Sustainable internal corporate social responsibility and solving the puzzles of performance sustainability among medium size manufacturing companies: An empirical approach.

Studies have been conducted within the domain of internal corporate social responsibility, yet less attention has been given to how sustainable internal corporate social responsibility can be employed to accelerate performance sustainability in medium-sized manufacturing companies. Additionally, the culture of internal corporate social responsibility practice in SMEs has been largely ignored by most of the existing studies. This research, therefore, identified the potential influence of work-life balance, wellbeing at workplace, resilience, and job stress on the performance and sustainability of the SME sector. This is achieved through the conceptualization of a research model that empirically tested the influence of four exogenous variables on performance sustainability using data from 270 respondents from Malaysia, having employed Partial Least Square Structural Equation Modeling (PLS-SEM) as a technique of analysis. The results of the study reveal that wellbeing at workplace and job stress as dimensions of sustainable internal corporate social responsibility have a strong influence on performance sustainability. Practitioners can gain valuable insights into how to effectively use workplace wellbeing and job stress to achieve performance sustainability, which is especially important now that SMEs rely heavily on sustainable competitive advantage to stay in business and create value for organizations.

Introduction

Happiness and wellbeing are the ultimate desires of employees across the world (Cohn et al., 2009a). Policymakers have launched a major debate on ideal development in the quality of work life of employees in recent times to promote quality of work life and a healthy lifestyle. Following this development, the United Nations' Sustainable Development Goals (SDGs summit 2019) also highlights the importance of labor development in relation to employees’ wellbeing and job satisfaction. Employers need to strengthen a mutual relationship that will enhance sustainable performance in various economic sectors. 70% of the global population is employed, and it has been observed that employees in most countries work more than 48 h per week without adequate care and attention to their basic needs (Messenger et al., 2007).

Recently, Descatha et al. (2020) reported that a large number of employees are working themselves to death in order to cope with the global economic challenges relating to financial obligations. These are amongst the reasons for studying sustainable internal corporate social responsibility (ICSR) in order to help practitioners, identify those grey areas that need improvement in job satisfaction. This is to achieve performance sustainability. Burnout, a lack of job satisfaction, stress, and a heavy workload are also major predictors of poor performance and employees’ turnover known to cost organizations millions of dollars annually (Anees et al., 2021; Duan et al., 2019).

Given the importance of sustainable ICSR practice, studies have been conducted from the perspectives of developed and developing countries, e.g., (Chen and Hung-Baesecke, 2014; Duthler and Dhanesh, 2018b; Hameed et al., 2016a; Huber and Schormair, 2021; Obeidat et al., 2018a). Including different organizations like service and manufacturing industries, (Jie and Hasan, 2018; Karaman et al., 2021; Kim and Scullion, 2013; Kim et al., 2018). However, researchers have not reached a conclusion about the precise determinants of performance sustainability in medium-sized manufacturing companies (Aftab et al., 2021; Li et al., 2021a; Sendlhofer, 2020).

Precisely, most of the extant literature has not paid significant attention to how work life balance (Burke, 2010; Ganiyu et al., 2018a; Wood et al., 2020), wellbeing at workplace (Caniëls and Baaten, 2019; King and Jex, 2014; Paul et al., 2016b), and job stress (Wu et al., 2021; Yoon et al., 2018; Zargar Balaye Jame and Daneshvar, 2018) can be integrated holistically with sustainable ICSR practice as core variables (Asante Boadi et al., 2020; Carlini and Grace, 2021) to predict sustainable performance, despite their relevance to job satisfaction and employee performance. Though Duthler and Dhanesh (2018b) and (Lee, 2021b) studied ICSR and employee engagement and recommend that more holistic attempts are required to fill the existing research void on a good understanding of what constitutes sustainable ICSR practice for performance sustainability. Lee (2021a); Aftab et al. (2021) and Oduro et al. (2021) also concluded that new studies are required in this area, particularly among the SME companies that have been under-researched. Therefore, to fill the existing research gap, this study aims to answer the following research question: which factors can sufficiently predict performance sustainability among medium-sized manufacturing companies?

Therefore, to provide an answer to the research question, this study conceptualized a new model using sustainable ICSR (work-life balance WLB; wellbeing at workplace WW; resilience R; and job stress JS) to examine sustainable performance (Iqbal et al., 2020).

To the researchers' limited knowledge, this is the first research to integrate those variables holistically in a research model to explain the influence of sustainable ICSR practice on performance sustainability among medium-sized manufacturing companies. Meanwhile, medium-sized manufacturing companies are one of the strategic economic sectors in the global economy with the capacity to employ a large number of employees. The sector has been identified to contribute over 521.7 billion Ringgit worth of revenue to the Malaysian economy annually (Nor-Aishah et al., 2020). Medium-sized manufacturing companies also contribute up to 66.2% of the national employment quotas (Chin and Lim, 2018; Hami et al., 2018). It also highlighted the need to improve the performance of SMEs to promote the sustainability of the sector (Chin and Lim, 2018; Mohamad et al., 2021). Poor working conditions and employee turnover are problems affecting the continuity of the SME sector (Mohamad et al., 2021; Olubiyi et al., 2019).

Therefore, this study contributes to the body of knowledge and practice by providing a comprehensive model and results to guide academia and practitioners to come up with sustainable ICSR practice that will gain wider recognition and acceptance, especially with the present needs of innovation and performance sustainability. This study is, therefore, organized as follows: Section 1: Introduction. Section 2: Provides a review of relevant literature on sustainable ICSR and performance sustainability, which focuses on theory, constructs, and hypotheses development. Section 3 presents the research methodology, where the emphasis is laid on the data collection and analysis. Section 4 presents the result of the analysis, Section 5 discussion, Section 6 conclusion, Section 7 implications, Section 8 limitations, and Section 9 recommendations for future studies.

