Analysis of the Importance of Job Insecurity, Psychological Safety and Job Satisfaction in the CSR-Performance Link

Abstract

Existing works on the association between corporate social responsibility (CSR) and performance have investigated how CSR affects external stakeholders (e.g., shareholders, customers, local communities, and environment). However, the effect of CSR on internal stakeholders such as employees who ultimately determine organizational performance is relatively underexplored. Institutional theory suggests that institutional enablers, e.g., CSR practices, influence macro-level variables, like organizational performance, via micro-level intermediating processes, such as perceptions, attitudes and behaviors of employees. Thus, this paper proposes that internal mechanisms are essential to explain the CSR-performance link. Using a 3-wave time-lagged survey data of 301 workers in South Korean firms (144 men and 157 women, average age: 40.30), this research examines how psychological safety and job satisfaction of an employee function as sequential mediators in the CSR-performance link. Moreover, the current research also investigates how job insecurity negatively moderates the link between CSR and psychological safety. The results demonstrated that psychological safety and job satisfaction function as sequential internal mediators in the link. In addition, job insecurity negatively moderated the influence of CSR on psychological safety. The results suggest that an employee’s perceptions and attitudes, such as job insecurity, psychological safety, and job satisfaction, significantly influence the relationship between CSR and performance.