Hussain Ali
Jianhua Yin1
Faiza Manzoor- 1Business School, University of International Business and Economics, Beijing, China
- 2Department of Agricultural Economics and Management, School of Public Affairs, Zhejiang University, Hangzhou, China
- 3School of Government, University of International Business and Economics, Beijing, China
This study investigates the impact of corporate social responsibility (CSR) on firm reputation and organizational citizenship behavior, along with the mediating inclusion of organic organizational cultures (Clan and Adhocracy) in the medium and large enterprises of Pakistan. To do the path analysis and to investigate the mediating role of organic organization culture, Smart PLS was used. For data collection, the convenience sampling technique was used and responses from 360 questionnaires were the main data source. The results displayed that CSR has a significant and optimistic effect on a firm reputation and employees’ organizational citizenship behavior (OCB). Secondly, the outcomes showed a positive and full mediation effect of organic organizational cultures between CSR and firm reputation but a partial mediation effect of organic organizational cultures between CSR and employees OCB. Further, the results demonstrated a positive and significant influence of employees’ OCB on a firm reputation. The extensive analysis of all factors of the study was autonomously examined to identify the insights that verify how the inclusion of organic organizational cultures can boost the firm reputation and employees’ OCB. Theoretical implications and future research direction are discussed.
1. Introduction
In an increasingly globalized business domain, intangible assets like firm reputation and worker trust are crucial. Indeed, intangible assets are critical in determining a business’s long-term sustainability and success. A firm’s reputation (FR) is stated as an overall impression that exposes the collective perception of stakeholder units (Sallah and Caesar, 2020). In recent years, academics have assessed corporate social responsibility (CSR) in multiple contexts. Increased interest in CSR sparked from the increasing globalization and international trade, which resulted in more complex business operations and triggered demand-based transparency and corporate citizenship. Academics have shown a strong interest in studying CSR in recent years, with the corporate sector providing widely the early impetus for research into CSR in the aftermath of significant scandals like WorldCom and Enron. Particularly, many studies have focused on strengthening business leadership characteristics that encourage organizations to engage in ethical and socially responsible behavior (Pasricha et al., 2018). The efficiency of social enterprises is based on meeting the expectancies of various stakeholders (Mikołajczak, 2020), and henceforth the occurrence of CSR strategy in these organizations is a subject matter of additional study (Yan et al., 2022). Theoretically, research specialists continue to investigate the influence of CSR on organizational performance (Yoon and Chung, 2018; Ikram et al., 2019). In practice, more and more businesses realize that CSR can help them to be more sustainable and accountable (Ahmad et al., 2021). For example, in a Chinese firm, where current business scandals, labor issues, food safety, and environmental devaluation have brought about much negative reputation while simultaneously impacting performance negatively, there is a heightened need to establish business morals in the face of growing demand for CSR. Every business has to depend on society’s resources and deal with the communities for its growth. CSR is a concept that upholds and looks after the interests of both businesses and societies. CSR programs address the three major corporate wings: customers, society, and employees (Manzoor et al., 2019b).
Despite enormous efforts in studying CSR, a few critical issues require further attention. First, research on the relationship between CSR and firm reputation has produced inconclusive and contradictory findings. Some researchers have discovered a link between CSR and firm performance (Hou, 2019; Rehman et al., 2020; Bahta et al., 2021). Second, while much research has been done on the influence of CSR on organizational performance, little has been conducted to investigate the relationship between CSR and firm reputation and the intermediate process that links CSR and firm reputation. CSR benefits have also been positively associated with evidence of the entity’s success. As an example, consider the financial performance (Cho et al., 2019; Karyawati et al., 2020), increased customer confidence (Aljarah et al., 2018), massive and positive direct customer purchasing behavior (Zhang and Ahmad, 2021), raised in the level of complete stakeholder confidence (Del Brio and Bolaños, 2020), increase in employee job satisfaction (Farmaki et al., 2022). The domino effect of CSR on both performance and society suggests that CSR practices can occur and become powerful entities and indicators in determining the direction of long-term business success (Singh and Misra, 2021).
The necessary individual consequences highlighted in this research stream are CSR and organizational citizenship behavior (OCB), and firm reputation (Jacobsen and Beehr, 2022). Employee OCB can be understood as the voluntary participation of employees in different tasks of the organization, which do not fall under the ambit of their contracts. Few studies justify how and why CSR influences employees’ OCB (Oo et al., 2018; Supanti and Butcher, 2019). Furthermore, prior research has focused on the antecedents of OCB, but the association between OCB and a firm reputation in the business sector is still unknown. There are two opposing viewpoints on OCB, first is the optimistic view that says that OCB improves performance from a relational perspective (He et al., 2019; Yaakobi and Weisberg, 2020). Second, the opposing viewpoint contends that OCB places employees under stress and causes conflicts, resulting in poor performance (He et al., 2019; Fu et al., 2022), negative employee performance leads to a low level of firm reputation. As a result, it is worthwhile to investigate the relationship between OCB and the firm reputation further. CSR influences OCB and firm reputation by highlighting implied belongingness and the psychological link between the organization and the employees, as well as by fostering organizational identification in which “the individual defines himself or herself in terms of membership in a particular organization” (He et al., 2019).
