Come work for us! The effect of CSR fit on Millennials’ work willingness

Come work for us! The effect of CSR fit on Millennials’ work willingness Elisa Langendorf, 11366419

Master in Corporate Communication Master thesis

Supervisor: Dr. Claartje ter Hoeven Graduate School of Communication

University of Amsterdam January 2019

Acknowledgements

A sincere and warm thank you to my supervisor Claartje ter Hoeven for all the precious thoughts and the detailed feedback on my thesis throughout the process. Special thanks to Nadine Bol who thought me the basics in experimental design one year ago and was a consistent source of encouragement. A heartful thank you to my family. I don’t know how I would have done all of this without your love and support. I would also like to thank Jonas who gave me his passion for numbers and encouraged me throughout my entire studies – we came such a long way and I will always be grateful for our journey. Last but not least, a huge thank you to all of my wonderful friends, the ones I made this year and the ones at home. You are such a source of inspiration and made this entire experience so fun.

Abstract

This study aims to investigate to what extent and how a company’s corporate social responsibility (CSR) fit affects Millennials’ potential work willingness. In this context, a high CSR fit was defined as a high congruence between a supported CSR initiative and a

company’s core business. In this study, the signaling theory has been considered suggesting that a high CSR fit mostly sends a positive signal to applicants. It was expected that, because of the high CSR fit, the level of perceived legitimacy increases while CSR skepticism

decreases. Under consideration of the social identity theory (SIT), it was further assumed that a high CSR fit mostly leads to high organizational identification. Results of an online

experiment among Millennials demonstrate that a high CSR fit affects their’ potential work willingness positively. This relationship was mediated by the level of perceived legitimacy. Contrary to that, there was no mediation effect of skepticism. This study contributes to the literature of signaling theory and SIT. Further, the field of research on the CSR fit will be extended by focusing on potential workers and the importance of a CSR fit in the application process will be highlighted.

Keywords: CSR fit; potential work willingness; organizational attractiveness; Millennials; signaling theory; social identity theory; employer branding

The influence of CSR fit on Millennials’ work willingness

Nowadays, organizations have to differentiate in order to persist in a competitive market environment. In order to do so, the recruitment of qualified individuals is crucial (Breaugh, 2012; Catano & Morrow Hines, 2016; Ryan & Delaney, 2010). In this context, Millennials represent a comparatively young and attractive group of potential workers for organizations (McGlone, Spain, & McGlone, 2011). By 2020, Millennials are considered to constitute over half of the total workforce (Allen, Allen, Karl, & White, 2015). As people born between 1979 and 2000 (Helton, 2017) they are however expected to hold a different set of values compared to older generations (Catano & Morrow Hines, 2016). This is of high relevance in regard to their (un-)willingness to work for a specific company and the expectations they hold towards organizations. Furthermore, Millennials care about social causes and tend to gravitate towards environmentally and socially responsible campaigns (Hyllegard, Yan, Ogle, & Attmann, 2010). As a result of increased social expectations, corporate social responsibility (CSR) gained importance for companies in order to demonstrate that they are responsible (Crane & Glozer, 2016). In this context, CSR was defined by Du, Bhattacharya and Sen (2010) as “a commitment to improve [societal] well-being through discretionary business practices and contributions of corporate resources” (p. 8). More specifically, the CSR fit has been highlighted as an important factor to communicate (e.g. Du et al., 2010). In the literature, the CSR fit was most frequently defined as the

congruence between a social issue and the organization’s business (Becker-Olsen, Cudmore, & Hill, 2006; de Jong & van der Meer, 2017; Du et al., 2010). The CSR fit has been

researched extensively (e.g. Aksak, Ferguson, & Duman, 2016; Elving, 2013; Janssen, Vanhamme, Lindgreen, & Lefebvre, 2014; Nan, & Heo, 2007).

Yet, a literature review of Peloza and Shang (2011), reviewing CSR related studies, summarizes that most of the studies focus on business practices or philanthropy, services and products. Only very few of the identified studies investigate the influence of CSR on

However, there is a promising potential. For example, it has been emphasized in the field of organizational communication that companies can use CSR programs in order to enhance employees’ commitment to a company (ter Hoeven & Verhoeven, 2013).

Therefore, this study aims to contribute to the literature in at least three ways. First, the influence of CSR fit on potential workers will be investigated. As mentioned above, this relationship has hardly been explored in the literature (Klimkiewicz, & Oltra, 2017; Peloza & Shang, 2011). Nonetheless, it is important for companies in order to target applicants

appropriately and thus recruit them. Second, Millennials will be in focus of this study. Since they symbolize the future job market (Allen et al., 2015) they are an important target group for companies. Furthermore, they are supposed to hold a different view of CSR (Catano & Morrow Hines, 2016) which generates the need to investigate what they favor when it comes to the CSR fit. Third, this study aims to contribute to a gap defined by Aguinis and Glavas (2012). According to the authors, further research is needed to get a better understanding of the processes through which CSR initiatives lead to specific outcomes (Aguinis & Glavas, 2012). Therefore, underlying mechanisms will be considered that explain how the CSR fit is linked to its potentially positive outcomes.

