An Empirical Research of Environment Management

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AN EMPIRICAL RESEARCH OF ENVIRONMENT MANAGEMENT STRATEGY: EXPLORING THE RELATIONSHIPS AMONG PERCEIVED CORPORATE SOCIAL RESPONSIBILITY, ORGANIZATIONAL TRUST, PERCEIVED EXTERNAL PRESTIGE AND ORGANIZATIONAL IDENTIFICATION

Chin- Lai Su Doctoral student, Doctoral Program of business operations and management College of management, Chang Jung Christian University, Taiwan

Ethel M. Lee MBA, Master Program of business operations and management College of management, Chang Jung Christian University, Taiwan

Yuan- Duen Lee* Professor, Department of International Business College of management, Chang Jung Christian University, Taiwan *Corresponding Author [email protected]

Abstract

This study was designed to survey 200 employees of two big and important companies in Taiwan using an online questionnaire. The first company is Uni- President Corporation (UPC) and the second one is Taiwan Chinese Petroleum Corporation (CPC). From the 200 questionnaires that were delivered, 135 questionnaires were returned, 126 of them were valid, and 9 ones were discarded. The purposes of the survey were to discover why, how and under what circumstances employees of the above mention corporations respond to their organizations’ Perceived Corporate Social Responsibility (PCSR) initiatives and also, to what extent their perceptions of the organizational trust (OT), perceived external prestige (PEP) and organizational identification (OI) are affected by these initiatives. The results were analyzed by descriptive statistics, ANOVA, hierarchy regression analysis for mediating testing and simple regression analysis for the impact relationship hypotheses testing. The results for the survey are as followings: The perceived CSR initiatives have a significant and positive impact on the perceived external prestige, organizational trust and 245 The International Journal of Organizational Innovation Volume 12 Number 1, July 2019

2019- 0949 IJOI http://www.ijoi- online.org/ organizational identification of employees. Perceived External prestige shows a moderate positive influence on organizational identification. Organizational trust reveals a substantial positive impact on organizational identification. Furthermore, PEP has a partial mediating effect on the relationship between PCSR and OI. But OT has a full mediating effect on the relationship between PCSR and OI. Several suggestions and further research direc- tions are provided to the practitioners and academia for the food and petroleum industry in Taiwan.

Keywords: Perceived Corporate Social Responsibility (PCSR), Organizational identification (OI), Organizational trust (OT), Perceived external prestige (PEP), Environ- mental management strategy (EMS)

Introduction are compromised with corporate social responsibility and how they apply the Research Background, Rationale and terms of sustainable development and Purpose social responsibility in a daily basis. In addition, to examine to what degree the Corporate Social Responsibility perception of CSR impacts the organiza- (CSR) is a term that describes the ac- tional identification (OI), organizational tions of organizations towards social and trust (OT) and perceived external pres- environmental concerns and also, how tige (PEP) of each employee in an or- these actions are related to the stake- ganization. The term social responsibil- holders of each organization. To have a ity was also defined by Carroll (1999), clear understanding of the meaning of which stated “the social responsibility of corporate social responsibility, in this business encompasses the economic, study the following definition was used legal, ethical and discretionary expecta- that corporate social responsibility actions that society has of organizations at cording to the World Business Council a given point of time.” for Sustainable Development was defined as “the commitment of business to The use of the term perceived CSR contribute to sustainable development, in this study would focus primarily in working with employees, their families the perception that employees of an or- and local communities”. While the goals ganization have of the CSR initiatives of some organizations are set on generat- that their organization undertakes. It is ing profits they should also manage their well known that when an organization operations in a way that they might con- totally entirely engaged in CSR initia- tribute to social and environmental per- tives, their employees will have a posi- spectives in the context of sustainable tive perception about their organization. development. The engagements of employees in CSR activities will not only enhance their The purpose of the study is to in- self- esteem but also will allow them to vestigate to what extent organizations obtain a degree of identification with the 246 The International Journal of Organizational Innovation Volume 12 Number 1, July 2019

