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CSR, Green Practice and Performance

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Journal of Cleaner Production 232 (2019) 739e750

Contents lists available at ScienceDirect

Journal of Cleaner Production


journal homepage: www.elsevier.com/locate/jclepro

Examining the relationship between corporate social responsibility,


performance, employees’ pro-environmental behavior at work with
green practices as mediator
L. Suganthi
Department of Management Studies, College of Engineering Guindy, Anna University, Chennai, 00 025, India

a r t i c l e i n f o a b s t r a c t

Article history: Incorporating corporate social responsibility (CSR) initiatives in an organization is identified as a strategic
Received 8 November 2018 tool for achieving sustainable performance. The objective of this research was to examine the conceptual
Received in revised form framework that relates adoption of CSR initiatives, green practices both product and process related
23 May 2019
practices and the effect of these practices on performance and employees' pro-environmental behavior
Accepted 26 May 2019
(PEB) at work. After a review of the literature, seven hypotheses have been proposed and tested with
Available online 31 May 2019
green practices as a mediating variable. Adoption of green practices was found to partially mediate the
relationship between CSR and performance while the mediating relationship of green practices between
Keywords:
Corporate social responsibility
CSR and employees’ PEB at work was found to be insignificant. This research extends to the body of
Organizational performance extant literature by establishing the results of the conceptual framework and in addressing the impli-
Green practices cations for India. The results also highlight how organizations can include CSR initiatives and green
Employees' pro-environmental behavior at practices synergistically to enhance performance and PEB at the workplace for corporate sustainability.
work Further study is required to explore how the constructs are related at two different time periods and
across the dimensions.
© 2019 Elsevier Ltd. All rights reserved.

1. Introduction organization which is in many instances voluntary in nature, have


any relation in the adoption of green practices? To comprehend
Driven by the accelerated deterioration of the environment and this, the theories of CSR was explored to find the pushers and
the competitive market conditions, researchers and practitioners pullers of good management practices. The stakeholder's theory of
are working on how green practices can be deployed to improve CSR is based on the governance relationship stressing on the force
organizational performance. Also, it is universally agreed upon that exerted by the stakeholders on business, i.e., CSR is company's
organizations contribute extensively towards environmental stakeholders' responsibility (Pfarrer, 2010; Sweeney, 2009) and has
degradation. As the world is moving towards intense industriali- confirmed the relationship between CSR activities and organiza-
zation, it is found that there is excessive production of disposable tional performance. Similarly, instrumental theory views CSR as a
products, which are being wasted in large quantities at the con- strategic tool to be used by organizations for improving their
sumer end. Also several of these products having good utility value financial performance (Gond et al., 2009). On the other hand, social
are being trashed resulting in not only wastage of material and contract theory opines that CSR has both ethical and political phi-
energy but also environmental pollution. It is high time organiza- losophy (Garriga and Mele, 2004; Mordi et al., 2012) in carrying out
tions intervene, set up innovative business practices through their social welfare and infrastructural development programs (Mordi
CSR initiatives and implement green practices with a missionary et al., 2012). Thus, organizations implementing CSR initiatives are
zeal so that the entire supply chain becomes green. expected to benefit, since, it acts as a strategic tool in building its
Several researchers have established that the implementation of business by having a good relationship with its stakeholders as well
CSR initiatives leads to improved organizational performance. as, it takes care of the society which is expected to indirectly bring
Nevertheless, does the implementation of CSR initiatives by an in benefits to the organization. Will such voluntary initiatives un-
dertaken outside the organization bear any relationship on the
organization's internal green practices? To answer this query, it was
E-mail address: suganthi_au@yahoo.com.

https://doi.org/10.1016/j.jclepro.2019.05.295
0959-6526/© 2019 Elsevier Ltd. All rights reserved.
740 L. Suganthi / Journal of Cleaner Production 232 (2019) 739e750