Studies have already considered different mechanisms such as trust (Farooq, Payaud, Merunka, & Valette-Florence, 2014; Fatma, Rahman, & Khan 2015; Vlachos, Tsamakos, Vrechopoulos, & Avramidis, 2009), brand credibility (Hur, Kim, & Woo, 2014), reputation (Galbreath & Shum, 2012; Hur, et al., 2014; Lai, Chiu, Yang, & Pai, 2010) or customer satisfaction (Galbreath & Shum, 2012; Saeidi, Sofian, Saeidi, Saeidi, & Saaeidi, 2015). Further, signaling mechanisms have been considered in order to explain how CSR initiatives attract potential applicants (Jones, Willness, & Madey, 2014). Therefore, potential workers evaluate a company’s characteristics as signals in order to decide how it would be like to work for this organization (Catano & Morrow Hines, 2016). Examples of these signaling mechanisms are the perceived pride an employee takes in working for a certain organization (Jones et al., 2014) or the person-organization fit (Cable, & Judge, 1996). However, the level

of perceived legitimacy has, to my best knowledge, not yet been studied in this specific context. Legitimacy could serve as a signaling mechanism since research suggests that the effects of CSR fit on its outcomes are mediated by variables capturing consumers’ perception of a company (de Jong & van der Meer, 2017). Further investigating consumers’ perception, CSR skepticism will be considered as an underlying mechanism, too. It was already identified in the literature as an important mechanism linking the CSR fit and its various outcomes (Elving, 2013; Skarmaes & Leonidou, 2013). However, skepticism towards CSR seems to be especially relevant in the context of Millennials, since they grew up with digital media and tend to be more critical towards it (Schmeltz, 2017). Concluding, the thesis should further research how the CSR fit possibly influences Millennials to work for a specific organization under consideration of the following research question:

RQ: To what extent does the CSR fit of an organization affect a company’s perceived legitimacy among Millennials, CSR skepticism and their willingness to work for it?

Theoretical framework CSR fit and applicants’ work willingness

In order to explain what motivates applicants to work for an organization that shows a certain level of CSR fit, different theories were identified in the literature (Catano & Morrow Hines, 2016). However, the leading theories in this context are the social identity theory (e.g. Catano & Morrow Hines, 2016; Turker, 2009) and the signaling theory (e.g. Greening & Turban, 2000; Jones et al., 2014).

Social identity theory (SIT)

According to the theory, individuals rely on different cues in order to define their “self-concept” (Tajfel & Turner, 1985). Such cues are, among other ones, the organization the individual works for (Catano & Morrow Hines, 2016). Whenever individuals create a

membership of a certain group (Tajfel & Turner, 1985) or organization. That way, individuals increase their self-esteem since they are proud to identify with a well-regarded company (De Roeck, & Delobbe, 2012). Here the level of CSR fit comes into play, since present research indicates that a high CSR fit tends to influence the individual’s attitudes towards the

organization positively (Du et al., 2010; Schmeltz, 2017; Sen & Bhattachary, 2001). Compared to that, a low fit potentially decreases organizational identification since the initiative might be considered as inappropriate for the organization (Elving, 2013). Taken together, a high CSR fit mostly increases organizational identification among applicants. Therefore, they would be proud to be a member of this group and thus are willing to work for the organization.

Signaling theory

Whenever individuals apply for a job they rarely know enough about a specific

company (Catano & Morrow Hines, 2016). Therefore, they rely on “signals” about companies in order to be able to decide if they are attracted to them (Uggerslev, Fassina, & Kraichy, 2012). According to the theory, information that has been provided by the organization to potential workers signals what applicants can expect from working for this company (Greening & Turban, 2000). Such a signal is the level of CSR fit that, depending on what initiative is supported by the company, highlights certain organizational values (Catano & Morrow Hines, 2016). Therefore, it can be expected that a high CSR fit mostly sends a positive signal to potential applicants. In other words, whenever a seemingly unrelated CSR initiative (in case of a low fit) will be supported, a negative signal is sent to applicants. Then they are likely to become skeptical of the company’s (true) intentions (Du et al., 2010). Because of the CSR skepticism their perception of the company is negatively influenced which further determines the level of attraction to a company (Uggerslev et al., 2012). CSR fit

According to SIT, individuals draw on the organization’s identity to create their own one. Drawing on the signaling theory, applicants rely on signals in the application process.

Furthermore, according to Greening and Turban (2000) applicants are more likely to work for socially responsible organizations. Therefore, the CSR fit is seen as a signal by Millennials and will be taken into their consideration when it comes to the identity creation process and potential willingness to work for an organization.

As emphasized before, the CSR fit refers to the perceived relationship between an organization and its CSR activities (Nan & Heo, 2007). In this context, a high fit is considered to have a positive influence on the individual’s attitude towards the organization since the CSR initiative is considered as appropriate for the company (Elving, 2013). Whenever there is a low CSR fit, there is a lack of a logical connection between the company’s core business and the CSR cause that is supported. In the case of a low CSR fit, the individual’s cognitive elaboration increases, and thus extrinsic motives become more salient (Du et al., 2010). As a result of these inconsistencies, consumers become more critical and are skeptical with regards to the organization’s motives (Elving, 2013). In order to avoid inconsistencies, research suggests a high CSR fit that impacts individuals’ attitudes towards the company positively (Du et al., 2010; Schmeltz, 2017; Sen & Bhattachary, 2001).

However, other research found the opposing effect, namely that a high fit can negatively influence consumers’ attitudes towards an organization (Yoon, Gürhan‐Canli, & Schwarz, 2006). This can be the case in controversial industries, such as the oil industry. There, a high CSR fit could possibly emphasis the organization’s lack of environmental responsibility (De Roeck, & Delobbe, 2012). Therefore, it has to be emphasized that the assumption that a high CSR fit is seen as appropriate for the company (Elving, 2013) might not be the case in all industries. However, this is only an issue in controversial industries and most company’s values are primarily of positive nature which will be highlighted by a high CSR fit. For this reason, a high fit will be defined as something potentially positive for the sake of this paper.

Besides of the contradicting results in regard to the direction of the effect, it has to be emphasized that studies indicate an explicit relationship between the CSR fit and attributes

given to the organization (Elving, 2013). Following the rational that a high fit shows a high congruence between the organization’s core business and the initiative and is therefore considered as appropriate by the individual (Elving, 2013) as well the observation that a CSR initiative positively influences applicants’ potential willingness to work for a company (Greening & Turban, 2000) it can be expected that:

H1: When an organization’s CSR fit is high, Millennials’ willingness to work for this organization increases, compared to a low CSR fit.

