xi (2009) [28], and Xu and Yang (2010) [29]. Specifically, there were nine items (a1-a9) for measuring CSR towards its employees, such as My company offers me good salary, and My company provides many opportunities for my career development ; 10 items (b1-b10) for measuring CSR to its customers such as My company regulates reasonable price of its products and services for its customers, and The company rapidly responds to the customers demand ; 11 items (c1-c11) for measuring CSR to the environment, such as My company is very positive in protecting the environment ; five items (d1- d5) for measuring CSR to the government such as My company pays taxes according the law ; seven items (e1- e7) for measuring CSR to the local community such as My company offers job opportunities for the local residents ; six items (f1-f6) for measuring CSR to its shareholders, such as The company makes great efforts to create the most value for its shareholders ; and four items (g1-g4) for measuring CSR to its business partners, such as The company pay its debts on time. Employee engagement Kahn (1990) defines personal engagement as the harnessing of organization members selves to their work roles; in engagement, people employ and express themselves physically, cognitively, and emotionally during role performances [1]. Although Kahn s definition is accepted widely, other researchers also suggest their own conceptions of job engagement from their own perspectives. Roberts and Davenport (2002) define employee engagement as a person s enthusiasm and involvement in his or her job [30]. Schaufeli, Salanova, González-Romá, and Bakker (2002) define work engagement as a positive, fulfilling, work-related state of mind that is characterized by vigor, dedication, and absorption [31]. Kahn presents a comprehensive theoretical model of psychological presence [32], unfortunately he does not develop an ideal operational construct [30]. May, Gilson, and Harter (2004) [33] attempted to develop a scale to measure employee engagement according to Kahn s thoughts, but they did not succeed. Although the Utrecht Work Engagement Scale (UWES) developed by Schaufeli, Salanova, González-Romá, and Bakker (2002) [31] has been widely used, but it has its own shortcomings [34]. In 2010, Rich, Lepine, and Crawford successfully develop a job engagement scale, which is fit

3 well with Kahn s classical engagement theory and has perfect empirical validity and reliability [6]. For simplicity, we called this scale as Rich engagement scale in our study. The Rich engagement scale may be the best one at the present time, because it is developed faithfully according to the original meaning and thoughts of engagement which is first put forth by Kahn (1990). The Rich Engagement Scale has 18 items which can measure three dimensions of job engagement which are physical engagement (PE), emotional engagement (EE), and cognitive engagement (CE). Some researches have proved that the Rich Engagement Scale has good validity and reliability [12]. Therefore, in this paper, we followed the conceptualization of engagement of Kahn (1990) and chose the Rich engagement scale to measure the engagement level of employees. 2.3 Validity and reliability Responses to all items of CSR and employee engagement were made on a scale ranging from 1 (strongly disagree) to 5 (strongly agree). A Confirmatory factor analysis (CFA) of CSR indicated a chi-square of with 1267 degrees of freedom as well as CFI=0.925, GFI=0.858, and RMSEA= CFA of employee engagement model indicated a chi-square of with 232 degrees of freedom as well as CFI=0.961, GFI=0.928, and RMSEA= The internal consistency reliabilities ( Cronbach alphas) of all the scales were between and 0.964, as shown in Tab.1. 3 Results 3.1 Descriptive statistics and correlations Using SPSS17.0, the means, standard deviations, and Pearson correlations for each of the variables in our study were estimated. The following abbreviations for variables in our paper are used throughout: CSR-YG, CSR to its employees; CSR-GK, CSR to its customers; CSR-HJ, CSR to the natural environment; CSR-ZF, CSR to the government; CSR-SQ, CSR to the local community; CSR-GD, CSR to its shareholders; CSR-HB, CSR to its business partners; and JE, employee engagement. The descriptive statistics and correlation results were shown in Tab.1. We found that there were positive correlations between all aspects of CSR and employee engagement, and all correlations are significant at the 0.01 level. 3.2 Multicollinearity diagnostics Because of existing several independent variables in this study, it was necessary to consider the collinearity problem. Using SPSS17.0, Tolerance, VIF, Condition index and variance proportions were calculated. The 1 The following abbreviations for statistical terms are used throughout: CFI, comparative fit index; GFI, goodness of fit index; RMSEA, root mean square error of approximation. statistic results indicated that there were no serious multicollinearity problems among the seven independent variables as shown in Tab Structural path analysis Structural path analysis was used to test the overall model. Mean scale scores were used for the dependent and independent variables. Using AMOS17.0, the effects of seven aspects of CSR on employee engagement levels were estimated, and the results were shown in Fig.1. The chi-square of the overall model fit was with 3112 degrees of freedom as well as CFI=0.920, GFI=0.838, RMSEA= The standardized path coefficient of CSR-YG to JE was (p<0.001), CSR- GK to JE is (p<0.001), CSR-ZF to JE is (p<0.001), CSR-SQ to JE is (p<0.01), CSR-HB to JE is (p<0.001), therefore hypotheses H1, H2, H4, H5, and H7 were supported. Meanwhile, the standardized path coefficient of CSR-HJ to JE was (p>0.05), and CSR-GD to JE was (p>0.05), and therefore hypothesis H3 and H6 were not supported. Our empirical results showed that CSR to the employees, to the customers, to the government, to the local community, and to the business partners had significant positive effects on the engagement levels of their employees, and CSR to the natural environment and its shareholders did not. This might indicate that when an organization was responsible for the benefits and wellbeings of its employees, its customers, the government, the local community and the business partners, it might receive reciprocity and mutual benefits that derived from its employees in the form of high levels of engagement. But why CSR to the natural environment and to its shareholders did not have significant positive influences on employees engagement level? We think that there may be at least two reasons. First, the employees might regard an organization should be responsible for its shareholders benefits and well-beings as a matter of course, and therefore CSR to shareholders could not inspire the employees to put more effort to their work. Second, at present time, CSR to the natural environment might be still in the stage of the castle in the air from the perspective of the employees, and therefore it couldn t have any significant positive effects on their engagement levels. 4 Conclusion Engaged employees are valuable resources of an organization, and raising the employees engagement levels have been the crucial issues of human resource management of any organization. In this paper, we regarded CSR as an important contextual antecedent variable of employee engagement, and hypothesized that CSR might influence the levels of employee engagement in the workplace. Based on survey data of 1837 Chinese employees, we found that the effects of seven aspects of CSR on employee engagement were different. Except for CSR to the natural environment and to the shareholders,

