Corporate Social Responsibility and Employee Commitment: An Exploratory Study

Recent business scandals like Satyam scandal of falsified accounts, Lehman brothers collapse, Common wealth Games, 2G Spectrum frauds to name a few have shaken the corporate world and have placed an immoral front. In the aftermath of these acts, the business community is rethinking in discharging their responsibilities towards various stakeholders. Despite the enormous concentration on corporate social responsibility (CSR) activities, less stress has been given to the employee perspective. The current paper contributes in the efforts to understand CSR from the employee perspective. CSR describes the relationship between the organisation and the stakeholders.

The main objective of the study was to explore the relationship between perceptions of CSR towards external stakeholders (social and non-social stakeholders), internal stakeholders (employees), ethics and employee commitment. Further, it also aimed to investigate differences among perceptions of CSR and employee commitment according to gender, tenure and hierarchy. The sample comprised 85 employees working in diverse sectors. The questionnaires were administered through an online survey. Pearson correlation coefficient and independent sample t-test analysis was used to prove the hypothesis. The results obtained were consistent to the hypothesis formulated.

Results of the study indicate that:

• The perceptions of CSR towards external stakeholders are positively related to employee commitment. The external stakeholders in this paper are limited to community, government, investor, suppliers and customers.

• The perceptions of CSR towards internal stakeholders are positively related to employee commitment.

• Female employees show stronger preferences for the CSR initiatives in the organisation than male employees.

These findings have implication that Corporate Social Responsibility affects commitment level of employees. The positive relationship between perceptions of CSR and commitment emphasizes the payoff that may flow from investment in CSR. The relationship between external CSR and commitment suggests the benefits are not restricted to external reputation and external stakeholder management, but may also be reflected in the behavior of internal stakeholders.