07-04-2025
How CSR Activities Reduce Turnover - And Why Men Stand To Benefit More Than Women
Post by Dr Florencio Portocarrero, Assistant Professor of Management in the Department of Management at the London School of Economics and Political Science.
A couple is taking a bag of food at the food and clothes bank. Volunteers are working together at ... More the humanitarian aid project.
For decades, corporate social responsibility (CSR) activities have been a way for organisations to give back to society. Research I've led shows that these activities can also play a significant role when it comes to employee retention.
My study, carried out with Professor Vanessa Burbano from Columbia Business School and published in Management Science, examined the effects of a day-long CSR activity among new employees at a large Latin American bank. Some 221 newly hired employees were randomly assigned to either participate in a social impact initiative or continue with a standard onboarding process.
We found that employees who took part in the CSR activity were approximately 50% less likely to leave the firm than those who did not take part in it. New recruits, who are making sense of their positions and their employer, may interpret their participation in CSR initiatives as a sign that their company values them - something we call Organizational justice, and this increases their sense of belonging and loyalty.
Men who participated in short CSR activities were 65% less likely to leave the bank nearly a year later, while the figure for women was 25%. Since women typically place higher value on communal activities, the study suggests that men undergo a process called "sensemaking", that is, reflecting on and interpreting their experiences. This deeper engagement may explain why CSR had a stronger impact on men's retention than women's.
We found that participation in the CSR activity not only benefited the bank, but also its employee participants by improving their wellbeing. Again, this effect was stronger for male employees. Specifically, we uncovered that men who participated in the activity reported 30% lower levels of stress at work several weeks later, compared to men who continued with the standard onboarding process. One male financial planning associate manager said: 'This activity allows us to internalize the bank's purpose of transforming dreams into reality. Helping young students identify their dreams was a powerful experience.'
While the study focused on the banking sector, its findings could be applicable across industries.
Our study showed that to be meaningful to employees, CSR activities have to be executed thoughtfully. Authenticity is vital. Employees need to see CSR as a genuine company value, rather than part of a public relations strategy. The initiative must also align with employees' interests and values. In the bank's case, employees highly valued education, so mentoring students was particularly relevant to them.
The most successful CSR activities tend to involve direct interaction with those who benefit from them. The employer must also provide proper training so that their employees feel prepared and confident in their roles before participating in the CSR activities.
CSR initiatives can be more than philanthropy. When clearly thought through, they are a strategic tool to reduce turnover and build a committed workforce.