2019- 0949 IJOI http://www.ijoi- online.org/ organization. The absolute engagement Related Literature Review of an employee to their organization will benefit the organization in a long- term The Evolution of Corporate Social because employees will not feel the ne- Responsibility cessity to leave the organization and will by all means demonstrate fidelity. The The first signs of Corporate Social perception of an employee will also have Responsibility (CSR) where emerged effect in their level of trust. Employees during the 1950’s. It was during the will only trust an organization that they emerging factory system in Great Britain, perceive as being ethical. An organiza- where child labor was considered normal. tion that is responsible of their actions This issue was also present in America. and seeks to cooperate in the well being A management historian called Daniel A. of its community and the environment is Wren suggested that the industrial bet- an organization that can be trusted. terment/welfare movement that was happening during that time was a com- Therefore, due to these positive plete mixture of humanitarianism, busi- behaviors employees’ will not only trust ness insight and philanthropy. The objec- the organization but also, feel identified tive of this movement was to prevent with it. Furthermore, another factor that labor problems and to improve perform- will strongly influence the identification ance. In order for this to happen business of an employee with its organization is and social actions had to be taken. Some the perceived external prestige. Per- of the actions were the settlement of ceived external prestige is the term used medical centers, cafeterias, profit sharing, to describe the opinions, views or per- changing rooms, and accommodation ceptions that outsiders have of an or- (Wren, 2005). ganization and, that will be perceived in a certain way by employees. The percep- During 1918 to 1929, a term tions that employees acquire from exter- known as ‘community movement’ nal sources will shape their attitudes and helped to construct business views of behaviors towards the organization and philanthropy, one of the earliest forms of depending on how positive or negative CSR. New perspectives of corporate these perceptions might be, will dictate social responsibility began to develop the level of trust and identification. when business executives began to have Nowadays, business organizations are close interaction with social workers. It entirely concentrated in generating prof- was because of these business leaders its or services; they are also being pres- that other entrepreneurs became familiar sured by severe competition. However, with social problems in society and be- firms have the obligation to apply and came conscious of the mission of social implement sustainable development in workers. Corporate contributions were their daily operations. fundamental in the development of Cor- porate Social Responsibility.

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The important definition of the so- Theoretical Foundation And Hypotheses cial responsibilities of businessmen Development stated by Bowen was "Social responsibility refers to the obligations of busi- Perceived Corporate Social Responsibil- nessmen to pursue those policies, or to ity (PCSR) and Perceived External Pres- follow those lines of action which are tige (PEP). desirable in terms of the objectives and Perceived External Prestige (PEP) values of our society." tend to be the form in which employees assume outsiders view their organization Corporate Social Responsibility Towards (Herrbach & Mignonac, 2004). In other Environmental Management words, employees construct the image of Strategy their organization based on their perceptions of how outsiders perceive their The Corporate Environmental organization. Perceived External Pres- Management Strategy (CEMS) has be- tige is the employees’ interpretation of come a topic of discussion since long the social status of their organization. time ago. The greening of corporate strategies and the urge of growing It is well known that the establish- awareness for environmental conserva- ment of a solid reputation and image is tion is what environmental activists are an critical determinant for the prosperity asking corporations to take into consid- or deficiency of an organization through eration. Welford (1995) stated that envi- out time (Worcester, 2009). In the past ronmental management is one stage in time, it has been recognized CSR as an society’s development towards sustain- important contributor in the development able development. of corporate reputation (Worcester, 2009). Due to the singular and uncommon char- Corporations should adopt the acteristics of an organization (Esch, et al., Corporate Social Responsibility towards 2004), the corporate image is the final Environmental Management Strategy in outcome of experiences, training, percep- order to reduce or eliminate the impact tions, knowledge, ideas and behaviors of corporate actions to the environment. that employees have attained due to their The impact of corporate actions on envi- relation with the organization (Worcester, ronment are considered as follows: 2009). Corporate image attractiveness is A. Accidents described as the attraction that causes the B. Water pollution corporate image to the audience C. Consumption of natural re- (Bhattacharya & Sen, 2003 ). If its vari- sources ous stakeholders perceive the corporate D. Noise pollution image of an organization as attractive it E. Soil damage will give the organization an enormous F. Atmospheric emissions advantage in the competition field (van G. Generation of hazardous Riel & Balmer, 1997). Brammer & wastes Millington (2005) inspected the princi- ples of corporate reputation from various 248 The International Journal of Organizational Innovation Volume 12 Number 1, July 2019