Literature review and hypothesis development

In the past few years, the literature has extensively examined factors that determine employee performance from different organizational perspectives. Various theoretical models, such as Stakeholder Theory Friedman and Miles (2002); Jones et al. (2018); Resource Based-Model (RBV) Barney (1991) and (McGahan, 2021a) and Social Exchange Theory; Cook and Emerson (1987) and Sungu et al. (2019b) has been used to predict employees' performance. Though, Resource Based-Theory Colbert (2004) is the most cited theory by researchers within the domain of human resource management (HRM), due to its parsimony and veracity in predicting and supporting statements of research assumption (Alvarez and Busenitz, 2001; McGahan, 2021b).

However, Social Exchange Theory, which was employed in this study, has transited from its nascent stage to a popular strategic management theory in recent times. Initially, Social Exchange Theory was conceptualized as the most parsimonious, theoretically sound, and relevant model to explain employee performance and job satisfaction, as evidenced by a recent study Sungu et al. (2019a), especially in developing countries (Lee et al., 2010).

Meanwhile, Social Exchange Theory has also been reasonably proven to be effective at predicting employees' reactions towards organization performance by scholars like Cook and Hahn (2021) and Sungu et al. (2019b), while Yin (2018) opine that such a prediction is narrowly focused on the employee's perspective of cost and benefit relating to employee performance and expectations.

Therefore, it indicates that other variables can be applied to Social Exchange Theory to facilitate sustainable performance prediction. Recently, Cook and Hahn (2021) has enhanced the existing classical approach to social exchange theory from perspectives of collective action, power dynamics, and social cohesion by adding the current perspectives of social change that often result from power inequalities between employees and employers. including the digitalization of mutual value-creation activities.

Study like Sungu et al. (2019a) has also replaced the classical approach of an employee's intentions to reciprocate performance with what has been obtained from organizations to achieve high performance based on the mutual exchange of values. Social Exchange Theory suggest that efforts should be made to ensure an employee's capabilities are aligned with specific tasks for performance and well-being through a mutual exchange of values. Likewise, Tanskanen (2015). extended the concept of Social Exchange Theory to include solving the complex relationships between buyers and suppliers in marketing research. These extensions justify the inclusion of work life balance, wellbeing at workplace, resilience, and job stress into Social Exchange Theory in order to predict performance sustainability in the context of SME where study of this type is still evolving.

Related standards

Standards are equally capable of increasing performance sustainability and improving the sustainable ICSR practice of organizations. Although researchers appeared to disagree on the appropriateness of implementing CSR standards, particularly on employee management services, because they were thought to be designed for external stakeholders and environmental purposes (Chung et al., 2020). Meanwhile, this is a common misunderstanding. For example, recent evidence shows that international standards have potential benefits for employee satisfaction in relation to good organization performance (Marinescu, 2020). And considering that the majority of existing studies have paid little or no attention to how these international standards can be deployed despite their benefits, (Valmohammadi, 2014). Therefore, this study integrated some international standards with sustainable ICSR practice core variables to explain performance sustainability.

For instance, the International Organization for Standardization (ISO 26000) is a corporate social responsibility standard that gives guidelines to organizations of all types and sizes in their responsibilities toward society, the environment, and stakeholders. It recommends organizations follow the principles of accountability, transparency, ethical behaviors, and fair operating practices that safeguard organizations and their stakeholders' interests. ISO 26000 sets standards that relate to ICSR practice on employee management in terms of social protection, good working conditions, and social dialogue (Balzarova and Castka, 2012; Valmohammadi, 2014). The Global Reporting Initiative GRI 401 is a comprehensive standard on sustainable development for labor practice. GRI 401 emphasizes full-time employee benefits in terms of parental leave, employee representatives, employee health and safety management, and extensive workplace wellness that prevent work-related fatalities (Fernandez-Feijoo et al., 2014; Marinescu, 2020).

Global Reporting Initiative 402 is a standard that emphasizes guidelines on employee and employer relationships through effective social benefit provision. The standard is related to sustainable ICSR practice by highlighting guidelines on social benefits available to employees for performance sustainability. It laid standards for work-life balance by incorporating employees’ rights to maternity and paternity leave with employment benefits (Initiative, 2012). Global Reporting Initiative 403 is a standard on occupational health and safety and the environment. The standard supports the concept of wellbeing at the workplace by explaining the spectrum of responsibilities expected by organizations for occupational health and safety procedures. GRI 403 is an approach towards the prevention of harm and promotion of health (Evangelinos et al., 2018; Menichini and Rosati, 2014). The guidelines support good, sustainable ICSR practice. The Global Reporting Initiative 404 provides standards and guidelines on training and education on skill enhancement programs that promote the employability of workers and help with career advancement opportunities. Organizations can incorporate GRI 404 guidelines into sustainable ICSR practice by recommending an average of training hours per year for each employee in line with performance sustainability objectives (Chung et al., 2020; Pedrini, 2007).

Sustainable internal corporate social responsibility (ICSR)

ICSR involves those social responsibilities directed towards the satisfaction of employees within the organization. (Sánchez-Hernández et al., 2021). Sustainable ICSR practice creates value for both employees and organizations. With sustainable ICSR in place, employees and the organization will realize the objectives of mutual contract through job satisfaction and performance sustainability. This position has been argued earlier by Obeidat et al. (2018b) and most recently, supported by Lee (2021c) who emphasizes that positive ICSR practice will promote active employees’ engagement with organizations.