found that the green theory stresses, CSR has a green tinge with a workplace which was investigated in this research.
multidisciplinary context that cuts across management, environ-
ment, social sciences and borders/boundaries for sustainable 2. Theoretical framework
development (Dunne et al., 2013). Green theory paves way for one
to believe that the holistic functioning by the organization in taking The relationship between CSR activities and two outcome var-
care of the society will necessarily have a bearing on the internal iables namely organizational performance and PEB and the medi-
green practices. It is hence proposed to study if there exists a ating role of green practices was examined. The review was carried
relationship between the implementation of CSR activities by the out on the relationship between these constructs.
organization and the adoption of green practices within the
organization. 2.1. CSR and green practices
Also, consumers in their purchase are looking out for greener
products since their consumption exert significant pressure on the Kuei et al. (2015) have established that government regulations,
environment (Laureti and Benedetti, 2018). This causes stress on customer pressures, and environmental uncertainty have induced
the supply chain upstream-organizational level. Organizations have organizations to adopt green practices. Skipping the regulatory
to ensure their employees become environmentally conscious by frameworks, will voluntary initiatives such as taking up CSR ac-
engaging them in PEB at the workplace. There is a growing interest tivities bring about any ripple among the employees to adopt
among researchers to find the antecedents of employees’ PEB at environment-friendly practices?
work (Paille and Boiral, 2013). In recent years it was found that a majority of industries (Thiel,
Drawing from the theory of planned behavior which relates 2016) including sports (Trendafilova et al., 2013) water manage-
attitude toward PEB, perceived behavior control, subjective norms, ment (Lambooy, 2011) implement CSR initiatives for corporate
intention to act, Wesselink et al. (2017) have stressed on the role of sustainability. Gordon et al. (2012) have found CSR related initia-
corporate leaders and organizational support for employees’ PEB at tives involving society helped in overall emission abatement
work. because of increased environmental consciousness.
An offshoot of the stakeholder theory of CSR is shareholder- Lagoudis and Shakri (2015) have developed a model that
agency theory which is based on the transactional/contractual reckons the need for CSR practices within the organization to create
relationship between the shareholders and agents (namely the environmental awareness because of the carbon-intensive activ-
employees) (Luhman and Cunliffe, 2013) for perpetuating the ities across their transportation and distribution network. Do or-
economic interests of the organization, which draws the employees ganizations implementing CSR initiatives, have a relation on the
to take on the role of stewards (Connelly et al., 2010; Ryan and organization taking up green practices? If so, what is the strength of
Schneider, 2003). Taking a cue from the shareholder-agency and such a relation?
green theory, it is expected that the employees who are the stew- Hens et al. (2018) have highlighted how the need for cleaner
ards will consciously steer the organization keeping the interests of production and greener environment have changed over the years,
the shareholders and organization at heart. Against this backdrop, stressing the importance of CSR for achieving the above.
among organizations implementing CSR initiatives and adopting Bohas and Poussing (2016) have studied how CSR strategies
green practices, will employees take the step forward in exhibiting impact green IT strategies. Though research has established that
PEB at the workplace? Looking at this from an employees’ organizations take up green practices when they are brought under
perspective, will there be any relation between these three vari- a regulatory framework, on the contrary, when organization takes
ables namely implementing CSR practices, adoption of green up voluntary initiatives such as CSR activities does it have any
practices and PEB? If so, will green practices mediate the rela- relation to the adoption of green practices?
tionship between the implementation of CSR initiatives and per- In this study, it is proposed to find if there is a positive rela-
formance and between the implementation of CSR initiatives and tionship between the implementation of CSR initiatives and the
pro-environmental behavior? adoption of green practices. If a positive relationship is found, then
Thus the paper aims to examine the relationship between the organizations can develop strategies for a holistic, environment-
implementation of CSR initiatives, adoption of green practices by friendly corporate sustainability.
the organization, organizational performance with PEB at work This led to the postulation of the hypothesis:
from employees’ perspective.
H1. The implementation of CSR initiatives will have a positive
Though several definitions of CSR were found in the literature
relationship with the adoption of green practices in the
(Carroll, 1999; Dahlsrud, 2008), Marsden's definition of CSR was
organization
adopted for this research which stated ‘CSR is about the core
behavior of companies and the responsibility for their total impact
on the societies in which they operate. CSR is not an optional add- 2.2. Green practices and organizational performance
on nor is it an act of philanthropy. A socially responsible corpora-
tion is one that runs a profitable business that takes account of all Porter and van der Linde (1995a, 1995b) state appropriate
the positive and negative environmental, social and economic ef- environmental regulations can induce innovation which will, in
fects it has on society’ (Marsden, 2006). According to Richard et al. turn, enhance their competitiveness and performance (Lin and
(2009), organizational performance encompasses financial, market Yang, 2011; Zhao and Sun, 2016). Green innovation in organiza-
performance and operational performance while Zhu et al. (2007a) tions can lead to competitive advantage and building of the orga-
have stressed the need to include environmental performance nization's image (Chen, 2008; Chen et al., 2006; Kam-Sing Wong,
criteria in the organizations for sustainable development. Green 2012). Increased performance was witnessed through organiza-
practices in organizations include product and process related tional innovation (Yeh et al., 2007), green product innovation (Lee
functions at the operational level (Gonz alez-Benito and Gonza lez- et al., 2012a, b; Lin et al., 2013), green practices (Armbruster
Benito, 2005a). PEB was defined as an individual's behavior that et al., 2008; Mitra and Datta, 2014; Tachizawa et al., 2015; Vanalle
consciously seeks to lessen the negative impact of their actions on et al., 2017). This affirmed the strategic business theories which
the natural and built environment (Kollmuss and Agyeman, 2002). suggest that any innovations carried out would subsequently in-
Employees' PEB at the workplace deals with their behavior at the crease a firm's performance (Teece et al., 1997).
L. Suganthi / Journal of Cleaner Production 232 (2019) 739e750 741