4 other five aspects of CSR all have significant positive effects on the employees engagement levels. Our findings indicated that the employees engagement levels could be influenced by several aspects of CSR individually or simultaneously. It was not enough for the organization to merely flatter their employees, whereas perform not so good in other aspects to achieve the goal of raising their engagement levels. The organizations must do their best to become the responsible employers to all their key stakeholders. The two unexpected findings were that CSR to the shareholders, especially CSR to the natural environment did not have significant positive effects on the levels of employees engagement. We think that such situations could be changed as the improvement of employees environmental consciousness. The limitation of this paper may be that it was only a preliminary research results at present time. The future research agenda may further explore the influencing mechanism of CSR on employee engagement. Tab.1 Means, standard deviations, correlations, and reliabilities Variable Mean S.D CSR-YG (0.924) 2. CSR-GK ** (0.947) 3. CSR-HJ ** ** (0.958) 4. CSR-ZF ** ** ** (0.927) 5. CSR-SQ ** ** ** ** (0.923) 6. CSR-GD ** ** ** ** ** (0.925) 7. CSR-HB ** ** ** ** ** ** (0.908) 8. JE ** ** ** ** ** ** ** (0.964) **. Correlation is significant at the 0.01 level (2-tailed). Coefficient alpha reliabilities are on the diagonals in parentheses. Tab.2 Collinearity statistics and diagnostics Tolerance VIF Eigenvalue Condition Variance Proportions Index (Constant) CSR-YG CSR-GK CSR-HJ CSR-ZF CSR-SQ CSR-GD CSR-HB Dependent variable: JE CSR-YG CSR-GK CSR-HJ.216***.180*** PE *** CSR-ZF.124*** JE.881*** EE.066**.915*** CSR-SQ *** CE CSR-GD CSR-HB Fig.1 Standardized path coefficients for the research model

