The Impact of Corporate Social Responsibility on Organizational legitimacy (Managerial Modelling of the Importance-Performance Matrix)

Background and Objectives: Organizations need to manage relationships with their stakeholders to create multiple benefits for both. In line with the stakeholder theory, stakeholder groups are influenced by the behaviour and actions of organizations; In fact, the survival of the organization is affected by the organization's ability to meet the needs of the stakeholders and understand their perceptions. Thus, if enterprises want to be successful in the medium-to-long term, they must identify the full range of these needs and be able to build lasting relationships with their stakeholder base. Currently, stakeholders’ requirements regarding the social impact of the organizations with which they are associated have been strengthening. These groups expect companies to respond to societal needs that extend beyond economic considerations and will avoid engaging with institutions that are not able to meet their social behavior expectations.  Organizations need stakeholder support to survive and succeed in the market. Thus, the introduction of corporate social responsibility policies has become a critical element in responding to social demands. Most of the existing research on corporate social responsibility (CSR) has sought to analyse how these policies affect external stakeholders’—such as customers, governments, markets in general, etc.—perceptions. However, the internal management and impact of these actions remain relatively unexplored Organizations can apply diverse CSR initiatives and, considering the critical role that employees play in organizational performance and success, introduce socially responsible procedures within their management that will enhance corporate knowledge and culture. Applying social responsibility initiatives, such as encouraging fluid relationships between employees and managers or considering employees’ interests, will build trust within the company. Policies based on social responsibility are the main component in responding to social need. Therefore, the purpose of the research is to investigate the impact of the implementation of human resource management policies cantered on social responsibility on organizational legitimacy. In addition, the importance and performance of the diverse CSR measures is analysed through the importance-performance matrix.
Materials and Methods: This research method was applied in terms of   purpose, and it was conducted in a descriptive-survey manner.  The data was collected by field method and using a standard questionnaire. The statistical population of the research is 25 multinational companies in Isfahan, and the sample size is considered using the introduced formula for structural equation modelling at a 95% confidence level by 142 corporate social responsibility experts. PLS-SEM software was used for data analysis.
Results: The The findings showed that there is a strong and positive relationship between organizational legitimacy and social responsibility measures. Therefore, stakeholders support organizations that are perceived to be ethical and consistent with their CSR principles. socially responsible HR management for achieving high legitimacy scores is related to diversity, opportunity, and no discrimination, followed by corporate volunteering and employee training. In contrast, the CSR elements with lower levels of relevance are the communication paths or relationship between managers and employees, as well as health, security, and social benefits policies.
Conclusion: The The results offer relevant information for company managers to improve their resource optimization and internal stakeholder management through the correct and efficient introduction of CSR policies. Additionally, the correct implementation of socially responsible principles within HR management will help the organization be considered acceptable from stakeholders’ point of view. Furthermore, it will have an impact on stakeholders’ perceptions regarding the in-situation’s ability to meet its needs and interests. Therefore, these organizations’ efforts to encourage corporate volunteering, employee training, the implementation of communication channels between managers and employees, health, security and social benefits, diversity, opportunities and no discrimination policies are well-valued by stakeholders. The information provided by the IPMA is critical and has relevant managerial implications, since managers will have information regarding best practices for allocating resources to socially responsible HR management policies in their aim to achieve high legitimacy assessments. Based on results, company managers should reorganize their resource distribution to emphasize socially responsible HR management. These institutions should start by focusing more on increasing their internal stakeholders’ training possibilities. Therefore, Corporate managers must continue to introduce CSR principles related to employee management to improve social acceptance and to increase their commitment while improving organizational performance and development.