(Luận văn thạc sĩ) a study of employee perception of internal CSR and employee commitment in VNPT technology company

A Framework for Analyzing the Relationship between Perception of employee of Internal Corporate Social Responsibility CSR and Employee Commitment.. The study desires to point out the imp

ĐẠI HỌC QUỐC GIA HÀ NỘI KHOA QUẢN TRỊ VÀ KINH DOANH

LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH

HÀ NỘI - 2019

ĐẠI HỌC QUỐC GIA HÀ NỘI KHOA QUẢN TRỊ VÀ KINH DOANH

Chuyên ngành: Quản trị kinh doanh

Mã số: 60 34 01 02

LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH

NGƯỜI HƯỚNG DẪN KHOA HỌC: PGS.TS NGUYỄN NGỌC THẮNG

HÀ NỘI - 2019

DECLARATION

The author confirms that the research outcome in the thesis is the result of author‟s independent work during study and research period and it is not yet published in other‟s research and article

The other‟s research result and documentation (extraction, table, figure, formula, and other document) used in the thesis are cited properly and the permission (if required) is given

The author is responsible in front of the Thesis Assessment Committee, Hanoi School of Business and Management, and the laws for above-mentioned declaration

Date 25/06/2019

ACKNOWLEDGEMENTS

After studying at the Hanoi School of Business (HSB) - Hanoi National University, with gratitude and respect, I would like to express my sincere thanks to HSB and all lecturers have been enthusiastic to guide, teach and create favorable conditions to help me during the process of learning, researching and completing the thesis

In particular, I would like to express my deep gratitude to Assoc Prof Dr Nguyen Ngoc Thang, who directly guided and assisted me in the process of implementing the thesis

Thank you very much for the sharing and encouragement of MBA15 - HSB students during the learning process as well as the process of implementing the topic

I would also like to thank VNPT Technology Company and colleagues for facilitating me in the process of studying at HSB

Finally, I would like to express my deep gratitude to my family, my wife and

my two children for always encouraging and supporting during my studies at HSB

Thank you very much!

Hanoi, 25/06/2019

Tran The Hung

CONTENT

ABBREVIATION i

LIST OF FIGURES ii

LIST OF TABLES iii

INTRODUCTION 1

1 Rationale 1

2 Literature review 2

3 Research Subject 5

4 Research Objectives 5

5 Research Scope 6

6 Research methods 6

6.1 Data collection methods 6

6.2 Data analysis methods 6

7 Research agenda 6

CHAPTER 1 THEORETICAL BACKGROUND 8

1.1 Theoretical basis for Corporate Social Responsibility (CSR) 8

1.1.1 Concept of CSR 8

1.1.2 Theory related to corporate social responsibility 11

1.1.3 Standards and tools for CSR management 15

1.1.4 Internal CSR 17

1.2 Employee Commitment 22

1.3 The linkage between internal CSR and organizational commitment 24

1.4 Research Hypothesis and Research Model 26

1.4.1 Research Hypothesis 26

1.4.2 Research Model 28

CHAPTER 2 RESEARCH METHODS 30

2.1 Overview of VNPT Technology Company 30

2.2 Research Design 32

2.2.1 Research process 32

2.2.2 Research objects and scope of research 34

2.2.3 Data collection method 34

2.2.4 Sample and Measure 35

2.2.5 Data processing method 43

CHAPTER 3 RESEARCH FINDING AND DISCUSSION 45

3.1 Summary of survey results 45

3.2 Descriptive statistics of variables 48

3.2.1 Descriptive statistics of Internal CSR variables 48

3.2.2 Descriptive statistics of Employee commitment variables 49

3.3 Evaluate the reliability of the scale 51

3.3.1 Cronbach’s Alpha analysis 51

3.3.2 Exploratory Factor Analysis (EFA) 53

3.3.3 Regression analysis and hypothesis testing 57

3.3.4 Hypothesises testing 62

3.3.5 Analysis of influence of the difference personal characteristics 63

3.3.6 Research finding and discussion 65

CONCLUSION, LIMITATION AND IMPLICATION 68

1 Conclusion 68

2 Limitation and Future Research 69

3 Implication and recommendation 69

REFERENCES 71

APPENDIX

APPENDIX 1 QUESTIONARE (VIETNAMEASE)

APPENDIX 2 SAMPLE DESCRIPTION

APPENDIX 3 CRONBACH‟S ALPHA ANALYSE

APPENDIX 4 EXPLORATORY FACTOR ANALYSIS

APPENDIX 5: CORRELATION ANALYSIS

APPENDIX 6: REGRESSION ANALYSIS

APPENDIX 7: TESTING THE DIFFERENCE BY PERSONAL CHARACTERISTICS

ABBREVIATION

AC : Affective commitment BSCI : Business Social Compliance Initiative

CC : Continuance commitment CSR : Corporate social responsibility EFA : Exploratory Factor Analysis

HS : Heathy and safety ILO : International Labor Organization

LR : Labor relation

NC : Normative commitment NGO : Non-governmental Organization OECD : Organization for Economic Co-operation and

LIST OF FIGURES

Figure 1 A Framework for Analyzing the Relationship between Perception of employee of Internal Corporate Social Responsibility (CSR) and Employee

Commitment 6

Figure 1.1 Carroll‟s (1991) Four-Part Model of CSR 8

Figure 1.2 Stakeholder theory of the firm (Crane and Matten, 2004) 13

Figure 1 3 The three components of sustainability 14

Figure 1.4 Core subjects of CSR in ISO26000 17

Figure 1.5 Proposed research model 29

Figure 2.1 Research process 32

Figure 3.1 Gender distribution among 297 participants 45

Figure 3.2 Age distribution among 297 participants 45

Figure 3.3 Education distribution among 297 participants 46

Figure 3.4 Seniority distribution among 297 participants 47

Figure 3.5 Position distribution among 297 participants 47

Figure 3.6 The result of the study model of employee perception of internal CSR and employee affective commitment 59