A sustainable ICSR integrates social benefits that motivate employees to perform. Employees that are happy with their organizations are likely to meet performance obligations. (Chan et al., 2020; Li et al., 2021b). In this study, sustainable ICSR is a practice that integrates work-life balance, wellbeing at workplace, resilience, and job stress into the scale of job benefits for performance sustainability. Sustainable ICSR can also be seen from the perspective of the social wellbeing of employees within the organization. Most often, the bottom-line goal of organizations is better employee performance, whereas employees’ intentions and efforts to perform depend on how they are pleased within the organization. To reciprocate sustainable performance with organizational objectives, sustainable ICSR must be effective. Ultimately, sustainable ICSR could be considered a novel practice by organizations in developing countries. Therefore, for employees to be motivated by this practice, they must have some degree of job satisfaction. This is in line with the findings of Sánchez-Hernández et al. (2021) and Carlini and Grace (2021) who affirmed that ICSR practice significantly influences employee performance. Hence, sustainable ICSR practice in this study is justified on the basis of the conclusion that it could determine the performance sustainability of SME companies.

Performance sustainability

Nowadays, organizations use performance sustainability to enhance competitive advantages. Performance sustainability refers to a specified number of resources spent on a volume of production and the consistency of output obtained from it. It is the capacity of the organization to achieve its performance objectives using human and material resources in an efficient and effective way for a long time (Barki and Pinsonneault, 2005; Rume and Islam, 2020). Understanding valuable practices that boost positive behavior towards performance objectives is what led to sustainable ICSR practice in the first place. Many employees’ performances are characterized by the exchange of mutual benefits or services. A value orientation that reciprocates sustainable ICSR benefits with expected organization performance. Organizations are advised to carefully study what can be done to achieve and maintain high performance. Organizations with poor ICSR practice tend to lose talented and experienced employees, and this can lead to performance uncertainty that hinders growth and financial sustainability (Eluyela et al., 2018; Falahat et al., 2020). Performance sustainability is considered necessary for the continuity of organizations. Employees with strong senses of job satisfaction are tools for positive job commitment and will always respect the laid rules and regulations on performance efficiency (Memon et al., 2020). Other recent studies affirmed the relevance of performance sustainability to increase profit maximization and offer potential opportunities required to enhance the competitiveness of business (Lemoine et al., 2021; Zandi et al., 2018; Zimmerman and Darnold, 2009). It is also confirmed that performance sustainability enables organizations to maximize the amount of capital invested in human resource management. Research attention needs to be intensified on performance sustainability to reduce the common problems of liquidation and cessation of trade. Table 1 presents some existing related studies.

Table 1

Presents internal corporate social responsibility and performance related studies.

Source	Title	Unit of Analysis	Method	Country	Findings
Carlini and Grace (2021).	The corporate social responsibility (CSR) internal branding model: Aligning employees' CSR awareness, knowledge, and experience to deliver positive employee performance outcomes.	Employee.	Empirical data analysis.	Australia.	ICSR is a branding tool that improves brand alignment and employee performance.
Sánchez-Hernández et al. (2021).	Internal corporate social responsibility for Sustainability.	Complementary content analysis.	Systematic review.	Spain.	Sustainable management requires attention to ICSR practices like employee well-being and social engagement.
Dung (2021).	The mediating role of employee intrapreneurial behavior in nexus between constructs of Internal corporate social responsibility practices and organizational outcomes.	Employee.	Empirical data analysis.	Vietnam.	A weak relationship was found between the concerns for employees' welfare and the performance efficiency of the organizations.
Lu et al. (2021).	The moderating role of corporate social responsibility on the association of internal corporate governance and profitability; evidence from Pakistan.	Top management.	Empirical data analysis.	Pakistan.	ICSR improves firm performance because it practically contributes to the reduction of environmental and social problems. concerning the employees.
Li et al. (2021a).	Platform corporate social responsibility and employee innovation performance: A cross-layer study mediated by employee intrapreneurship.	Employee.	Empirical data analysis.	China.	ICSR can positively influence employees' innovation performance through enterprise and intrapreneurship CSR initiatives.
Lee (2021a).	Bridging employee advocacy in anonymous social media and internal corporate social responsibility (CSR).	Employee.	Empirical data analysis.	U. S.A.	The results show that ICSR positively influences organization–employee relationships through advocate behavior.
Duthler and Dhanesh (2018a).	The role of corporate social responsibility (CSR) and internal CSR communication in predicting employee engagement: A Perspectives from the United Arab Emirates (UAE).	Employee.	Empirical data analysis.	U.A.E.	ICSR strongly predicts employees' engagement.
Jie and Hasan (2018).	Predictors of employees' job satisfaction through corporate social responsibility (CSR) practices in Malaysian banking company.	Managerial and non-managerial employees.	Empirical data analysis.	Malaysia.	ICSR has a positive but weak correlation with job satisfaction.
Hameed et al. (2016b).	How do internal and external CSR affect employees' organizational identification? A perspective from the group engagement model.	Employee.	Empirical data analysis.	Pakistan.	ICSR influences employees' organization identification through their calling orientation.

