Employee Performance Implications of CSR for Organizational Resilience in the Banking Industry: The Mediation Role of Psychological Empowerment

Abstract

Corporate social responsibility (CSR) has been found to be important in boosting organizations’ sustainability and resilience against crisis. Although employees constitute key internal stakeholders for CSR, limited attention has been paid to them. The purpose of this research is to examine how employee perceptions of CSR activities affect employee performance through their sense of psychological empowerment. Drawing upon a sample of 203 employees in the Cypriot banking sector, a structured questionnaire was administered to measure employee performance, psychological empowerment, and CSR activities as perceived by employees. The analysis of data, based on path modeling using the partial least squares (PLS) approach, confirms the mediating role of psychological empowerment between CSR activities (philanthropic, ethical, and environmental) and job performance. This study contributes to the theoretical evolvement of the CSR literature, as it established the mediating role that psychological empowerment plays between perceived CSR and job performance. The findings suggest that CSR should be treated not just as a pressing obligation but as a dynamic investment in organizational effectiveness, sustainability, and resilience because positive employee perceptions of CSR can contribute to staff empowerment and indirectly to job performance.