Perceived legitimacy

Legitimacy was most frequently defined as the congruence between organizational behavior (and thus its activities) and values or social norms that are considered as important in society (Coelloni, 2013; Dowling & Pfeffer, 1975; Suchman, 1995).

Moreover, it has been shown that whenever organizations manage to communicate in a credible manner, they succeed in establishing legitimacy (Lock & Seele, 2017). As

explained before, whenever the CSR fit is low, individuals tend to become skeptical of the organization (Elving, 2013) since they become more aware of inconsistencies. For that reason, a credible and consistent CSR message is central in order to establish legitimacy (Lock & Seele, 2017). In regard to the CSR fit, a high fit is most likely to be considered as credible since it stresses a logical association between the company’s business and the social cause that is supported. A high CSR fit may help individuals make sense of why the CSR initiative is supported by the company (de Jong & van der Meer, 2017) and applicants therefore do not second-guess the organization’s intentions. Instead, the high CSR fit signals that the company is truly engaged with its environment, that way influencing the applicant’s perception positively (Turban & Greening, 1997). The high fit therefore serves as a symbol to identify the company with social or legitimate practices (Dowling & Pfeffer, 1975) and thus brings legitimacy to the company itself.

In addition, legitimacy is viewed as an organizational resource since it is of great importance for organizations in order to compete on the market (Dowling & Pfeffer, 1975). More specifically, it is crucial in order to gain access to a stronger workforce (Seele & Gatti, 2017). Legitimacy further relies on the moral evaluation of the company and its CSR

activities and thus is highly subjective and judgmental (Seele & Gatti, 2017). In order to positively influence applicants’ moral evaluation, a high fit should be favored, since the applicants are more likely not to doubt the company’s intentions, because of the high congruency (de Jong & van der Meer, 2017). Additionally, legitimacy can be gained by aligning social values that are associated with the company’s CSR initiatives to what is considered as a social norm or acceptable behavior in society (Dowling & Pfeffer, 1975). With a high CSR fit, a company supports initiatives that are close to its core business and therefore the company’s core values. This leads to legitimacy for the company, whenever the two value systems (of the society and the organization) are congruent (Dowling & Pfeffer, 1975). Furthermore, the gained legitimacy will serve as a positive symbol for potential applicants (Dowling & Pfeffer, 1975). In the literature, it is emphasized that organizations holding legitimacy appear to be meaningful and therefore are considered as desirable

(Colleoni, 2013). For this reason, applicants’ willingness to work for the company increases. Taken all of this together, the following hypotheses can be expected:

H2: High fit between an organization and its CSR initiative increases the perceived legitimacy among Millennials, compared to a low CSR fit.

H3: Perceived legitimacy among Millennials increases their willingness to work for an organization.

H4: The positive relationship between a high CSR fit and Millennial’s willingness to work for an organization is mediated by the level of perceived legitimacy among Millennials.

CSR skepticism

As already briefly discussed above, individuals tend to be skeptical in regard to an organization’s CSR efforts (Elving, 2013). More specifically, they question why companies support certain initiatives and how these contribute to society (Skarmeas, & Leonidou, 2013). Skepticism arises whenever individuals feel some sort of betrayal by considering companies to act on behalf of their own interest rather than the society’s benefits (Elving, 2013).

Moreover, a study by Ellen, Webb and Mohr (2006) indicates that a high CSR fit appears to decrease the level of skepticism. According to the authors, individuals’ response to the

company was most positive whenever they judged the CSR initiative as value-driven (Ellen et al., 2006). In contrast to that, consumers responded negatively whenever they considered the initiative to be externally motivated and therefore egoistic (Ellen et al., 2006). Moreover, Millennials grew up with digital communication and therefore tend to be critical towards it (Schmeltz, 2017). For this reason, they might be able to identify inconsistencies in the case of a low CSR fit and thus become more skeptical of the company. Additionally, Millennials are considered to lack loyalty to employers (Mack, 2016) and change their job frequently. This emphasizes the recruitment process as an opportunity to persuade Millennials with a high CSR fit. Furthermore, it has been highlighted in the literature that Millennials prefer CSR communication to be engaging and explicit (Schmeltz, 2017). In the case of a low CSR fit, it can be expected that the level of skepticism increases because of the lack of an explicit connection to the core business. A high fit, however, shows a logical and explicit connection between a company and its CSR initiative and that way avoids conflicting signals. Following this logic, it can be expected that:

H5: High fit between an organization and its CSR initiative decreases skepticism among Millennials, compared to a low CSR fit.

Skepticism has been negatively associated with different outcomes such as attitudes towards an organization (Du et al., 2010), equity (Skarmeas, & Leonidou, 2013) and purchase intention (Elving, 2013). As mentioned before, individual’s furthermore draw on a company’s attributes whenever they create their own social identity and aim to work for organizations that are well esteemed (De Roeck, & Delobbe, 2012). Whenever Millennials become

skeptical of the organization’s motives, because of a low CSR fit, they might not identify with it. This further decreases the likelihood of interest on the applicant’s side, since job seekers are most attracted to organizations they identify with (Catano & Morrow Hines, 2016). Taken all together, it can be expected that Millennials’ attractiveness to an organization will decrease whenever they are skeptical about it:

H6: CSR skepticism among Millennials decreases their willingness to work for an organization.