Green practices include both product-related practices (such as 2.3. CSR and organizational performance
the substitution of polluting and hazardous materials, design
focusing on reducing resource consumption and waste generation, Researchers have been empirically testing the relationship be-
etc.) and process-related environmental practices (such as emission tween CSR and corporate performance using stakeholder theory
filters, end-of-pipe controls, acquisition of clean technology (Kao et al., 2018; Marom, 2006; Orlitzky et al., 2003), and institu-
equipment) (Gonz alez-Benito and Gonza lez-Benito, 2005a). Cheng tional theory (Brown et al., 2009; Chen and Bouvain, 2009; Tate
et al. (2014) using resource-based theory have found that perfor- et al., 2010). It was found that when the corporate vision is
mance is impacted directly and indirectly by the three types of eco- shared among the employees, it enhanced a firm's performance.
innovation namely process, product, organizational. Lindgreen et al. (2009) have also recorded a positive link existing
A positive relationship was found between green practices and between philanthropic activities and organizational performance.
firm performance in the container terminal operations (Lun, 2011), This highlighted that when stakeholders are made aware of the
in the automobile industry (Lin et al., 2013), in the wine industry measures taken by the organization for their wellbeing, it led to
(Leenders and Chandra, 2013) and in the manufacturing firms increased performance.
(Rehman et al., 2016). A meta-analysis also confirmed the positive Sidhoum and Serra (2017) investigated the relationship be-
relationship between green practices and performance (Geng et al., tween CSR and performance - environment, social and economic
2017; Golicic and Smith, 2013). among US electric utilities. Price and Sun (2017) have studied the
Having established the existence of a positive relationship be- influence of CSR as well as corporate social irresponsibility (CSI) on
tween green practices and performance, the relationship between performance. They found that firms having low CSI as well as not
green practices and various dimensions of performance was much CSR activities reported better performance and vice versa.
reviewed. Their results indicated that CSI has far-reaching consequences than
Researchers have found that adoption of green supply chain CSR initiatives. Table 1 gives a brief review of the different types of
management (SCM) practices among manufacturing firms, will relationships reported among the study variables-CSR and
lead to increased financial and operational performance (Carmona- performance.
Moreno et al., 2004; Kuei et al., 2015; Lee et al., 2012a, b; Testa and Whether CSR relates positively or negatively to performance
Iraldo, 2010; Zhu and Sarkis, 2004), manufacturing performance continues to be a debatable issue. From the review of the meta-
(Vachon and Klassen, 2008) and environmental performance analysis research papers, it is found that in a majority of in-
(Chien and Shih, 2007; de Giovanni, 2012; De Giovanni and Vinzi, stances, a positive relationship was found (Orlitzky et al., 2003; van
2012; Li et al., 2018; Ruiz-Benitez et al., 2018; Zhu et al., 2005; Beurden and Go €ssling, 2008). However Margolis and Walsh (2003)
Zhu and Sarkis, 2004). The strength of the association depended on in their review found that 54 researchers have reported a positive
how long and how well the respective industry had implemented relationship, 7 negative, 28 non-significant and 20 some combined
green SCM practices (Zhu et al., 2010, 2007b). results from among the 109 research papers reviewed while
Also, both internal and external green practices Boaventura et al. (2012) stated 65.5% of the articles reviewed
(Miroshnychenko et al., 2017), green product design (Lin et al., indicated a positive relationship, 19% negative and 31% neutral or
2013), environmental management practices (Lucas and non-existent relationship.
Noordewier, 2016) was found to be positively related to financial Similarly researchers found disclosure of the organization's CSR
performance. Zhu et al. (2013) found internal environmental initiatives yielded contradictory results on the organization's fi-
management and cooperation with customers were positively nancials: positive (Byun and Oh, 2018; Chen et al., 2015; Yusoff
related to environmental and operational performance. Diabat et al. et al., 2013), negative (Chen et al., 2018) and nil (Angelia and
(2013) have examined the relationship between green SCM prac- Suryaningsih, 2015) effect.
tices with the economic, environmental and operational perfor- Considering the debatable nature of this relationship and with
mance. Laari et al. (2016) have examined the direct relationship many researchers claiming a positive relationship, it was hypoth-
between customer driven green SCM practices with environmental esized that.
and financial performance. Zailani et al. (2012) have found that
H3. The implementation of CSR initiatives by the organization will
green practices in purchasing have a positive relationship with
have a positive relationship on the organization's performance
social, economic and operational performance. Jabbour et al. (2015)
have also found a positive relationship between green product
development practices and green performance, operational and
market performance. The review also highlights four types of per- 2.4. Green practices and employees’ PEB at work
formance measures namely financial (economical, cost), opera-
tional (manufacturing), social (market) and environmental (green) Researchers have found pro-environmental priming (Tate et al.,
performance were being examined. 2014; Trivedi et al., 2018), environmentally responsible strategies
Though several researchers have found a positive relationship to (Yu et al., 2017), introduction of green products (Jabbour, 2015),
exist between green practices and performance, results to the Leadership in Energy and Environmental Design (LEED) branding in
contrary were also found in the review. Green practices had a buildings (Khashe et al., 2015) encourage environmentally friendly
negative relationship with environmental and operational perfor- behavior. The positive relationship between pro-active measures
mance (Eltayeb et al., 2011; Green et al., 2012; Zhu et al., 2007a) and including product-process innovation and performance through
did not impact operational performance (Perotti et al., 2012). In lieu environmental practices have been confirmed (Christmann, 2000).
of the above contradictory results, it was proposed to find the Babiak and Trendafilova (2011) have examined how sustainable
relationship of green practices with performance (operational, practices as a component of CSR initiatives can result in pro-
market, cost and environmental). This led to the hypothesis. environmental behavior. Though green practices were covered to
some extent in sustainable practices, the strength of the relation-
H2. The adoption of green practices by the organization will have ship between the two constructs exclusively needs investigation.
a positive relationship on the organization's performance The review highlights limited research has been done in the
742 L. Suganthi / Journal of Cleaner Production 232 (2019) 739e750

Table 1
CSR and performance e a review of research articles.

