Question

Write a literature review of employee involvement in CSR. (at least 5 pages)

Answer 1

Literature review of employee involvement in CSR

CSR:-Corporate Social Responsibility

Initially, organizations practiced CRS activities out of their own choice, for philanthropic reason. Such organizations were very few, to start with, in India. However, in the year 2013 Government of India made it mandatory for all organization having “profit of 500 Crore to invest at least 2% of their annual profit, every three years” towards CSR activities. Non-compliance of this is liable for punishment. With enforcement of the New Companies Act more and more organizations have started investing in CSR activitie
Corporate Social Responsibility (CSR) is one of the most prevalent topics in the
corporate conversations around the world now days and has also received extensive
attention from both academicians and researchers over the years (Durand, 2006; Jamali
and Mirshak, 2007; Kim et al., 2012; Lee et al., 2013). The review of literature
available discloses that the taxonomy was developed over several decades as a broader
set of obligations for companies which perceived CSR (Devinney, 2009).

The concept of CSR refers to the common understanding that modern businesses have a
responsibility towards the society beyond „just profitability‟. That is, the corporations
should be responsible for more than simply making profit (Godfrey & Hatch, 2007).
CSR may be defined as „actions that appear to further some social good, beyond the
interests of the firm and that which is required by law‟ (McWilliams and Siegal, 2000). It encompasses notions of business ethics and the importance of stakeholders besides owners, investors and any shareholders (Henderson, 2007). Redford, (2005) stated that
CSR is the positive action(s) of any company or organization towards the society.

CSR is not a new concept; authors have even shared statements in 1930s…
“CSR analysis economical, legal, moral, social and physical aspects of
environment”
(Chester Barnard, 1938)

Inthe present scenario of business, it is important to satisfy the needs of theshareholders, stakeholders, national and international regulators, watchdogs, NGOs, etc.(Hatcher, 2002) because CSR is considered to be vital link between business and stake holders.