This analysis aims to contribute to CSR research in the business sector. Further, prior research has not explored how certain CSR practices influence the development and implementation of organic organizational cultures. Furthermore, previous research has not provided empirical explanations for the relationships between CSR practices, firm reputation, and employee OCB. It is worth noting that one of the intangible assets in firm performance is the reputation (Pires and Trez, 2018), though reputation is the primary outcome of perceptions of a business’s CSR practices (González-Rodríguez et al., 2019). Even though firm reputation is an undeniable source of competitive advantage, only a few studies have looked into how CSR can be used as a tool to improve a firm reputation (Verčič and Ćorić, 2018; González-Rodríguez et al., 2019). Organizational culture is the characteristic and tangible personality of each organization. The organizational culture can effectively promote knowledge exchange, experience, and ideas (Asatiani et al., 2021). Meanwhile, organizational culture can provide a positive and better atmosphere/environment to facilitate the following organizational and individual outcomes. Organizations cannot survive or thrive in ever-changing environments unless their members act as good citizens by engaging in various positive behaviors (Isensee et al., 2020). OCB is an extra role behavior that is not specified or required by the formal job responsibilities (Celiker and Guzeller, 2022) and can be seen in an employee who voluntarily assists other employees in their work to promote the employer’s excellence without expecting to be compensated for it (Habeeb, 2019).
This study contributes to the literature on the line of CSR, organic organizational cultures, firm reputation, and OCB. A previous study by Agarwala et al. (2022) shows that CSR performance is still scarce in developing countries. This study would promote value to the current set of limited literature. Previous literature showed the direct influence of CSR on the firm reputation (Tangngisalu et al., 2020; Nguyen et al., 2021), as well as CSR’s impact on employee’s organizational citizenship behavior (He et al., 2019; Khaskheli et al., 2020) but this study expands these relationships via mediating mechanism of organic organizational cultures, which is an attractive contribution to the existing literature. Moreover, previous studies highlighted the direct effect of organic organizational cultures on firm performance (Noone et al., 2022), nevertheless, little research has studied the impact of organic organizational cultures on firm reputation and employee OCB. This study also covers these gaps by investigating the direct effect of organic organizational cultures on firm performance and employee OCB.
The main objective of this study was to unlock the effects of CSR on firm reputation and employee OCB in Pakistan. Therefore, we used organic organizational cultures (clan and adhocracy) as a mediator in this study. This study’s findings are the first of their kind in Pakistan. The study’s specific research questions are as follows:
1. Does CSR affect the firm reputation and employees’ OCB in medium and large enterprises in Pakistan?
2. Do organic organizational cultures (clan and adhocracy) mediate between CSR-firm reputation link and CSR-employee OCB linkage?
3. Can an employee’s OCB affect a firm reputation?
Following that, we provide a brief theoretical background and review of the literature, present the study’s methods and measures, and elaborate on the survey findings in detail. Our study concludes by discussing the research’s findings, limitations, and implications in the final section.
2. Theories and hypotheses development
The literature review relies on reputable scientific databases, including Wiley, Springer, Elsevier, Emerald, and Taylor and Francis. It covers the years 2017 to the present to establish current knowledge. Significant older research was included where it was necessary to present a comprehensive picture of the topic. We begin by establishing the overall context of the study. This research is based on three theories: the stakeholder theory, the social identity theory, and the social exchange theory.
The results of this study support the connections between CSR and the stakeholder theory by recognizing many stakeholder groups, including employees and the community. Advocates of CSR in modern business contend that organizations have obligations to stakeholders and their respective shareholders or investors. Employee attitudes and behaviors drive organizational culture and environment. CSR initiatives can encourage a culture of innovation (Chen, 2022). This study highlights the role of CSR in the organization’s culture and supports the stakeholder theory.
CSR can promote employee organizational identification (Martínez et al., 2014; Shin et al., 2016). Motivation and a desire to help others can make employees feel closer to their employer. Social identity theory provides evidence that CSR enhances organizational identification leading to OCB. In conformity with the social exchange theory, the leader and follower develop a reciprocal relationship in which one side receives something of value from the other and is compelled to respond in kind. Social exchange theory explains how CSR practices and firm reputation impact one another (Farooq et al., 2019). This study supports the social exchange hypothesis by highlighting the impact of CSR on corporate reputation and OCB.
As mentioned above, the theories employed for the purpose of this study are the stakeholder theory, the social identity theory, and the social exchange theory. The stakeholder theory argues that it is not only the shareholders that are impacted by firm decisions, but rather a several stakeholders including, but not limited to the employees, the customers, the suppliers as well as the communities. Based on this, our research involved employees in the process of data collection, since they are the most impacted by firm decisions. However, one limitation that we faced in employing this theory was that our data collection did not include the rest of the stakeholders.
The social identity theory explains individuals’ self-concept derived from perceived membership in a social group. Whereas the social exchange theory studies the interactions between individuals from a cost–benefit perspective. Our model is further supported by these two theories, to help explain the impact of CSR on OCB and FR. However, since we are focusing more on the impacts of CSR on OCB and FR, we could not dig deeper into individual employee self-identities.