Variables Relationship Authors

CSR and performance Positive Crifo et al. (2016); Gallardo-Vazquez and Sanchez-Hernandez (2014); Mustafa et al. (2012); Orlitzky (2011); Herrera Maduen ~o
et al. (2016); Karaye et al. (2014)
CSR and financial Positive Arago n-Correa et al. (2008); Bernal-Conesa et al. (2016); Bird et al. (2007); Blasi et al. (2018); Cornett et al. (2016); Dobrea and
performance Dinu (2012); Fayad et al. (2017); Flammer (2015); Gallardo-Va zquez and Sanchez-Hernandez (2014); Garcia-Castro et al.
(2010); Goll and Rasheed (2004); Han-Min Wang et al. (2015); Jin and Drozdenko (2010); Lin et al. (2009); Mallin et al. (2014);
Maqbool and Zameer (2018); Nicolau (2008); Orlitzky et al. (2003); Sila and Cek (2017); Tsoutsoura (2004); Wu and Shen (2013)
CSR and financial, social Positive Zhu et al. (2016)
performance
CSR and performance Negative Brammer et al. (2006); Mun ~ oz et al. (2015)
CSR and performance No effect Aupperle et al. (1985); Chand (2006); Chih et al. (2010); Fauzi and Idris (2009); McWilliams et al. (2006); Mulyadi and Anwar
(2012)

organizational context focusing on the PEB of employees at the It was hence hypothesized that.
workplace.
H6. The adoption of green practices will mediate the relationship
It was hence hypothesized.
between CSR and performance
H4. The adoption of green practices in the organization will have a Researchers (Babiak and Trendafilova, 2011) have examined
positive relationship with the employees' pro-environmental green practices as a component of CSR to influence employees' PEB
behavior at work at the workplace. Considering this, and if the hypotheses H1, H4
and H5 were found to be significantly related, then it is proposed
to examine the relationship between CSR and employees’ PEB at
2.5. CSR and employees’ PEB at work the workplace through green practices as a mediator. This led to the
hypothesis.
Karassin and Bar-Haim (2016) have proposed a multilevel model H7. The adoption of green practices will mediate the relationship
to determine the factors affecting corporate environmental re- between CSR and employees' PEB at work
sponsibility (CER). They have defined corporate environmental The conceptual model for the above hypotheses is given in Fig. 1.
responsibility as a measure of CSR. They found the institutional
level variables such as regulatory power have a relationship with
CER while organizational level variables such as culture, attitude, 3. Research methodology
and behavior have a strong and positive relationship with CER. Tian
and Robertson (2017) have examined how and when employees' 3.1. Measures
perceived CSR affects voluntary PEB through employee engage-
ment in hotels. Blok et al. (2015) using the premise of planned The measures used for the constructs are as follows: CSR - Tian
behavior theory, have examined the PEB of university employees and Robertson (2017) scale comprising of 12 items measuring
with external factors namely leadership support and behavior of perceived CSR in 3 dimensions adapted from Turker (2009) was
leaders. PEB was analyzed in terms of how university employees used. Green Practices - Gonza lez-Benito and Gonz alez-Benito
behave when they use computers, heating and lighting facilities, (2005a; 2006) 16 item scale was used to measure product and
printing and copying documents and whether they recycle items process related green practices. Organizational performance e was
which have utility value. They found a significant positive relation measured using four dimensions: Operational, cost and environ-
existing between leadership support and employees’ PEB at work. mental performance were measured using 14 item scale of Zhu
The review also indicated that there is a research gap existing on et al. (2007a) and market performance was measured using 3
how voluntary measures brings in environmental change (Bansal item scale of Gonza lez-Benito and Gonza lez-Benito (2005b;
and Roth, 2000). In this context, based on Blok et al. (2015) and Gonza lez-Benito and Gonz alez-Benito, 2006). Employees' PEB at
Wesselink et al. (2017) research, it is argued whether voluntary work: 4 item scale adapted from Blok et al. (2015) and Gatersleben
measures undertaken at organizational level such as CSR activities et al. (2017) that captured employees’ PEB at work with reference to
have a relation with the employees’ PEB at work? This led to the their usage of lights, air-conditioners, water and vehicles was used.
hypothesis. The questionnaire is given in Appendix 1.
H5. The implementation of CSR initiatives in the organization will
have a positive relationship with the employees' pro- 3.2. Sample and data collection
environmental behavior at work
Saeed et al. (2018) have examined how green human resource Two business associations in Chennai were approached to
management practices results in employee's pro-environmental identify the list of companies in manufacturing, service and infor-
behavior through pro-environmental psychological capital. In Ca- mation technology sector that had their branch offices in and
nadian manufacturing plants, the mediating role of environmental around Chennai. Companies which was in existence for more than
practices itself has been empirically determined between lean 5 years and with more than 100 employees were shortlisted for
supply management and environmental performance carrying out the survey. These companies were having businesses
(Hajmohammad et al., 2013) while Zhu et al. (2012) have carried across the state of Tamilnadu and a few across India. The research
out a mediation analysis between internal and external green SCM followed a survey-based methodology. The questionnaires were
practices with economic, environmental and operational perfor- given to the managers belonging to the human resource depart-
mance. As green practices were found to act as a mediator and if the ment, who distributed to their employees, collected the same and
hypothesis H1, H2 and H3 are significant, it is expected that green returned. It was requested to distribute the questionnaires only to
practices may mediate the relation between CSR and performance. employees who were in a supervisory position and above since
L. Suganthi / Journal of Cleaner Production 232 (2019) 739e750 743