2019- 0949 IJOI http://www.ijoi- online.org/ companies in the United Kingdom (UK). its customers, community, natural envi- They discovered that organizations with ronment, and all stakeholders in general, high levels of humanitarian investments will develop a sense of trust and self- hold stronger reputation and are viewed worth in employees. Having knowledge as more competently in the social re- that their organization seeks to operate sponsible sense. for the welfare of its stakeholders devel- ops a sense of pride in being part of such Organizations that owns an indis- organization. putable external prestige due to their constant participation in socially respon- Employees really play an important sible activities will be perceived by its role in an organization. They are part of employees as an reputable organization the multiple stakeholders that an organi- and trustworthy, which in return will zation has; therefore, they participate in enhance their organizational identifica- any discussion related to actions of CSR tion. Additionally, due to the external (Aguilera, Rupp, Williams, & Ganapathi, CSR practices that their organization is 2007). Employees have the right to sug- involved, employees are able to perceive gest, assist with, take part in, and com- that their organization is constantly aim- mand CSR initiatives (Rupp, Williams, ing to maintain with the ethical and & Aguilera 2011), researchers have at- moral norms. Also, because of this, out- tested that when an organization is per- siders also play an important part be- ceived as socially responsible, employ- cause they are able to perceive these ees feel motivated, supportive and at- external CSR activities and hence con- tracted to the organization (Stites & sider the organization reputable and dis- Michael, 2011; Valentine & Fleischman, tinguishable, which in return gives em- 2008 ). Furthermore, researchers demon- ployees a high- perceived external pres- strated that CSR impacts employee’s tige. Based on the above reviews, the performance and conducts, which can be following hypothesis is proposed: further considered as a type of organizational identification (Jones, 2010 ). Hypothesis 1: The Perceived CSR initiatives of an organization have a sig- It has been demonstrated that CSR nificant and positive impact on the initiatives are an important indicator by Perceived External Prestige (PEP) which employees assess the uniqueness of employees. and attractiveness of their organization (Carmeli, Gilat, & Waldman, 2007). CSR Perceived Corporate Social Responsibil- is an ongoing plan that comprises spon- ity (PCSR) and Organizational taneous actions for the prosperity and Identification (OI). benefit of numerous stakeholders (El When an organization strives to Akremi, Gond, Swaen, De Roeck, & promote outstanding CSR initiatives, Igalens, 2015). Because of the imple- newcomers will feel undoubtedly at- mentation of these actions and functions, tracted. Working for an organization that organizations expect that stakeholders demonstrates interest in the well being of will treasure and esteem these actions 249 The International Journal of Organizational Innovation Volume 12 Number 1, July 2019

2019- 0949 IJOI http://www.ijoi- online.org/ and functions. The employees who per- found a relationship between PCSR and ceive their organization as being socially organizational identification, the second responsible will likely held their organi- hypothesis in the study is as follows: zation in great respect. Also, they will consider their organization as being Hypothesis 2: The perceived CSR initia- unique, worthy and attractive. In order to tives have a significant and positive strengthen their self- worth and self- impact on Organizational Identifica- enhancement, employees will attempt to tion (OI). identify with an organization that is well known to be socially responsible. For Perceived External Prestige (PEP) and this reason, it is known that CSR plays Organizational Identification (OI). an important role in employee identifica- Perceived External Prestige (PEP) tion. is a concept that defines the way in which the employees of an organization When there exists a strong identifi- assimilate the reputation of their organi- cation with the organization, employee’s zation. It depends on what employees personal identification will be entrenched perceive about their organization that in their organizational identification will designate their levels of identifica- (Ashforth, Harrison, & Corley, 2008). tion, fidelity, sincerity, and support to the Employees will be honored to belong to organization. It is also important to men- the organization (Dutton, Dukerich, & tion that when the degree of perception is Harquail, 1994). positive, this can lead to high levels of job satisfaction and excellent job per- The image of an organization is the formance. determinant of the level of identification an employee can achieve. Organizations When a person considers looking sponsor their organizational image in for a job, they consider a list of options. order for employees to attain identifica- These options encompass a list of factors tion with such organization (Dutton & that may be of personal consideration, Dukerich, 1991). If an organization owns for example, personal development, sal- an acceptable reputation, an employee ary, pleasant atmosphere, and reputation. will probably establish a strong connec- An organization’s reputation not only tion to his or her organization (Cialdini, involves the organization itself, but also Borden, Thorne, Walker, Freeman, & each employee who works in it. Working Sloan, 1976 ). Seeing that Social Identity in a respectable organization is the dream Theory demonstrates that employees will job for every individual. Therefore, every feel honored to be a part of an organiza- person will seek to belong to decent or- tion with an outstanding prestige ganization. (Ashforth & Mael, 1989; Dutton, Dukerich, & Harquail, 1994; Maignan & In the research (Elsbach & Kramer, Ferrell, 2001), it is hypothesized that a 1996) that conducted, they found that positive relationship exists between CSR employees working for an organization and organizational identification. Having are susceptible to examine their way of 250 The International Journal of Organizational Innovation Volume 12 Number 1, July 2019

