Rokhaya i, Hij oh; Sholihin, Mah ud; Djajadike a, Had ian Ge i
A icle
The e ec o incen i e ypes and o ganiza ional alue
s a emen s on co po a e social esponsibili y decisions
Cogen Business & Managemen
P o ided in Coope a ion wi h:
Taylo & F ancis G oup
Sugges ed Ci a ion: Rokhaya i, Hij oh; Sholihin, Mah ud; Djajadike a, Had ian Ge i (2024) : The e ec
o incen i e ypes and o ganiza ional alue s a emen s on co po a e social esponsibili y decisions,
Cogen Business & Managemen , ISSN 2331-1975, Taylo & F ancis, Abingdon, Vol. 11, Iss. 1, pp.
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The effec o incen i e ypes and o ganiza ional
alue s a emen s on co po a e social
esponsibili y decisions
Hij oh Rokhaya i, Mah ud Sholihin & Had ian Ge i Djajadike a
To ci e his a icle: Hij oh Rokhaya i, Mah ud Sholihin & Had ian Ge i Djajadike a
(2024) The effec o incen i e ypes and o ganiza ional alue s a emen s on co po a e
social esponsibili y decisions, Cogen Business & Managemen , 11:1, 2301137, DOI:
10.1080/23311975.2023.2301137
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ACCOUNTING, CORPORATE GOVERNANCE & BUSINESS
ETHICS | RESEARCH ARTICLE
Cogen Business & ManageMen
2024, VoL. 11, no. 1, 2301137
The e ec o incen i e ypes and o ganiza ional alue s a emen s
on co po a e social esponsibili y decisions
Hij oh Rokhaya ia , Mah ud Sholihinb and Had ian Ge i Djajadike ac
aDepa men o accoun ing, Jende al soedi man uni e si y, Pu woke o, indonesia; bDepa men o accoun ing, gadjah Mada
uni e si y, Yogyaka a, indonesia; cschool o accoun ing, economics and Finance, Cu in uni e si y, Pe h, aus alia
ABSTRACT
This s udy examines he e ec o incen i e ypes and o ganiza ional alue s a emen s
on co po a e social esponsibili y (CSR) decisions. I used a 2 × 2 be ween-subjec
expe imen al design and analyzed he da a using Analysis o Va iance (ANOVA). The
pa icipan s we e unde g adua e s uden s in he accoun ing depa men o a majo
uni e si y in Cen al Ja a, Indonesia. The esul s show ha incen i es in he o m o
ecogni ion encou age CSR decisions mo e han inancial incen i es. This s udy also
p o ides e idence ha en i onmen al-based alue s a emen s encou age manage s o
make CSR decisions a he han inancial-based alue s a emen s. This s udy, howe e ,
inds he e is no in e ac ion be ween he ype o incen i es and o ganiza ional alue
s a emen s on CSR decisions. The implica ion o he esul s o his s udy is he
impo ance o using he ypes o ecogni ion incen i es and alue s a emen s ha
ocus on sus ainabili y o p omo e CSR decisions.
1. In oduc ion
The implemen a ion o co po a e social esponsibili y (CSR) in ope a ional ac i i ies has become o g ea
impo ance in o ganiza ions oday. Wi hin he sus ainabili y con ex , he social conce ns o co po a ions
also co e en i onmen al conside a ions (F ancoeu e al., 2017). Recen ly, he clima e- ela ed si ua ion
has inc eased as g eenhouse gas emissions con inue o ise (The Sus ainable De elopmen Goals Repo ,
2023). Gas emissions lead o global wa ming and clima e change. Inc eased awa eness o he nega i e
consequences o global wa ming on li e has encou aged esea che s and p ac i ione s o in es iga e
he impac o ca bon emissions on ope a ional decision-making (Jauha i e al., 2023). In p ac ice, o
example, some businesses asse hei commi men o en i onmen al p o ec ion by implemen ing co po-
a e g eening ac i i ies (Alzaidi & Iyanna, 2022). En i onmen al sus ainabili y in ol es educing pollu ion,
egene a ing esou ces, a oiding he use o haza dous subs ances, and elimina ing all p ocesses ha
nega i ely impac he en i onmen (Rehman e al., 2022). Many manage s belie e ha good CSR can
imp o e company-communi y ela ions, which is c ucial o ea ning us . The a ie y o CSR p ac ices is
ex ensi e, and he e is li le consensus on wha a socially esponsible business en ails (Tian e al., 2020).