Performance

H3
H2
CSR H1 Green
Practices
H4
H5
PEB

H6 : CSR -> GP -> Perf


H7 : CSR -> GP -> PEB
Fig. 1. Conceptual model.

they will be aware of the organization's processes and procedures. Table 2


In a few organizations, permission was granted to contact the Descriptive statistics.

employees in person and get the questionnaire filled. The ques- Constructs Mean Standard deviation
tionnaires were distributed to more than 1000 employees. Assur- (N ¼ 527)
ance was given at the beginning of the questionnaire stating the CSR
data is being collected for research purposes and will be kept Stakeholder 5.086 1.105
confidential. The questionnaires were collected at their workplace. Customer 5.720 1.009
Government 5.948 1.087
The convenience sampling process was adopted. The data was
Green Practices
collected from employees during the period from April to August Product-related 5.125 1.172
2018. Since some of the organizations had a pan India operation, Process-related 5.267 0.993
the results can be generalized across India. Paper and pen method Performance
was used for data collection. The collected responses that had Operational 5.418 0.911
Environmental 5.327 1.120
missing data were excluded from the analysis. 580 responses were Cost 5.190 1.203
returned. In cases, when the employees were unsure of the an- Market 5.667 1.109
swers, they had left a blank space for the questions. Sometimes due Employees' PEB at work 6.097 0.941
to oversight also, respondents skip answering some questions. Such
responses which had missing values were discarded and not taken
for further analysis. 527 responses that were complete in all aspects Table 3
were considered as clean and was used for further analysis. Independent ‘t’ test and ANOVA.

Test Significance
3.3. Data analysis procedure
Gender ‘t’ test - t525
CSR 2.285 p ¼ 0.023*
The hypotheses were tested using covariance-based structural Green practices 0.627 p ¼ 0.531
equation modeling using AMOS. Both the measurement and Performance 0.872 p ¼ 0.384
Employees' PEB at work 1.408 p ¼ 0.160
structural model was obtained. The seven hypotheses were tested
Education ‘t’ test - t525
by applying Cohen (1992) and Hair et al. (2010) cutoff values. CSR 0.798 p ¼ 0.425
Communality, AVE, and the square root of the AVE were used to Green practices 1.553 p ¼ 0.121
measure the validity of the latent variable. Cronbach’ alpha and Performance 1.936 p ¼ 0.053
composite reliability were used to measure reliability. The ‘t’ test Employees' PEB at work 2.513 p ¼ 0.012*
Type of organization F test ¼ F 2,524
was used for testing the hypotheses and goodness of fit indices was
CSR 0.319 p ¼ 0.727
used to determine the model fit. Green practices 1.475 p ¼ 0.230
Performance 2.999 p ¼ 0.051
4. Research results Employees' PEB at work 1.026 p ¼ 0.359

Note:*p < 0.05.


4.1. Descriptive statistics

The respondents profile were as follows: Gender- 56% male and organization. The details are given in Table 3. Using ‘t’ test it was
44% female; Education- 65.5% graduation, 34.5% post-graduation found that there is no significant difference in mean due to gender
and above; type of organization - 16% manufacturing, 25% service for all the variables except for CSR while for education, it was found
and 59% IT sector. There was a higher proportion of male members. that there is no significant difference in mean due to education for
This was attributed to the fact that in India, the proportion of male all the variables except PEB. Using one way ANOVA it was found
members going for work is higher than female members. The there is no significant difference in mean due to the type of orga-
descriptive statistics for the dimensions are given in Table 2. nization for all the study variables.
Independent ‘t’ test was done to find if there is a significant
difference in the study variables due to gender and education, and 4.2. Measurement model
one way ANOVA was performed to find if there is any significant
difference among the study variables with reference to the type of The model fit indices for the measurement model was as
744 L. Suganthi / Journal of Cleaner Production 232 (2019) 739e750

