The influence of stakeholder theory and Islamic faith on employee perception of CSR

Purpose – The purpose of this paper is to examine the influences of employee perception of CSR in the Readymade Garment Industry. The RMG industry in Bangladesh has faced constant criticism of their working practices and following some fatal incidents, the industry was faced with external pressures of implementing CSR practices and policies. Manufacturers invested and initiated CSR in their business and marketing strategy to survive in the global competition. Employees are internal stakeholders that help to implement and disseminate strategies successfully, however, there is not enough knowledge in the area of employee perception of CSR.

Design/methodology/approach – The paper is an exploratory study using the quantitative data collection method. 128 responses have been collected from participants who are employees of garment factories in Bangladesh, to understand their perception of CSR. Regression analysis has been conducted to ascertain the relationships between the factors that influence employee perception. Theories of Stakeholder management, Organizational Citizenship Behaviour, Social Exchange Theory and Employee engagement have been used to analyse the factors that influence employee perception.

Findings – The findings show that the factors that influence perception of CSR are not confined to the stakeholder’s initiatives but are significantly dependent on the employees’ direct involvement, engagement and personal values as a beneficiary and an executioner. In addition to the stakeholder’s initiatives that is a key deliverable to the marketing strategy, the employees are influenced by their personal beliefs and practices that can be associated with influences of religion, culture, and the wider social landscape.

Research limitations/implications – The data is limited to a small number of factories located near the capital, Dhaka, this is a small sample compared to the 4000 factories in Bangladesh. Further research can be conducted based on a larger data set which could represent a wider range of employee perspectives from different factories relating to size, product category and geographical location. The study does not expand on the factors that influence employee perception specifically.

Practical implications – The findings of the study can help the employers to understand that the organization’s priority and participation are not the only factors that influence the employee’s perceptions. The employees’ assessment of the stakeholder’s intentions of CSR which is reflected in the organization’s priority, shapes employee perceptions that is influenced by their personal values and beliefs. The awareness of the factors that influence the employees will enable organizations to motivate them and deliver on expectations of the business partners.

Social implications - It is the practices aimed at the employees that enhances their engagement in CSR that enables them to reciprocate and influence their perception of the organization’s fair and genuine motives. The effectiveness of this aids the macro-marketing aspects of managing social concerns and the impact of businesses.

Originality/value – The data collected is primary data from employees of garment manufacturers. The hypothesized framework is developed by the authors and the outcomes of the factors that influence the employee perception of CSR are escalated from the analysis conducted by the authors.