The e o e, o ganiza ions see a need o in eg a e social and en i onmen al aspec s in o hei s a egic
© 2024 he au ho (s). Published by in o ma uK Limi ed, ading as aylo & F ancis g oup.
CONTACT Hij oh Rokhaya i hij oh.ak @gmail.com Depa men o accoun ing, Jende al soedi man uni e si y, Jl HR Boenjamin 708
Pu woke o, Cen al Ja a, 53122, indonesia.
h ps://doi.o g/10.1080/23311975.2023.2301137
his is an open access a icle dis ibu ed unde he e ms o he C ea i e Commons a ibu ion License (h p://c ea i ecommons.o g/licenses/by/4.0/), which
pe mi s un es ic ed use, dis ibu ion, and ep oduc ion in any medium, p o ided he o iginal wo k is p ope ly ci ed. he e ms on which his a icle has been
published allow he pos ing o he accep ed Manusc ip in a eposi o y by he au ho (s) o wi h hei consen .
ARTICLE HISTORY
Recei ed 16 Oc obe
2023
Re ised 22 Decembe
2023
Accep ed 26 Decembe
2023
KEYWORDS
Incen i es; ecogni ion;
alue s a emen s;
co po a e social
esponsibili y; expe imen
REVIEWING EDITOR
Collins N im, Uni e si y o
Sou hamp on, Uni ed
Kingdom o G ea B i ain
and No he n I eland
SUBJECTS
Social Responsibili y;
Accoun ing, Business
Economics, En i onmen
and De elopmen ;
Compensa ion and
Compensa ion Me hods
and Thei E ec s;
Sus ainable De elopmen ;
Execu i e Compensa ion
2 H. ROKHAYATI ETAL.
decision-making p ocess (Jou neaul , 2016; Wije hilake, 2017). P e ious s udy, howe e , mos ly explains
he implica ions o implemen ing en i onmen al esponsibili y ha i can imp o e ope a ional e iciency
(Jou neaul , 2016), en i onmen al pe o mance (Anse e al., 2020), ge a en ion om in es o s (Rokhaya i
e al., 2019), inancial pe o mance (Ind ias u i & Cha i i, 2021), and e en a ec s ock ola ili y (Zhang
e al., 2018). Mo eo e , en i onmen al managemen o p oduc ion p ocesses has become a key success
ac o o ma ke compe i ion (B a i e al., 2020). Companies oday a e mo e inclined o explo e how o
in eg a e socie al goals (Ca ballo, 2023; Obel & Kalleha e, 2022). Howe e , esea ch on CSR in eg a ion in
in e nal company s a egy is a e.
Managemen accoun ing esea che s a e inc easingly ecognizing he need o wi ness managemen
con ols as a package sys em, including speci ic con ols a ec ing how o he con ols a ec
decision-making and beha io (Malmi & B own, 2008). Wi hin his con ex , managemen con ol sys-
ems a e essen ial in helping o ganiza ions de elop p ac ices in ol ing en i onmen al aspec s in hei
o ganiza ional s a egy (Hopwood & Une man, 2010; Jou neaul , 2016; Madein & Sholihin, 2015; Malmi
& B own, 2008) and hei CSR ac i i ies (Lagui e al., 2019; Rokhaya i e al., 2021).
Managemen con ol can be exe cised in he o m o o mal and in o mal con ols. While much manage-
men accoun ing esea ch has ocused on accoun ing-based con ols, which a e o en o mal sys ems, he e
is s ill a lack o knowledge o he impac o di e en ypes o con ols (Malmi & B own, 2008). Fo mal
con ol sys ems ely on incen i es o mo i a e employees o achie e o ganiza ional goals (Ch is e al.,
2016; Libby & Lipe, 1992; Me chan & S ede, 2008). Clea ly de ined pe o mance measu emen s a e neces-
sa y condi ions o he e ec i eness o incen i es (Me chan & S ede, 2017). Based on he beha io al
aspec s wi hin he agency amewo k, incen i es also de e mine he choice o business model and s a egy,
business de elopmen , and a ainmen o non- inancial success (Vel e, 2020), and educe agency con lic s
be ween managemen and s akeholde s (Hill & Jones, 1992).
Acco ding o he ac i a ion heo y, howe e , men al en husiasm is equi ed o mo i a e indi iduals o
achie e hei pe o mance (Ga dne , 1986). He s a ed ha employees seek ac i a ion h ough an a ay o
s imuli. One o he subs an ial s imuli ha can be used o engage employees’ awa eness and commi -
men o hei assigned asks is compensa ion schemes (Fessle , 2003). Incen i es can be made in he
o m o inancial o non- inancial incen i es (i.e. ecogni ion). In achie ing inancial pe o mance, money
and ecogni ion incen i e schemes ha e been subs i u able. Besides mone a y incen i es, incen i es in
he o m o ecogni ion ha e been ound o imp o e business and pe o mance (Lou enço, 2016).