Source: Author 2021

Work life balance

Work-life balance can be regarded as a significant factor that an individual employee considers while choosing a particular organization. A study has shown that conflict between work and home responsibilities has been linked to job dissatisfaction and turnover decisions (Ganiyu et al., 2018b). In a real-time performance strategy, organizations can use work-life balance to recruit and retain key personnel. Organizations that concentrate on providing employee satisfaction have a competitive advantage in achieving performance sustainability. Employees react differently to both work and private life. Effective management of employees' qualities of work life requires organizations to recognize and account for the array of job roles that impact employees’ wellbeing. Lack of work-life balance is known to cause strained relationships between personal life and job obligations, leading to a reduction in productivity and personal enjoyment (Oludayo et al., 2018). Organizations that implemented work life balance could promote happier and more productive employees and reduce ill-health complaints Bouzari and Karatepe (2020). Employees will embrace work-life balance careers, because the responsibilities of raising children and managing the household continue to weigh heavily on their personal lives. Employees are interested in maintaining a balance between their personal lives and the time spent at work to promote health and wellbeing (Gragnano et al., 2020). Performance sustainability becomes possible when employees have more flexibility to enjoy spare time outside of work and bring fewer personal concerns to the organizations they work for (Altindag and Siller, 2014). It was reported that lateness and exhaustion negatively affect performance. Work-life balance is a social factor that can reduce job stress and maintain a healthy work life.

Wellbeing at workplace

Advanced technology has changed the structure of the work environment in both developed and developing countries. The industrial model of production that was based on quality of goods and services with maximum effort, time, and cost is a significant determinant of what is needed to be considered as wellbeing at workplace. Setting a standard for wellbeing at workplace will empower employees to work towards achieving performance objectives (Hungerford and Cleary, 2021).

Wellbeing at workplace take care of activities that prevent and eliminate dangers in the workplace. Wellbeing at work refers to a safe and peaceful internal work setting that includes health and safety, emotional balance, as well as physical fitness (Carvajal-Arango et al., 2021; Tay et al., 2017). Wellbeing at workplace can influence the psychological and physical health of employees. Nevertheless, a poor work environment can impede wellbeing, which is often related to occupational stress, with a negative effect on performance sustainability. A toxic work environment or leaders are an obstacle to sustainable wellbeing. Wellbeing is one of the necessities of a peaceful working condition (Kuykendall et al., 2015). It is the organization's responsibility to ensure employees' health, happiness, safety, care, awareness, and education about the control and prevention of hazards while at work. The devastating effects of occupational injury induce the question of how a responsible organization influences an employee's wellbeing while at work (Carvajal-Arango et al., 2021), since a dangerous or hazardous work environment can be avoided. However, the dynamics of activities within the workplace can influence the state of an employee's wellbeing. Likewise, stable mental and physical health can translate into performance sustainability Tay et al. (2017). This suggests that managers or supervisors need to build and promote a friendly work environment that would facilitate happiness and job commitment.

Resilience

Resilience is a concept that manifests in the behavior of employees in terms of how they are able to deal with stress and disappointments arising from daily task accomplishment. Researchers have studied resilience from different personality and organizational perspectives. Some of the factors considered are ego resilience, personal resilience, career resilience, trait resilience, emotional resilience, and psychological resilience (Caniëls and Baaten, 2019; Paul et al., 2016b). Studying resilience at an organizational level will enhance employees' ability to cope with unforeseen difficult situations that are likely to occur at any point in time. Resilience can be measured as the capacity to cope with emotional stress, violence, and hostile leadership styles. Human life is characterized by disappointments and troubles, resilience is a strength needed to remain grounded. The same is applicable to employees in the organization. Previous studies found resilience to be positively related to an employee's desire to display positive behavior and attitude towards performance (Kuntz et al., 2017; Paul et al., 2016a).

Resilience is a clear manifestation of employees’ commitment and flexibility in handling negative job situations. Prior literature also affirmed that factors like difficulties, negative events, and stressors at work lead to poor employee performance and turnover decisions (Cohn et al., 2009b; Seville, 2018). The modality employed by the organization may promote or discourage resilience.

Job stress

Today, a series of negative economic events like upheavals, downsizing, layoffs, organization bankruptcies that affect employees' job continuity and financial stability, workload, lack of work-life balance, COVID-19, among others, have contributed to a high rate of employee stress globally. Millions of employees are struggling to cope with and survive this trend. Adding to the job stress are the supervisors' or managers’ job demands, fewer health and retirement benefits, and the danger of workload. A high rate of economic and social unrest was identified as aggravating job stress (Wu et al., 2021). The basic rationale underpinning the concept of job stress is that a job has certain demands, and the process of meeting those demands can be quite tedious and stressful. Meanwhile, stress disorder can cause major problems relating to burnout, illness, labor turnover, absenteeism, poor morale, and a reduction in the efficiency of job performance (Biganeh et al., 2021).

However, the global enforcement of labor regulations and practices has not done enough to control the level of job stress, according to the findings of (Li et al., 2020). An example is the labor law that clearly stipulates eight working hours a day, and it was found that three out of five employees work more than 8 h a day and 49 h a week, causing death, suicide, stress, depression, and fatigue. This is a serious social issue in today's workplace, and it can have an impact on performance sustainability. (Li et al., 2020). Today, people are still working themselves to death due to economic hardship, low salaries, and a high rate of inflation. Organizations should minimize job stress to achieve performance sustainability.

Additionally, Schwepker Jr and Dimitriou (2021) study also affirmed that job stress that evolved from overworking, excessive workload, and mental and physical abuses had contributed to significant negative effects on sustainable HRM. Job stress has caused serious problems for both the physical and mental wellbeing of employees recently (Yoon et al., 2018). A study conducted by Wood et al. (2020) discovered that job stress facilitated mental disorders, depression, loneliness/social isolation, and suicidal attempts. Therefore, keeping employees healthy requires conscious activities that will increase the length of time spent at work as well as fulfill social obligations to society. Figure 1 presents the research model for the study.