2.1. Corporate social responsibility and firm reputation
Research demonstrates a positive link between CSR practices and FR (Jeffrey et al., 2018; Yadav et al., 2018; Park, 2019). Social exchange theory facilitates the connection between CSR perceptions and the trust (Tangngisalu et al., 2020). Each stakeholder’s overall impression of the company and level of trust can be characterized by the firm’s reputation (Yadav et al., 2018). Stakeholders are more likely to trust companies with strong CSR since high-quality management is an indicator. According to research, customers’ perceptions of a company’s CSR actions are positively correlated with their evaluations of its reputation (Arli et al., 2019). From the employee’s point of view, the employees’ impression of their organizations’ CSR is linked to their level of organizational commitment, which improves their firms’ reputation ratings (Lee and Tao, 2020). Among the company’s efforts to strengthen its reputation among senior-level executives, philanthropic activities may play a role (Özcan and Elçi, 2020). Under the theory of social exchange, the norm might regulate employee responses. A good perception of CSR is likely to boost employee confidence in their superiors, as employees see that the company has served the interests of all parties and so deserves greater trust. Businesses can enhance their firm reputation by focusing on proper CSR programs and communication channels (Ajayi and Mmutle, 2021). Stakeholders evaluate a firm’s reputation based on the signals they receive from the organization (Tangngisalu et al., 2020). In addition to the company’s financial performance and ownership, alerts based on philanthropic values used by the CSR contribute positively to CSR perception (Harun et al., 2020). CSR improves a business’s brand image and reputation, as well as its sales and customer loyalty, as well as its capacity to attract and retain employees (Bahta et al., 2021). Hence, based on arguments in the extant research, we propose the following hypothesis:
H1: CSR has a positive and significant effect on a firm reputation.
2.2. Corporate social responsibility and employee OCB
Voluntary individual behavior, not immediately or explicitly recognized by the formal reward system, and overall supports the efficient operation of the organization is referred to as organizational citizenship behavior (OCB; Bies, 1989). We have used social identity theory and social exchange theory to support the link between CSR-OCB. According to social identity theory, individuals classify themselves and share the benefits of this affiliation (Ashforth and Mael, 1989). Existing research has identified the favorable effects of organizational factors such as authentic leadership, organizational justice, and perceived organizational support on OCB among employees (Iqbal et al., 2018; Farid et al., 2019; Tran and Choi, 2019). Scientists have discovered a correlation between OCB and employee loyalty and identification with a firm (El-Kassar et al., 2021). CSR contributes to organizational identification and encourages employees to demonstrate extra-role and responsibility-taking behaviors (Wang et al., 2017). In this regard, employees who identify with their organization are more likely to maintain their self-identity through OCB (Wang et al., 2019; El-Kassar et al., 2021). Social exchange theory says that people trade with each other for both social and economic reasons (Blau, 1964). Characterized by obligations, trust, interpersonal attachments, or commitment to specific exchange partners (Lee, 2021), there is evidence that people are more likely to show OCB at work if they know that the company is socially responsible (Farid et al., 2019). Overall, the real-world data shows that CSR positively affects OCB. The social exchange theory explains why employees do things on their own time. When employees think a company’s CSR activities are fair, they behave cooperatively at work (Aftab et al., 2021). Also, when organizations help their employees socially and emotionally, the workers show their appreciation by trying to compensate for the good behavior they have received (Cappelli et al., 2020; Naz et al., 2020). In compliance with social exchange theory and social identity theory, and the information mentioned above from extant research, this study hypothesizes the following:
H2: CSR has a positive and significant effect on employees’ OCB.
2.3. Corporate social responsibility and organic organizational culture
In organizations in emerging nations, organic organizational cultures, such as clan and adhocracy, are standard (Awino, 2020). Due to their emphasis on flexibility, organic cultures are effective in these countries’ continuously changing and unpredictable environments (Alvesson and Lindkvist, 1993; Pasricha et al., 2018; Awino, 2020). Organizational culture is “a collective entity that emerges from individuals’ values and societal, ethical leadership, organic organizational cultures, and CSR (Schein, 2004; Žukauskas, 2018). Shared values “provide the normative or moral purpose of directing members in how to respond to certain crucial situations” (Ellemers et al., 2019). Li and Fung (2020) stated that values are ingrained in the layered creation of culture and should be analyzed to get insight into an organization’s culture.
By its stated objectives, the present study investigates organic organizational culture through the shared values of individuals in the organization. However, the importance of organic organizational culture in facilitating the understanding of diverse management processes has been widely demonstrated, for example, organizational innovation (Chen et al., 2018), competitive advantage (Ziaei Nafchi and Mohelská, 2020), and organizational effectiveness (Hassan, 2020; Khan et al., 2020). There is little interest in organic organizational culture in the search for CSR. The current study contributes to this research by investigating the critical role of organic organizational culture as a mediator in the relationship between CSR, firm reputation, and OCB. The findings of this study reinforce the links between CSR and stakeholder theory by identifying different stakeholder groups, namely employees and society (Dmytriyev et al., 2021). Contemporary advocates of the CSR (Waheed and Zhang, 2020) argue that business organizations have a responsibility not only to investors or shareholders but also to stakeholders, i.e., employees and society.