Fu he mo e, i is known ha ou namen incen i es in he o m o money a e subs i u es o ecogni ion
incen i es, as non- inancial incen i es, in he con ex o c ea i e pe o mance (Ilyana & Sholihin, 2021).
The na u e o mone a y incen i es has also no always p o en bene icial in a no ma i e con ex (Meh a
e al., 2017). Addi ionally, CEOs may be mo i a ed by inancial incen i es; hey may be willing o ake
lowe compensa ion in exchange o pe sonal hough s o he ul illmen o handling social issues
(F ancoeu e al., 2017). Simila ly, in companies whe e employees pe cei e hei commi men o socie y’s
objec i es as genuine, inancial incen i es may no be essen ial, compa ed o companies ha appea o
place less emphasis on socie al goals may equi e inancial incen i es o inspi e hei employees (Spallek
e al., 2023). In a p osocial se ing, ecogni ion incen i es a e conside ed mo e aluable han mone a y
incen i es o enhancing pe o mance (Handg aa e al., 2013), al hough he e ec i eness o ecogni ion
incen i es is highly si ua ional (Kos eld e al., 2017). In ela ion o CSR, managemen con ol sys ems ha e
been sugges ed o be e ec i e in embedding CSR ini ia i es in o companies’ plans and s a egies (C u zen
e al., 2017).
In o mal con ol sys ems main ain he con inui y o o mal con ol (Akinyele e al., 2020; No is &
O’Dwye , 2004). C u zen e al. (2017) also a gue ha ocusing on jus a single o m o managemen
con ol, whe he o mal o in o mal, exposes an o ganiza ion owa ds a isk o in e nal con lic s. In o mal
con ols di ec o ganiza ional membe s’ conduc h ough unw i en policies, and sha ed alues ha
de i ed om he o ganiza ional cul u e (Lang ield-Smi h, 2006; Ouchi, 1979). In o mal sys ems p edomi-
na e when esol ing e hical issues (Falkenbe g & He emans, 1995). Manage s could also adop in o mal
con ols o encou age s akeholde commi men o a CSR-aligned o ganiza ional cul u e (Lagui e al.,
2019). Hence, o mal and in o mal con ol mechanisms should in e ac o accomplish companies’ social
and en i onmen al objec i es (Bed o d e al., 2016). Companies should acco dingly es ablish ‘company
COGENT BUSINESS & MANAGEMENT 3
alues’ ha egula e employee beha io (Van appen & Jong, 2018). O ganiza ional alues ha e been
p o en o guide beha io (Allison, 2019; Ye, 2012). As pa o in o mal con ol sys ems, o ganiza ional
alues s a emen s can enhance pe o mance (Akinyele e al., 2020) by s eng hening esponsibili y and
se ing s anda ds (U bany, 2005). Based on no m ac i a ion model, pe sonal no ms need o be ac i a ed
o achie e social and en i onmen al goals (Schwa z, 1977; Thøge sen, 2009). Mo eo e , alue s a emen s
can os e social no ms (Lynn Hannan, 2016) ha anscend sel ish beha io o p io i ize he in e es s o
he la ge o ganiza ion (Bicchie i, 2005).
Despi e he s ong suppo o managemen con ol sys ems in CSR decision-making, empi ical
esea ch in his a ea is s ill limi ed (Di illo & Lisi, 2016; He emans & Naza i, 2016; Rokhaya i e al., 2021).
The exis ing li e a u e linking aspec s o managemen con ol sys ems and CSR has so a been con-
s ained o concep ual pe o mance measu emen s (Hopwood & Une man, 2010; Pe ego & Ha mann,
2009; Sea cy, 2012), measu emen base in he CSR in es men (Chu ch e al., 2019; Rokhaya i e al., 2021),
and implemen a ion o CEO compensa ion (Co dei o & Sa kis, 2008; Deckop e al., 2006), while some
sugges ed ha CSR s a egies and implemen a ion in companies a e in luenced by he exis ence o
incen i es (Be one & Gomez-Mejia, 2009; Co dei o & Sa kis, 2008). O e all, he e is s ill a lack o esea ch
on he e ec i eness o o mal and non- o mal con ol mechanisms on CSR decisions. To add ess his
issue, his s udy examines he e ec o o mal con ol (money incen i es s ecogni ion) and in o mal
con ol (social s inancial alue s a emen s) on CSR decisions. I aims o con ibu e o he li e a u e in
his a ea and he me hodology by de eloping expe imen al esea ch ins umen s in he con ex o CSR
decisions.