Companies are expected to operate in an ethical way to portray a good image in the society. It is important to deal in a fair manner with shareholders, suppliers, regulators, customers and especially employees because they are the internal stakeholders and help company to grow. With the swift increase of CSR in many firms, it becomes important to know the way in which CSR affects the employees‟ perception. Employees are considered to be one of the most important stakeholders of any company because their satisfaction and motivation will reflect the productivity. Bhattacharya et. al., 2009 were of the opinion that CSR is one of the important components to bridge the gap between its operations and reputation in the eyes of stakeholders like its employers and customers not in Indian hotels. Kotler & Lee, 2005 and Rego et. al., 2003 concluded that one of the most know benefits of involvement in CSR activities is that it improves the relations between companies and its multiple stake holders.Valentine & Fleischman, 2008 have observed that CSR activities lead to job satisfaction of the employees of various fields. (Chaing, 2010) has suggested that company‟sstrategies should be merged with CSR to improve the company‟s profile job satisfactionrate of employees and employee engagement is a key to sustainable success, therefore,it becomes important for hotel companies to explain the importance of taking care oflocal communities and the environment. In addition to this, companies should alsoprovide with good working conditions so that they can feel good about their companyand consequently have a strong commitment and improve their job satisfaction andmorale. They are the primary stakeholder and are first line contact for customers.Employees will not be able to convey the message to the customers accurately if theyare not aware of the efforts made by the company. They are the once who execute CSRstrategies and are directly engaged in CSR practices. Many companies have designedthe corporate philanthropic programs in a way that the employees get establish goodfaith and strong business reputation which improves the employees' morale and productivity (Porter & Kramer, 2002; Geroy et, al., 2000) and employees get opportunities to strengthen their professional and interpersonal skills through informal training program under employee volunteer programs (Ross, 1997) which increases the
morale of the employees to improve the job satisfaction resulting in less turnover(Lantos, 2002) and leads to strong organizational commitment of the employees (Stites& Michael, 2011; Brammer, et al., 2007). Koh & Boo, (2001) have stated that one ofthe dimensions of CSR is organizational ethics which improvise the job satisfaction ofemployees.
This study has further strengthened the role of CSR and its impact of employee motivation. The study by Zheng (2010) has suggested that companies should communicate to employees regarding CSR strategies and focus on ethical engagement as organizations will also get benefitted by effectively interacting with the employees on CSR issues. Employees' perceive that conforming to rules and regulations, reducing waste and pollution, treating employees and other stakeholders fairly and getting engaged in community development are a part of CSR (Maignan & Ferrell, 2000). Employee perception towards company's CSR activities is positive work outcomes. It
also helps the employees to develop the skills like social networking and group identification (Caldwell & Andereck, 1994). Many researchers have stated that companies with CSR image provides an organizational identification which raise to a very clear organizational visibility amongst the stakeholders, especially presentemployees or even who are seeking job have a positive influence and helps the employer to attract the job seeker segment as they get attracted towards company‟snorms which are practicing CSR. Moreover, if an organization focuses on the development also a component of CSR practice then the relationship between management and employees get increased which leads employee retention resulting to higher level of job performance and directs the employees towards strong organizational commitment. Recent researches have observed that CSR initiatives may raise organizational visibility (Farooq et. al, 2013; Glavas & Godwin, 2013; Kim et. al, 2010) which helps the employer to attract the job seeker segment as they get attracted towards companys' norms which are practicing CSR (Turban & Greening, 1997; Albinger & Freeman, 2000). In fact, Companies who want to show cast themselves as socially responsible enterprise have started disclosing the voluntary CSR practices in their annual reports (Campbell, 2000; Deegan and Gordon, 1996). Several studies have shown that future employees are attracted more towards companies which are socially responsible rather companies which are less socially responsible (Albinger & Freeman, 2000; Evans & Davis, 2008). Therefore, CSR gives an edge to companies as an important recruitment tool, especially in case of high potential candidates with increased choice of jobs (Albinger & Freeman, 2000). Companies which are strongly committed to CSR activities can recruit and retain their employees more easily (Turban & Greening, 1997). In fact, CSR increases the relation between management and employees and employee retention if organizations' focuses on the development and quality of products and services which leads to higher level of job performance (Cameli et. al, 2007). Companies have realized that activities like employee volunteer programs may enable to increase the morale and productivity of employees (Geroy, Wright & Jacoby, 2000) and have designed the corporate philanthropic programs in a way that the employees get establish good faith and strong business reputation which improves the employees' morale and productivity (Porter & Kramer, 2002). (Koh & Boh, 2001) have mentioned that organizational fairness will have a positive psychological impact on the employee perceptions because it affects the work attitude and behavior and employees who volunteer are more motivated and attain personal satisfaction by undertaking meaningful tasks and helping people (Dolincar & Randle, 2007) and get influenced by the company's CSR practices which results to a stronger organizational commitment (Brammer et. al, 2007).Employees also get opportunities to strengthen their interpersonal skills through informal training program under employee volunteer programs (Ross, 1997) and professional skills like teamwork, communication, event management and leadership/interpersonal could be developed in employees through workplace volunteer programs (Wild, 1993) which might increase the morale of the employees and can improve the job satisfaction resulting in the less turnover (Lantos, 2002) and help the employees to develops the skills like social networking and group identification (Caldwell & Andereck, 1994). Researchers have observed that CSR activities lead to job satisfaction of the employees of various fields (Valentine & Fleischman, 2008). Literature findings have directed a positive relationship between an organization‟s CSR engagement and employees‟ job satisfaction (Phillip, 2000). Employee engagement is a key to sustainable success; therefore, it becomes important for hotel companies to explain the importance of taking care of local communities and the environment. In
addition to this, companies should also provide with good working conditions so that they can feel good about their company and consequently have a strong commitmentand improve their job satisfaction (Chiang, 2010).Employees' perceive that conforming to rules and regulations, reducing waste and pollution, treating employees and other stakeholders fairly and getting engaged in community development are a part of CSR (Maignan & Ferrell, 2000). Organizational fairness will have a positive psychological impact on the employee which helps them to work together and enhance the personal and professional skills like teamwork, communication, event management and leadership qualities. Activities for CSR also help the employees to develop skills like social networking and group identification which is again a motivational factor for them to have a commitment towards the organization. It has been observed that activities like employee volunteer programs may enable to increase the morale and productivity of employees, therefore, many companies have designed the corporate philanthropic programs in a way that the employees get establish good faith and strong business reputation which improves the employees' morale and productivity. One of the dimensions of CSR is organizational ethics which improvise the job satisfaction of employees (Koh & Boo, 2001). Employee perception towards company's CSR activities is positive work outcomes. The study has suggested that companies should communicate to employees regarding CSR strategies
and focus on ethical engagement as organizations will also get benefitted by effectivelyinteracting with the employees on CSR issues (Zheng, 2010). Previous research on
relation between attitude and behavior has denoted that it is not necessary that attitude always become behavior because of individual, social and cultural factors (Bentler & Speckart, 1979; Zanna, et. al, 1980) but CSR practice leads to the positive effects towards organizational commitment of employees (Stites & Michael, 2011). Employees relate themselves with organizational identification and believe in knowledge sharing. They do acknowledge the efforts made by company for other stakeholders along with actions focused on them but companys' concern about the environment doesn‟t have much impact on the employees (Farooq et, al, 2014). Now days, people would rather work for organizations which care about their customers, employees and other for the sense of being valued and respected. There are companies which have realized that implementation of ethical policies have increased the employee commitment for their organization (Egan, 2006). Employees are aware of CSR activities and its prospects and fulfilling their expectations about CSR can result in better work attitudes, greater productivity and decreased rate turnover (Trevino & Nelson, 2004). It is largely recognized fact that the hotel employees have relatively higher turnover rate than other industries. Studies have revealed that the morale might be enhanced through CSR and human resource management if the employees participate in workplace volunteer programs, which can provide a satisfied job and decreased staff turnover (Lantos, 2002). Formal policies that are directly related to the employees such as working conditions, safety and security, etc. demonstrate company‟s commitment to the employees and reflect the fairness and attributions of companies morality, built trust in company and reduce the fear of exploitation which holds the employees with organization (Aguilera et al, 2007; Rupp, 2011; Rupp et al., 2006). As per the existing literature, the views of hotel employees in the context of CSR have not been taken into consideration till now. Therefore, it is requisite for hotels along with employees to share the views in order to achieve the maximum benefits of CSR within the hotel companies and society at large. It is suggested that companies should communicate to employees regarding CSR strategies and focus on ethical engagement so that organizations will
also get benefitted by effectively interacting with the employees on CSR issues.
Volunteer employees are motivated and attain personal satisfaction by undertaking meaningful tasks and helping people. Employee engagement is a key to sustainable success; therefore, it becomes important for hotel companies to explain the importance of taking care of local communities and the environment. In addition to this, companies should also provide with good working conditions so that they can feel good about their company and consequently have a strong commitment and improve their job satisfaction. Participation in the workplace volunteer programs increases the morale of
the employees which improves the job satisfaction resulting in the less turnover and
higher productivity.

CSR has a direct influence on employees which contributes towards increased job satisfaction, personal satisfaction, morale, decrease attrition rate, attract high potential, candidate, strengthens professional and personal interpersonal skills, and improves productivity and quality of life which in turn reflects high job performance.