Figure 1

Presents variables and hypothetical research model.

Research hypotheses

Work-life balance has a positive influence on performance sustainability.

Wellbeing at workplace has a positive influence on performance sustainability.

Resilience has a positive influence on performance sustainability.

Job stress has a positive influence on performance sustainability.

Methodology

The study employed a quantitative research method, Smart PLS Version 3 software was used to test the research hypotheses through a Partial Least Square Structural Equation Modeling (PLS-SEM) technique. The study used this technique due to its effectiveness in estimating a complex model relating to cause-effect analysis (Hair et al., 2021a, Hair et al., 2021b). The study also employed a random sampling technique to get the appropriate sample size. Full-time employees who are currently working in medium-sized manufacturing companies are the selected respondents.

Questionnaires were distributed online via Google Form. Meanwhile, data was collected between October 2020 and March 2021 from employees in the medium-sized manufacturing companies across three states (Perak, Selangor, and Penang). However, the response rate was low due to the inability to distribute the questionnaire in person, and in the end, the study obtained a response rate of 65.2%. In the original SPSS dataset, all the data points were duly represented and no missing value was found (Tabachnick et al., 2007; van Ginkel et al., 2020). The study further examines the cases of outliers using Mahalobis SPSS version 25 uses distance values to detect observations that are outside SPSS value labels due to the wrong entry of data. There was no value found to be outside of the normal range (Karale, 2020).

Therefore, all the 270 responses were found useable. Hence, outliers are observations that are significantly different from other observations in a given dataset (Hair et al., 2017b). Additionally, the study examines the respondents' profile via a frequency statistical analysis in the same SPSS version 25 (Table 2). The demographic characteristics showed that 153 respondents (56.7%) have spent 1–10 years working for their organizations; 156 (57.8%) have a bachelor's degree. While 108 (40%) were between the ages of 31 and 40 years, Lastly, the gender demographic analysis shows that 150 (55.6%) of the respondents were female. In the study's demographic analysis, focus was only on the highest frequency among each of the respondents' attributes; see Table 2.

Table 2

Presents the demographic information of respondents.

Experience		Education		Age		Gender
Frequency153	%56.7	Frequency156	%57.8	Frequency108	%40	Frequency150	%55.6
Total	270		270		270		270

This study employed a random sampling technique to determine the sample size of the study, in this technique, elements of the population must be known or predetermined with the chances of being selected as a subject (Ryu and Kamata, 2021). Therefore, this study used a form of random sampling known as systematic sampling, which enables the researcher to select companies that participated in the study by drawing every nth element in the population of medium size manufacturing companies and commencing with a random selected element between 1 and nth using the available sampling frame of registered companies (Wright et al., 2015). The sampling frame (Annual Report of SME Corporation (2015 & 2019)) has a total of 2,519 medium-sized manufacturing companies as at date. Based on this number, we applied (Krejcie and Morgan, 1970) to determine 335 sample size while using systematic random sampling to ascertain the appropriateness of the number of companies that participated in the study by employing the nth element principle of the 12th, 18th, 24th, 30th, and 36th to 335 (Etikan and Bala, 2017; Rahi, 2017; Sekaran and Bougie, 2019). Having determined the participating companies (the unit of analysis), questionnaires were sent to 335 full-time employees of these companies.

However, 270 responses were received, and which are adequate based on the recommendations of (Jenkins and Quintana-Ascencio, 2020) and (Sapnas and Zeller, 2002), which affirm that a sample size that is significant in number is appropriate for any empirical study. The Roscoe rule of thumb equally argues that a sample size larger than 30 or smaller than 500 is appropriate for most behavioral studies (Sekaran and Bougie, 2016).

Instrument design

In the instrument design, five items of the Likert scale that measure work-life balance were adapted from Pichler (2009), Wellbeing at the workplace was measured with five items of a questionnaire based on the work of (Utriainen et al., 2015). Resilience was also measured using five items from questionnaires that were established by Connor and Davidson (2003). Finally, the study adapted five items of questionnaires on job stress from (Wu et al., 2018). All the adapted questionnaire items were based on the 5-point Likert Scale (Table 3).

Table 3

Presents the questionnaire item measurements for the study.

Sustainable ICSR Practice	Items
WLB1 (Work life balance)	Flexible work hour helps me to manage work and family.
WLB2 (Work life balance)	I achieved a balance between job and social life.
WLB3 (Work life balance)	I achieved a balance between job and social life.
WLB4 (Work life balance)	Proper time allocation for different activities helps me to maintain work life balance.
WLB5 (Work life balance)	Suitable childcare arrangements help to handle work and personal life smoothly.
WW1 (Wellbeing at workplace)	I maintained good working relationship with my colleagues.
WW2 (Wellbeing at workplace)	I enjoy good health and safety benefits at my organization.
WW3 (Wellbeing at workplace)	I have strong connection with people in my organization.
WW4 (Wellbeing at workplace)	My organization is a friendly environment
WW5 (Wellbeing at workplace)	My job improves my emotional status.
R1 (Resilience)	I have high emotional intelligence.
R2 (Resilience)	I can manage my emotions effectively.
R3 (Resilience)	I maintained good working relationship with my colleagues.
R4 (Resilience)	I view myself as an achiever rather than victim.
R5 (Resilience)	I am positive in my ability to perform.
JS1 (Job stress)	My job makes me prone to insomnia.
JS2 (Job stress)	I constantly losing interest in my job.
JS3 (Job stress)	I undervalued and feel bad about my job.
JS4 (Job stress)	I constantly take a sick leave.
JS5 (Job stress)	Unpleasant work environment affects my energy to perform.
PS 1 (Performance sustainability)	Internal corporate social responsibility practice convinced me to work for my organization for years to come.
PS 2 (Performance sustainability)	Internal corporate social responsibility differentiates my organization from others.
PS 3 (Performance sustainability)	Internal corporate social responsibility practice increases my organization performance.
PS 4 (Performance sustainability)	I'm proud to be part of my organization because I enjoy good internal corporate social responsibility.
PS 5 (Performance sustainability)	My management provides all that made me proud of my job via internal corporate social responsibility.