2019- 0949 IJOI http://www.ijoi- online.org/ viewing the organization due to the in- form a particular action important to the formation they perceive about its exter- trustor irrespective of the ability to moni- nal image. How outsiders view the or- tor or control the other part”. ganization will dictate to what extent the employees identification will be affected. Organizations can foster their Or- The external image of an organization ganizational Identification by introduc- can be interpreted as appealing for some ing to their new employees, their organ- employees. It is interpreted as appealing izational culture and also by setting because the image of the organization boundaries. Employees should become most likely possess factors that are valu- familiar with the different roles in their able and significant, factors that employ- organization, that is, their roles and co- ees must likely feel identified with. For workers’ roles. The Organizational Iden- this reason, the identification of employ- tification literature suggests that indi- ees with the organization creates a con- viduals will be more involved in prac- structive social identity. tices that reinforces their organizational identity and values, and therefore, al- The employees of an organization lowed them to feel identified (Ashforth who witness Perceived External Prestige & Mael, 1989). Various researchers have as greatly appealing are more attracted shown that the high involvement in extra and heavily identified with their organi- curricular activities, supportive behaviors, zation. Employees who don’t find Per- and high motives and intentions to en- ceived External Prestige appealing would dure in the organization are related to demonstrate low levels of identification. Organizational Identification (Abrams, Carmeli (2005) demonstrated that the Ando, & Hinkle, 1998; Wan- Huggins, higher engagement of employees to an Riordan, & Griffeth, 1998). organization is due to strong perceptions of Perceived External Prestige (PEP). For employees who possess a high Therefore, the following hypothesis is Organizational Identification, the goals proposed: and achievements of their organization will be taken as their own success, and Hypothesis 3: The employees’ Perceived the relationship with their employer will External Prestige (PEP) has a sig- be strengthen and will acquire a long- nificant and positive impact on their term relational nature. Therefore, higher Organizational Identification (OI). levels of Organizational Identification will lead to higher levels of trust. Higher Organizational Trust (OT) and Organiza- levels of trust for employees will lead to tional Identification (OI). greater commitment and engagements The definition of trust was em- towards the organization. Additionally, ployed by Mayer, Davis, & Schoorman the employee may contribute to any im- (1995). They stated that trust it “the will- provement attempt if necessary. For em- ingness of a party to be vulnerable to the ployees with high Organizational Identi- actions of another party based on the fication the relationship with their em- expectation that the other party will per- ployer can be observed as a “long- term” 251 The International Journal of Organizational Innovation Volume 12 Number 1, July 2019