Moreover, skepticism has been found as an underlying mechanism between the CSR fit and consumers’ attitudes (Elving, 2013). According to Elving (2013) a high level of CSR fit decreases the level of skepticism and that way leads to more favorable attitudes towards the organization. Therefore, similar results are expected in regard to Millennials’ willingness to work for a company:

H7: The positive relationship between a high CSR fit and Millennials’ willingness to work for an organization is mediated by the level of skepticism.

Figure 1: The conceptual model

Methods Design

A two-group experimental design was conducted to investigate the effect of fit of the CSR initiative on perceived legitimacy, CSR skepticism and Millennials’ potential work willingness. This decision was made based on the research question, since its focus is on testing causality between the variables. The two conditions consisted of a high and a low CSR fit. Participants were randomly assigned to one of the two conditions. Due to randomization all systematic differences between participants in the two groups, including possible

prepositions in regard to the dependent variables, are eliminated (Research Methods and Statistics, 2016). Moreover, a convenience sample was chosen in order to recruit participants for the online experiment. That way, respondents were asked via social media such as

Facebook, LinkedIn and WhatsApp or face-to-face contact to take part in the study.

Additionally, the snowball sampling method was used, and participants were asked to share the link within their own network.

Furthermore, IKEA was chosen as a company in this study. This decision has been made for two reasons. First, the Swedish furnishing chain operates globally in 29 different markets with about 360 stores (Butler, 2018) and is therefore a well-known brand. Because of

the high brand familiarity, it is more likely that participants are able to evaluate whether the CSR initiative is related to the core business or not. Second, the company’s CSR efforts show a variety of different activities such as energy consumption or support of local communities (Dudovskiy, 2017) which gives the introduced initiatives credibility.

Participants

Since this thesis focuses on Millennials’ attitudes specifically, respondents that were born between 1979 and 2000 were invited to participate in the experiment. However, it was secured by a filter question that only participants with a minimum age of 18 years participated in the experiment. In total, 242 responses were recorded. However, 88 cases were excluded since the questionnaires were either incomplete (N = 72) or identified as outliers (N = 16) under consideration of the minimum amount of time that it takes respondents to complete the questionnaire advisedly. That way, a total sample of N = 154 respondents was collected. Participants were between 18 and 39 years old, with an average age of 25 years (SD = 3.40). The convenience sample was slightly overrepresented by women (62.0% were female) and 80.5% had an academic education. This, however, is not a problem since Millennials are a highly educated cohort (Schmeltz, 2017). Respondents were quite equally distributed over the two conditions with a slightly higher number of respondents in the high fit (N= 82) compared to the low fit condition (N= 72).

Procedure

Respondents were invited to participate in the online experiment over a period of two weeks. After exposure to the stimulus material, participants were asked within a brief online questionnaire to what extent they considered the proposed cause to fit the actual business of IKEA. Furthermore, participants were asked to evaluate the level of perceived legitimacy, CSR skepticism and the potential willingness to work for the company. Moreover, the questionnaire contained variables assessing demographics and background information such as participants previous experiences with IKEA.

Stimulus material and Pretest

In order to guarantee an authentic experience, IKEA’s current homepage “People and Planet Positive” was manipulated. This homepage is dedicated to the company’s CSR

initiatives. There was a possibility that respondents had seen the homepage before, therefore the layout of the original homepage was incorporated in the material. By using IKEA’s layout, the level of skepticism resulting from concerns about its authenticity should be limited. Further, it can be secured that the level of skepticism respondents indicated in the questionnaire results from the message itself (rather than from an authenticity problem). The general set-up of the homepage, including e.g. layout or navigation bar, was kept consistent in both conditions (see Appendix 2). Consequently, the material only differed in terms of the introduced initiative, namely only the text and photo varied across the two conditions.

For the high fit condition, a CSR initiative was chosen that IKEA promotes on its homepage. Therefore, information about water and energy saving showers was provided. More elaborate information about how water and energy will be saved was given and this was linked to IKEA’s core business by emphasizing that IKEA aims to help consumers live a more sustainable life at home. In contrast to that, the low fit condition was portrayed by a seemingly unrelated CSR initiative. This initiative was purely fictional and information about children’s vaccination was provided. In the low fit condition, it was claimed that IKEA supports humanitarian partners like UNICEF with financial support in order to guarantee kids a healthy start in life.

In order to make the stimulus material as distinct as possible it had to be adjusted several times. Furthermore, a pretest (N = 39) was conducted revealing a significant t (31.35) = 5.48, p <0.001 mean difference 2.31, 95% CI [1.45; 3.17], d = 1.38 between the two groups in the fit condition, with equal variances not assumed (Levene’s F (37) = 17.75, p <0.001). The level of fit (perception) was tested with three items such as “I think IKEA and the CSR initiative are similar” on a 7-point Likert scale ranging from 1("strongly disagree") to 7("strongly agree"). The scale proved to be reliable (α = .93). Participants in the high fit

condition rated the fit between IKEA and the initiative as ‘high’ (M = 5.63, SD = .89) and in the low fit conditions they perceived the fit as “low” (M = 3.32, SD = 1.68) proving the manipulation successful.

Measures

Two to five items scales were used to measure the constructs, as shown in Appendix 1. Table 1 contains the bivariate correlations and alpha coefficients (α range .74-.90).

Additionally, factor analyses were conducted on all of the scales. In regard to the factor loadings the conventional threshold of .40 was considered (Field, 2013). All variables in this paper, unless indicated otherwise, were measured on a 7-point Likert scale ranging from 1(”strongly disagree”) to 7(”strongly agree”).

CSR fit. The central independent variable CSR fit was measured with three items from a scale developed by Lafferty, Goldsmith and Hult (2004), examining cause-brand alliances. A sample question was: “I think there is a good fit between the company and the CSR initiative.” The three items were averaged into a new scale and factor loadings ranged between .68 and .90.