The aims o his esea ch a e h ee olds. Fi s , his esea ch aims o examine he in luence o he ype
o inancial incen i es and ecogni ion on CSR decisions. Second, his esea ch examines he in luence o
alue s a emen s on CSR decisions. Thi d, his esea ch examines he e ec o he in e ac ion be ween
incen i e ype and alue s a emen on CSR decisions. This s udy uses a be ween-subjec s expe imen al
design ha in ol es 2 incen i e ypes ( inancial and ecogni ion) and 2 alue s a emen s ( ocus on p o i
and ocus on en i onmen ). The esul s show ha indi iduals make g ea e CSR decisions when hey
ecei e ecogni ion incen i es. Fu he mo e, he esul s show ha indi iduals make g ea e CSR decisions
when he company’s alue s a emen ocuses on en i onmen al issues. This esea ch does no ind an
in e ac ion e ec be ween incen i e ype and alue s a emen . Howe e , his esea ch shows ha he
la ges CSR decisions a e made when indi iduals a e awa e o ecogni ion incen i es and s a emen s o
en i onmen al alues.
This esea ch con ibu es o he ex an li e a u e by examining he ela ionship be ween o mal con-
ol, in o mal con ol, and CSR decisions. Fi s , his esea ch p o ides e idence on CSR esea ch using
o mal and in o mal con ols on CSR decisions. P e ious esea ch shows ha sus ainabili y managemen
con ol needs o include all sys ems and ools whe e manage s de elop and use o mal and in o mal
sys ems ha suppo he achie emen o CSR objec i es (C u zen e al., 2017). This s udy in es iga es
ypes o incen i es, namely inancial and ecogni ion as o mal con ol. The esul s o his s udy suppo
p e ious s udies ha incen i e ypes a ec pe o mance (Cianci e al., 2013) and ha ecogni ion incen-
i es a e ega ded as mo e impo an han mone a y incen i es o imp o ing pe o mance in p osocial
se ings (Handg aa e al., 2013).
The second con ibu ion o his s udy is ha i p o ides addi ional empi ical e idence o he impo -
ance o using in o mal con ol in he o m o alue s a emen s (Aguia , 2021; Akinyele e al., 2020;
Kachelmeie e al., 2016). The esea ch expands he esul s o he e ec i eness o alue s a emen s o
inc easing CSR decisions. Con o mi y o sus ainabili y alues s a emen will encou age indi iduals o p i-
o i ize CSR decisions because a company’s alues s a emen ha highligh s sus ainabili y issues will
encou age indi idual social no ms. Mo eo e , he compa ibili y be ween ecogni ion incen i es and sus-
ainabili y alue s a emen s esul s in he highes CSR decisions. These esul s indica e ha he ma ch
be ween o mal and in o mal con ols ha ocus on social no ms will p oduce he g ea es in luence on
indi iduals in CRS ac i i ies.
The emainde o his a icle is p esen ed as ollows. The nex sec ion discusses he backg ound. The
sec ions ha ollow a e ela ed o he heo e ical amewo k, li e a u e e iew and hypo hesis de elop-
men , esea ch design, empi ical esul s and discussion, summa y and conclusion.
4 H. ROKHAYATI ETAL.
2. Backg ound
The en i onmen is a c i ical componen in sus ainable de elopmen . En i onmen al ac o s a e also
impo an aspec s o heal h ha a e di ec ly connec ed wi h indi idual and popula ion heal h. Ai pollu-
ion is una oidable and has become p oblema ic in many de eloping coun ies, including majo ci ies in
Indonesia. By he end o 2024, he e is a a ge pe cen age educ ion in g eenhouse gas emissions o
27.3 pe cen ; also imp o ing he Ai Quali y Index om 86.8 (2019) o 84.5 (2024). The Low Ca bon
De elopmen app oach emphasizes c oss-sec o policies ha balance economic g ow h a ge s wi h
e o s o educe emissions and encou age he g ow h o g een in es men o mo e sus ainable de el-
opmen (CISDI, 2021). I means he go e nmen s ag ee wi h he plan o p e en clima e change by
educing emissions h ough mi iga ion.