2019- 0949 IJOI http://www.ijoi- online.org/ and/or “relational”, while for employees they are committed to the welfare of the with low Organizational Identification, organization and they will make every the relationship can be observed as effort for the prosperity of such organiza- “short- term” and/or “transactional” (Lee, tion, but it will all depend to what extent 2004). Having observed the relationship the CSR initiatives impact the employees. between Organizational Identification and Organizational Trust, the following If the CSR perceptions are positive, hypothesis is proposed: then employees will sense their organization as being responsible and they will Hypothesis 4: Organizational Trust (OT) even feel proud of belonging to such a of employees, has significant and prestige organization, but if there exist positive impact on their Organiza- no knowledge or perception of any activ- tional Identification (OI). ity for the benefit of different stakeholders, they will likely lose interest in Perceived Corporate Social Responsibil- such organization and even decrease ity (PCSR) and Organizational their interest in the organization. Em- Trust (OT). ployees will definitely react to the sig- Organizations that are thoroughly nals that come from organizations CSR involved in CSR initiatives provide im- strategies directed to those outside the portant feedback to employees about the organization (Rupp, Ganapathi, Aguilera, organizations ethics and values. By pro- & Williams, 2006 ). As these signals will viding this significant feedback, employ- give them a perfect panorama of how ees can decide to what extent their or- their organizations treat and seek the ganization can be trusted (Rupp, welfare of their stakeholders. Ganapathi, Aguilera, & Williams, 2006 ). Employees follow closely the associated As described by Balmer & Greyser ethics behaviors in CSR activities of (2002), the term corporate marketing and their organization; hence, organizations several identity literatures displayed the are the ones to be trusted (Balmer, importance of employee’s trust, which Fukukawa, & Gray, 2007). Pivato, propose that employee’s perceptions and Misani, & Tencati (2008) suggested trust behaviors regarding an organization’s as to be the “first result of a firm’s CSR ethics perform a fundamental role in activities” or the actual result of CSR modeling their attitudes and behaviors activities. Trust is an instantaneous result related to, and affiliation with, the or- of CSR perceptions. If employees per- ganization. Recommendations of Organ- ceive their organization as being socially izational Behavior literature and market- responsible, this may help to model their ing literature suggests that employees behaviors. Employees will definitely evaluations of the organization’s social trust an organization if they perceive it as responsibility perform a crucial role in being committed with the welfare of its modeling their organizations’ trust, various stakeholders. It is a comprehen- which successively determines their per- sive advantage for organizations when formance and attitudes (Perrini & employees have trust in them because Castaldo, 2008; Rupp, Ganapathi, 252 The International Journal of Organizational Innovation Volume 12 Number 1, July 2019

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Aguilera, & Williams, 2006). Employ- has a significant mediating effect on ees’ perceptions of CSR have a strong the relationship between employees’ significance in their connection to the Perceived CSR and their Organiza- organizational trust (Lee, Song, Lee, Lee, tional Identification. & Bernhard, 2013 ). Due to the important association between perceived CSR Research Design and Methods and Organizational Trust, the following hypotheses are proposed: Conceptual Framework

Hypothesis 5: Employees’ perceived According the background, ration- CSR initiatives have a significant ale, purpose and literature review men- and positive impact on their Organ- tioned above in this study, the theoretical izational Trust (OT). research framework is as follows.

Hypothesis 6: Perceived External Pres- tige has a significant mediating effect on the relationship between employees’ Perceived CSR and their Organizational Identification.

Hypothesis 7: Organization Trust

Perceived External Prestige (PEP) H6 H1 H3

2 Perceived Corpo- Organizational rate Social Respon- Identification (OI) sibility (PCSR)

H5 Organizational H4 Trust (OT)