CSR skepticism. CSR skepticism was measured on a four-item scale which was derived from Skarmeas and Leonidou (2013). The authors used the scale to investigate to what extent individuals are skeptical of the (social) involvement of a retailer (Skarmeas & Leonidou, 2013). An item was for example: “It is questionable that this retailer acts in a responsible way”. The factor loadings ranged from .75 to .83.

Perceived legitimacy. Legitimacy was measured on a four-item scale (Lee, Yoon & O’Donnell, 2018). A sample question was “I think IKEA is a necessary part of our society”. However, the authors used a dichotomous scale where respondents could only answer the questions with 1(”yes”) or 2 (”no”) (Lee et al., 2018). Considering the complexity of the construct, a dichotomous scale seemed to be insufficient as it would not guarantee that

above) was used instead, guaranteeing higher variability. Factor loadings ranged between .50 and .91.

Willingness to work for an organization. In order to investigate if Millennials are potentially willing to work for IKEA a scale by Turban and Keon (1993) was used. Studies used it to measure applicants’ attraction to a firm (Turban, 2001; Turban & Keon, 1993). Five items examining the extent to which respondents were interested in pursuing their application with the company, would accept a job offer, would like to work for the company, would exert a great deal of effort to work for it or were not interested in the company except as a last resort (reversed item) were used. Factor loadings ranged between .65 and .92.

Background variables. Background measures included the respondents’ gender, age, educational level, brand familiarity and brand attitudes. Education was measured as an ordinal variable, ranging from 1”(no education”) to 7(“university”). Respondents were asked to pick the most appropriate category if their level of education was not listed. Brand familiarity was measured on a three-item scale (Xie, Bagozzi, & Meland, 2015) and a sample question was: “I am very familiar with this firm’s products and services”. Factor loadings ranged between .59 and .91. In regard to respondents’ attitudes towards IKEA it had to be controlled for previous experiences participants had at IKEA. Therefore, a two items scale by Suh and Youjae (2006) was used ranging from 1(“unfavorable”) to 5(“favorable”) and 1(“dislike”) to 5 (“like).

Table 1.

Correlations and descriptive statistics.

Variable M (SD) 1 2 3 4 5 6 7 8 9 1 CSR fit (α fit perception) 0.53 (0.50) .82 2 Willingness _{to work} 3.71 (1.38) .20* .90 3 CSR _skepticism 3.77 (1.37) -.12 -.56** .87 4 Perceived _legitimacy 4.38 (1.12) .21** .58** -.68** .78 5 Brand _attitudes 3.79 (0.70) -.01 .39** -.46** .51** .78 6 Brand _familiarity 4.74 (1.18) -.02 .27** -.27** .27** .46** .74 7 Gender 0.62 (0.50) .04 .14 -.09 .05 .03 .04 - 8 Age 25.34 (3.40) -.07 .03 -.02 .02 -.12 .01 .13 - 9 Educational _level 6.61 (0.92) -.03 .08 -.11 .16 .16* .29** -.06 .37** - Notes: N = 154. Values on the diagonal in bold represent reliabilities (α).

*Significance at p <.05 **Significance at p < .01.

Analysis

In order to test the hypotheses, Pearson’s correlation was performed (see table 1). This first step was taken in order to get an overview and check whether there is a linear association between the variables of interest. Afterwards multiple linear regression models were used as a more sophisticated model-based technique. Since it was investigated whether the level of CSR skepticism or the perceived legitimacy mediates the relationship between the CSR fit and applicant’s potential willingness to work for an organization, a multiple linear regression analysis was conducted, using PROCESS analysis by Hayes (2012).

Results Manipulation check

As before in the pretest, a significant t (131.46) = -7,37, p < 0.001 mean difference -1.53, 95% CI [-1.94; -1.12] between the two groups in the fit condition was found. It

presented a large effect (d = 1.06). However, it has to be noted that the assumptions of equal variances in the population were violated, Levene’s F (152) = 7.60, p = 0.007. On average, participants in the high fit condition perceived the fit as “high” (M = 5.15, SD = 1.09)

compared to the low fit condition where participants evaluated the fit between IKEA and the initiative as rather “low” (M = 3.62, SD = 1.44). For this reason, the experimental

manipulation was successful. Randomization check

There was no significant difference in the two experimental conditions in regard to gender (χ2(2) = 1.66, p = .436) and educational level (χ2(4) = 3.21, p = .524). In regard to the age, respondents showed on average the same age in the high fit (M = 25.12, SD = 2.91) and low fit condition (M = 25.61, SD = 3.89). The mean difference 0.50 is not significant t (152) = .912, p = 0.363, 95% CI [-.58; 1.59], d = 0.129. Further, there was no significant mean difference t (152) = .184, p = 0.854, 95% CI [-.34; .41], d = 0.03 between the two groups in regard to brand familiarity. Taken all of this together, it can be concluded that the two experimental conditions do not differ significantly from each other, proving the randomization successful.

Model and hypothesis testing

First of all, the assumptions were checked in order to continue with the analysis. All of the assumptions for the performed regression analyses have been met. Moreover, residuals were quite normally distributed, and scatterplots indicated a homoscedastic variance of error in the prediction. There was no detection of multicollinearity between the variables and considering the conventional threshold of 10 (Field, 2013), all variance inflation factors (VIF) were in norm. Since the assumptions were met, the hypotheses were analyzed. For all the

effects in the regression models the added independent variables were assumed to be held constant. Furthermore, the bootstrap option was used. Please note, that only the control variable “brand attitudes” was included in all of the regression models.

