how united nations global compact impacts business performance: the mediating role of quality of...
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How United Nations Global Compact ImpactsBusiness Performance: The Mediating Role of
Quality of Life of Employees in an Emerging Market
Dr. Satyendra SinghProfessor, Marketing and International Business
President, Academy of Business and Emerging MarketsEditor, International Journal of Business and Emerging Markets
University of Winnipeg, [email protected]
www.abem.ca
Outline
① Model, Theory and Hypotheses
② Definition, Measurement and Sample
③ Tests, Results and Discussion
④ Contributions: Academic and Managerial
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Model
UN Global Compact•Human Rights (2)•Labor (4)•Environment (3)•Anti-corruption (1)
Business Performance•Profitability•New product success•Employee retention
Quality of Life (WHO)•Physical (3)•Psychological (3)•Relationship (2)•Environment (4)
Source Position Performance
Source-position-performance Theory (Day and Wensley, 1988)
Central Hypothesis is that UNGC contributes more indirectly than directly to Business Performance
Direct path
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, Theory and Hypothesis
UN Global Compact (UNGC, 2006)
Items Factor Loading t-valueSupport human rights .73 11.76Human rights abuses .75 10.34Freedom of association .74 13.68Forced labor .74 12.34Abolition of child labor .73 09.66Nondiscrimination employment .71 13.24Environmental challenges .72 11.46Environmental responsibility .74 12.36Environmentally friendly technologies .73 09.79No corruption and bribery .77 10.32
Cronbach α = .82, CR = .93, AVE = .51
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Human Rights
Labor
Environment
Anti-corruption
Quality of Life (WHOQOL, 1999)Items Factor Loading t-valueActivities of daily living .80 11.47Sleep and rest .79 10.65Work capacity .78 09.76Bodily image and appearance .77 10.43Positive feelings .78 09.21Self-esteem .76 11.49Personal relationships .77 12.31Social support .73 11.97Health and social care .78 12.19Opportunity for acquiring skills .81 10.11Opportunity for recreation .73 09.64Physical environment .76 09.23
Cronbach α = .81, CR = .89, AVE = .45 4
Physical Health
Psychological
Relationship
Environment
Business Performance (Narver and Slater, 1990)
Items Factor loading t-valueProfitability .77 10.73New product success .78 11.26Employee retention .79 11.86
Cronbach α=.79, CR=.87, AVE=.75 Model Fit Indices2 (26)=74.32 (p=.001), GFI=.89, AGFI=.85, NFI=.92, RMSEA=.04, NNFI=.91, TLI=.93, GFI=Goodness of Fit Index, AGFI=Adjusted Goodness of Fit Index, NFI=Normed Fit Index, RMSEA=Root Mean Square of Error of Approximation, NNF=Non-normed Fit Index, TLI=Tucker Lewis Index.
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Sample CharacteristicsTotal sample size 107Manufacturing products 41 (38%)Providing services 66 (62%)Foreign firms 32 (30%)Local firms 75 (70%)Sales turnover (<$4m) 60 (56%)Sales turnover (>$4m) 47 (44%)Employee turnover (<100) 64 (59%)Employee turnover (>100) 43 (41%)Respondents’ designation (CEO/MD/Proprietor) 68 (63%)Respondents’ designate 39 (37%)Respondents’ business experience (in years) 18.7
Respondents’ international business experience (in years) 13.6
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Correlation Matrix and Descriptive Statistics
Variables 1 2 3 41 UNGC .712 Quality of Life .24 .673 Business Performance .27 .31* .864 Firm Size .33* .13 .23 NAIndustry Sector .23 .27 .23 .15
Mean 5.3 6.1 6.2 53Standard Deviation .84 .87 .85 8
Diagonal elements represent average variance extracted.Off-diagonal elements represent correlations between latent variables.
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Tests, Results and Discussion
UN Global Compact•Human Rights (2)•Labor (4)•Environment (3)•Anti-corruption (1)
Business Performance•Profitability•New product success•Employee retention
Quality of Life (WHO)•Physical (3)•Psychological (3)•Relationship (2)•Environment (4)
Source Position Performance
Unstandardized Structural Coefficients (Hair et al., 2006, p. 868)
Total effects = .57 (.19+.29x1.31)Direct effect = 33% (.19/.57), Indirect = 67%
The Central hypothesis is supported
.29*
1.31*
.19
8*p≤.05
① Operationalization of the UNGC Scale② Inclusion of QOL in the integrated model③ Non-USA setting: Ghana, West Africa
① UNGC leads to a superior BP through QOL (e.g., HP…)② Access to 8,000 members (source of comp. Adv.)③ Engage in social issues (economic empowerment)
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Managerial Contributions
Academic Contributions
References1. Day, G. S. and R. Wensley: 1988, 'Marketing Theory with a
Strategic Orientation', Journal of Marketing 47(Fall), 79–89.
2. Hair, J.F., Black, W.C., Babin, B.J., Anderson, R.E and Tatham, R.L: 2006, Multivariate Data Analysis. New Jersy: Prentice-Hall.
3. Narver, J. C. and S. F. Slater: 1990, The Effects of a Market Orientation on Business Profitability', Journal of Marketing, 54(4), 20-35.
4. UNGC: 2006, 'United Nations Global Compact -- Impact and progress of the Global Compact’s 105 largest Companies’ www.unglobalcompact.org/NewsAndEvents/news_archives/2006_04_26.html. [Accessed March 3, 2014]
5. WHOQOL. World Health Organization: 1999, WHOQOL: Annotated Bibliography (October), Geneva: WHO. 10