Figure 3.7 The result of the study model of employee perception of internal CSR and employee continuance commitment 61

Figure 3.8 The result of the study model of employee perception of internal CSR and employee normative commitment 62

LIST OF TABLES

Table 2.1 Observed variables of perception of Labor relation 36

Table 2.2 Observed variables of perception of Training and development38 Table 2.3 Observed variables of perception of Heath and safety 39

Table 2.4 Observed variables of perception of Workplace diversity 40

Table 2.5 Observed variables of perception of Work-life balance 41

Table 2.6 Observed variables of Employee Commitment Items 42

Table 3.1 Descriptive statistics of Perception of Internal CSR variables 48

Table 3.2 Descriptive statistics of Employee Commitment variables 50

Table 3.3 Result of Cronbach‟s Alpha analysis 51

Table 3.4 Result of EFA analysis for independent variables 53

Table 3.5 Result of EFA analysis for AC variables 55

Table 3.6 Result of EFA analysis for CC variables 55

Table 3.7 Result of EFA analysis for NC variables 56

Table 3.8 Correlation between variables 57

Table 3.9 Result of regression analysis for perception of internal CSR and affective commitment 58

Table 3.10 Result of regression analysis for perception of internal CSR and continuance commitment 60

Table 3.11 Result of regression analysis for perception of internal CSR and normative commitment 61

Table 3.12 Summary the result of Analysis of influence of the difference personal characteristics to employee commitment 65

INTRODUCTION

1 Rationale

Corporate social responsibility (CSR) is a concept that has been mentioned a lot in governance research and practice in developed countries in the past decades This term is known in Vietnamese businesses in the last 10 years through international organizations, multinational companies, some joint-venture companies, directly or indirectly investing in Vietnam In recent years, due to the requirements of foreign partners, along with the awareness of society, the need for international integration and sustainable development, CSR has been increasingly concerned CSR is no longer a new concept for Vietnamese firms However, activities on CSR in most companies are merely interpreted as charitable contributions, community sharing, environment or voluntary social work of enterprises CSR has not received adequate attention in the strategy and operation of many firms

World Business Council (1998) define CSR "continuing commitment by business to contribute to economic development while improving the quality of life

of the workforce and their families as well as of the community and society at large” Today CSR is not only a charity or a respect for environmental protection but also involves many aspects, which are specifically concretized in ISO26000 including: Organizational governance, human rights concern, labor practices, environmental protection, fair operation practices, consumer issues, community involvement and development (ISO26000, 2010)

Thus CSR not only expresses the external responsibility of the firms but also the elements that express the internal activities and internal responsibilities of the firms

As a firm in the field of telecommunications, information technology, R&D and manufacturing telecom equipment, VNPT Technology Joint Stock Company, from inception, has determined the core value of the company as human resource Therefore, human resource management are particularly concerned by the leaders,

that including the commitment of employees to the organization Many studies show the impact of employee commitment on business performance (Anthony Andrew, 2017) The commitment of employees directly affects the operation and implementation of the business strategy Employees committed to work will help increase the efficiency of employees, businesses achieve goals faster, create professionalism, building the culture and brand From the fact of the company, there are some limitations:

There is no clear content about CSR in the development strategy

The implementation of corporate social responsibility for employees who are following state regulations; paying attention to the training and person, however, the company has not paid attention to the employees' feelings about activities Many employees have not their commitment to organization, work inefficient The company still has high turnover rate, especially highly specialized staff

So how does the implementation of CSR at VNPT Technology Company and the perception of employees of internal CSR affect the employee's commitment? Up

to now, there is a lack of researches to answer this question and to solve the above mentioned shortcomings for the Company

From the reality situation, the author chooses topic “A study of employee

perception of internal CSR and employee commitment in VNPT Technology Company” as the master thesis The study desires to point out the impact, the

relationship between employee perception of internal CSR factors and employee commitment at the company Thereby advising the Board of Directors of the Company to better implement CSR within the Company

Glavas, 2012) However, the effectiveness of CSR activities for internal stakeholders, such as company employees, has not been taken into consideration (Arson, Flaherty, Zablah, Brown, & Wiener, 2008) Some studies address the relationship between CSR and employee commitment to the organization, some typical studies such as below

Brammer, Millington, & Rayton, (2007) studied the impact of three aspects

of socially responsible behavior on organizational commitment: employee perceptions of external CSR and in particular CSR in the community, procedural justice in the organization and the provision of employee training The research was investigated within a model which discriminates by gender and draws on social identity theory

Al-bdour, A Ali., Ellisha Nasruddin., and Soh Keng Lin (2010) attempts to investigate the relationship between internal CSR practices and organizational commitment based on the social exchange theory (SET) in banking system in Jordan The research found the impact of five dimensions of internal CSR practices

on organizational commitment: health and safety, human rights, training and education, work life balance and workplace diversity Results showed that all internal CSR dimensions are significantly and positively related to affective and normative commitment In addition, the findings of this study indicate that all internal CSR dimensions did not have a significant relationship with continuance commitment

Roudaki J and Arslan M (2017) studied the Impact of Perceived CSR on Organizational Commitment: A Perspective of Service Employees This study investigated the relationship between perceived CSR and Organizational Commitment (OC) in the service sector of Pakistan The four dimensions of CSR employed in the study include economic, legal, ethical and philanthropic Data were collected through survey method from employees of hotels of Pakistan The findings of the study reveal that perceived CSR has a significant and positive correlation with organizational commitment The economic and philanthropic aspects have more influence on organizational commitment of employees

The study from Nguyen Ngoc Thang and Yves Fassin (2017) investigates the impact of internal CSR on the organizational commitment evidence from Vietnam service firms The study addresses the internal factors of CSR such as labor relations, life balance, social dialogue, health and safety, training and development The results show that there are factors of labor relations, health and safety, training and development that positively affect employee commitment, while factors that balance life, social dialogue not related to employee commitment

