THE IMPORTANCE OF CORPORATE SOCIAL PERFORMANCE TO THE PROSPECTIVE EMPLOYEES IN MALAYSIA

More and more organizations are now aware that in pursuing their economic objectives, they should also contribute to the society at large. Organizations now realize that in order for them to survive and stay competitive in this complex business environment, they must bridge the economic and social systems. The concept of corporate social performance (CSP) was introduced to analyze how well an organization performs its corporate social responsibility. It measures the overall performance of the organization towards its social surroundings such as employees, environment, customers, suppliers and others. Besides bridging the economic and social systems, it is also very important for the organization to capitalize on its competitive advantage in order to survive in this complex business environment. Several studies have suggested that a talented, quality workforce will become an important source of competitive advantage for business organizations in the future. This paper aims to examine the importance of CSP towards the decision of prospective employees in joining an organization in Malaysia. Drawing on social identity theory and signaling theory, the authors hypothesize that firms can use their corporate social performance (CSP) activities to attract job applicants. The dimensions of CSP were adopted based on Kinder, Lydenberg and Domini (KLD) ratings. The decision of prospective employees in joining an organization or the interest of a person to commit into a job is referred as job pursuit intention. The authors used four major CSP dimensions which include employee relations, diversity, product quality and environment to obtain the CSP measures which were then tested with job pursuit intention. A total of 200 questionnaires were used for the analysis. The result showed significant positive relationship between all the variables used in measuring CSP and job pursuit intention. This indicates that CSP may provide organizations with the ability to attract higher number of job applicants that could be translated into better choices of human resources which will lead to sustained competitive advantage in the long run.