Hypothesis testing

The main effect stated that a high CSR fit (compared to a low one) affects Millennials’ willingness to work for IKEA positively. Therefore, the total effect model has to be

considered since it shows the effect of the predictor variables on the dependent variable when the mediators are not present in the model (Field, 2013). The total effect model was

significant F (2, 151) = 17.73, p < .001 and thus indicated that CSR fit and brand attitudes predicted about 19% of the total variance in Millennials’ work willingness (R² = .19). Respondents in the high CSR fit condition were on average more willing to work for IKEA (M = 3.97, SD = 1.36) compared to the ones in the low fit condition (M= 3.43, SD = 1.35). This difference between the two groups was significant b = 0.54, t = 2.70, p = .008, 95% CI [0.15, 0.94]. Moreover, brand attitudes had a strong significant effect on Millennials’ willingness to work for IKEA b = 0.77, t = 5.33, p < .001, 95% CI [0.48, 1.05]. For H1 the null effect has to be rejected and it can be assumed that a high CSR fit positively affects Millennials’ potential work willingness.

For the legitimacy route, H2 stated that a high CSR fit positively affects perceived legitimacy. After running the analysis, the model resulted significant F (2, 151) = 32.72, p < .001. This indicates that it can be used to explain Millennials’ perceived legitimacy and about 30 % of the variation of the dependent variable can be predicted on the basis of the level of CSR fit and brand attitudes (R² = .30). On average, participants in the high fit condition perceived IKEA as more legitimate (M = 4.61, SD = 0.99), compared to participants in the low fit group (M = 4.13, SD = 1.21). This difference was substantial (see Figure 2). Furthermore, participants’ previous brand attitudes b = 0.81, t = 7.46, p < 0.001, 95% CI [0.60, 1.03], had a strong significant effect on perceived legitimacy. Based on these results,

there was support for H2, indicating that a high CSR fit increases Millennials’ perceived legitimacy, compared to a low one.

The third hypothesis stated that perceived legitimacy increases Millennials’ potential willingness to work for IKEA. The model resulted significant F (4, 149) = 25.10, p < .001 and was therefore used to predict potential work willingness on the basis of CSR fit, skepticism, legitimacy and brand attitudes. The model improved compared to the previous one and about 40% of variance in the dependent variable can be explained with these predictors (R ² = .40). Brand attitudes had no significant effect on the dependent variable in this model, b = 0.19, t = 1.25, p = 0.214, 95% CI [-0.11, 0.48]. Millennials’ perceived legitimacy had a positive significant effect on their potential work willingness (see figure 2). For each point of legitimacy increase, the predicted level work willingness increases by 0.40. Consequently, for H3 the null effect has to be rejected and it can be assumed that there is a positive relationship between legitimacy and work willingness.

H4 stated that the level of legitimacy Millennials perceive, mediates the positive relationship between a CSR fit and their potential willingness to work for IKEA. The total effect, namely the effect of the independent on the dependent variable when the mediator is not included in the model (Field, 2013), proved to be significant, b = 0.54, t = 2.70, p = 0.008, 95% CI [0.94, 0.40]. However, as figure 2 indicates below, the direct effect of CSR fit on the potential work willingness is not significant whenever the mediator is present in the model. Furthermore, there was support for H4 and a significant indirect effect of a high CSR fit on Millennials’ potential work willingness through perceived legitimacy was found in the data.

Figure 2: Mediation effect

Considering the skepticism route, H5 stated that a high CSR fit decreases Millennials’ level of skepticism. After running the analysis, the model resulted significant F (2, 151) = 22.76, p < .001 and thus can be used to predict Millennials’ CSR skepticism. The strength of the prediction is moderate: About 23% of the variance in the dependent variable can be explained on the basis of the level of CSR fit and brand attitudes (R²= .23). On average, participants in the high fit condition were less skeptical (M= 3.60, SD= 1.24), compared to participants in the low fit group (M= 3.95, SD= 1.50). The effect was not significant and small, b = -0.35, t = -1.78, p = .077, 95% CI [-0.74, 0.04]. Furthermore, the confidential interval includes 0, indicating that there is a chance that there is no effect at all. However, the effect is in the hypothesized direction. Interestingly, the model showed that brand attitudes had a significant effect on CSR skepticism, b = .91, t = 6.52, p < 0.001, 95% CI [1.19, -0.64]. The effect was strong and negative.

H6 stated the level of CSR skepticism that Millennials showed decreases their potential work willingness. The same model that was used to test H3 was used, predicting work willingness on the basis of CSR fit, skepticism, legitimacy and attitudes. Millennials’ skepticism towards CSR had a significant, negative effect b = -0.29, t = -3.23, p = .002, 95% CI [-0.46, -0.11] on their potential work willingness. That indicates that for each point the level of skepticism increases, the predicted level of work willingness decreases by 0.29.

Consequently, there was support for H6 and it can be assumed that there is a negative

relationship between the level of CSR skepticism and Millennials’ potential work willingness. H7 expected the level of CSR skepticism to mediate the positive relationship between CSR fit and Millennials’ willingness to work for IKEA. The same model that has been used in order to answer H4 was considered. However, there was no significant indirect effect of a high CSR fit on Millennials’ potential work willingness through the level of CSR skepticism, b = 0.10, 95% CI [-0.12, 0.24]. For this reason, H7 has to be rejected.

Discussion

This study aimed to investigate to what extent and how a company’s CSR fit affects Millennials’ potential work willingness. Therefore, the signaling theory (e.g. Greening & Turban, 2000; Jones et al., 2014) has been considered suggesting that a high CSR fit sends a positive signal to potential applicants. It was expected that, because of the high CSR fit, the level of perceived legitimacy increases while CSR skepticism decreases. Under consideration of the SIT (e.g. Catano & Morrow Hines, 2016; Turker, 2009) it was further assumed that a high CSR fit increases organizational identification among applicants since individuals aim to be identified with well-regarded and socially respected companies. Taken all of this together, it was expected that they are more willing to work for the company.