In Vietnam, there is little research on CSR available The study of Wang (2005) explored the influence of the state trade union on CSR The study of Taiwanese transnational corporation management practices and workplace unions has provided insight into the way in which labor rights issues are addressed, seeking the factors constraining the formation of an independent workplace trade union The study also explored the influence of the newly developed „„codes of conducts‟‟ from Western buyers, which emphasize the rights to freedom of association and collective bargaining

Nguyen Phuong Mai (2012) researched and assessed the level of CSR implementation at DAGARCO- a garment company by assessing the implementation of CSR contents of two groups of managers and employees at the Company Since then the proposal improves the level of CSR Implementation of the Company

The above studies have researched many aspects of CSR But CSR is driven

by different cultural expectations and complicates the environmental context for firms Even among developed economies, there are some differences (Nguyen Ngoc Thang, 2017) The existing CSR studies have some limitations Firstly, there are very few research on employee perception of internal CSR and employee commitment The researches related to this topic have not shown the impact of some internal CSR factors to organizational commitment The second, there are no general studies on CSR and employee commitment The third, the studies collected information from the specific sectors and limitations of sample size Finally, there still not have research about employee perception of internal CSR and employee

commitment in Telecom, R&D and manufacturing telecom equipment sector, so it can not apply to VNPT Technology Company

Therefore, the topic of the thesis is a new research about employee perception

of internal CSR and employee commitment in telecommunication and technology firms in Vietnam: case in VNPT Technology Company

The research also makes some proposals for VNPT Technology Company to have proper attention to internal CSR and enhance employee's commitment to the company

Perception of employee of

Internal CSR:

- Labor relation

- Training and development

- Health and Safety

Figure 1 A framework for Analyzing the Relationship between Perception of employee of Internal Corporate Social Responsibility (CSR) and Employee

Commitment

5 Research Scope

The topic is limited to studying the relationship between employee perception of CSR and employee commitment to more than 1000 employees in VNPT Technology Company

Primary data: investigation, survey from April 2019 to May 2019

6 Research methods

6.1 Data collection methods

Research was done through two stages: qualitative research and quantitative research Qualitative research: within this scope of research, qualitative research technique was interviewed with sample size of eight experts in the field of CSR or employees with knowledge and experience more than 3 years in implementing CSR We invited them to participate in the form to assess the scale of the measuring, adjust the scale, set up the questionnaire for the study

Quantitative research: The thesis used primary data from survey research method Data obtained through the use of a structured questionnaire The population was about 1000 employees of VNPT Technology Company The sample size was

291 (with a confidence level of 95% and a margin of error of 5%) (Research Advisor, 2006) The sampling method: random sampling

6.2 Data analysis methods

Data from survey put into the SPSS 22 software then conduct correlation analysis and regression analysis Reliability analysis was conducted by computing the Cronbach‟s alpha The result showing that variables in the study had acceptable reliability with Cronbach‟s alpha ranged from 0.82 to 0.91 (Nguyen Ngoc Thang and Yves Fassin, 2017)

7 Research agenda

The thesis consists of 4 chapters:

Introduction: Rationale, literature review, research subject, research objects, research scope, research methods

1 Chapter 1: Theoretical background

This chapter systemize of knowledge and researches about CSR, internal CSR factors, perception of employee of internal CSR, employee commitment, the linkage between CSR and organizational commitment measurement of perception of employee of internal CSR, measurement of employee commitment

2 Chapter 2: Research Methods

This chapter descripts the detail sample, the framework for analyzing the Relationship between Perception of employee of Internal Corporate Social Responsibility (CSR) and Employee Commitment, data collection and analysis method

3 Chapter 3 Research finding and discussion

This chapter provides the results obtained after analyzing data from the survey tables, thereby seeing the relationship of employee perception about internal CSR factors and their commitment to the organization

Conclusion, limitation, implication and recommendation

References

Appendix

CHAPTER 1 THEORETICAL BACKGROUND

1.1 Theoretical basis for Corporate Social Responsibility (CSR)

1.1.1 Concept of CSR

The term CSR was first formally shaped in 1953, when Howard R Bowen published this book entitled "Social Responsibilities of the Businessman" It was the first comprehensive discussion of business ethics and social responsibility It created a foundation by which business executives and academics could consider the subjects as part of strategic planning and managerial decision-making Most of the landmark concept from Carroll who suggested probably the most established and accepted model of CSR It is the “Four-Part Model of Corporate Social Responsibility” (Carroll, 1979), subsequently refined in later publications (Carroll, 1991; Carroll and Buchholtz, 2002) Carroll offer the following definition: “Corporate social responsibility encompasses the economic, legal, ethical, and philanthropic expectations placed on organizations by society at a given point in time.”

Figure 1.1 Carroll’s (1991) Four-Part Model of CSR

Carroll regards CSR as a multi-layered concept, which can be differentiated into four interrelated aspects – economic, legal, ethical and

philanthropic responsibilities He presents these different responsibilities as consecutive layers within a pyramid, such that „true‟ social responsibility requires the meeting of all four levels consecutively

Economic responsibility Companies have shareholders who demand a

reasonable return on their investments, they have employees who want safe and fairly paid jobs, they have customers who demand good quality products at a fair price etc a company‟s first responsibility is to be a properly functioning economic unit and to stay in business This first layer of CSR is the basis for all the subsequent responsibilities, which rest on this (ideally) solid basis According to Carroll (1991), the satisfaction of economic responsibilities is thus required of all corporations

Legal responsibility The legal responsibility of corporations demands that

businesses abide by the law and „play by the rules of the game‟ Laws are understood as the codification of society‟s moral views, and therefore abiding by these standards is a necessary prerequisite for any further reasoning about social responsibilities As with economic responsibilities, Carroll (1991) suggests that the satisfaction of legal responsibilities is required of all corporations seeking to be socially responsible

