Corporate Social Responsibility and Employee Retention

54 Pages Posted: 30 Jun 2022

See all articles by Xiao Cen

Xiao Cen

Mays Business School, Texas A&M University

Yue Qiu

Temple University

Tracy Yue Wang

University of Minnesota - Twin Cities - Carlson School of Management

Date Written: June 23, 2022

Abstract

Using administrative data from the U.S. Census, this study provides the first direct evidence on the positive effect of firms’ corporate social responsibility (CSR) policies on employee retention. Following an exogenous shock leading to deterioration in firms’ CSR policies, we find that within an employer, voluntary separation rate of CSR-conscious employees increases while that of others does not, and such employee turnovers are costly to employers. Furthermore, for CSR-conscious employees, CSR’s retention effect cannot be substituted by financial incentives. Our findings suggest that CSR-related value alignment between firms and employees serves as a non-financial job benefit that strengthens employee retention.

Keywords: employee retention, CSR, environmental consciousness, social consciousness, financial incentive, non-financial incentive

JEL Classification: G13, G14, G41, G23, J31, L25, M52

Suggested Citation

Cen, Xiao and Qiu, Yue and Wang, Tracy Yue, Corporate Social Responsibility and Employee Retention (June 23, 2022). Available at SSRN: https://ssrn.com/abstract=4144689 or http://dx.doi.org/10.2139/ssrn.4144689

Xiao Cen

Mays Business School, Texas A&M University ( email )

430 Wehner
College Station, TX 77843-4218
United States

Yue Qiu (Contact Author)

Temple University ( email )

Philadelphia, PA 19122
United States

Tracy Yue Wang

University of Minnesota - Twin Cities - Carlson School of Management ( email )

19th Avenue South
Minneapolis, MN 55455
United States

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