Results of this study indicate that a high CSR fit positively affects Millennials’ potential work willingness. These results link to past research by Greening and Turban (2000). Within this study, the authors manipulated a firm’s corporate social performance (CSP) activities and found that a high CSP (compared to a low one) increases applicants’ probability to accept a job offer at the company (Greening & Turban, 2000). Furthermore, the findings connect to previous studies, reporting that a high CSR fit has a positive influence on individual’s attitudes towards the organization (Du et al., 2010; Schmeltz, 2017; Sen & Bhattachary, 2001). However, the observed effect of CSR fit on Millennials’ potential work willingness is not significant whenever the mediators are included in the model. This suggests

that the effect of CSR fit is more complex. It has already been assumed by de Jong and van der Meer (2017) that the CSR fit does not directly affect various outcomes. Alternatively, the authors proposed that the CSR fit is mediated by variables that capture applicant’s perception of the CSR initiative or the company (de Jong & van der Meer, 2017). Zooming in on

applicant’s perception, results of this study demonstrate that a high CSR fit positively affects the level of perceived legitimacy. This might be the case due to the high congruence between the supported CSR initiative and the core business which allows applicants to make sense of the fit (de Jong & van der Meer, 2017). Moreover, findings show that the level of perceived legitimacy further impacts Millennials’ potential willingness to work for the company positively. The results confirm previous research suggesting that companies that hold legitimacy are considered as meaningful and therefore desirable (Colleoni, 2013) and thus guarantee companies access to a stronger workforce (Seele & Gatti, 2017). In addition, the positive relationship between a high CSR fit and Millennials’ willingness to work for IKEA was mediated by the level of perceived legitimacy. As already indicated above, this is in accordance with the assumption by de Jong and van der Meer (2017) that the CSR fit does not directly affect its outcomes. In contrast to that, the CSR fit is mediated by variables that capture applicant’s perception (de Jong & van der Meer, 2017), as in this case by the level of perceived legitimacy.

Considering all of these results, it seems to be true that Millennials are attracted by legitimate organizations that are meaningful to them. These findings are connected to

literature about Millennials’ needs, indicating that they hold high expectations when it comes to the organizational value system, salary and meaningfulness of work (Helton, 2017; Myers & Sadaghiani, 2010). Moreover, they expect organizations to be socially responsible (Crane & Glozer, 2016). In order to please these needs, the findings indicate that a high CSR fit can be used to signal that the company is responsible and cares about its environment.

Considering the skepticism route, results point out that a high CSR fit did not

expected in the theory section of this paper. It might however be explained by the fact that Millennials hold favorable attitudes towards IKEA on average (see table 1). Findings show that these on average rather favorable attitudes significantly decreased the level of skepticism. Therefore, the potentially negative effect of a low CSR fit might be leveled out by the high brand “likability”. In line with this, IKEA recently announced to terminate all single-use plastics products from its restaurants and stores (Butler, 2018). Therefore, the company is well reputed for its environmental engagement. An alternative explanation for this surprising finding could be found in a study by Becker-Olsen et al. (2006). According to the authors, the presence of a fit (compared to the absence of a fit) has a positive effect on the individual’s attitudes towards a company (Becker-Olsen et al., 2006).For that reason, it could be argued that the level of the fit does not significantly affect the applicant’s CSR skepticism as long as there is at least some sort of fit between the CSR initiative and the organization. In other words, in the case of a rather low fit applicants might still not be skeptical towards the

company since they might feel like the initiative is still somehow related to the organization’s business and appreciate the company’s social efforts. Furthermore, it has to be noted that the assumed effect showed the hypothesized direction. Indeed, further research is needed to investigate the effect of CSR fit on skepticism thoroughly.

Regarding the relationship between CSR skepticism and Millennials’ potential work willingness, results show that the level of skepticism negatively impacts the willingness to work for IKEA. This is in accordance with past research, which found that skepticism is negatively associated with various outcomes (Du et al., 2010; Elving, 2013; Skarmeas, & Leonidou, 2013). Moreover, there was also no mediation effect of skepticism. This is contrary to what was expected in the beginning of this paper but can be explained for the same reasons as already discussed above.

Theoretical implications

This study contributes in several ways to research focusing on employees’ responses to CSR initiatives. In regard to the signaling theory, the findings give reason to believe, just as

expected in the theory part, that a high CSR fit sends a positive signal to potential workers. Just as assumed, the high CSR fit signals applicants that the company is truly engaged with its environment (Turban & Greening, 1997). Because of the engagement with its organizational environment, applicants mostly perceived the company to contribute to society and thus accept it as legitimate. Because of the higher level of perceived legitimacy, Millennials indicated in this study that they are potentially willing to work for IKEA. Therefore, one can assume that perceived legitimacy is a signaling mechanisms. Past research by Jones et al. (2014) showed similar results and identified signaling mechanisms such as the perceived pride employees take from working for a certain company. According to the authors, signaling mechanisms have the power to positively influence organizational attractiveness (Jones et al., 2014).

Furthermore, the findings contribute to the literature about SIT in at least two ways. First, it was expected that applicants draw on organizational attributes whenever they reflect on their own identity (Tajfel & Turner, 1985). For that reason, the membership of a certain organization might be desirable, and applicants are thus potentially willing to work for it. In this specific case, results indicate that the membership of a legitimate organization allows Millennials to increase their self-esteem which leads to higher work willingness. Furthermore, there is reason to believe that, similar to what DeRoeck and Delobbe (2012) found in their study, that organizational identification is the key for understanding why CSR initiatives influence (potential) workers’. In line with previous studies (de Roeck & Delobbe, 2012; Jones, 2010) this study suggests that the SIT is a useful framework for explaining (potential) employees’ responses to the CSR fit. Second, the results indicate that CSR skepticism might reduce Millennials’ identification with the company and thus their willingness to work for it. This is in line with the notion that applicants aim to be a member of prestigious companies and therefore gravitate to work for companies with positive rather than negative attributes (Catano & Morrow Hines, 2016).