Ethical responsibility These responsibilities oblige corporations to do what is

right, just and fair even when they are not compelled to do so by the legal framework Carroll (1991) argues that ethical responsibilities therefore consist of what is generally expected by society, over and above economic and legal expectations

Philanthropic responsibility Lastly, at the tip of the pyramid, the fourth

level of CSR looks at the philanthropic responsibilities of corporations This aspect of CSR addresses a great variety of issues, including matters such as charitable donations, the building of recreation facilities for employees and their families, support for local schools, or sponsoring of art and sports events According to Carroll (1991), philanthropic responsibilities are therefore merely desired of corporations without being expected or required, making them „less important than the other three categories‟

The advantage of the four-part pyramid model of CSR is that it structures the various social responsibilities into different dimensions, yet does not seek to explain social responsibility without acknowledging the very real demands placed

on the firm to be profitable and legal In this sense, it is fairly pragmatic This model is comprehensive and highly feasible However, its main limitation is that it does not adequately address the problem of what should happen when two or more responsibilities are in conflict The expression of Carroll model seems to make us understand that if the firms want to strive to fulfill their responsibilities at a higher level, they must satisfy lower levels first and this model has a clear distinction between the ethical and the philanthropic, the economic and the legal responsibilities In fact, these factors are still intertwined and sometimes exist at the same time in the same thing just by looking at different angles of the problem According to Matten and Moon (2004), CSR is a cluster concept that includes many other concepts such as business ethics, corporate philanthropy, corporate citizens, sustainability and environmental responsibility It is a dynamic concept and is always challenged in each particular economic, political and social context Thus, the nature of CSR is the viewpoint of the role of enterprises in each correlation with the role of the state to change the concept of CSR, always depending on not only the spatial scope but also the time of place of the debate about CSR takes place

CSR is a complex category that defined in many different ways However, although the expression of different words, but the internal reflection of CSR basically has something in common, besides the separate development benefits of each enterprise in accordance with the current legislation, it must be associated with the general development of the social community

In the framework of the thesis, the author uses the new definition of CSR of the European Commission in 2011 and ISO 26000: 2010 The European Commission puts forward a new definition of CSR as “the responsibility of enterprises for their impacts on society” Respect for applicable legislation, and for collective agreements between social partners, is a prerequisite for meeting that responsibility To fully meet

their corporate social responsibility, enterprises should have in place a process to integrate social, environmental, ethical, human rights and consumer concerns into their business operations and core strategy in close collaboration with their stakeholders, with the aim of maximizing the creation of shared value for their owners/shareholders and for their other stakeholders and society at large; identifying, preventing and mitigating their possible adverse impacts

CSR involves many aspects, which are specifically concretized in ISO26000:2010 including: (i) Environmental protection; (ii) Community involvement and development; (iii) Fair operation practices; (iv) ensure consumer benefits; (v) Care about human rights; (vi) Labor practices; (vii) Organizational governance In which the first four factors show the external responsibility of the firms, the following three elements represent internal and internal responsibilities

of the firms The division into external responsibility and internal responsibility is only relative and cannot say which responsibility is more important than what responsibility (Nguyen Ngoc Thang, 2015) The specific contents of social responsibility show us that the implementation of CSR does not only help the firms

in sustainable development, but also contributes to the common development of the community and society

1.1.2. Theory related to corporate social responsibility

1.1.2.1 The stakeholder theory of the firm

The stakeholder theory of the firm is probably the most popular and influential theory to emerge in the CSR area (Stark, 1994) While the term

„stakeholder‟ was first recorded in the 1960s, the theoretical approach was in the main developed and presented by Edward Freeman (1984) in the 1980s Freeman's stakeholder theory stated that managers should tailor their policies to satisfy stakeholders such as workers, customers, suppliers, and community organizations,

in addition to satisfying their shareholders Stakeholders are most often classified

as primary or secondary, depending on their importance to the company Attention

is increasingly being paid to the role of primary stakeholders and their impact on other organizationally relevant outcomes Employees are primary internal

stakeholders who not only benefit from socially responsible practices, they can also greatly affect implementation and success of CSR programs

Figure 1.2(a) shows the traditional model of managerial capitalism, where the company is seen as only related to four groups Suppliers, employees and shareholders provide the basic resources for the corporation, which then uses these

to provide products for consumers The shareholders are the „owners‟ of the firm and are consequently the dominant group, in whose interest the firm should be run

(a) Traditional managerial model of the firm

Customers

EmployeesGovernment

Suppliers

Competitors

Shareholders

Civil society

Figure 1.2 Stakeholder theory of the firm (Crane and Matten, 2004)

In Figure 1.2(b) we find the stakeholder view of the firm, where the shareholders are one group among several others The company has obligations not only to one group but also to a whole variety of other constituencies that are affected by its activities The corporation is thus situated at the central of a series of interdependent two-way relationships

1.1.2.2 Theory of sustainable core triple

Following the Rio Earth Summit of 1992, one concept in particular appears

to have been widely promoted as the essential new conceptual frame for assessing not only CSR activities specifically, but also industrial and social development more generally That concept is sustainability

The triple bottom line (TBL) is a term coined by John Elkington in 1994 After that it has extended by adding environmental and social value in 1998 With its roots in environmental management and analysis, sustainability as a concept was for a long time largely synonymous with environmental sustainability More recently though, the concept of sustainability has been broadened to include not only environmental considerations, but also economic and social considerations (Elkington, 1998)

Figure 1 3 The three components of sustainability

Sustainable development is a widely accepted concept and guiding

objective that gained international recognition following the publication in 1987 of Report of the United Nations World Commission on Environment and Development: Our Common Future (ISO26000, 2010) Sustainable development is about meeting the needs of society while living within the planet's ecological limits and without jeopardizing the ability of future generations to meet their needs Sustainable development has three dimensions – economic, social and environmental – which are interdependent; for instance, the elimination of poverty requires the promotion of social justice and economic development and the protection of the environment The importance of these objectives has been reiterated over the years since 1987 in numerous international forums, such as the United Nations Conference

on Environment and Development in 1992 and the World Summit on Sustainable Development in 2002 Social responsibility is closely linked to sustainable development Because sustainable development is about the economic, social and environmental goals common to all people, it can be used as a way of summing up the broader expectations of society that need to be taken into account by organizations seeking to act responsibly Therefore, an overarching objective of an organization's social responsibility should be to contribute to sustainable development