Figure 1. Theoretical Conceptual Framework

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Sample Selection or purchase and what services should they use. Due to these overall pressures Data for this study was obtained and considerations, it is highly expected from two big and important corporations that CSR initiatives would dictate the in Taiwan, the Uni- President Corpora- different norms and values of an organi- tion and the CPC Corporation. An online zation and would be highly perceived as questionnaire was designed and distrib- appealing to employees working for uted to employees from both companies. such organizations (De Roeck & A link redirecting to the questionnaire Delobbe, 2012). The scale established by was sent to the email of 200 employees, Turker (2009) was used to evaluate this 100 employees from Uni- President Cor- CSR measure. The scale identifies four poration and 100 employees from CPC types of CSR initiatives: CSR to em- Corporation. The questionnaire was di- ployees, CSR to customers, CSR to gov- rected to employees of different ranking ernment, and CSR to secondary social positions in the companies, which in- stakeholders and non- social stake- cluded top- level, middle- level, first holders (society, environment, NGO’s level managers and also, employees and future generations). The scale was working in different company areas. consistent and reliable were Cronbach’s α was found to be 0.89. High scores in Measurement of Constructs the scale show that the participants have a high degree of perception of their or- All items of the questionnaire were ganizations CSR actions. conducted in both Mandarin Chinese and English. The questionnaire was carefully Perceived External Prestige (PEP). translated by a bilingual expert from Perceived External Prestige (PEP) English to Mandarin Chinese and was was evaluated according to three items validated by translation- back- transla- established by Bartels, Pruyn, & de Jong, tion to guarantee that both versions were (2009) composed to measure employees’ compatible and each item of English interpretation of their organization repu- version was made on a Likert- type scale tation. The scale was consistent and reli- ranging from 1 (strongly disagree) to 5 able were Cronbach’s α was found to be (strongly agree). However, the Mandarin 0.924 which indicates that respondents Chinese questionnaire was designed have a high degree of perception from based on 6- point scale because it is be- their organizations’ external prestige. lieved that 6- pint scale tends to produce a better distribution of data. Organizational Trust (OT). Organizational Trust was evaluated Perceived Corporate Social Responsibil- according to three items determined by ity (PCSR). Dulac, Coyle- Shapiro, Henderson, & All organizations actions are to Wayne, (2008) composed to measure some extent being judge by the public employees’ level of trust in their organi- eyes. Consumers are being more critical zation. The scale was consistent and in deciding which products to consume reliable were Cronbach’s α was found to 254 The International Journal of Organizational Innovation Volume 12 Number 1, July 2019

2019- 0949 IJOI http://www.ijoi- online.org/ be 0.928. High scores on the scale show some needed discussions are also pro- that participants trust their organization vided. more. According to original studies from Organizational Identification (OI). researchers De Roeck & Delobbe (2012), Organizational Identification was the results demonstrate that the four- determined by using a scale established factor model has a favorable fit by Mael & Ashforth (1992). Cronbach’s ( =281.60; =146; =1.93; α was found to be 0.662, which is con- =99.73**; RMSEA= 0.08; sidered acceptable and of fair reliability. NNFI= .94; CFI= .95; SRMR= .09) and was notably superior to the rest of con- Data Collection strained models.

The questionnaire was distributed Simple Regression Analysis- Hypotheses to employees of Uni- President Enter- Testing prises Corporation and CPC Corporation. The questionnaire was developed using The five hypotheses mentioned Google Forms and it was divided into above were tested by using simple re- four sections. All questionnaire regression analysis. For hypothesis 1 (Per- sponses were anonymous and confiden- ceived CSR impacts Perceived External tial. All participants were asked to pro- Prestige (PEP)), we found a significant vide information regarding their gender, relationship ( ; p< 0.001; professional position, level of education, R2= .540), which means that Perceived age, and length of time in position. A CSR has a strong significant influence total of 200 surveys were distributed. Of on Perceived External Prestige (PEP). the 135 returned questionnaires obtained, Therefore, hypothesis 1 is accepted. For 9 were discarded due to high number of hypothesis 2 (Perceived CSR impacts missing data. One hundred and twenty- Organizational Identification (OI)), we six (126) questionnaires were valid and found that Perceived CSR only have a effective returned rate was 63%. Before moderate influence on employees’ Or- analysis, variables were examined pro- ganizational Identification (OI) even cedures for accuracy of data entry and though the p- value is significant missing values. The data from the ques- ( ; p< 0.001; R 2= .177). For hy- tionnaires were analyzed using SPSS pothesis 3 (Perceived External Prestige 21.0 statistical soft package program. (PEP) impacts Organizational Identifica- tion (OI)), we found that Perceived Ex- Analysis, Results and Discussions ternal Prestige (PEP) also does not have a substantial influence in employees’ Construct Validity Analysis Organizational Identification (OI) even though the p- value reflected a signifi- Through the implementation of re- cant value ( ; p< 0.001; search methods and procedures, the re- R2= .107). For hypothesis 4 (Organiza- sults of the study are as following, and 255 The International Journal of Organizational Innovation Volume 12 Number 1, July 2019