Result of analysis

Reliability and validity (measurement model)

As part of the preliminary data analysis, the study conducted a reliability test of the variables using Cronbach's Alpha and Composite Reliability. All the items were found to have a factor loading that was above 0.6 and 0.7 (Hair et al., 2017a) (Table 4). A reliability index of >0.9 is considered "excellent", >0.8 is "strong", and 0.7 is "good", anything 0.5 is no different than random chance, and indicators with such a low degree of correlation should be avoided.

Table 4

Represents the reliability and validity measure of questionnaire items.

Latent ConstructIndicators (Sustainable ICSR)	Standardized Loadings	Cronbach's Alpha	Composite Reliability	Average Variance Extracted (AVE)	Variance Inflation Factor (VIF)
Work life balance (WLB)		0.849	0.888	0.613
WLB1	0.174				1.739
WLB2	0.153				2.024
WLB3	0.317				1.805
WLB4	0.364				1.531
WLB5	0.340				2.135
Wellbeing at Workplace (WW)		0.886	0.916	0.685
WW1	0.503				1.904
WW2	0.370				2.050
WW3	0.384				2.391
WW4	0.376				2.630
WW5	0.449				2.112
Resilience (R)		0.851	0.891	0.622
R1	0.334				1.424
R2	0.223				1.781
R3	0.179				2.305
R4	0.221				2.406
R5	0.304				2.029
Job stress (JS)		0.882	0.912	0.675
JS1	0.273				2.450
JS2	0.247				2.495
JS3	0.369				1.911
JS4	0.214				2.401
JS5	0.353				1.885
Performance sustainability (PS)		0.923	0.942	0.766
PS 1	0.887				3.341
PS 2	0.894				3.191
PS 3	0.878				3.026
PS 4	0.904				3.502
PS 5	0.812				2.063

Average Variance Extracted (AVE) also had a value that was higher than 0.50 or close to 0.70, Tabachnick et al. (2007) which met a threshold of convergent validity (Table 4). Cross-loadings represent the value of discriminant validity, and questionnaire items that were found with a loading lower than 0.6 were deleted from the items Hair et al. (2017). The result was presented in Tables 4 and 5 respectively. All the factor loadings presented are greater than their cross-loadings, which is a sign of good discriminant validity. The study also examines the multicollinearity statistics to check the value of each indicator's variance inflation factor (VIF) and the values obtained are less than 5, which meets the required threshold (Table 4). Also, Fornell & Larcker and Heterotrait-Monotrait (HTMT) techniques were used to check the discriminant validity; see the results in Tables 6 and 7.

Table 5

Presents Cross Loading of Items in terms of Same Construct and Multiple Constructs.

	WLB	WW	R	JS	PS
WLB1	0.498	0.213	0.408	0.827	0.273
WLB2	0.536	0.194	0.441	0.821	0.247
WLB3	0.516	0.389	0.586	0.831	0.369
WLB4	0.523	0.254	0.513	0.828	0.214
WLB5	0.494	0.337	0.405	0.801	0.353
WW1	0.330	0.403	0.272	0.331	0.887
WW2	0.348	0.512	0.301	0.317	0.894
WW3	0.313	0.410	0.281	0.343	0.878
WW4	0.345	0.417	0.275	0.359	0.904
WW5	0.306	0.486	0.345	0.270	0.812
R1	0.409	0.678	0.742	0.294	0.334
R2	0.387	0.385	0.768	0.465	0.223
R3	0.397	0.318	0.781	0.421	0.179
R4	0.449	0.438	0.825	0.491	0.221
R5	0.499	0.431	0.823	0.611	0.304
JS1	0.750	0.204	0.390	0.448	0.153
JS2	0.813	0.413	0.511	0.553	0.317
JS3	0.787	0.444	0.358	0.411	0.364
JS4	0.844	0.364	0.514	0.536	0.340
JS5	0.304	0.817	0.413	0.220	0.503
PS1	0.309	0.810	0.434	0.246	0.370
PS2	0.352	0.843	0.548	0.239	0.384
PS3	0.371	0.854	0.514	0.333	0.376
PS4	0.464	0.814	0.590	0.424	0.449
PS5	0.714	0.110	0.353	0.526	0.174

Table 6

Represents Fornell-Larcker criterion of discriminant validity for the study.

	JS	PS	R	WLB	WW
JS	0.822
PS	0.370	0.875
R	0.577	0.338	0.788
WLB	0.623	0.376	0.550	0.783
WW	0.354	0.512	0.602	0.436	0.828

Table 7

Represents heterotrait-monotrait ratio (HTMT) of discriminant validity for the study.