1.1.3 Standards and tools for CSR management

1.1.3.1 Legal biding group

The group of legally binding standards is set out in the Law and by-laws The detailed content of the regulations may vary between countries, depending on the level of development and cultural characteristics In the context of social responsibility, adhering to the provisions of the law means that an organization's operation must comply with all applicable laws and regulations

In Vietnam, on state management in the field of labor, we have the Labor Code of 1994, revised in 2012 with basic contents such as labor agreement, overtime, and social insurance, social allowance, regulations on dismissal of labor, compensation, maternity

1.1.3.2 Group of standards for the large market

BSCI Code of conduct

BSCI stands for Business Social Compliance Initiative, a common and standardized European approach for monitoring social standards, in all supplier countries for all consumer goods BSCI implements the principle international labor standards protecting workers‟ rights such as International Labor Organization (ILO) conventions and declarations, the United Nations (UN) Guiding Principles on Business and Human Rights and guidelines for multinational enterprises of the Organization for Economic Co-operation and Development (OECD) The BSCI Code of Conduct includes 11 key principles: (1) Freedom of association and the right to set up a collective bargaining; (2) Fair Wages; (3) Health and safety; (4) Special protection of young workers; (5) No provide dependent employer; (6) Ethics business; (7) Prohibition of Discrimination; (8) Time Working Hours; (9) Prohibition of child labor; (10)

Prohibition of temporary employment; (11) Environmental protection

SA8000 Standard

The SA8000 Standard is the leading social certification standard for factories and organizations across the globe It was established by Social Accountability International in 1997 as a multi-stakeholder initiative The

SA8000 Standard refers to working conditions and related issues such as: Child Labor; Forced or Compulsory Labor; Health and Safety; Freedom of Association and Right to Collective Bargaining; Discrimination; Disciplinary Practices; Working Hours; Remuneration; Management System

ISO26000 Standard

ISO 26000 is defined as the international standard developed to help organizations effectively assess and address social responsibilities that are relevant and significant to their mission and vision; operations and processes; customers, employees, communities, and other stakeholders; and environmental impact

The ISO 26000 standard provides guidance on: Recognizing social responsibility and engaging stakeholders, and the ways to integrate socially responsible behavior into the organization

The seven key underlying principles of social responsibility: accountability, transparency, ethical behavior, respect for stakeholder interests, respect for the rule of law, respect for international norms of behavior, respect for human rights

ISO 26000's aims are to: (i) assist organizations in addressing their social responsibilities while respecting cultural, societal, environmental, and legal differences and economic development conditions; (ii) provide practical guidance related to making social responsibility operational; (iii) assist with identifying and engaging with stakeholders and enhancing credibility of reports and claims made about social responsibility; (iv) emphasize performance results and improvement; (v) increase confidence and satisfaction in organizations among their customers and other stakeholders; (vi) achieve consistency with existing documents, international treaties and conventions, and existing ISO standards; (vii) promote common terminology in the social responsibility field; (vii) broaden awareness of social responsibility

Figure 1.4 Core subjects of CSR in ISO26000

(Source: ISO website)

The seven core subjects and issues pertaining to social responsibility: (i) organizational governance; (ii) human rights; (iii) Labor practices; (iv) the environment; (v) fair operating practices; (vi) consumer issues; (vii) community involvement and development

The organizations will gain some benefits when applying ISO26000 such as the competitive advantage, the reputation, the ability to attract and retain workers

or members, customers, clients or users In addition, the organizations can maintain of employees‟ morale, commitment and productivity, improve view of investors, owners, donors, sponsors and the financial community, and improve the relationship with companies, governments, the media, suppliers, peers, customers and the community in which it operates Nowadays, sustainable business for organizations means not only providing products and services that satisfy the customer, and doing so without jeopardizing the environment, but also operating in a socially responsible manner

1.1.4 Internal CSR

In this study, we divided CSR into internal and external practices Internal CSR practices refer to CSR practices which are directly related with the

physical and psychological working environment of employees (Turker, 2009) It is expressed in concern for the work–family relationship, work–life balance and equality of opportunities, some corporate governance practices, health and well-being of workers, their training and participation in the business (Vives, 2006) (Nguyen Ngoc Thang, 2017) External CSR refers to corporate socially responsible for local community, business partners and suppliers, customers, public authorities and NGOs representing local communities, and the environment such as philanthropy, volunteerism and environmental protection (European Commission, 2011)

In thesis the author focus on these factors of internal CSR: Labor relation, workplace diversity, work-life balance, heath and safety, training and development

Not all work is performed within a labor relation Work and services are perform by labor who are self-employed, in this case the parties are considered independent of each other and have a more equal and commercial relationship The difference between employment and commercial relationship is not always clearly differentiated, sometimes misunderstood, with the consequence that workers do not always receive the protection and rights that they are entitled to receive It is important to give both society and each individual an appropriate legal and institutional framework Whether work is done under an employment contract, all

parties to the contract have a right to understand their rights and responsibilities and to have appropriate resource in case the terms of the contract are not respected

In this context, labor understand that work results will correspond to the remuneration they receive, and do not include activities that are carried out voluntarily However, organizations should have policies and measures to address their legal liability and duty of care concerning volunteers

