Finance, Business & Investing Articles

A Model for Giving The Effect of Corporate Charity on Employees

Part 3

Just as all charities are not equal for a given firm, nor are all employees created equally
in terms of the effects of firm identity changes on performance. In keeping with Chatman’s
value fit (Chatman 1991), I posit that employees who have values that fit with the
firm’s charitable efforts will identify with the firm more strongly and, in turn, also
respond more strongly in terms of performance. This might happen in two different
cases. First, people with stronger social values will tend to respond more strongly to a
firm’s charitable emphasis, especially when the firm has identified its product with the
charity (when firm/cause fit is high). These employees will probably respond to an
increase in the salience of their social values to firm work by increasing their OCB as
well as generally increasing their commitment to the firm (Moorman and Blakely 1995).
Further, an employee who has high social values will feel that a charitable workplace is
more in line with his or her values; consequently the employee will gain greater firm
identification, and probably greater job satisfaction and higher emotional effect, which
the literature suggests directly increases OCB (suggested by many studies, including Isen
and Levin 1972; Organ and Ryan 1995). If employees are motivated chiefly by performance-
oriented behaviour or egoism, charity is likely to have less salience to them, and
their behaviour is less likely to be affected by corporate charity.

H6: When a corporation gives charitably, employees with strong social values are
more likely to identify with the company more strongly than employees without
strong social values.

Further, an employee whose values are specifically aligned with a particular cause or a
particular charity will be more likely to increase identification with the firm and more likely also to affect his or her firm performance positively. Clary et al. (1994) found that people judged motivationally based advertisements that had personally relevant messages as more persuasive than ads that were mismatched and had less personal significance. This held true for people who viewed volunteerism as a social objective, value-expressive, utilitarian, knowledge-based or ego-defensive. So a good match between employee and cause may serve to increase employee identification with the firm.

On the other hand, employees who are already committed to a cause might, in reaction to corporate charity, increase identification with the cause and not increase identification with the company. Thus the link between company and cause would not increase their commitment to the company but instead psychologically justify and strengthen their commitment to the cause (‘my company agrees with me that this is a great cause; I am going to do them and myself proud by working even harder at it’). This leads me to a potentially varying hypothesis (though both could theoretically be true) about the consequences of this sort of employee/cause fit:

H6(1): Employees’ previous personal alignment to a cause will create a greater
identification with a firm which takes on that cause.

H6(2): Employees’ previous personal alignment to a cause will increase if their
firm takes on that cause.

Chatman’s value fit argument (1991) tends to support H6(1). She argues that person/ organisation fit is created in part by selection of incoming employees, in part by socialisation. Further, she says that those recruits whose values most closely match the firm’s adjust to the firm more quickly, those who have the most intense socialisation fit the firm’s value better, and those whose values most closely fit the firm’s feel most satisfied and intend to and do remain with the firm longer. The importance of socialisation in firm performance is powerfully argued by Jones (1986) as well as Pratt (2000), who, in his piece on Amway, illustrates how, once socialised, a company can use employee/firm fit (either natural or built up through sense-breaking/sense-making tactics) as a powerful driver for firm commitment and performance.

This argument, if it is to be believed, makes a firm’s choice to align itself with a cause more difficult. If the employee/firm fit acts as a moderator to firm performance and integration, then if an employee disagrees with a firm’s charitable giving, or has another set of social priorities, giving can actually harm this employee’s integration within the firm or discourage him or her from joining the firm (since the employee’s values and the firm’s values would be in conflict). For example, a Catholic employee or applicant might find a firm’s pro-abortion or pro-birth control stance to be offensive and either reduce identifications with the firm (or, Chatman would suggest, tend to leave earlier) or not enter the firm at all. Further, once the firm has thus modified its identity, it will begin to attract people with aligned beliefs, at least to some extent, and this may or may not be desirable.

The relationship between an individual and a firm can be viewed roughly as shown
in Figure 3. Imagine that a firm has a set of ranked attributes and an employee has a set
of ranked beliefs/values. Each attribute or belief/value, let us assume, represents a preference
or emphasis on a state of the world. So, for example, an employee might value
teamwork while the company has the attribute of fostering/placing a high emphasis on
individual performance. The seemingly incommensurable traits of firm/employee may
be indirectly commensurable when reified. Thus, placing beliefs/values and attributes
on one scale, we can say that an employee values (1, 2, 3, 4) in that order. And a firm values
(6, 5, 4, 3) in that order. A firm/employee fit would be higher either if the firm began
to have (2) as an additional attribute (i.e. have attributes 6, 5, 4, 3, 2), or if the firm
realigned its attributes such that it rated more highly the values that the employee valued (or vice versa). In other words, the fit would also be better if the firm ranked (6, 5,
3, 4) instead of (6, 5, 4, 3). This model, as seen in Figure 4, is, of course, incomplete and
simplified. It does not take into account that people/firms can have an unlimited number of
relevant attributes or interaction between attributes or the many dimensions on which attributes
can interact. But it illustrates firm/employee fit in a logical way.

Figure4

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