The manda e o co po a e social esponsibili y in Indonesia is con ained in Law No. 40 o 2007 con-
ce ning Limi ed Liabili y Companies, Law No. 25 o 2007 conce ning Capi al In es men , and Go e nmen
Regula ion No. 47 o 2012 conce ning he Social and En i onmen al Responsibili y o Limi ed Companies.
Fu he mo e, he achie emen o SDGs is suppo ed by he Indonesian Go e nmen wi h P esiden ial
Regula ion No. 111 o 2022 conce ning he Implemen a ion o he Achie emen o Sus ainable
De elopmen Goals. Indonesia is one o he Uni ed Na ions membe coun ies ha ac i ely pa icipa es
in he de elopmen o Sus ainable De elopmen Goals (SDGs). One o he objec i es is o p o ec he
en i onmen . Addi ionally, he e is Go e nmen Regula ion No. 22 o 2021 on En i onmen al P o ec ion
and Managemen Implemen a ion. This egula ion is a sys ema ic and comp ehensi e e o o conse e
en i onmen al unc ions and a oid pollu ion and/o damage o he en i onmen . Fu he mo e, in
Indonesia, he Financial Se ice Au ho i ies No. 51 o 2017 enac ed an obliga o y egula ion o inancial
indus ies o conduc sus ainable inance and in es men .
O he coun ies in Sou heas Asia, such as he Philippines and Vie nam, al eady ha e CSR egula ions o
companies. Howe e , Malaysia, Thailand, and Singapo e ha e no manda ed CSR h ough o icial laws and
egula ions, bu hose laws and egula ions encompass some key componen s o CSR such as human
igh s, en i onmen al p o ec ion, labo law, and p o ec ing consume s law (T an e al., 2021). An eme ging
conce n in CSR is assis ing businesses in implemen ing CSR in a way ha is compa ible wi h hei speci ic
business ci cums ances (Vi akul e al., 2009). P e ious esea ch showed ha co po a ions wi h be e go -
e nance a e also mo e likely o pu sue a mo e socially esponsible agenda (Asogwa e al., 2020; Nguyen
e al., 2021). Mo eo e , a managemen con ol sys em is c i ical in p o iding he in eg a ion o en i onmen-
al and social ac i i ies in o an o ganiza ion’s s a egic plans and goals (Gond e al., 2012). Managemen
con ol sys ems implemen a ion in CSR in eg a ion in o a business s a egy can encou age Indonesian and
o he de eloping-coun y manu ac u e s o implemen CSR mo e e ec i ely (Rinawiyan i e al., 2020).
Managemen con ol sys ems encompass all ins umen s and p ocedu es es ablished and employed by
manage s o ensu e ha employee beha io s and decisions a e consis en wi h he o ganiza ion’s CSR- ela ed
objec i es and s a egies, bo h o mally and in o mally (C u zen e al., 2017; Malmi & B own, 2008).
3.Theo e ical li e a u e e iew
The ac i a ion heo y s a es ha men al en husiasm is impo an o mo i a e indi iduals e ec i ely in
achie ing hei pe o mance (Ga dne , 1986). Ac i a ion heo y has been used o explain he impac o
ask design a iances on he esponses o ask pe o me s (Sco , 1966). Ac i a ion heo y p edic s a
a ie y o beha io al ou comes in asks ha in ol e con inuous epe i ion o a es ic ed se o esponses
o con igu a i e simple and empo ally consis en s imulus. A dec ease in ac i a ion le el is expec ed
when he indi idual ge s amilia wi h his o he su oundings and lea ns he esponses equi ed in he
epea ed ask. I he ac i a ion le el passes below he ypical no m, he pe son will ha e a nega i e
e ec and will y o inc ease impac . I he is es ic ed om pe o ming impac -inc easing beha io , his
pe o mance will con inue o dec ease.
Social no ms p omo e socially ela ed beha io (Schwa z, 1973). Social no ms can be used o explain
di e ences in beha io om decisions ha p io i ize pe sonal in e es s (Biel & Thøge sen, 2007;
Thøge sen, 2008). Acco ding o Schwa z (1977), social no ms a e ac i ely expe ienced as eelings o
mo al obliga ion a he han as in en ions. The no m ac i a ion model analyzes he ac o s ha
COGENT BUSINESS & MANAGEMENT 5
in luence human in en ion o engage in al uis ic and en i onmen al beha io s (Onwezen e al., 2013).