2.3.1. CSR and the clan culture
According to Alharbi and Abedelrahim (2018), distinctive features of clan-type companies are teamwork, employee engagement programs, and the company’s commitment to the employee. Some of the basic assumptions in clan culture are that the environment can be better managed through teamwork and employee development, that customers are better treated as partners, and that the organization creates a humane work environment (Acquah et al., 2020; Nanayakkara and Wilkinson, 2021; Zhang et al., 2022). Firms are responsible to their respective investors, shareholders, and stakeholders (Waheed and Zhang, 2020). CSR improves the corporate image (Kim et al., 2020). A positive firm reputation is associated with increased job satisfaction and decreased employee turnover (Chatzopoulou et al., 2021). The organization of clan culture is held together by loyalty and tradition (Kheir-Faddul et al., 2019). CSR can increase employee loyalty to the organization (Stojanovic et al., 2020). Hence, we posit that:
H3: CSR positively and significantly affects clan culture (organic organizational culture).
2.3.2. CSR and the adhocracy culture
Adhocracy culture is a developmental, organizational culture that emphasizes the development, growth, innovation, and productivity of new products and services (Misigo et al., 2019). An adhocracy culture is characterized by a dynamic, entrepreneurial, and creative environment (Scaliza et al., 2022). Strategic plans for a company with an adhocracy culture are based on the desire for constant change and acquiring new knowledge and resources. Organizations that deal with an online business, defined as a new economy using modern technology, are examples of this culture (Acar and Acar, 2014; Misigo et al., 2019; Zeb et al., 2021). Innovativeness and ever-improving eminence of a company’s products and services are granted prominence in adhocracy culture. CSR programs can assist in fostering a culture of innovation (Chen, 2022). Hence, we propose the following hypothesis based on arguments in the extant research.
H4: CSR positively and significantly affects Adhocracy culture (organizational culture).
2.4. Organizational culture on firm reputation
Organic organizations are adaptable and flexible (Hartnell et al., 2019) allowing them to be more responsive to the market (Pasricha et al., 2018). Organic cultures promote risk-taking, nurture employees’ aspirations, and provide a collaborative environment, which can be the basis for competitive advantage and help a business grow and improve its chances of success (Dimitrova, 2018). A good firm’s reputation is created following a firm’s success and destroyed following a firm’s failure (Tadelis, 2003). The employees of an organization influence how projects are perceived and implemented, as well as how clients, partners, and the general public perceive the organization (Afsar et al., 2020). Consequently, the need to enhance a firm reputation has prompted businesses to examine their culture and adopt ways to evolve and improve it (Hatch and Schultz, 1997).
Clan culture is frequently characterized as a particularly welcoming workplace (Xie et al., 2020; Li et al., 2021; Shaked, 2021; Huang et al., 2022). It resembles a large family. The leaders, or the heads of the organization, are seen as mentors and possibly even parents. The organization is held together by tradition or loyalty, and high commitment exists. The organization prioritizes the long-term value of human resource development and places a premium on teamwork and morale. Success is defined by customer awareness and concern for customers. Employee trust is typically related to clan culture (Masood et al., 2006). Ideally, increasing employee trust increases the company’s reputation among its workforce (Yadav et al., 2018). It has been hypothesized that employee trust leads to good attitudes, such as dedication and job satisfaction, and behavior, such as increased effort (Michaelis et al., 2009). Company culture and identity, contact personnel, and physical environment are significant factors affecting consumers’ perceptions of a firm reputation. Workplaces characterized by an adhocracy culture are entrepreneurial and inventive (Misigo et al., 2019; Noone et al., 2022). Adhocracy culture is viewed as a culture that fosters innovation (Hamzah et al., 2022). Moreover, Aladwan and Alshami (2021) found that invention significantly impacts a company’s reputation. Hence the following hypothesis is proposed:
H5: Clan culture has a positive effect on a firm reputation.
H6: Adhocracy culture has a positive and significant effect on a firm reputation
2.5. Organizational culture on OCB
Clan culture stresses collaboration among members, including a family-like atmosphere, morale, communication, and cohesion, and focuses on maintaining and enhancing human relationships inside the organization (Jeong et al., 2019). Adhocracy culture promotes organizational success through creativity, innovation, and challenges, which also leads to the acquisition of new resources and entrepreneurship (Azeem et al., 2021). Organizational culture influences employee behavior significantly (Kawiana et al., 2018), so there is likely a favorable relationship between these organic organizational cultures and OCB. Indeed some studies (Zeyada, 2018; Mitonga-Monga, 2019; Mitonga-Monga and Flotman, 2021) found an increase in OCB among employees who were linked with and understood the organizational principles and ethics. In addition, they concluded that support, structure, and risk tolerance were among the most influential contributors to organizational culture on employee OCB. OCB can be influenced by the degree of commitment, mutual trust, and shared values among the organization’s employees (Bhoki, 2020). Additionally, an innovative work atmosphere can affect OCB (Soelton et al., 2020). Taking into account these relationships, some researchers assessed the impact of different organizational cultures on the OCB (Al-Shurafat and Halim, 2018; Mansouri et al., 2018; Lockhart et al., 2020). Hence our study offered the following hypotheses:
H7: Clan culture has a positive and significant effect on OCB.
H8: Adhocracy culture has a positive and significant effect on OCB.