Table 4 results indicated there could be other factors which lead to PEB
Composite reliability, convergent and discriminant validity. since CSR and green practices had explained only a minuscule of
Construct CR AVE CSR Green practices Perf PEB PEB.
CSR 0.884 0.721 0.849
The results indicated that hypotheses H1, H2, H3 and H5 are
Green Practices 0.915 0.843 0.816 0.918 significant. Among the path coefficients, it was found that the
Performance 0.902 0.698 0.826 0.799 0.836 implementation of CSR initiatives has a strong relationship with the
PEB 0.826 0.546 0.238 0.194 0.254 0.739 adoption of green practices. Also, the implementation of CSR ini-
Note: (i) The elements along the diagonal are the square root of average variance tiatives has a significantly positive relationship with performance.
extracted (AVE) and is greater than the off-diagonal elements which are the cor- However, hypothesis H4 was not supported. The relationship be-
relations between constructs.
tween CSR and PEB (b ¼ 0.265*, SE ¼ 0.064) as well as between
(ii) All items in each variable have AVE >0.5 and CR > 0.7.
green practices and PEB (b ¼ 0.164*, SE ¼ 0.045) was checked
separately and it was found that in both cases the relationship was
follows: c2 ¼ 1058.094; df ¼ 419; p ¼ 0.000; c2/df ¼ 2.525; significant. for its total effect. The estimated standardized
GFI ¼ 0.879; AGFI ¼ 0.856; NFI ¼ 0.885; TLI ¼ 0.919; IFI ¼ 0.927; b ¼ 0.249, SE ¼ 0.041, p < 0.01 with R2 ¼ 0.101 for CSR -> PEB and
CFI ¼ 0.927; RSME ¼ 0.054; SRMR ¼ 0.0498. The model fit was b ¼ 0.197, SE ¼ 0.041, p < 0.01 with R2 ¼ 0.103 for GPrac->PEB.
found to be acceptable. However, in the presence of other variables, the effect of green
The composite reliability (CR) for all four latent variables were practices on PEB was found to be insignificant in the proposed
above 0.7 ranging from 0.826 to 0.915. This indicated strong com- conceptual model. Also comparing the b coefficient for GPract
posite reliability. Convergent validity was checked using AVE for the -> PEB in the two cases, it was found that the b coefficient changed
four latent variables and it was found that for all the four variables, from 0.164 to 0.021 in the presence of CSR. The association of CSR
the AVE was above 0.5 ranging from 0.546 to 0.843 indicating with performance and PEB through green practices was examined
strong convergent validity as shown in Table 4. Also, it was found using the mediating model.
that the values along the diagonal in Table 4 are greater than the
off-diagonal values in all cases. This implied that the dimensions 4.4. Mediating role of green practices
accounted for a greater proportion of variance of the items that
were assigned to the respective dimension (Fornell and Larcker, The direct, indirect and total effects were found using the
1981). This indicated a strong discriminant validity. Hence the bootstrap method. The results are given in Table 5. The direct effect
measurement model was found to have adequate reliability, of CSR on performance and PEB was found to be significant. Also,
convergent validity, and discriminant validity. the indirect effect of CSR on performance through green practices
was found to be significant indicating implementation of CSR
4.3. Structural model influenced the adoption of green practices and in turn influenced
performance. This indicated the presence of partial mediation of
The structural model with maximum likelihood estimates was green practices between CSR and performance confirming the
presence of hypothesis 6. The indirect effect of CSR on PEB was
used in AMOS and the corresponding unstandardized coefficients
of the path for the hypothesized model is given in Fig. 2. found to be insignificant. This implied that the implementation of
CSR initiatives had a strong relation with green practices as well as
The model fit was also found for the structural model. The
model fit was found to be acceptable with the following model fit with employees’ PEB at the workplace. However, the mediating
relationship of green practices between CSR and PEB was not
indices: c2 ¼ 1060.826; df ¼ 420; p ¼ 0.000; c2/df ¼ 2.526;
GFI ¼ 0.878; AGFI ¼ 0.856; NFI ¼ 0.885; TLI ¼ 0.919; IFI ¼ 0.927; supported.
CFI ¼ 0.927; RSME ¼ 0.054; SRMR ¼ 0.0501. The full structural
model with latent structure indicating the standardized estimates 5. Discussion
along with its subscales and items is given Fig. 3. It is found from
the figure that CSR explained 67% of the green practices, while CSR From the measurement model it was found that in the case of
and green practices explained 73% of the performance. On the CSR initiatives, customers play a very important role followed by
contrary, CSR and green practices explained 6% of the PEB. The other social and non-social stakeholders and government. In a

Performance
0.502*(0.091)

0.295*(0.070)
CSR 0.944*(0.094) Green
Practices
-0.021 ns (0.093)
0.262*(0.113) PEB

Mediating hypotheses
CSR -> GP -> Perf = 0.278*
CSR -> GP -> PEB = -0.020 ns
Note: * p<0.05 ns - not significant

Fig. 2. Structural model.


L. Suganthi / Journal of Cleaner Production 232 (2019) 739e750 745

Fig. 3. Structural model with full latent structure.

Table 5
Mediating effect of green practices using the bootstrap method.

Bootstrap

BCa 90 %CI

Hypothesis Path b SE Lower Upper Supported

Total (without a mediator)


CSR - > Perf 0.780 0.122 0.596 0.995
CSR - > PEB 0.241 0.076 0.135 0.391
Direct effect (with a mediator)
CSR - > Perf 0.502 0.156 0.281 0.787
CSR - > PEB 0.262 0.157 0.026 0.549
Indirect effect
6 CSR - > GPrac -> Perf 0.278 0.098 0.126 0.442 Yes
7 CSR - > GPrac - > PEB 0.020 0.126 0.235 0.172 No

Note: Bootstrap 5000 sample, BCa e bias-corrected- accelerated CI - confidence interval.