Beha io s a e a esul o pe sonal no ms which a e egula ed by awa eness o consequences and asc ip-
ion o esponsibili y (Schwa z, 1977). No m ac i a ion begins wi h an indi idual’s awa eness o po en-
ial ad e se consequences, which p omp s eeling o ake esponsibili y o he nega i e e ec s o no
ac ing p o-socially.
4. Empi ical li e a u e e iew and hypo heses de elopmen
4.1. Incen i e ypes and CSR decisions
The ac i a ion heo y s a es ha men al en husiasm is impo an o mo i a e indi iduals e ec i ely in
achie ing hei pe o mance (Ga dne , 1986). Addi ionally, employees seek ac i a ion h ough a a ie y o
s imuli. Compensa ion schemes a e e ec i e s imulan s ha can be implemen ed o imp o e employees’
awa eness and e o in hei assigned asks (Fessle , 2003). The o ganiza ion’s incen i es can mo i a e and
ac i a e indi idual e o s and commi men o accomplishing hei esponsibili ies.
Companies need o in eg a e CSR ac i i ies in o he o ganiza ion’s ope a ions by de eloping a con ol
sys em ha in ol es CSR aspec s. F om a managemen con ol s andpoin , companies can pu sue hei
CSR goals by guiding manage s on how o conduc hemsel es inside a cen alized con ol sys em
(Chu ch e al., 2019). A managemen con ol sys em is a se o o mal and in o mal con ols (Malmi &
B own, 2008). Fo mal con ol is a se o s uc u es, ou ines, and p ocesses ha employees mus ollow
(Bisbe & O ley, 2004), which consis s o planning p ocedu es, con ac ual obliga ions, pe o mance e al-
ua ion, and ewa d sys ems (Malmi & B own, 2008). Incen i e schemes as a o mal con ol mechanism
a e used o mo i a e employees o imp o e hei pe o mance (Ch is e al., 2012; Libby & Lipe, 1992).
Sus ainabili y p o ides new oppo uni ies whe e i ms need o c ea e incen i es and all he o he aspec s
o he o ganiza ional design o he i m (Obel & Kalleha e, 2022). Mo eo e , he implemen a ion o incen-
i e con ac s es ablishes a connec ion be ween he manage ’s compensa ion and hei CSR in es men
o pe o mance (Chu ch e al., 2019).
P e ious esea ch has shown ha pe o mance is in luenced by mone a y incen i es, eedback, and ec-
ogni ion (Lou enço, 2016). Social con ex esea ch e eals ha inancial incen i es and ewa ds c owd ou
because hey ha e di e en mo i a ional p e e ences (Bénabou & Ti ole, 2010; Lou enço, 2016), in which
mone a y incen i es discou age social beha io . Fo non- inancial o ganiza ions, in insic mo i a ion om
agen s po en ially dec eases he impac o ex insic ewa ds (Bénabou & Ti ole, 2006; Besley & Gha ak, 2005).
This s udy ocuses on inancial incen i es and ecogni ion because, acco ding o p e ious s udies, he
implemen a ion o eedback h ough CSR ac i i ies has a es ic ed unde s anding o inancial accoun ing
measu es, and i will ake ime o con ey an unde s anding o eedback, such as inancial accoun ing
(De chi e al., 2021). Mo eo e , mone a y incen i es and ecogni ion ha e ou comes u ili y ha is consid-
e ed accep able a e he indi idual pe o mance is accomplished, as con as ed o eedback, which has
ou come appeal in he o m o in o ma ion p ocessing ha go e ns indi idual ac ions h ough
sel -e alua ion (S ajko ic & Lu hans, 2001). Acco ding o he esul s o hei esea ch, eedback has he
leas impac on an indi idual’s pe o mance.
P e ious esea ch showed ha indi idual pe o mance inc eases wi h non- inancial, i.e. ecogni ion,
a he han inancial incen i es o p osocial se ings (Ash a e al., 2014; Handg aa e al., 2013).
Recogni ion can be ex emely e ec i e and mo i a e indi iduals wi hou cos ing he company signi i-
can ly (Lu hans, 2000). O he esea ch s a es ha money leads o lowe ou comes o indi iduals o help
o he s (Vohs e al., 2006); dona e o cha i y (Liu & Aake , 2008) and CSR engagemen (Spallek e al.,
2023). Employees ha e also been shown o alue company ecogni ion highly (Lu hans, 2000).
