Corporate Social Initiative (CSR)

Corporate Social Initiative (CSR)

Corporate Social Initiative or CSR is a special kind of practice that includes the benefits of society, which is achieved by some initiatives taken by a company. A company does not seek financial profit from any of its CSR activities but there is a certain kind of attention the company receives that helps the management to increase its goodwill among its customers, society and employees. The domain of CSR is a widespread and from giving a part of company’s profit to charity, or adopting changes to implement greener business operations, all fall under the category of CSR. According to Moon et al. (2014, p.55) CSR activities include environmental effort, philanthropy, ethical labor practices and volunteering. Employee satisfaction is an important factor for any company to run its operations smoothly and a rightly chosen CSR effort, in many ways can help a company to satisfy its employees. We further examine this by categorizing into different inquiry question. First to know, the concept of CSR and the research approaches taken with respect to this field. Second, to know how does the concept of CSR influence on employee satisfaction. This is further inquiry is made, to know the mediation effects on CSR with organizational image.  Lastly, does level of reward have significant effect on employee satisfaction or not?

The concept of Corporate Social Responsibility

CSR in many ways affect the company’s reputation in the market and the attitude of the employees towards the organization. CSR is becoming more main stream these days because the company wants to sustain in their core business operations that can create a shared value for business and society. Sustainability is not only important for customers but also the core strategies of business and its success depend on it. The main function of CSR is to help the communities in their problems that are global in scope and has a multifaceted structure. CSR is a set of policies, practices and initiatives that help the company to keep a transparent and honest image that will have a good impact on the environmental and social betterment, as opined by Hoeffler et al. (2010, p.82). As consumers are getting more and more aware about social issues, the companies are also changing their CSR tactics that suit the contemporary situation. It should be noted that the impact of CSR does not only apply to the employees to make them keep loyal to the company, but its applies to the employees of the company too. Therefore, it can be said that the effect of CSR is presented both externally and internally.

CSR and Employee Satisfaction

A company with a good record of CSR activities holds a good image in the community that many employees want to work in that company. So, before being recruited in the company, the effects of CSR can be seen on the company. A company can affect the employees on two ways. Firstly, it has an impact on the prospective employees and secondly it has an impact on the existing employees. Greeting and Turban (2000, p.270) stated that companies with a good record of accomplishment of social and corporate performance often have the ability to attract talented workforce. Thus, it is clear that before actually joining in a company, the employee gets satisfied with the company’s history and so he wants to join there, observed Backhaus et al. (2002, p.310). The employees want to be posted in such companies because the companies have already promoted the idea that they offer a work atmosphere that encourages the employees to take part in social responsible activities, which will grow social concepts and identities of the employees. The existing employees are also impacted by the organization’s CSR. A company, which has a good CSR, can hold its employees because they are committed to their work and they are loyal to the company and they do not usually leave the company as they think leaving the company may affect their career negatively, as noted by Perrini and Vurro (2010). They are satisfied with the overall process in which employees are treated and a certain level of communication is maintained in the company. On the other hand, companies with a bad CSR record gradually become a bad place to work so the dissatisfied employees want to leave (Onkila, 2015).

Mediation effect of organizational image

The mediating effect of the organizational image can affect the satisfaction of the employees in an organization. The point is, the main function of CSR is to build a good reputation in the market to attract customers who are showing an increasing social awareness in recent times. Precisely, customers are attracted toward those companies that have managed to secure a more environment and society friendly approach rather than those who are having a bad past record of some massacre or just silent in their CSR activities. A company, which has a preferably well CSR record, are more effective in attracting employees and the employees think that working in that company can give his career a solid boost, as stated by (Tariq, 2015). The companies, which do not have any such good record of accomplishment, cannot attract employees and the rate of employees leaving the company is high. Moreover, the employees show a greater amount of commitment to the companies with more CSR activities (Barakat, et al., 2016).

Level of reward on employee satisfaction

Rewards are an important factor to keep the employee satisfaction at a constant level. Rewards can be of two kinds. Financial rewards, that includes performance rewards, incentive schemes etc. and non-financial reward that does not promise any kind of monetary reward but gives accomplishments, acknowledgements and verbal appraisal in front of other employees. Brammer and Millington (2008, p.1330) said that reward is important to motivate the employees that can make them more enthusiastic about working in the company and it helps to generate a sense of self-accomplishment that is crucial to any employee. That helps the employee to remain loyal to the company and the employee thrives to attain the organisational objectives. This leads to employee satisfaction and generate positive vibes (Bustamam, Teng and Fakhrul,2014).

Overall, this review responds to the key factors that play important role in employee satisfaction and managing the employees. CSR initiatives mean a lot to the employee who is currently working in the company as well as who are willing to be employed in the company. Other factors are also important in employee satisfaction like job security and company values. These factors are also directly linked with company’s CSR strategies because a company is valued more when it undertakes many CSR activities. In addition to this, it also stabilizes the overall business process which ensures job security and employee satisfaction, as commented by Cheng and Chan (2008, p.282). Thus, it can be said that the more CSR value a company earns, the more it satisfied its employees are and in terms of level of reward it is an important factor (Brammer & Millington,2008) that motivate the employees that can make their work satisfaction. To conclude, there are some gaps visible from the previous review of literature findings and more research is required for better gaining and understanding the CSR influence level of employee satisfaction. Finally, as CSR adopts the creation of intangible capital (Hoeffler et al. (2010), future research might need to analyze the relationship between corporate social responsibility and other intangible assets, such as culture and innovation.


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