5 References [1]W A Kahn. Psychological conditions of personal engagement and disengagement at work. Academy of Management Journal, 1990(33): [2]K. Wollard, and B. Shuck. Antecedents to employee engagement: A structured review of the literature. Advances in Developing Human Resources, 2011, 13(4): [3]C Truss, R Delbridge, K Alfes, A Shantz, E Soane. Employee engagement in theory and practice. Routledge, New York, 2014: 1-2. [4]M S Christian, A S Garza, J E Slaughter. Work engagement: A quantitative review and test of its relations with task and contextual performance. Personnel Psychology, 2011(64): [5]A Kataria, P Garg, R Rastogi. Psychological climate and organizational effectiveness: Role of work engagement. The IUP Journal of Organizational Behavior, 2013, 12(3): [6]B L Rich, J A LePine, E R Crawford. Job engagement: Antecedents and effects on job performance. Academy of Management Journal, 2010(53): [7]E Soane, C Truss, K Alfes, A Shantz, C Rees, M Gatenby. Development and validation of a new measure of employee engagement: The ISA engagement scale. Human Resource Development International, 2012, 15(5): [8]M E Babcock-Roberson, O S Strickland. The relationship between charismatic leadership, work engagement, and organizational citizenship behaviors. The Journal of Psychology, 2010, 144(3): [9]W B Schaufeli, T W Taris, W van Rhenen. Workaholism, burnout, and work engagement: Three of a kind or three different kinds of employee well-being? Applied Psychology: An International Review, 2008(57): [10]A Shimazu, W B Shaufeli, K Kamiyama, N Kawakami. Workaholism vs. work engagement: The two different predictors of future well-being and performance. Int.J. Behav. Med, 2015(22): [11]B Shuck, T G Reio, Jr, T S Rocco. Employee engagement: An examination of antecedent and outcome variables. Human Resource Development International, 2011, 14(4): [12]H He, W Zhu, X Zheng. Procedure justice and employee engagement: Roles of organizational identification and moral identity centrality. Journal of Business Ethics, 2014(122): [13]B Menguc, S Auh, M Fisher, A Haddad. To be engaged or not to be engaged: The antecedents and consequences of service employee engagement. Journal of Business Research, 2013(66): [14]A M Saks. Antecedents and consequences of employee engagement. Journal of Managerial Psychology, 2006, 21(7): [15]H Aguinis, A Glavas. What we know and don t know about corporate social responsibility: A review and research agenda. Journal of Management, 2012, 38(4): [16]A Carmeli, G Gilat, D A Waldman. The role of perceived organizational performance in organizational identification, adjustment and job performance. Journal of Management Studies, 2007(44): [17]D A Jones. Does serving the community also serve the company? Using organizational identification and social exchange theories to understand employee responses to a volunteerism programme. Journal of Occupational and Organizational Psychology, 2010(83): [18]C Lin, N Lyau, Y Tsai, W Chen, C Chiu. Modeling corporate citizenship and its relationship with organizational citizenship behaviors. Journal of Business Ethics, 2010(95): [19]M S Sully de Luque, N T Washburn, D A Waldman, and R. J. House. Unrequited profit: how stakeholder and economic values relates to subordinates perceptions of leadership and firm performance. Administrative Science Quarterly, 2008(53): [20]S Brammer, A Millington, B Rayton. The contribution of corporate social responsibility to organizational commitment. The International Journal of Human Resource Management, 2007, 18(10): [21]A Glavas, S K Piderit. How does doing good matter? Effects of corporate citizenship on employees. Journal of Corporate Citizenship, 2009(36): [22]C Tang, Y Pan, X He. How corporate social responsibility influences employees work engagement? The effect of organizational identification and organizational support // The Fifth Chinese Academy of Management Annual Meeting (MAM2010), Dalian, China, 2010: (in Chinese) [23]A Dahlsrud. How corporate social responsibility is defined: An analysis of 37 definitions. Corporate Social Responsibility and Environmental Management, 2008(15): [24]W F Abbott, R J Monsen. On the measurement of corporate social responsibility: Self-reported disclosures as a method of measuring corporate social involvement. Academy of Management Journal, 1979, 22(3): [25]D Turker. Measuring corporate social responsibility: A scale development study. Journal of Business Ethics, 2009(85): [26]A Remišová, Z Búciová. Measuring corporate social responsibility towards employees. Journal for East European Management Studies, 2012, 17(3): [27]H Zheng. On the behavior of corporate social responsibility: Dimensions, determinants, and impacts on business performance. Zhejiang University, (in Chinese) [28]H Xi. Study of the mechanism of characteristics of corporate social responsibility on employees organizational commitment and citizenship behavior. Zhejiang University, (in Chinese) [29]S Xu, R Yang. Indigenous characteristics of the Chinese's CSR conceptual paradigm. Journal of Business Ethics, 2010, 93(2): [30]D R Roberts, T O Davenport. Job engagement: Why

6 it s important and how to improve it. Employment Relations Today, John Wiley & Sons, Inc., Autumn, 2002: [31]W B Schaufeli, M Salanova, V González-Romá, A B Bakker. The measurement of engagement and burnout: A two sample confirmatory factor analytic approach. Journal of Happiness Studies, 2002(3): [32]W A Kahn. To be fully there: Psychological presence at work. Human Relations, 1992(45): [33]D R May, R L Gilson, L M Harter. The psychological conditions of meaningfulness, safety and availability and the engagement of the human spirit at work. Journal of Occupational and Organizational Psychology, 2004(71): [34]D A Newman, D A Harrison. Been there, bottle that: Are state and behavioral work engagement new and useful construct wines? Industrial and Organizational Psychology, 2008(1):

Procedia - Social and Behavioral Sciences 141 ( 2014 ) WCLTA 2013

Available online at www.sciencedirect.com ScienceDirect Procedia - Social and Behavioral Sciences 141 ( 2014 ) 1315 1319 WCLTA 2013 A Study Of Relationship Between Personality Traits And Job Engagement