Bringing purpose to life: the role of employee involvement in corporate sustainability

In recent years, many companies have proclaimed a higher purpose beyond profits, often with the expectation of fostering positive employee-related outcomes. Corporate sustainability (CS) activities are one way in which companies seek to bring this purpose to life. CS activities are not all alike. They differ in the extent to which they are embedded in a firm’s core business. Although scholars and practitioners frequently argue that embedded (as opposed to peripheral) CS is more effective in engaging employees, empirical evidence directly comparing these approaches remains fragmented, and critical contingencies are insufficiently understood. Drawing on organizational identification and cue diagnosticity, we develop a conceptual framework that explains when CS activities function as meaningful identity cues for employees. We propose and find that embedded CS alone does not generate stronger organizational identification. Rather, its benefits unfold primarily when employees have the opportunity to become involved in shaping and developing these initiatives, whereas offering involvement in peripheral CS is associated with lower rather than higher identification. We test our framework in a between-subjects experiment with employees of a manufacturer of building materials and an exploratory supplemental study conducted in the pharmaceutical industry.