	JS	PS	R	WLB	WW
JS
PS	0.393
R	0.661	0.359
WLB	0.727	0.386	0.626
WW	0.380	0.554	0.656	0.449

Tables 6 and 7 present Discriminant Validity using the criterion by Fornell & Larcker and Heterotrait-Monotrait Method (HTMT). Discriminant validity refers ​to the degree to which variables are distinct and uncorrelated within the research model.

The diagonal elements are the square roots of the AVE (average variance extracted). Below the diagonal, elements are the correlations between the constructs. Above the diagonal elements are the HTMT.

Descriptive statistics

The study presents a descriptive analysis of the results of the perception of respondents on each of the constructs in the conceptual framework (Table 8).

Table 8

Presents descriptive statistics representing the summary of characteristics within the data set.

	N	Minimum	Maximum	Mean	Std. Deviation
WLB (Work life balance)	270	1.00	5.00	3.7689	.68064
WW (Wellbeing at workplace)	270	1.00	5.00	3.8415	.74738
R (Resilience)	270	1.00	5.00	3.4341	.76233
JS (Job stress)	270	1.00	5.00	3.6970	.73078
PS (Performance sustainability)	270	1.60	5.00	4.0393	.70163
Valid N (listwise)	270

Structural model

In the structural model, the study examined and established hypotheses about relationships among the variables. Since there were no mediation and moderation relationships in the study, only direct relationships were examined (Table 9).

Table 9

Shows direct relationship between hypotheses (path coefficient).

	β	STDEV	T Statistics	P Values
WLB - > PS (Work life balance & performance sustainability)	0.113	0.074	1.514	0.131
WW - > PS (Wellbeing at workplace & performance sustainability)	0.464	0.068	6.776	0.000
R - > PS (Resilience & performance sustainability)	-0.123	0.077	1.604	0.109
JS - > PS (Job stress & performance sustainability)	0.207	0.078	2.641	0.009

Table 9 shows that two of the four hypotheses were supported: H2; WW→PS (= 0.464, t = 6.659, P = 0.000) and H4; JS→PS (= 0.207, t = 2.655, P = 0.000).The study's findings suggest that workplace well-being has a positive and significant relationship with performance sustainability, which supports the findings of Collie et al. (2020). Therefore, hypothesis H2 was accepted. Also, job stress was found to have a positive influence on performance sustainability; this is in line with the findings of Schwepker Jr and Dimitriou (2021) Therefore, hypothesis H4 was accepted. H1; WLB→PS (= 0.113, t = 1.530, P = 0.127) and H3; RP→S (= -0.123, t = 1.635, P = 0.103) yielded negative results, so hypotheses H1 and H3 were rejected. This is in line with the findings of Gribben and Semple (2021) on work life balance and Nipa and Kermanshachi (2021) on resilience. Figure 2 illustrates the structural model analysis for the study. The study also assesses the model fit using the value of SRMR, with an estimated model of (= -0.083) at an 83% confidence interval. Table 10 shows the SRMR (= 0.083), indicating that this study explained 83% of the model.

Figure 2

Structural model for the study.

Table 10

Shows standardized root mean square Residual ​(SRMR) indicating the model fit.

	β	95%	99%
Saturated Model	0.083	0.051	0.055
Estimated Model	0.083	0.051	0.053

The results we obtained for wellbeing at workplace and job stress are in line with the one-tail hypotheses we formulated. In PLS-SEM, the 95% significance level of one tail hypothesis is equal to 1.645 T.Value (Lieber, 1990). However, the T, value obtained for WW (6.776) and JS (2.641) are above the threshold of (1.645) and are appropriate based on the recommendations of (Tenenhaus et al., 2005) and (Götz et al., 2010) and as equally reported by the recent studies (Hair et al., 2021a, Hair et al., 2021b; Sarstedt et al., 2020).

Discussion

This study investigates the role of sustainable ICSR practice on performance sustainability through work life balance (WLB), wellbeing at workplace (WW), resilience (R), and job stress (JS) in medium-sized manufacturing companies. Overall results showed positive relationships amongst wellbeing at work, job stress, and performance sustainability. This supports the existing findings from Collie et al. (2020) and Schwepker Jr and Dimitriou (2021) respectively. Thus, work-life balance and resilience were found to have a negative relationship with performance sustainability; this is in line with the studies conducted by Gribben and Semple (2021) and Nipa and Kermanshachi (2021) respectively. The findings of this study are related to the social exchange theory, which affirmed that employees would work better for companies in return for the social services they receive.

Therefore, employees can evaluate their choice of organizations while focusing on sustainable ICSR practice. In this study, wellbeing at work and job stress were found to have significant positive relationships with performance sustainability through a sustainable ICSR practice. This effect could help SME companies focus on achieving performance sustainability. In relation to the context of this study, ICSR has been found to improve employees’ satisfaction. (Story and Castanheira, 2019). Additionally, wellbeing at workplace was found to have a significant impact on employee performance. (Carvajal-Arango et al., 2021; Collie et al., 2020). Prior studies revealed that job stress positively influenced employee performance (Wu et al., 2021; Yoon et al., 2018). The significance of job stress in the existing research affirms that job stress is an impediment to better performance (Tay et al., 2017; Yoon et al., 2018). Similarly, Soegoto and Narimawati (2017). Opine that organizations that are cognizant of reducing job stress are minimizing the risk of poor performance.