2.6. OCB and firm reputation
Firm reputation is an intangible resource that gives the company a competitive advantage because it affects customer loyalty and financial outcomes (Farhan et al., 2020; Islam et al., 2021; Khan et al., 2022; Le, 2022). A good firm’s reputation could reduce the cost for sellers and buyers to do business with each other since most people prefer to do business with people who have already shown they can be trusted (Wiedmann et al., 2013). Existing research has looked at a firm’s reputation from the perspective of different stakeholders, such as customers (Osakwe et al., 2020) and potential employees (Tangngisalu et al., 2020). Little attention has been paid to employees, a potentially vital part of a firm’s reputation program, and critical employee outcomes, particularly their OCB. González-Rodríguez et al. (2019) says that a firm’s reputation is the socially shared impression of how people see the firm. Similarly, employees of the same company share their images of their employer. Based on what the public thinks, employees know how trustworthy the company they work for is as proposed by social identity theory (SIT), which pertains to a person’s oneness with a group (an individual’s sense of belonging to a group) and is a significant factor in their behavior (Ashforth and Mael, 1989). Hence, based on arguments in the extant research, we propose the following hypothesis:
H9: Employee’s OCB positively and significantly affects a firm’s reputation.
2.7. Mediating mechanism of organic organizational culture (CC&AC)
Though, a few studies have established associations between organizational culture and CSR other than the Pakistani medium and large enterprises without the inclusion of any moderation or mediation variable (El-Kassar et al., 2021). CSR is a business paradigm in which businesses make a concentrated effort to operate in ways that benefit society and the business environment rather than harm them (Kapelus, 2002), as well as CSR, is a source of employee satisfaction (Wisse et al., 2018). Regarding CSR, it determined that integration of CSR competence may help to achieve company performance and satisfied employees (Wang et al., 2020). Furthermore, many academicians and specialists have urged focusing more on CSR, especially in light of empirical studies conducted in developing countries (e.g., Manzoor et al., 2019b; Wang et al., 2020). Researchers should concentrate on developing countries because CSR research in developed countries has been extensive in recent decades (El-Bassiouny and El-Bassiouny, 2018; Kudłak et al., 2018; Nill and Papp, 2020).
Nevertheless, no well-known work has determined the nexuses between CSR, firm reputation, and OCB by employing organic organizational culture (clan and adhocracy culture) as the mediator in underdeveloped countries’ medium and large enterprises. As a result, based on the arguments mentioned above and hypothesized relationships, we seek to specify empirical and analyzed proof discovering the mediating mechanism of organic organizational culture (clan and adhocracy culture) in the relationships between CSR firm reputation and OCB (see Figure 1). Accordingly, we suppose that:
Figure 1. Conceptual framework of the study.
H10: Clan culture has a positive mediating effect on the nexus of CSR and firm reputation.
H11: Adhocracy culture has a positive mediating effect on the nexus of CSR and firm reputation.
H12: Clan culture has a positive mediating effect on the nexus of CSR and OCB.
H13: Adhocracy culture has a positive mediating effect on the nexus of CSR and OCB.
3. Methods of the study
The cross-sectional design and self-administered questionnaires were used to collect primary data from employees working in various medium and large enterprises in Pakistan. The reason for using questionnaires as the main data source was that our research has been conducted in an undocumented market of Pakistan, where secondary data is often not available. In such markets, primary research is often the most reliable source. The questionnaire adopted constructs on CSR from Manzoor et al. (2019b)‘s study, those on OOC from Cameron and Quinn (2011)‘s study, while the constructs on Firm Reputation and OCB were taken from Tangngisalu et al. (2020) and Yang et al. (2022)‘s studies, respectively.
The enterprises from whose employee data was collected are big shopping malls, restaurants, Hotels, Automobiles, and pharmaceutical companies in urban areas of Pakistan. We visited these enterprises to highlight the significance of the study and encourage workers to contribute; questionnaires were circulated among them. These questionnaires consisted of the entire demographic characteristics of the participants and all main study variables (CSR, organic organizational cultures (Clan and Adhocracy), organizational citizenship behavior, firm reputation, etc.).
For this study, convenience sampling was used. We used this sampling technique to recruit participants who are convenient and easily accessible. We distributed 500 questionnaires to owners, top-level management workers, and employees of these enterprises, and 360 (72%) filled questionnaires were returned for analysis. The demographic characteristics of respondents are shown in Table 1.
Table 1. Demographic statistics of study participants (n = 360).
3.1. Measurement instruments of the study variables
Standard scales from the existing literature were used for the study measures. These measures’ items were anchored on a 5-point Likert scale ranging from 1 to 5, with 1 being strongly disagreed and 5 strongly agreeing.
i. Corporate Social Responsibility: The questionnaire on the CSR variable consisted of 16 items and the CSR questionnaire is adopted from the previous study by Manzoor et al. (2019b).
ii. Organic organizational cultures: We focused on two Organic organizational cultures, i.e., (a) Clan and (b) Adhocracy. Each of the constructs has six measuring items founded on Cameron and Quinn (2011) Organizational Culture Assessment Instrument (OCAI). These culture types are determined by the characteristics of the organization, organizational leadership, employee management, organizational glue, strategic emphasis, and success criteria (Cameron and Quinn, 2011).
iii. Firm reputation: Three questions refer to the firm reputation variable, which we adopted from a previous study by Tangngisalu et al. (2020). The same questions are used in earlier literature (Rupp et al., 2006; Lai et al., 2010).
iv. Organizational citizenship behavior: In this study, we employed the OCB scale established by Yang et al. (2022), and previously used in the literature (Bachrach et al., 2007). Total of 10 items using the Likert five-point scale measurement, the score was from 1 to 5, indicating “strongly disagree” to “strongly agree.”
