The relationship between corporate social responsibility and employee engagement : a social exchange perspective

The purpose of this article is to investigate the impact of internal CSR on Employee Engagement through a mediation-moderation mechanism in a developing country, using social exchange theory. In this empirical study, 300 self-reported questionnaires were randomly distributed among the employees of 25 companies, from the FMCG and Telecom sectors of Pakistan. Data collected from these employees were further analyzed through confirmatory factor analysis using the structural equation modeling technique, using the latest available version of software Smart PLS 3. The results of confirmatory factor analysis prove the hypothesized direct effects of corporate social responsibility on employee engagement. The findings also indicate the positive mediating role of trust in the relationship between internal corporate social responsibility and employee engagement. However, the moderator Leader-Member exchange did not demonstrate any effect. The study encourages practitioners to focus on building trust in employees for improved participation in the firm's processes, use new ways of conveying the concerns to employees through various human resource interventions and leader-member exchange mechanisms. However, since the research has been conducted in a single country, i.e. Pakistan, with a limited number of respondents, therefore, it cannot be generalized, whereas research in different countries with a larger sample may bring interesting/contrasting results.