similar context, the importance of customers has also been stressed of CSR initiatives had a significant relation in the adoption of green
by Maignan et al. (2005) using stakeholder theory. For the adoption practices within the organization because of the strong positive
of green practices, the organization has to focus on its process more relationship between the two constructs. The reason could be
than its products as already suggested by Zotter (2004) for water because the relationship with various stakeholders will induce
conservation solutions. This also affirmed with the TQM philosophy organizations to look inwards in becoming green. Similar results
which states if the process is perfected, the products manufactured were found in the study carried out by Hens et al. (2018) wherein
from such a process will necessarily be of good quality. In the case they established the link between cleaner production, green and
of performance, it was found that when CSR initiatives are imple- circular economy. Thus it is expected that organizations will strive
mented, market performance will be high (Jabbour et al., 2015). towards a greener business environment for achieving corporate
Operations, environmental and cost performance will then follow. sustainability.
In this research, it was found that the direct and total effect was The literature review highlighted that very few studies have
positively significant between CSR and performance (Gallardo- prodded on the influence of CSR on employees’ PEB at work. In this
Vazquez and Sanchez-Hernandez, 2014) and between CSR and research, it was found that there is a significant positive relation
PEB (Tian and Robertson, 2017). This indicated that the imple- between CSR and PEB (Tian and Robertson, 2017) and between
mentation of CSR initiatives resulted in better organizational per- green practices and PEB (Yu et al., 2017). The total effect between
formance because of the improved relationship between the green practices and PEB indicated when organizations adopt green
organization and its stakeholders - environment (social and non- practices it will motivate employees towards PEB. The research also
social), customer and government. In addition to affirming the highlighted that there are other factors that lead to PEB since the
positive relationship between CSR and performance, the research variance explained was low for this relationship.
has also established the existence of a strong relationship between
CSR and employees’ PEB at work.
5.1. Theoretical implications
Strategic business theories propose that when innovations are
introduced in the organization, it increased the firm's performance.
The research findings confirmed the stakeholders' theory (that
This study also confirmed the results already obtained that adop-
organizations' strive to satisfy the needs of stakeholders) wherein
tion of green practices has a significant positive relation to perfor-
the CSR activities had a strong relation to performance. Also, as per
mance (Rehman et al., 2016). It was found that the implementation
social contract theory, organizations have a responsibility to give
746 L. Suganthi / Journal of Cleaner Production 232 (2019) 739e750

back to the society, and CSR can be used as a strategic tool as per activities among the male and female employees and in the
instrument theory was also affirmed in the study because of the perception of employees' PEB at work based on education. These
very strong relationship between CSR and performance. The orga- outcomes need to be validated by testing the model in different
nization's benevolence in terms of CSR activities builds goodwill contexts. Further, a longitudinal study is required to ascertain if a
among the stakeholders and customers being part of the stake- causal relationship exists between the constructs. This would help
holders in the marketplace. The study found not only a strong in generalizing the findings. Secondly, the model was tested using
relation found between CSR and performance but also a strong the employees' perspectives on the organizational level parame-
influence on market performance. It was expected that CSR initia- ters. It is necessary to consider the decision makers point of view
tives implemented by the organization will have a direct relation- also of the various constructs especially on the PEB items. More
ship on the green practices adopted since green theory highlights items can be added for PEB if decision makers are considered as
that for a holistic organization that has a concern on the welfare of respondents. Thirdly, the data is completely based on self-report. A
the society, there will be a takeaway by the organizations in making more objective method of data collection can be used to measure
its internal practices green. The results confirmed this hypothesis actual data pertaining to the constructs. Fourthly, the employees
with CSR activities having a very strong relationship with green working in various organizations were the respondents to the
practices adopted within the organization. survey. Hence there could be the presence of common method bias,
When organizations adopt green practices, it is expected that it because of artificially inflating or deflating the response items.
will spill over the employees and over a period of time engulf them However, precautionary measures have been exercised to remove
since they are considered as the stewards in the organization as per the common method variance by randomly placing the items in the
the shareholder-agency theory. This will, in turn, spur them to questionnaire. Further, the questionnaire was kept anonymous to
behave in an environment-friendly manner. This was found true in remove the social desirability bias. Also, since taking part in the
this research study wherein green practices were found to have a survey was voluntary, non-response bias was addressed to some
positive relationship with employees’ PEB at work and also CSR extent. However, there could be the presence of some amount of
activities were found to have a positive relationship with PEB when bias, since data collection was a survey based method and results
considered in isolation. need to be used with caution. Fifthly, in the questionnaire, the re-
The research had also examined the mediating relationship of spondents were not given the option to answer ‘do not know the
green practices between CSR and performance and between CSR answer’. This could have resulted in getting missing data in the
and PEB. The study highlighted the role of green practices both in responses.
terms of product and process for improving performance. Green
practices were found to have a partial mediation effect between 6. Conclusion
CSR and performance which is a unique contribution to the extant
literature on green theory. However, the mediating effect of green Though the literature review threw up mixed results on the
practices between CSR and PEB was found to be negated. Another influence of CSR on performance, this research affirmed the posi-
unique contribution to literature is the presence of a significant tive relationship existing between CSR and performance. Also, a
relation between the implementation of CSR initiatives and em- strong positive relationship was found between CSR and green
ployees’ PEB at work. practices. Green practices were found to partially mediate the
relationship between CSR and performance. The study demon-
5.2. Practical implications strates the importance of adopting green practices within the or-
ganization as well as implementing CSR initiatives among the
The research found the existence of a strong relationship be- stakeholders to improve performance. Also in today's globalized
tween CSR and green practices and the role of CSR initiatives economy, protecting the environment should be of prime impor-
(external) in enhancing the green practices (internal in terms of tance among all stakeholders. This study threw light on the sig-
product and process). Specifically, this research establishes the nificant relationship existing between the implementation of CSR
importance of implementation of CSR initiatives which motivates activities and employees' PEB at work. In addition to the strengths,
organizations to go for green practices within the organization. the study has come up with some limitations. The research high-
Also, the result highlights the importance of green practices in lights there are other antecedents that contribute towards PEB in
increasing performance. addition to green practices and CSR. Future research needs to be
The survey was conducted with a cross-sectional data covering taken up to find what other factors will lead to employees' PEB at
manufacturing, service and IT organizations within India. The work.
analysis was done using bootstrapping procedures to increase the
robustness of the model. The importance of green practices within Funding information
the organization as well as the implementation of CSR initiatives
among stakeholders was established. As the coefficients of the path The author declares that the research is not funded by any
between these constructs were high, it is expected that imple- funding agency.
mentation of CSR initiatives and adoption of green practices will
enhance the performance of the organization as well as employees’ Conflicts of interest
PEB at the workplace. The research will help organizations to take
steps to implement CSR initiatives and adopt green practices by The author declares that she has no conflict of interest.
conserving material and energy resources, avoiding wastages,
which will motivate employees to become environmental Appendix 1. Instrument
conscious at the workplace. This will, in turn, result in optimal use
of energy, material and human capital by organizations. CSR
This study has several limitations. Firstly the study was con-
ducted using cross-sectional data. Although the analysis indicated A. Stakeholder
that there was no significant difference across the different types of CSR1 My company participates in activities, which aim to
organization, yet there was a difference in the perception of CSR protect and improve the quality of the natural environment.
L. Suganthi / Journal of Cleaner Production 232 (2019) 739e750 747