1.1.4.2 Workplace diversity

Diversity refers to differences in “age, ethnic heritage, gender, physical ability and qualities, religious belief and sexual/affectional orientation” (Arai, Wance T & Shockley, 2001) (Atasha R., Sanjana B Parumasur, 2014) This is a broad definition of the term and is similar to one proposed by Thomas (1996), which adds that diversity in its fullest sense involves a broad range of factors A definition by Cox (1991) which conceptualizes diversity as the collective (all inclusive) mixture of human differences and similarities along a given dimension These dimensions include “race, culture, religion, gender, sexual preference, age, profession, organization team tenure, personality type, functional background, education level, political party, and other demographic, socioeconomic and psychographic characteristics” Workplace diversity includes identifying those individuals who share these common traits which can either unite or divide people

Diversity management is a process intended to create and maintain a positive work environment where the similarities and differences of individuals are valued There are many benefits to having a diverse workplace Having a diverse workforce with multi-lingual employees and employees from varying ethnic backgrounds can also

be helpful for organizations who want to expand or improve operations in international, national, regional and local markets More benefits to having diversity in the workplace Firstly, employees from diverse backgrounds imbue organizations with creative new ideas and perspectives informed by their cultural experiences Secondly, a diverse workplace will help organizations better understand target demographics and what moves them Thirdly, the workplace diversity will increased customer satisfaction by improving how employees interact with a diverse clientele and public

1.1.4.3 Work-life balance

Work–life balance is the lack of opposition between work and other life roles It is the state of equilibrium in which demands of personal life, professional life and family life are equal Work-life balance consists but it is not limited to flexible work arrangements that allow employees to carry out other life programs and practices

Although work-life balance has become an increasingly frequent field to research, there is not yet “a well-accepted definition of construct” for work-life balance (Lyness & Judiesch, 2014) Dundas (2008), states that work-life balance is about “effectively managing the juggling act between paid work and all other personal activities such as family, community activities, voluntary work, personal development, leisure and recreation” Greenhaus & Allen (2011) identify three commonly used ideas that conceptualize work-life balance: (1) absence or low level of work-family conflict; (2) high involvement in fulfilling multiple roles and commitments in both work and personal life; (3) high satisfaction and fulfillment across multiple roles (Yan Li, 2018)

A large number of empirical research have focused on the relations between work-life balance and employee attitudinal and organizational outcomes The research by Virick, Lilly & Casper (2007) on layoff survivors in high-tech sector finds that WLB has a positive relationship with job satisfaction Also, the outcome of research conducted by Kinnie, Hutchnison, Purcell, Rayton & Swart (2005) indicates that WLB is positively linked to organizational commitment of all employee groups regardless of the types of professional This research also shows that policies adopted by the organization to help employee balance their work and family demands is associated with increased affective commitment (Yan Li, 2018)

J Smith and D Gardner (2007) studied factors affecting employee use of work-life balance initiatives The study examines work-life balance using a sample of

153 employees in a large New Zealand organization The results highlighted the importance of workplace culture in enabling an environment that was supportive of

work-life balance and consequently use of initiatives that was offered by the organization

1.1.4.4 Heath and safety

According to Mondy, Noe, and Premeaux (1998), health refers to employee‟s freedom from physical or emotional illness while safety involves protecting employees from injuries caused by work-related accidents

Health and safety at work focuses on promoting and maintaining workers' physical, mental and social health status at the highest level and preventing the risk

of physical harm health due to working conditions It also involves protecting workers against health risks and helping workers adapt to the professional environment Pollution and workplace hazards that are harmful to workers can also affect the community and the environment Health and occupational safety should

be emphasized on equipment, processes, practices and dangerous substances (chemistry, physics and biology)

1.1.4.5 Training and development

Human development includes the process of enlarging people's choices by expanding human capabilities and functioning, thus enabling women and men to lead long and health lives, to be knowledgeable and to have a decent standard of living Human development also includes access to political, economic and social opportunities for being creative and productive and for enjoying self-respect and a sense of belonging to a community and contributing to society Organizations can use workplace policy and initiatives to further human development by addressing important social concerns, such as fighting discrimination, balancing family responsibilities, promoting health and wellbeing and improving the diversity of their workforces They can also use workplace policy and initiatives to increase the capacity and employability of individuals Employability refers to the experiences, competencies and qualifications that increase an individual's capacity to secure and retain decent work (ISO 26000, 2010)

1.2 Employee Commitment

The area of organizational commitment has been of theoretical and empirical interest by management researchers and organizational behavior scientists (Allen and Meyer, 1996; Mowday et al., 1997; Porter et al., 1974) Organizational commitment can be defined as a relationship of the employee to the organization where employee feel committed to the organization and involved emotionally in the affairs of the organization Commitment level of the employees can vary among the employees and the organizations (Mohammed S Alamri1 & Thamir

I Al-Duhaim, 2017)

Organizational commitment is considered as psychological attachment of

an employee to the organization Normally organizational commitment is used to determine if an employee will stay with the organization or not Organizational commitment is very popular topic in human resources now Organizations are very much concerned about knowing about the level of commitment of an employee toward the organization (Mathews and Jerry, 2002), defined organizational commitment as a belief interiorized by employees (Meyer et al., 2006) also defined organizational commitment as “a force that binds an individual to a target (social or non-social) and to a course of action of relevance to that target”

According to Meyer and Allen (1991), organizational commitment reflects at least three general themes: affective attachment to the organization, the perceived costs associated with leaving it and the obligation to remain with it These three approaches are referred to as affective, continuance and normative commitment Common to these three approaches is the view that commitment is a psychological state that characteristic the employee‟s relationship with the organization and has implications for the decision to continue membership of it These psychological states also have different implications for work relevant behavior

Affective commitment refers to the employee‟s emotional attachment to, identification with, and involvement in the organization Employees with a strong affective commitment continue employment with the organization because they want to According to Mowday (1982), the antecedents of affective commitment

generally fall into four categories: (1) personal characteristics, (2) structural characteristics (organizational), (3) job-related characteristics, and (4) work experiences Although various research studies have been conducted to link demographic characteristics such as age, tenure, gender and education to commitment, the relations were neither strong nor consistent, the reason being too many variables such as job status, work rewards and work values moderating the relationship Relatively few studies have examined the relationship between organizational characteristics and commitment However, research has proved that affective commitment is related to decentralization of decision making and formalization of policy and procedures In contrast to personal and organizational characteristics, a considerable amount of research has been conducted into the relationship between work experience variables and affective commitment Work experience variables that have been found to correlate with affective commitment include equity in reward distribution (Rhodes & Steers, 1981), role clarity and freedom from conflict (Glisson & Durick, 1988), supervisor consideration (Glisson