Practical implications

Companies that aim to recruit Millennials for their organization should consider implications from this study. Results support the notion that a high CSR fit is beneficial in order to generate legitimacy among Millennials. This further impacts Millennials’ willingness to join the organization positively. For this reason, a high CSR fit is recommended. In order to find an appropriate initiative, organizations are advised to identify several initiatives that are closely related to the core business. That way, potential applicants are able to understand why the initiative is supported (de Jong & van der Meer, 2017). However, legitimacy theory has to be considered, too. As already explained in the theory section of this paper, scholars

emphasize that it is built whenever there is a congruence between society’s values and the organizational activities (Coelloni, 2013; Dowling & Pfeffer, 1975; Suchman, 1995). In other words, legitimacy is built whenever the CSR program is congruent with what Millennials expect of the organization. Therefore, companies should consider Millennials’ involvement in a social cause such as their volunteerism (Hyllegard et al., 2010). That way, companies can identify a fit that matches Millennials’ social norms and expectations. Whenever this is the case, a high fit serves as a positive symbol to identify the organization with legitimate practices (Dowling & Pfeffer, 1975).

This is even the case in industries with a potentially bad reputation. As already mentioned before, in some industries such as the oil business, it might come across as paradoxical to promote environmental responsibility (de Roeck & Delobbe). However, research by de Roeck and Delobbe (2012) demonstrates that even in controversial sectors, a strong (and therefore high) CSR fit can support organizational legitimacy among employees. In other words, even in disputed industries a high CSR fit could be perceived as favorable by potential applicants. Therefore, companies should, according to the authors, rather show honesty when introducing a CSR initiative (De Roeck, & Delobbe, 2012). That way, a high CSR fit highlights that the initiative is related to the organization and thereby puts effort on the company’s true intentions. This increases organizational identification and thus, as

findings of this study demonstrate, their potential work willingness. Consequently, companies will succeed in recruiting Millennials.

Limitations and future research

This study comes with a number of limitations. First, the sample has to be considered. Since the used sample was a convenience sample, it mainly contained German (56.6%) and Dutch (23.0%) Millennials. However, it might be interesting to replicate this study in different cultural contexts. There have been studies about CSR programs and Millennial job seekers in Poland (Klimkiewicz & Oltra, 2017), America (Helton, 2017) and Australia (Leveson & Joiner, 2014) to only name a few examples. However, they often focus on a different interplay of variables and investigate various aspects of CSR, as for example Millennials’ previous attitudes towards CSR programs (Klimkiewicz & Oltra, 2017) or priorities among various CSR dimensions (Leveson & Joiner, 2014) rather than the CSR fit. Since the randomization check was successful, it was ensured that the observed effect resonated from the CSR fit rather than from respondents’ nationality. However, the level of fit was assessed by asking respondents how they perceived it. Since both concepts, namely the perception of the CSR fit and the level of perceived legitimacy, are highly subjective and culturally influenced

constructs further research is needed. In different countries the same initiatives as used in this study might be rated differently among Millennial applicants. Taken all of this together, it has to be further investigated if there are similar effects in different cultures.

Second, IKEA has been chosen as a company in this study. Strictly spoken, this study only shows how willing Millennials are to work for IKEA. Therefore, future research should focus on companies showing different characteristics. Covariates such as ownership, size or industry could be varied. This might, as already explained throughout this paper, be especially interesting in controversial industries dealing with a rather negative reputation and potential legitimacy issues (De Roeck, & Delobbe, 2012). This connects to the potential effect of CSR fit on skepticism, too. The high CSR fit did not significantly predict Millennials’ skepticism. However, the effect showed the proposed direction and thus further research is needed to

investigate the effect thoroughly. In addition, results show that brand attitudes significantly decreased the level of CSR skepticism. For this reason, the company in center of investigation has to be considered more closely. In regard to the hypothesized skepticism route, different effects might have been found when the potential willingness to work for another company would be assessed. Since IKEA is a well-known and environmental reputed brand (Butler, 2018) this might level out the potential effect of a low CSR fit as explained above. Taken all together, future research could assess Millennials’ potential willingness to work for different companies in order to compare the results to this study.

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Appendix Appendix 1: Item batteries of the main variables

CSR fit perception (Lafferty et al., 2004)

1. I think IKEA and the CSR initiative are similar.

2. I think there is a good fit between the company and the CSR initiative. 3. I think this initiative is a logical choice for IKEA.

CSR skepticism (Skarmeas et al., 2013)

1. It is doubtful that this is a socially responsible retailer.

2. It is uncertain that this retailer is concerned to improve the well-being of society. 3. It is unsure that this retailer follows high ethical standards.

4. It is questionable that this retailer acts in a responsible way.

Perceived legitimacy (Lee et al., 2018)

1. I think IKEA is a necessary part of our society. 2. IKEA is a good corporate citizen.

3. I think IKEA is honest.

4. I believe IKEA follows government regulations.

Willingness to work (Turban & Keon, 1993)

1. I would exert a great deal of effort to work for this company. 2. I am interested in pursuing my application with the company. 3. I would like to work for the company.

4. I would accept a job offer.

Brand attitudes (Suh & Youjae, 2006)

1. How would you evaluate the company? 5-point Likert scale from 1”Unfavorable” to 5”Favorable”

2. How much do you like the company? 5-point Likert scale from 1”Dislike” to 5”Like”

Brand familiarity (Xie et al., 2015) 1. I know quite a bit about this firm. 2. I am very familiar with this firm.

Appendix 2: Stimulus material

Condition 1: High CSR fit