The impact of internal corporate social responsibility (ICSR) on employee engagement in local and multinational organizations in Pakistan

Importance and Key Contribution Over three decades corporate social responsibility (CSR) has become a popular subject of public debate and organizational success (Carroll, 1979; Margolis & Walsh, 2003; McWilliams & Siegel,... [ view full abstract ]

Importance and Key Contribution
Over three decades corporate social responsibility (CSR) has become a popular subject of public debate and organizational success (Carroll, 1979; Margolis & Walsh, 2003; McWilliams & Siegel, 2000). Although it is more commonly associated with a firm’s dealings with its external stakeholders, it also has an internal dimension. The study will examine the relationship between Internal CSR (ICSR) practices and employee engagement. It is significant from the CSR literature that employee engagement (EE) is found to be a strong driver of internal motivation which in result leads companies to long-term success and sustainable development (Harrington 2007; Harter et al. 2002 & James 2004). Findings from this study are expected to advance the existing CSR literature, in particular ICSR, and offer valuable strategic insights into the link between organizational and HRM&D strategies for enhanced employee engagement in today’s diverse workplace (De Cieri et al. 2005; Pinnington et al. 2007).

Aim of paper
The proposed study intends to investigate and compare the current CSR, especially ICSR, practice and its relationship to employee engagement in local and multinational organizations in Pakistan. The local and multinational organizations are chosen for their prominence in the economy (market value, public exposure and employment size).

Corporate Social Responsibility (CSR) is considered to be a high profile management variable which the business world perceives as strategic (Economist, 2008; Porter & Kramer, 2006.Though CSR has been defined in various ways, Wood (1991, 693), is one of commonly cited authors, defines CSR as “a business organization's configuration of principles of social responsibility, processes of social responsiveness, and policies, programs, and observable outcomes as they relate to the firm’s societal responsibilities".

In the field of Human Resource Management & Development, researchers began to investigate the impact of CSR on employees and their work attitudes such as employee engagement (Alshbiel, & Awawdeh, 2011; Ali et al., 2010; Lee et al., 2009; Peterson, 2004; Turke, 2009 & VanBuren, 2005). These past studies implicitly and explicitly have shed light on the duality of CSR, more specifically the internal dimension of CSR or internal CSR (ICSR). According to Brammer et al. (2007 pp. 1701-19), ICSR encompasses "the activities related to all the internal operations of the company" these activities includes the social topics of engaging in fair and efficient HRM, guarantee safety, respect freedom of association, abandon discrimination & encourages work place diversity (Martinuzzi, Gisch-Boie et al., 2010). Despite the duality, however, management attention has been largely skewed toward external stakeholders, overlooking CSR activities concerning an organisation's internal stakeholders, employees. This is also reflected in the past CSR literature whose foci are predominantly on CSR practices concerning environment, sponsorship and charity. In this regard Saks (2006) and Robinson et al. (2004) argue that Employee Engagement (EE) studies are among few exceptions. As defined by Kahn (1990:694) employee engagement is “the harnessing of organization members’ selves to their work roles; in engagement, people employ and express themselves physically, cognitively, and emotionally during role performances". Employee Engagement has been found to be a strong driver of internal motivation and results in long-term success and sustainable development (Harrington 2007; Harter et al. 2002; James 2004). Basil and Weber (2006) contend that ICSR can be one of the most useful tools to motive employees.

It has been noted that internal CSR has been neglected and there is a need to find out how this influences employee engagement in an organization. CSR has been a very popular subject among theorists and practitioners. Several approaches in understanding internal CSR have been proposed so far and it has been noted by many scholars that there is minimal literature available in this area except for these few studies (Mory et al; 2015; Skudiene & Auruskeviciene 2012; Slack et al., 2014; Valentin et al., 2015; Donaldson & Preston 1995; Freeman 1984; Greenwood 2007; Kaler 2009; Matten & Crane 2005). Furthermore, the extant literature is scant on the subject in countries other than in the developed world.

It is found that the idea of CSR especially ICSR in Pakistan is still not developed clearly. Only a few companies have existing CSR policies and the others are completely unaware of the benefits and advantages of implementing ICSR policies in their organizations (Faiz & Ambreen, 2002; Ahmed et.al, 2015; Awan et,.al , 2012). Hence, this proposed study aims to fill the gap from a Pakistani perspective as well as to generate comparative insights into ICSR practice and its impacts on employee engagement (EE) in local and multinational organizations in Pakistan.

