Authentic Corporate Social Responsibility Pays: Organizational Practices and Salary Requirements

Abstract

Corporate social responsibility (CSR) programs can be a source of societal aid (external CSR) or employee benefit (internal CSR). Yet, not all CSR practices are created equally, with many organizations decoupling their formally stated goals from their behavior. Thus, the extent to which organizations truly implement these programs varies, with some acting in line with their socially responsible claims (authentic CSR), while others fail to take concrete action (inauthentic CSR). Drawing from a multi-motive theoretical framework, we propose that these macro-level CSR practices will yield different micro-level results due to the particular needs they each fulfill (or fail to fulfill) for prospective employees; authentic external CSR practices fulfill morality-based needs, authentic internal CSR practices fulfill self-interest-based needs, and inauthentic CSR practices fail to fulfill either of these needs. Furthermore, in contrast to self-interest-based models, we draw from moral psychological theory to predict that authentic external CSR practices will have the strongest impact on employee outcomes because they fulfill morality-based needs, which often supersede self-interest-based needs. To test our theorizing, we explored the impact these different CSR practices have on prospective employees’ required annual salaries, allowing us to monetarily quantify the value of each type of CSR. Across two experiments (Study 1a, 1b) and a field study (Study 2), we find that authentic CSR practices lead to lower required salaries among prospective employees and active job seekers than organizations without CSR practices or with inauthentic CSR practices. Furthermore, we find that authentic external CSR practices lead to the lowest required salaries – an effect mediated by moral-need fulfillment. Our results suggest that when implemented authentically, CSR practices can lead to both positive social change and quantifiable organizational benefits.