& Durick, 1988), fairness of performance-based rewards and job challenge (Meyer

& Allen, 1987), opportunity for advancement (O‟Reilly & Caldwell, 1980) and participation in decision making (Rhodes & Steers, 1981) Research to date suggests that work experiences play the largest role in employees‟ decisions to remain with

an organization

Continuance commitment refers to an awareness of the costs associated with leaving the organization The potential costs of leaving an organization include the threat of wasting the time and effort spent acquiring nontransferable skills, losing attractive benefits, giving up seniority-based privileges, or having to uproot family and disrupt personal relationships Apart from the costs involved in leaving the organization, continuance commitment will also develop as a function of a lack of alternative employment opportunities Employees whose primary link to the organization is based on continuance commitment remain because they need to

Normative commitment reflects a feeling of obligation to continue employment Employees with a high level of normative commitment feel that they

ought to remain with the organization Wiener (1982) suggests that the feeling of obligation to remain with an organization may result from the internalization of normative pressures exerted on an individual prior to entry into the organization (family or cultural orientation), or following entry (organizational orientation) However, normative commitment may also develop when an organization provides the employee with “rewards in advance”, or incurs significant costs in providing employment Recognition of these investments causes employees to feel an obligation to reciprocate by committing themselves to the organization until the debt has been repaid (Scholl, 1981) (according to Coetzee M, 2005)

In this study, the author use commitment term that was defined by Allen and Mayer They suggested to measure employee commitment by model This model is one of the most commonly used model in the assessment of organizational commitment In thesis, the author changes some questions to match the Vietnamese context Change the reverse-coded item (the negative sentences) to the positive sentence

1.3 The linkage between internal CSR and organizational commitment

Rettab, B., Brik, A, B., & Mellahi, K (2009) conducted a research to examine the link between CSR activities and three measures of organizational performance: financial performance, employee commitment, and corporate reputation in emerging economies, United Arab Emirates The results show that CSR has a positive relationship with employee commitment

Rego, A., Leal, S., Cunha M., P., & Faria J., (2008) conducted a research on corporate citizenship at the individual level of analysis They aimed to investigate the relationship between perceptions of corporate citizenship and three will establish components of OC on a sample of 249 employees The study found that the perceptions of corporate citizenship explain 35%, 18% and 5% of unique variance of, respectively, the affective, normative and continuance commitment The best predictors are the perceptions of the responsibilities toward employees and

of the legal/ethical and discretionary responsibilities The perceptions of economic

responsibilities do not predict any dimension of commitment Commitment of the continuance type increases when employees perceive that the organization is legally/ethically responsible, but neglects the responsibilities toward them

Perception of training and development has a very significant impact on the minds of the employee working in an organization Ahmad and Baker (2003) suggest that if the employees have a positive perception of training they will have higher level

of motivation for getting training They also found that if the organization spends money on training it will result in stronger commitment with the organization They also are more committed to the organization Motivation of the employees toward training is very important in learning process Training process depends upon the personal characteristics and the perception about how training will benefit the employee (Burke & Hutchins, 2007) Research has focused on employee mental attitude toward training process and its outcome (Mohammed S Alamri1 & Thamir I Al-Duhaim, 2017)

Brammer, Millington, & Rayton, (2007) studied the impact of three aspects of socially responsible behavior on organizational commitment: employee perceptions of external CSR and in particular CSR in the community, procedural justice in the organization and the provision of employee training The research investigated within a model which discriminates by gender and draws on social identity theory

Yan Li (2018) explored the effects of employee work-life balance on organizational commitment in China‟s context Questionnaire was used to collect data in a state-owned enterprise and the sample size was 363 This study found that work-life balance was significantly and positively linked to organizational commitment in China‟s context

Collier, J., & Esteban, R (2007) studied the factors that may have an impact

on employee motivation and commitment to CSR The finding indicated that there are two types of factors that may have an impact on employee motivation and commitment to CSR The first set of factors is the contextual factors: employee‟s

attitudes and behaviors will be affected by organizational culture and climate, by whether CSR policies are expressed in terms of compliance or in terms of values, and by whether such policies are integrated into business processes or simply an 'add-on' that serves as window-dressing The second set of factors is the perceptual factors Motivation and commitment will be affected by the extent to which they can align personal identity and image with that of the organization, by their perceptions of justice and fairness both in general and in terms of how CSR performance is rewarded, and by their impressions concerning the attitude of top management to CSR issues and performance

1.4 Research Hypothesis and Research Model

1.4.1 Research Hypothesis

As earlier described in this study, several studies indicated that CSR play important role to enhance organizational commitment

Al-bdour, A Ali., Ellisha Nasruddin., and Soh Keng Lin (2010) attempts

to investigate the relationship between internal CSR practices and organizational commitment based on the social exchange theory (SET) in banking system in Jordan The research found the impact of five dimensions of internal CSR practices

on organizational commitment: health and safety, human rights, training and education, work life balance and workplace diversity Results showed that all internal CSR dimensions are significantly and positively related to affective and normative commitment In addition, the findings of this study indicate that all internal CSR dimensions did not have a significant relationship with continuance commitment

Roudaki J and Arslan M (2017) studied the Impact of Perceived CSR on Organizational Commitment: A Perspective of Service Employees This study investigated the relationship between perceived CSR and Organizational Commitment (OC) in the service sector of Pakistan The four dimensions of CSR employed in the study include economic, legal, ethical and philanthropic Data were collected through survey method from employees of hotels of Pakistan The

findings of the study reveal that perceived CSR has a significant and positive correlation with organizational commitment The economic and philanthropic aspects have more influence on organizational commitment of employees