Nevertheless, the negative effects of work-life balance and resilience are contradicted by the findings of Ip et al. (2020); Caniëls and Baaten (2019); Cohn et al. (2009b) where it has been discovered that work-life balance and resilience improve organizational performance. Meanwhile, the insignificant findings of work life balance and resilience may be due to employees losing focus on performance sustainability due to the inability of management to improvise means of performance motivation through sustainable ICSR practice. In this case, a medium-sized manufacturing company is at a high risk of losing its objectives of performance sustainability.

Conclusion

Prior research on ICSR and organization performance in medium-sized manufacturing companies has majorly ignored the potential of work-life balance, wellbeing at workplace, resilience, and job stress on performance sustainability. Therefore, our findings suggest that for medium-sized manufacturing companies to improve their performance sustainability, a sustainable ICSR practice should be the focus. The findings of this study agree with the previous literature that the practice of ICSR can enhance an employee's organization identification and performance (Raza et al., 2021; Singh and Misra, 2021). This study concluded that sustainable ICSR practice can be used to enhance existing performance strategies across the global organization by improving employees' preferential treatment. The partial practices of sustainable ICSR by medium-sized manufacturing companies compared to corporate social responsibility practices could be attributed to increasing government pressure while ignoring the role of ICSR on performance. In SME, employees have little knowledge about what constitutes sustainable ICSR practice. This may be justified by the absence of a direct relationship between work-life balance and an employee's resilience.

Theoretical implications

This study contributes to the existing studies by conceptualizing a new theory grounded in employee resource management using the core variables of sustainable ICSR in the context of performance sustainability. The proposed conceptual framework makes a significant contribution to performance management in the medium-sized manufacturing companies within the existing studies. Workplace well-being and job stress are two examples of factors that have a significant impact on performance sustainability. Despite the length of existing literature on both corporate social responsibility and ICSR and employees’ performance, authors have not paid critical attention to how sustainable ICSR practice (work life balance, wellbeing at workplace, resilience, and job stress) can directly influence performance sustainability in SME.

This study thereby adds a new perspective to the body of literature by testing this statistical relationship. Additionally, this study sheds light on the omitted yet significant relationship between applied theory and HRM literature. The results suggest that exogenous variables (work life balance, wellbeing at workplace, resilience, and job stress) may have a significant positive influence on the performance sustainability of a medium-sized manufacturing company. This relationship is an important theoretical contribution that could further enhance future research analysis.

Implication for managers/practitioners

The findings of this study suggest that managers might be able to increase the level of performance sustainability by increasing or improving on sustainable ICSR practice. Specifically, using work-life balance, wellbeing at workplace, resilience, and job stress reduction. One way of achieving this goal is for the managers to increase financial resource allocation to sustainable ICSR practice. Likewise, policies that promote work-life balance, wellbeing at workplace, resilience, and job stress reduction can be implemented or reinforced by the respective managers.

Employees could be interviewed to determine their wants for achieving performance sustainability and managerial ability could be directed towards providing those wants through a sustainable ICSR practice. Also, the work environment could be made suitable for sustainable ICSR practice and performance sustainability by implementing policies related to the success of the highlighted variables in this study. Most SME managers do not see employees as the drivers of better performance; therefore, this study draws closer attention to this.

Study limitations

This study comes with limitations. The fact that the empirical study was conducted on medium-sized manufacturing companies may not be sufficient to generalize the factual image of sustainable ICSR practices in the context of other business sectors. Also, since data was obtained via a questionnaire, a primary method of data collection, employees might have hidden some facts that would have added to the credibility of this study. Therefore, future study should employ qualitative research method to further enhance the credibility of the findings.

Also, findings may not be suitable for generalization due to limited scope and small sample size. Moreover, this study was conducted in Malaysia, a developing economy. Therefore, the conclusions made in this study may not be relevant to medium-sized manufacturing companies in developed countries. Another limitation involves narrowing the scope of the study to Malaysian medium-sized manufacturing companies. Therefore, future research should explore other organizations from different countries for more valid conclusions.

Recommendation and future direction

It is recommended that governments, policy makers, business organizations, practitioners, and academic researchers be conscious of the economic benefits and implications of integrating the findings of this study into respective performance action plans, business strategies, and research models to promote performance sustainability. Additionally, variables employed in the study (work life balance, wellbeing at workplace, resilience, and job stress) are considered to be appropriate dimensions in sustainable ICSR practice. This study further recommends that, while focusing on corporate social responsibility for customer satisfaction or image protection, organizations can also intensify efforts on sustainable ICSR practice to enhance both employee satisfaction and performance sustainability. To enhance external validity, future research efforts should be directed towards obtaining samples from diverse organizations to increase the statistical power of these findings. Few items were used in this study, while it was recommended that measures with few items are more prone to unreliability than summated measures with a greater number of items. (Spector, 1992), it is recommended that future research should develop a complete measure of sustainable ICSR practice and performance sustainability by tapping into multiple dimensions of performance enhancement. Furthermore, this study suggests that future studies expand beyond organizational sizes and geographical locations to investigate the research framework on diverse organizations such as publicly traded companies and not-for-profit organizations. Also, future studies should expand the scope of this study beyond manufacturing companies to other sectors.

Declarations

Author contribution statement

Fasilat Aramide Sanusi: Conceived and designed the experiments; Performed the experiments; Wrote the paper.

Satirenjit Kaur Johl: Analyzed and interpreted the data; Contributed reagents, materials, analysis tools or data.

Funding statement

This research did not receive any specific grant from funding agencies in the public, commercial, or not-for-profit sectors.

Data availability statement.

Data will be made available on request.

Declaration of interests statement

The authors declare no conflict of interest.

Additional information

No additional information is available for this paper.