4. Empirical results and findings
We used SPSS (v.26) and smart PLS (v.3.3.3) for analyses. The structural equation modeling technique (SEM) was applied for the mediation approach. PLS-SEM includes the measurement model description to validate the basic structure of the variables in the suggested model. Path analysis is used to scrutinize the study hypotheses demonstrated in the model. The variables with good factor loading convergent validity, composite reliability (CR), and discriminant validity were conducted for further analysis using the measurement model specification.
Furthermore, discriminant validity was used to calculate the associations between latent constructs by comparing the differences between latent variables that were validated using experts’ recommended criteria (Manzoor et al., 2021). Structural model valuation weighs path coefficients and tests their significance. Model fit for SEM was exposed using the goodness technique of Hu and Bentler (1999) by Standardized Root Mean Square Residual (SRMR). It is suggested that SRMR values should not surpass 0.08 (Hu and Bentler, 1999). All of the techniques applied are well-matched with previous research studies in the area; therefore, scholars are now encouraged to generate outcomes by employing these tools and techniques (Pasricha et al., 2018; Dana et al., 2022).
4.1. Descriptive measurements
Table 2 displays the study constructs’ means, standard deviations, and correlations. The correlation coefficients revealed that all study constructs are highly correlated.
Table 2. Descriptive measurements and Pearson correlation of the constructs.
4.2. Common method bias
This study’s measurement items were examined for common method bias (CMB; Manzoor et al., 2019a). Harman’s single factor analysis was used to check for measurement biases (Podsakoff and Organ, 1986), which exposed no CMB issue in the study’s data as the total variance obtained by one factor is 42.3% and it is lower than the suggested threshold of 50%.
4.3. Measurement model estimation
The measurement model evaluation is based on the recommendations of Hair et al. (2006) to verify the reliability and validity of the variables. All included 41 measures were estimated whole from elimination as the scrutinized factor loadings made over the recommended value of 0.60. The factor loadings, alpha coefficient, Composite Reliability (CR), and Average Variance Extracted (AVE) are all recorded in Table 3. The AVE and CR of all the indicators are higher than 0.50 and 0.70, correspondingly as per the recommended cut-off by specialists (Hair et al., 1998; Rabiul et al., 2021). As a result, reliability and convergent validity are confirmed. Likewise, discriminant validity is recognized, as listed in Table 4, using the criterion proposed by Fornell and Larcker (1981). Oliveira et al. (2016) advised that discriminant validity may be acquired by comparing interrelations of the variables with √AVEs. It is recommended that the values of √AVE be greater than the values of the following interconnections of the constructs. Consequently, values on the following model show the presence of such validity.
Table 3. Factor loading and reliability.
Table 4. Discriminant validity (Fornell and Larcker criterion).
4.4. Hypothesized path evaluation
Tables 5, 6 describe the outcomes of the SEM evaluation, which was used to test the hypotheses of the study. The assessment of direct effects is shown in Table 5. The current SRMR value is 0.056, which is in fulfillment with the emphasized condition. The SEM outcomes validated CSR’s significant and positive impact on firm reputation as established by β = 0.14 at p < 0.05. Therefore, hypothesis 1 was endorsed. Then, hypothesis 2 is predicted with the relationship between CSR and OCB. We found support for hypothesis 2 (β = 0.46, p < 0.001). Furthermore, hypothesis 3 postulates the relationship between CSR and clan culture. Which was endorsed as CSR exposed to have a positive and significant influence on clan culture (β = 0.48, p < 0.001). It is assumed in hypothesis 4 that adhocracy culture positively affects CSR. We found complete approval for hypothesis 4. In accordance with standardized (β = 0.62, p < 0.001), significant and strong relationship between adhocracy culture and CSR was recognized. According to hypothesis 5, clan culture and firm reputation have a positive relation. As revealed in Table 5, clan culture has a significant and positive relationship with firm reputation (β = 0.24, p < 0.001), confirming hypothesis 5. Likewise, hypothesis 6 assumed there is a significant and optimistic relationship between clan culture and OCB. This study found support for hypothesis 6 (β = 24, p < 0.001). Then, hypothesis 7 is expected with the connection between the adhocracy culture and firm reputation. We found support for hypothesis 7 (β = 0.24, p < 0.001). likewise, hypothesis 8 postulated with the relationship between OCB and adhocracy culture was confirmed as adhocracy culture was exposed to have a positive and significant influence on OCB (β = 0.12, p < 0.05). Similarly, hypothesis 9 assumed a positive and significant association between OCB and firm reputation. This study found support for hypothesis 9 (β = 0.13, p < 0.001), as shown in Table 5.
Table 5. Results of the path coefficient of the structural model (direct relationships).
Table 6. Results of bootstrapping for the direct, indirect, and total effect of the hypothesized model.