Theoretical framework
Figure 1 below depicts how stakeholder theory will be used to identify internal stakeholders and to investigate the implementation of ICSR to enhance employee engagement in the study.

Figure: -1: Theoretical Framework

Research Questions and Methodology
The following research questions have been developed:

RQ1: What ICSR activities are being practiced in local and multinational organizations of Pakistan?
RQ2: How do key stakeholders influence the implementation of ICSR?
RQ3: Do ICSR factors enhance employee performance and engagement?
RQ4: What are the benefits of implementing ICSR in an organization?
The proposed study will be interpretivist as it will focus on naturalistic methods primarily on semi-structured interviews. As defined “interpretive researchers assume that access to reality (given or socially constructed) is only through social constructions such as language, consciousness, shared meanings, and instruments” Myer (2008). To gain insight into the issues in detail an inductive approach will be used as it will provide the researcher the opportunity to inquire about the experiences of the participants through direct interaction by undertaking semi-structured interviews in order to design a framework and then formulate a theory (Goddard & Melville, 2004). The study will be carried out using grounded theory which involves constant comparative analysis of data obtained (Corbin & Strauss, 1990). As has been noted by many scholars, there is lack of research on internal CSR practices in organizations therefore there is a need to develop a new theory to explore the impact of ICSR on employee engagement (Harrington 2007; Harter et al. 2002; James 2004; De Cieri et al. 2005; Pinnington et al. 2007). Grounded theory will aid in generating extensive information by undertaking semi-structured interviews and make comparisons among different data gathered in a productive way (Strauss & Corbin, 1998). Comparing the data and moving in and out of the data collection and analysis process is known as ‘iteration’ in grounded theory.

After collecting data through semi-structured interviews the researcher will analyze the data. This initial analysis of data will assist the researcher to develop a theory on the basis of questions asked. Based on this initial theory the next sample will be formed this is known as theoretical sampling (Strauss & Corbin, 1993). The comparative analysis process between the categories of data obtained through semi-structured interviews will continue until it reaches saturation point where the researcher will find no new idea or theme. This study adopts a qualitative methodology to investigate the impact of internal CSR on employee engagement in detail through direct interaction with the participants (Bryman & Bell, 2007). Moreover, the study is cross-sectional as semi-structured interviews from HRM&D managers and employees will be conducted at one time and this can assist in comparing different population groups at a single point in time.

This study will employ three local organizations and three multi-national organizations from Pakistan. Data will be collected using purposive non-probability sampling. Based on Creswell’s (1998) recommendation for the qualitative research 12 HRD&M managers (two from each company) will be approached and selected through references and acquaintance to undertake semi-structured interviews. Three employees from each organization (n=18) will be selected through snowball sampling from different departments of the local and multinational organizations (n=6) of Pakistan. By using snow-ball sampling employees will recommend their fellow employees from different departments who will meet the specific criteria and are knowledgeable about the particular issue under discussion (Patton, et al., 2002).The semi-structured interviews will be recorded using an mp3 player. In addition notes will be taken during the semi-structured interviews. The data collected will then be transcribed and coded by using Nvivo10 software to undertake a thematic analysis of the qualitative data. This study adopts Corbin & Strauss’ (1990) approach of data analysis by using three stages of coding: open coding, axial coding, and selective coding.

Implications and contributions
• The study will contribute in understanding the positive relationship between internal CSR (ICSR) and employee engagement (EE) relationship given the critical role of employee engagement (EE) in an organizations’ success.
• The study will aid the organizations in identifying and implementing the ICSR factors which will benefit both the organization and employees as it is found that ICSR positively influences employee contentment, satisfaction and engagement level (Heslin & Ochoa, 2008; Aguilera et al., 2007).
• As extant literature is largely limited regarding the impact of ICSR practices therefore the study is expected to add to the management literature by examining the impact of various dimensions of internal CSR on employee engagement in a Pakistani context.


Keywords: CSR, ICSR, Pakistan, employee engagement

CSR, ICSR, Pakistan, employee engagement [ view full abstract ]

CSR, ICSR, Pakistan, employee engagement