Relationship between employee corporate social responsibility (CSR) attitudes, job satisfaction and organisational commitment in Bangladesh

Abstract

Corporate social responsibility (CSR) is a practice increasingly undertaken by modern businesses to achieve economic and social goals. It refers to businesses incorporating the interests of stakeholders as well as those of shareholders. The dimensions, patterns and practices of CSR vary between developed and developing countries. While in the past scholarly research has focused on the views of stakeholders, there is an increasing trend in academic research to examine employees' reactions to CSR initiatives. It has been observed that such initiatives influence employee attitudes and behaviour, such as job satisfaction (JS) and organisational commitment (OC). Previous studies, mostly conducted in developed countries, have demonstrated a positive relationship between employee corporate social responsibility (CSR) attitudes and both job satisfaction (JS) and organisational commitment (OC). The present research aims to investigate the nature of the aforementioned relationship in a developing contextual environment, Bangladesh. The Bangladesh central bank has taken a number of initiatives to promote CSR in the banking sector, which have influenced both Islamic banks (IBs) and conventional banks (CBs). With the growth of IBs in Bangladesh and with their increased participation in CSR initiatives, it is apparent that IBs are involved in additional CSR activities, in comparison to their conventional counterparts, possible influenced by the religious values of these banks. The current study addresses a key research question: 'what is the relationship between employee CSR attitudes, and JS and OC in an Islamic bank and a conventional bank in Bangladesh'? Social identity theory and value congruence theory are used to explain employee CSR attitudes and their behavioural outcomes. Analysis of data from a survey of 502 employees (271 from an IB and 231 from a CB) showed a positive relationship between CSR attitudes, and both JS and overall OC. Furthermore, three different types of commitments were examined, findings suggest that Affective commitment is the strongest among the employees of both the banks. Although this finding is similar to the findings of most previous studies conducted in developed countries, the motivation behind CSR is significantly different in developing countries. Consideration of Corporate Governance (CG) mechanisms, ownership structure and board composition are important factors in developed countries. Moreover, businesses in developed countries increasingly embrace social issues into their core business strategies. Furthermore, the shareholders and managers in developed countries support CSR as they identify a clear link between CSR and organisational image, affecting share prices, particularly important where managers’ compensation is tied to stock options. Conversely, in developing economies, the company ownership structure is characterised by family dominance, corruption and political interference, which means it is not conducive to the adoption of western-styled rational CG models. Moreover, the motivation for CSR in a developing country like Bangladesh is associated with philanthropy and religious belief, buyer driven compliance for export oriented businesses, ‘largely cosmetic’ and ‘a response to pressure from international market’, intention to manage influential stakeholder groups and occasionally by the initiatives from the regulatory authority, like the central bank of Bangladesh. This research is novel because there are few, if any, quantitative studies on the relationships among employee CSR attitudes, OC and JS encompassing organisational religiosity in a developing country context. This study is among the first to propose and test a set of relationships among these constructs. The findings of this study contribute to the CSR literature because they explore a previously under-explored area of CSR, in particular in relation to the emerging field of CSR and human resource management practices involving employees’ satisfaction and commitment from a contingency perspective. This study also has several practical implications for managers and policy makers as well as for future research. As this study shows that CSR attitudes are related to positive workplace outcomes, it is recommended that managers develop CSR awareness and positive CSR attitudes among employees (particularly in the banking sector of Bangladesh) and encourage their respective banks to contribute more resources towards CSR to enhance positive workplace outcomes among employees. As for future research, it is recommended to replicate the current study by using more banks and /or respondents and to focus on other industries as well as cross-sectional samples to examine the external validity of the current study. In addition, it is recommended that future studies include other variables/factors such as turnover, employees’ productivity, relationship between religiosity and employee salary, religiosity and CSR, and so on. Finally, further studies in a different geographical and economic area could give different results and extend the scope the study.