4.5. Mediation or indirect effects
An assessment of indirect effects is given in Table 6. It concerned the execution of the mediation analysis according to the method suggested by Baron and Kenny (1986). This technique recommends that the explanatory variable be related to the outcome variable, that the explanatory variable be linked with the mediator, that the mediator is connected to the predicted construct, and that the presence of the mediator should be lower (partial mediation) or render insignificant (complete mediation) the explanatory variable’s prior direct relationship with the outcome variable.
Hypotheses H10–H13 investigate the influence of CSR on firm reputation and OCB via the organic organizational culture (clan and adhocracy), respectively. Support for hypotheses H1–H9 proved the first three conditions, as suggested by Baron and Kenny. The next critical phase was to evaluate the effect of clan and adhocracy cultures on the association between CSR, firm reputation, and OCB.
To assess full or partial mediation, we executed percentile bootstrapping and bias-corrected bootstrapping at a 95% confidence interval with 5,000 bootstrap samples (Kozhakhmet and Nurgabdeshov, 2022). To test the significance of indirect effects as Preacher and Hayes (2008), we estimated the confidence of the interval of the lower and upper bounds. As shown in Table 6, we discovered that the indirect effects of clan culture on firm reputation (β = 0.10, p < 0.05, T = 2.27) and OCB (β = 0.09, p < 0.05, T = 2.56) are significant. Similarly, the indirect effects of adhocracy culture on firm reputation (β = 0.12, p < 0.05, T = 2.15) and OCB (β = 0.06, p < 0.1, T = 1.76) are significant. The direct connection between CSR and firm reputation (β = 0.12, p = 0.20, and T = 1.27) is insignificant and supports hypotheses 10 and 11 with complete mediation. Furthermore, the direct connection between CSR and OCB (β = 0.37, p < 0.001, and T = 5.23) is significant and endorsed hypotheses 12 and 13 with partial mediation. The findings reveal the partial mediation role of clan and adhocracy cultures in the CSR - OCB connection.
An additional endeavor was undertaken, involving an examination of the synchronized influence of clan and adhocracy cultures on the (i) CSR–firm reputation linkage and (ii) CSR–OCB linkage was made. Figure 2 illustrates the structural model that demonstrates this.
Figure 2. SEM modeling. significant at ***p < 0.01 and **p < 0.05.
Figure 2 demonstrates the SEM results, which show that the path from CSR to clan culture is significant (β = 0.47; p < 0.01) and that the paths from clan culture to firm reputation (β = 0.21; p < 0.01) and to OCB (β = 0.20; p < 0.01) are also positive and show significant relations. Figure 2 shows that the direct path from CSR to firm reputation (β = 0.12, p > 0.05) is insignificant, confirming full mediation, whereas the direct path from CSR to OCB (β = 0.37, p < 0.01) is significant demonstrating partial mediation. Likewise, the path from CSR to adhocracy culture is significant (β = 0.52; p < 0.01), as are the paths from adhocracy culture to firm reputation (β = 0.24; p < 0.01) and to OCB (β = 0.11; p < 0.05) are also significant and displays positive connections. According to Figure 2, the direct path from CSR to firm reputation is insignificant, confirming full mediation, whereas the direct path from CSR to OCB is significant, proving partial mediation.
5. Discussion
The prime aim of this study was to test the empirical relations between CSR and firm reputation and organizational citizenship behavior in the existence of organic organizational cultures as mediators between Pakistani large and medium enterprise employees. The study’s results also endorse previous research studies in which mediating mechanisms of organic organizational cultures (clan and adhocracy) between CSR and firm reputation were discovered (Balaji et al., 2020; Sackmann, 2021; Arabeche et al., 2022). It is proven that workers who have CSR activities in their enterprises have inspiring spirits towards an appealing goal and experience an excellent level of satisfaction and alternatively possess commitment, i.e., OCB. These findings show positive relationships between organic organizational cultures (clan and adhocracy), firm reputation, and OCB (Sackmann, 2021; Arabeche et al., 2022; Youn and Kim, 2022). Employees with a better understanding of clan and adhocracy culture are happier and more committed to their organization/enterprise.
The main finding of this study is that organic organizational cultures act as mediators in the relationship between CSR and firm reputation and OCB. Leaders and top management who want to improve the firm reputation and boost OCB among employees must be capable of setting up an ethical and organic organizational culture. The study’s findings supported all of the hypotheses depicted in the proposed model. This study demonstrates that CSR has a significant direct effect on firm reputation and OCB, as well as an indirect effect on firm reputation and OCB via organic organizational cultures. The indirect impact of CSR via clan and adhocracy cultures provides more insight into the relationship between CSR, firm reputation, and OCB. Both the clan and adhocracy cultures were discovered to fully mediate the CSR-firm reputation and partially mediate the relationship of CSR-OCB. This mediating mechanism of organic organizational culture significantly contributes toward linking CSR and the firm reputation (Ikram et al., 2019).
This study explains the association between CSR, organic organizational cultures, firm reputation, and OCB, particularly in large and medium enterprises, a previously unexplored sector. It provides preliminary support for the critical role of organic cultures in expanding top management competence as a driver of CSR in large and medium-sized enterprises. It proposes to help these enterprises’ managers by increasing their knowledge of culture types, which are critical to be confident to cope with the organization’s responsiveness to its stakeholders and thus accelerate organizational performance and reputation. Aside from that, the study strengthens our knowledge of the absence of mutual exclusivity between different types of organic organizational culture (Bhoki, 2020). It highlights the importance of cultural complementarity in achieving desired organizational outcomes by highlighting the coexistence of organic clan and adhocracy cultures as encouraging the CSR-firm reputation relation and the CSR-OCB link.