Fu he mo e, ecogni ion s eng hens he o ganiza ion’s sense o suppo o i s employees, and con-
sequen ly, employees p o ide eedback by pe o ming be e (Wayne e al., 2002). These indings a e
consis en wi h he indings o Mon ani e al. (2020), who showed ha employees’ pe cep ions o man-
age ecogni ion a e posi i ely ela ed o he signi icance o hei wo k. Based on his easoning, i is
p edic ed ha indi iduals wi h ecogni ion incen i es will p e e CSR decisions o indi iduals wi h inan-
cial incen i es. Acco dingly, he ollowing hypo hesis is p oposed:
Ha1: Recogni ion incen i e schemes encou age CSR decisions mo e han inancial incen i es.
6 H. ROKHAYATI ETAL.
4.2. Value s a emen s and CSR decisions
Social no ms ha e a ole in socially ela ed beha io (Schwa z, 1973). Social no ms can be u ilized o
explain beha io s ha di e om decisions ha p io i ize pe sonal in e es s (Biel & Thøge sen, 2007;
Thøge sen, 2008). The main a ionale is ha social no ms ha e a endency o egula e beha io h ough
se e al mechanisms, and he ex en o which hey in luence beha io is condi ional on hei p ominence
o salience wi hin a pa icula en i onmen (Kallg en e al., 2000).
The no m ac i a ion model p oposed by Schwa z (1977) posi s ha he o ma ion o pe sonal no ms
is in luenced by si ua ional ac i a o s, such as awa eness o need, si ua ional esponsibili y, e icacy, and
abili y. I is based on Bicchie i’s (2005) social ac i a ion model o unde s anding how social no ms can
o e come sel -se ing beha io and place g ea e o ganiza ional goals. This social no m ac i a ion model
assumes ha indi iduals ha e a condi ional p e e ence o con o ming o social no ms and ha hese
p e e ences o no ms a e ac i a ed by si ua ional cues such as alue s a emen s in wo k se ings (Blay
e al., 2018).
In o mal con ols, which a e based on social no ms, end o mo i a e manage s o align hei beha -
io s wi h he o ganiza ion’s goals in si ua ions whe e o mal con ols a e lacking (Lee and Hageman,
2018). O ganiza ional alue s a emen s can ac i a e indi idual social no ms. O ganiza ional alues s a e-
men s can imp o e pe o mance when hey a e pa o in o mal con ol app oaches (Akinyele e al.,
2020). A alue s a emen is pa o he managemen con ol sys em mechanism, including alues, belie s,
and social no ms ha in luence employee beha io (Malmi & B own, 2008). A alue s a emen can lead
o posi i e o ganiza ional ou comes, such as inc eased us and pe cep ions o ai ness, cla i ying app o-
p ia e employee ac ions, and highe commi men o o ganiza ional goals based on in e naliza ion and
iden i ica ion. O ganiza ions adop alue s a emen s because hey can guide employees by de e mining
app op ia e beha io (U bany, 2005).
The o ganiza ion’s communica ion o alue s a emen s as a cue can ein o ce beha io al no ms
(Kachelmeie e al., 2016). I sugges s ha si ua ional cues help de e mine he impo ance o social
no ms in ce ain si ua ions (Abdel-Rahim & S e ens, 2018; Bicchie i, 2005). Sch am & Cha ness (2015)
a gues ha social no ms equi e a sha ed unde s anding o wha one should do in each si ua ion as
well as obse ing one’s ac ions.
En i onmen al in o ma ion is impo an o en i onmen ally- ela ed ac i i ies (Nzama e al. 2022).
P e ious esea ch has shown ha alue s a emen s ha e a posi i e impac on o ganiza ions (Akinyele
e al., 2020; Kachelmeie e al., 2016). Kachelmeie e al. (2016) show ha he exis ence o alue
s a emen s ha p io i ize quali y imp o emen leads employees o shi om mo e e icien ac ions
o less op imal ac ions, e en hough hey a e mo e aligned wi h he p io i ized goals. Akinyele e al.
(2020) expand on hese esul s by showing ha he beha io al e ec o alue s a emen s occu s no
only when he alue being communica ed has a na ow ocus on imp o ing quali y, bu also when
i has a b oad ocus on o ganiza ional owne ship. Fu he mo e, Aguia (2021) shows ha alue s a e-
men s ha ocus on en i onmen al issues encou age indi idual in en ions o ollow en i onmen ally
iendly beha io . This s udy sugges s ha a alue s a emen ha ocuses on he en i onmen will
encou age manage s o make CSR decisions. Based on he easoning abo e, he ollowing hypo he-
sis is p oposed:
Ha2: En i onmen al-based alue s a emen s encou age CSR decisions mo e han inancial-based alue
s a emen s.