The study from Nguyen Ngoc Thang and Yves Fassin (2017) investigates the impact of internal CSR on the organizational commitment evidence from Vietnam service firms The study addresses the internal factors of CSR such as labor relations, life balance, social dialogue, health and safety, training and development The results show that there are factors of labor relations, health and safety, training and development that positively affect employee commitment, while factors that balance life, social dialogue not related to employee commitment

Base on the research cited above, in this study, the factors of internal CSR factors of VNPT Technology is expressed by employee's perception of internal CSR factors Since then the research determines whether have a relation between perception of employees about internal CSR and commitment of employees at VNPT Technology Company

This study develops and proposes a theoretical framework for analyzing the relationship between perception of employee of internal CSR including labor relation, training and development, heath and safety, workplace diversity, work-life balance and organizational commitment including affective commitment, continuance commitment and normative commitment In this research, it is aimed

to create a model that identifies the positively relation between perception of employees about internal CSR, and commitment of employees of company This study hypothesizes that:

H1.1: Perception of employees about labor relation will be positively related to affective commitment

H1.2: Perception of employees about labor relation will be positively related to continuance commitment

H1.3: Perception of employees about labor relation will be positively related to normative commitment

H2.1: Perception of employees about training and development will be positively related to affective commitment

H2.2: Perception of employees about training and development will be positively related to continuance commitment

H2.3: Perception of employees about training and development will be positively related to normative commitment

H3.1: Perception of employees about heathy and safety will be positively related to affective commitment

H3.2: Perception of employees about heathy and safety will be positively related to continuance commitment

H3.3: Perception of employees about heathy and safety will be positively related to normative commitment

H4.1: Perception of employees about workplace diversity will be positively related to affective commitment

H4.2: Perception of employees about workplace diversity will be positively related to continuance commitment

H4.3: Perception of employees about workplace diversity will be positively related to normative commitment

H5.1: Perception of employees about work-life balance will be positively related to affective commitment

H5.2: Perception of employees about work-life balance will be positively related to continuance commitment

H5.3: Perception of employees about work-life balance will be positively related to normative commitment

1.4.2 Research Model

From the above hypotheses, the model proposed for research in this thesis is:

 Independent variables: include variables perception of employees about labor relation, training and development, heathy and safety, workplace diversity, work-life balance

 Dependent variables: affective commitment, continuance commitment, normative commitment

Affective commitment

Continuance commitment

Normative commitment

Dependent variables Employees commitment

H1.1 H1.2 H1.3

H2.1 H2.2

H2.3 H3.1 H3.2

H3.3

H4.1 H4.2 H4.3 H5.1 H5.2

H5.3

Figure 1.5 Proposed research model

CHAPTER 2 RESEARCH METHODS

2.1 Overview of VNPT Technology Company

Name of company: Vietnam Post And Telecommunication Industry Technology Joint Stock Company (VNPT Technology)

Address: High Technology Industrial Zone I, Hoa Lac High Technology Area, Ha Bang, Thach That District, Hanoi, Viet Nam

VNPT Technology is a driving force of VNPT Group in the fields of Technology, Electronics and Telecommunications Manufacturing, Information Communications Technology and Digital content industry

Recently, VNPT Technology has provided to the market more than 7 million products including network equipment, end-user devices and outstanding software solutions Those have been exported to potential markets such as Laos, Myanmar, Malaysia, Bangladesh, Indonesia, etc

VNPT Technology includes affiliated departments and 3 member companies: ANSV, VIVAS and TELEQ, VNPT Technology has 2 high-tech electronics factories in Hanoi

VNPT Technology was established on 6th January, 2011 by VNPT Group and 2 strategic shareholders: VNPost and Pacifab and operated as a joint stock company with a charter capital of VND 500 billion

Shortly after its forming, VNPT Technology had bought Alcatel‟s capital shares in the ANSV joint venture together with Siemens' capital share in the TELEQ joint venture, which turns these two into VNPT Technology‟s member companies

Inheriting resources and experience accumulated after nearly 20 years between two joint ventures ANSV and TELEQ, VNPT Technology has gradually affirmed its pioneer position and role as a driving force of VNPT Group in research, develop and manufacture of Electronic equipment, Telecommunications and Information technology

Some milestones of history:

 1993: Established Alcatel Network Systems Vietnam (ANSV) This is a joint venture between Alcatel Group of France and Vietnam Post and Telecommunications Corporation (now Vietnam Posts and Telecommunications Group)

 1995: Established Telecommunications Equipment Co., Ltd (TELEQ) (joint venture between VNPT Group and Siemens AG Group)

 2011: Established VNPT Technology JSC VNPT Technology acquired the rights and obligations of Siemens in TELEQ joint venture together with Alcatel Lucent in ANSV joint venture which became the mother company of TELEQ and ANSV Addition in 2011, VNPT Technology established Vietnam Innovation Value-Added Services-VIVAS specialized in providing digital content and value added services

 2016: Research, develop, manufacture and supply up to 5 million products to market The first information technology – electronics telecommunications firm has “High-Tech Enterprise Certificate” The only enterprise that has product in ICT field won “Vietnam Value Certificate”

 2017 to now: Research, develop, manufacture and supply more than 7 million products to market, Establish new representative offices in Bangladesh and Indonesia, Business cooperation with international partners: Fiber@home, Bracnet, BDCom, Link3 (Bangladesh); Powertel, Moratelindo, Neuviz, Indosat (Indonesia);

TM (Malaysia); TelBru (Brunei)… Got international CE, SAR certificate for company‟s main products

Currently, the company and members human resource have about 1130 people, of which middle management is 125 people (manager and deputy of department, center, workshop manager), workers have 240 people and 765 staffs, engineers The company's resources focus on research, development, business and project implementation Due to the application of high technology and semi-automatic transmission lines, the number of workers accounted for only 21% (including shifts)