Furthermore, the study findings are consistent with previous research linking CSR and firm reputation (Ikram et al., 2019; Tangngisalu et al., 2020) as well as CSR and OCB (Oo et al., 2018; Youn and Kim, 2022). According to the current study, this dynamic influence is more marked in large and medium-sized businesses because managers in these organizations are mainly responsible for a diverse set of stakeholders and are apprehensive about achieving the organization’s social mission. As a result, prior research indicates that an organization’s leadership impacts organizational outcomes through CSR. The study contends that organizational culture plays a role in this impact because, according to the results, the behavior of the leader defines the organization’s culture, which describes the CSR strategies of the organization.
5.1. Implications, limitations, and future directions of research
This study has significant implications for medium and larger enterprises regarding the relevance of CSR in terms of the effectiveness of such organizations. The study findings reveal how CSR techniques and qualities support a firm reputation by demonstrating the significant mediator role of organic organizational cultures. Implementing CSR qualities increases employee job satisfaction, which improves the firm’s reputation and employee OCB. Another practical implication of this study is that top-level management, such as leaders and managers, should be trained in managing organic cultures, which will improve their performance, organizational performance, and firm reputation. In conclusion, our research suggests that the primary goal of training should be to increase employee job satisfaction and performance to achieve high organizational outcomes and benefits. They are also directed to incorporate social responsibility agendas, as this can help enhance individuals’ strengths and nurture CSR-friendly value systems in the organization. Additionally, this would increase the performance of the personnel and thus inclusive organizational performance. Furthermore, the study findings provide critical efforts to specialists in the state’s enterprise area by facilitating a better understanding of medium and large enterprise management. Because Pakistan is a developing country, the study believes that these results and their implications are also relevant to other developing economies.
It is critical to highlight the study’s few limitations, which may lead to future investigation. The cross-sectional research design is applied for data collection. A future study could present the research model using a longitudinal study technique to avoid the ambiguity of a causal correlation. Second, the current study is limited to medium and large businesses. As a result, it is suggested that the study be expanded to include other organizations to overcome the limitations of this study. Third, this study was conducted in Pakistan. Future research studies should be conducted in other less-developed countries to investigate the model and increase the generalizability of the results. Finally, the other possible moderating and mediating effects of certain variables on the CSR–firm performance linkage and CSR–OCB link can be further studied.
6. Conclusion
This empirical study elaborated on the relationship between CSR and firm reputation, organizational citizenship behavior, and the mediation mechanism of organic organizational cultures, i.e., (clan and adhocracy). This study found that organic organizational culture (clan and adhocracy) fully mediated CSR’s impact on a firm’s reputation and partially mediated the relationship with OCB. Top management and enterprise leaders can improve CSR activities and develop organic organizational cultures by empowering their employees. Taken together, these results deliver more comprehension of CSR and OCB research and propose various phases that can be taken to promote it in larger enterprises. Finally, it offers important insights for businesses seeking to develop socially responsible and improve their potential for enhancing firm reputation. Despite the limitations of our study, we hope it will serve as a solid foundation for upcoming studies.
Data availability statement
The raw data supporting the conclusions of this article will be made available by the authors, without undue reservation.
Ethics statement
The studies involving human participants were reviewed and approved by University of International Business and Economics, Beijing China. The patients/participants provided their written informed consent to participate in this study.
Author contributions
HA initiated the basic idea and wrote the manuscript and built the article structure. JY reviewed and improved the manuscript. FM reviewed and improved the methodology of this study. AM further reviewed and improved methodology and improved structure. All authors contributed to the article and approved the submitted version.
Acknowledgments
We would like to express our appreciation to all those who have contributed to this research, including our colleagues and participants. Their support has been invaluable. We would also like to thank the reviewers and editors at Frontiers in Psychology for their valuable feedback on our manuscript.
Conflict of interest
The authors declare that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.
Publisher’s note
All claims expressed in this article are solely those of the authors and do not necessarily represent those of their affiliated organizations, or those of the publisher, the editors and the reviewers. Any product that may be evaluated in this article, or claim that may be made by its manufacturer, is not guaranteed or endorsed by the publisher.
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Keywords: CSR, organic organizational cultures, firm reputation, employees OCB, Pakistan
Citation: Ali H, Yin J, Manzoor F and An M (2023) The impact of corporate social responsibility on firm reputation and organizational citizenship behavior: The mediation of organic organizational cultures. Front. Psychol. 13:1100448. doi: 10.3389/fpsyg.2022.1100448
Edited by:
Aidin Salamzadeh, University of Tehran, IranReviewed by:
Sawsan Malik, Arab Open University, KuwaitMd. Mizanur Rahman, BRAC University, Bangladesh
Copyright © 2023 Ali, Yin, Manzoor and An. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY). The use, distribution or reproduction in other forums is permitted, provided the original author(s) and the copyright owner(s) are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.
*Correspondence: Mengmeng An, ✉ 02526@uibe.edu.cn