CSR 2 My company makes investment to create a better life PERFORMANCE


for future generations.
CSR 3 My company implements special programs to mini- A. Operational performance
mize its negative impact on the natural environment. PE 1 The company was able to increase the number of goods
CSR 4 My company targets sustainable growth, which con- delivered on time
siders future generations. PE 2 There has been an increase in capacity utilization to
CSR 5 My company supports nongovernmental organizations support different volumes in demand/client orders.
working in problematic areas. PE 3 There has been an increase in the quality of the com-
CSR 6 My company contributes to campaigns and projects pany's products (degree of conformity to specifications).
that aim to promote the well-being of the society. PE 4 There has been a reduction in the time required to
CSR 7 My company encourages its employees to participate develop and launch new products.
in voluntary activities. PE 5 There has been a decrease in the inventory levels
B. Customer maintained
CSR 8 My company respects consumer rights beyond the PE 6 There was a reduction in material wastes during
legal requirements. production
CSR 9 My company provides full and accurate information B. Environmental performance
about its product to its customers. PE 7 The company has reduced its carbon emission
CSR10 Customer satisfaction is highly important for our PE 8 The company has reduced its waste water generation
company. PE 9 The company has reduced its solid wastes generation
C. Government PE 10 The company has decreased its consumption of haz-
CSR11 My company always pays its taxes on a regular and ardous/harmful/toxic materials
continuing basis. PE 11 The frequency of environmental accidents has reduced
CSR12 My company complies with legal regulations C. Cost performance
completely and promptly. PE 12 There was reduction in operation costs - production,
distribution & supply chain cost because of green practices
PE 13 There was reduction in energy costs due to cleaner
technology
PE 14 There was reduction in environmental costs due to
GREEN PRACTICES green practices
D. Market performance
A. Product PE 15 There has been an improvement in the company's
GP1 My company substitutes greener materials/parts in the reputation and image in the market.
place of polluting and hazardous materials/parts PE 16 There is better alignment between what the company
GP2 Product design is focused on reducing resource con- is offering with consumers' expectations
sumption/waste generation during production and PE 17 The company has had success in launching new
distribution. products
GP3 Product design is focused on reducing resource con-
sumption and waste generation during product usage
GP4 Product is designed for disassembly, reusability and EMPLOYEES0 PRO-ENVIRONMENTAL BEHAVIOR AT WORK
recyclability
B. Process related PR 1 I switch off the lights and fan when not in use
GP5 The process design ensures there are emission filters PR 2 I switch off the air conditioner when the outside climate is
and end-of-pipe controls in my company ok
GP6 The process design is focused on reducing energy and PR 3 I try to conserve water
natural resources consumption in operations PR 4 I walk short distances and avoid using cars
GP7 Production planning and control is focused on reducing
waste and optimizing materials exploitation Note: (i) A 7 point scale was used for CSR, green practices and
GP8 My company prefers clean technology/equipment in the performance e from strongly disagree (1) to strongly agree (7) and
production process a 7 point scale was used for employees’ PEB at workplacee from
GP9 My company prefers purchasing green products for the very untrue of me (1) to very true of me (7).
process
GP10 During supplier selection, environmental criteria is
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