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How United Nations Global Compact Impacts Business Performance: The Mediating Role of

How United Nations Global Compact Impacts Business Performance: The Mediating Role of Quality of Life of Employees in an Emerging Market Dr. Satyendra Singh Professor, Marketing and International Business President, Academy of Business and Emerging Markets

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How United Nations Global Compact Impacts Business Performance: The Mediating Role of

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  1. How United Nations Global Compact Impacts Business Performance: The Mediating Role of Quality of Life of Employees in an Emerging Market Dr. Satyendra Singh Professor, Marketing and International Business President, Academy of Business and Emerging Markets Editor, International Journal of Business and Emerging Markets University of Winnipeg, Canada s.singh@uwinnipeg.ca www.abem.ca

  2. Outline ①Model, Theory and Hypotheses ② Definition, Measurement and Sample ③ Tests, Results and Discussion ④ Contributions: Academic and Managerial 1

  3. Model , Theory and Hypothesis Source Position Performance • UN Global Compact • Human Rights (2) • Labor (4) • Environment (3) • Anti-corruption (1) • Quality of Life (WHO) • Physical (3) • Psychological (3) • Relationship (2) • Environment (4) • Business Performance • Profitability • New product success • Employee retention Direct path Source-position-performance Theory (Day and Wensley, 1988) Central Hypothesis is that UNGC contributes more indirectly than directly to Business Performance 2

  4. UN Global Compact (UNGC, 2006) Items Factor Loading t-value Support human rights .73 11.76 Human rights abuses .75 10.34 Freedom of association .74 13.68 Forced labor .74 12.34 Abolition of child labor .73 09.66 Nondiscrimination employment .71 13.24 Environmental challenges .72 11.46 Environmental responsibility .74 12.36 Environmentally friendly technologies .73 09.79 No corruption and bribery .77 10.32 Cronbach α = .82, CR = .93, AVE = .51 Human Rights Labor Environment Anti-corruption 3

  5. Quality of Life (WHOQOL, 1999) Items Factor Loading t-value Activities of daily living .80 11.47 Sleep and rest .79 10.65 Work capacity .78 09.76 Bodily image and appearance .77 10.43 Positive feelings .78 09.21 Self-esteem .76 11.49 Personal relationships .77 12.31 Social support .73 11.97 Health and social care .78 12.19 Opportunity for acquiring skills .81 10.11 Opportunity for recreation .73 09.64 Physical environment .76 09.23 Cronbach α = .81, CR = .89, AVE = .45 Physical Health Psychological Relationship Environment 4

  6. Business Performance (Narver and Slater, 1990) Items Factor loading t-value Profitability .77 10.73 New product success .78 11.26 Employee retention .79 11.86 Cronbach α=.79, CR=.87, AVE=.75 Model Fit Indices 2 (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. 5

  7. Sample Characteristics Total sample size 107 Manufacturing 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 6

  8. Correlation Matrix and Descriptive Statistics Variables 1 2 3 4 1 UNGC .71 2 Quality of Life .24 .67 3 Business Performance .27 .31* .86 4 Firm Size .33* .13 .23 NA Industry Sector .23 .27 .23 .15 Mean 5.3 6.1 6.2 53 Standard Deviation .84 .87 .85 8 Diagonal elements represent average variance extracted. Off-diagonal elements represent correlations between latent variables. 7

  9. Tests, Results and Discussion Source Position Performance .29* 1.31* • UN Global Compact • Human Rights (2) • Labor (4) • Environment (3) • Anti-corruption (1) • Quality of Life (WHO) • Physical (3) • Psychological (3) • Relationship (2) • Environment (4) • Business Performance • Profitability • New product success • Employee retention .19 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 8 *p≤.05

  10. ① Operationalization of the UNGC Scale ② Inclusion of QOL in the integrated model ③ 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) Academic Contributions Managerial Contributions 9

  11. References 1. 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

  12. Thank you for gracing the occasion Satyendra Singh s.singh@uwinnipeg.ca

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