2019- 0949 IJOI http://www.ijoi- online.org/ tional Trust (OT) impacts Organizational strong contribution ( ; p< .745; Identification (OI)), we found a signifi- R2= .178), which means that Perceived cant relationship ( ; p< 0.001; External Prestige (PEP) has no full me- R2= .240), which means that Organiza- diating effect. Therefore, due to this re- tional Trust (OT) has a moderate influ- sult that hypothesis (H6) was partial ence on the employees’ Organizational accepted, that is to say, PEP has partial Identification (OI). Therefore, hypothe- mediating effect on the relationship be- sis 4 is accepted. For hypothesis 5 (Per- tween PCSR and OI. ceived CSR impacts Organizational Trust (OT)), we found a satisfactory In the testing of the mediating relationship ( ; p< 0.001; variable Organizational Trust (OT) in R2= .474), which means that Perceived hypothesis (H7), results were also ob- CSR has a strong influence in employ- tained by hierarchical regression analysis. ees’ trust. Therefore, hypothesis 5 is ac- The predictors were also entered to- cepted. gether with the control variables. In model 1, the results revealed that Per- Hierarchical Regression Analysis- Me- ceived CSR also has a significant influ- diating Effect Testing ence on employees’ Organizational Iden- tification (OI) ( ; p< .000; R 2=. In the testing of the mediating 177). In model 2, when Organizational variable Perceived External Prestige Trust (OT) was incorporated, the relation (PEP) in hypothesis (H6), results from between Perceived CSR and employees’ hierarchical regression analysis were Organizational Identification (OI) was obtained. Separate regression models not significant ( ; p< .142; R 2=. were used where the predictors were 253). The incorporation of Organiza- entered together with the control vari- tional Trust (OT) exhibited a strong and ables. In model 1, the results revealed significant contribution ( ; that there is a significant influence be- p< .001; R 2=. 253). In other words, Or- tween Perceived CSR and employees’ ganizational Trust (OT) has a full medi- Organizational Identification (OI) ating effect. Therefore, hypothesis (H7) ( ; p< .000; R 2= .177). In model is accepted. 2, when Perceived External Prestige (PEP) was incorporated, the relation Conclusions and Suggestions between Perceived CSR and employees’ Organizational Identification (OI) de- This study approves the significant creased ( ; p< .001; R 2= .178) and positive relationship that exists be- demonstrating a weaker influence of tween Perceived CSR and Organiza- Perceived CSR to employees’ Organiza- tional Identification (OI). Organizational tional Identification (OI) but still signifi- Identification is fundamental when at- cant. value is decreased from 0.421 to tempting to have a superior understand- 0.392. The incorporation of Perceived ing of the different behaviors and reac- External Prestige (PEP) did not exhibit a tions of employees’ to the various CSR

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Table 1. Mediating Effect Hypothesis Testing (H6)

Model 1 Model 2 OI OI Beta p Beta p Perceived CSR .421 .000 .392 .001 PEP .039 .745 R2 .177 .178

Table 2. Mediating Effect Hypothesis Testing (H7)

Model 1 Model 2 OI OI Beta p Beta p Perceived CSR .421 .000 .159 .142 Organizational Trust (OT) .381 .001 R2 .177 .253

initiatives. Trustworthy CSR actions of are involved with the implementation of an organization can be of great advan- CSR initiatives in an organization, espe- tage because it will cultivate an atmos- cially in employees’ attitudes and behav- phere of organizational trust, which in iors. Due to our findings regarding the turn will promote employees’ identifica- partial mediating effect of PEP, we sug- tion. Results obtained indicated a direct gest further research to test other possi- positive and significant influence rela- ble significant mediating variables that tionship of Perceived CSR on Organiza- could provide a more suitable relation- tional Identification. Also, PEP had par- ship between Perceived CSR and em- tial mediating effect between Perceived ployees’ OI. A possible significant medi- CSR and Organizational Identification. ating variable could be Organizational On the other hand, Organizational Trust Pride. Moreover, our results reflected had a fully mediating effect between that supervisors of both companies have Perceived CSR and Organizational Iden- higher Perceived CSR than that of the tification. In other words, employees’ general staff, middle managers and sen- identification with the organization, due ior executives, hence we suggest to each to the different perceptions of CSR ini- company to promote the programs or tiatives, can be strengthen through the activities related to PCSR so that all em- reinforcement of Organizational Trust ployees of the company are equally in- and partial through PEP. This study volved and have a greater knowledge of hopes to contribute with a greater under- the importance of PCSR. standing of the numerous benefits that 257 The International Journal of Organizational Innovation Volume 12 Number 1, July 2019

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