4.3. Incen i es, alue s a emen s, and CSR decisions
Social no ms dic a e ha indi iduals a e expec ed o exhibi speci ic beha io s ha a e deemed accep -
able while e aining om engaging in beha io s ha a e conside ed unaccep able. Mo eo e , social
no ms equen ly se e as in luen ial ac o s in shaping beha io wi hin ce ain ci cums ances, o en
equi ing delibe a e ac i a ion. The p ocess o ac i a ion, in many ins ances, occu s wi hou conscious
awa eness. Once a no m has been ac i a ed, indi iduals end o pe sis in adhe ing o he p imed no m
(Biel & Thøge sen, 2007).
COGENT BUSINESS & MANAGEMENT 7
Incen i e schemes a e a ool o mo i a e indi iduals o ca y ou hei du ies in achie ing pe o -
mance. Incen i es a e o mal con ols a anged by he o ganiza ion. Howe e , o ganiza ions also need
in o mal con ols. In o mal con ol is he implici s uc u e ha managemen adop s o encou age
employees o ac in alignmen wi h o ganiza ional goals (Be y e al., 2009; Bisbe & O ley, 2004).
In o mal con ol is ansmi ed o employees h ough signals such as o ganiza ional alue s a emen s
(No is & O’Dwye , 2004). When in o mal con ols a e adop ed o s imula e sel - egula o y beha io
among employees, managemen does no need o penalize o ewa d employees o hei beha io
owa ds hese con ols (Be y e al., 2009). As a esul , in o mal con ols in e ac wi h o mal con ols
o in luence beha io and decisions. I is di icul o sepa a e he e ec s o o mal and in o mal con-
ols because in o mal con ols may induce social no ms ha a e inconsis en wi h o mal con ols
(No is & O’Dwye , 2004).
Fu he esea ch ound an in e ac ion be ween o mal and in o mal con ols (Be y e al., 2009; Malmi
& B own, 2008). In managemen con ol esea ch using expe imen al me hods, i is p o en ha commu-
nica ion o alue s a emen s can pu social p essu e on employees o comply wi h alue s a emen s,
e en hough i educes employee compensa ion. Indi iduals who pe cei e a s ong o ganiza ional com-
mi men o he en i onmen show g ea e a achmen o en i onmen al ini ia i es (Ramus & S ege ,
2000). In he absence o s a ed o ganiza ional alues, indi iduals we e ound o ely on hei pe cep ions
o social no ms when choosing whe he o suppo o ganiza ional sus ainabili y ini ia i es (Me iman &
Sen, 2012). The esul s show ha he incen i e e ec alone canno explain p ojec choice o g oups ha
emphasize in angible bene i s o he en i onmen o co po a e inancial bene i s as a guide o social
no ms. A he same ime, incen i es can p edic ably a ec g oups ha do no emphasize ce ain social
no ms in hei decision-making. In social decisions, he e will be an in e ac ion be ween incen i es and
o ganiza ional alue s a emen s.
In o mal con ols, in he o m o o ganiza ional alues s a emen s, can p o ide social p essu e by com-
munica ing o ganiza ional alues e en when he e is no explici ac ion o en o ce hem (Be y e al.,
2009). Kachelmeie e al. (2016) sugges ha he choice o wo ds becomes impo an in he s a emen
o alues in o ganiza ions. Con empo a y alue s a emen s a e gene ally o ganiza ional and p omo e ide-
als ha os e social no ms (Lynn Hannan, 2016). By ac i a ing social no ms, con lic ing goals can eme ge
by hemsel es, which esul s in ge ing ou o con ol by ano he (Blay e al., 2018). Addi ionally, Aguia
(2021) showed ha in es iga es p o-en i onmen al alues s a emen s (in o mal con ol) as a po en ial
indica o o p o-en i onmen al beha io in indi iduals. A alue s a emen ha ocuses on he economic
aspec will weaken CSR decisions, bu when a alue s a emen ocuses on he en i onmen , i will
inc easingly encou age indi iduals o make CSR decisions because he alue s a emen can ac i a e hei
social no ms. The concep o mo i a ion c owding s a es ha in o mal con ols such as alue s a emen s
can in e ac wi h he incen i e sys em, which means ha in insic mo i a ion in e ac s wi h incen i es o
ge id o indi idual in insic mo i a ion (F ey & Jegen, 2001). Based on he easoning abo e, he ollow-
ing hypo hesis is p oposed:
Ha3: The e is an in e ac ion be ween he incen i e scheme and he o ganiza ion’s alue s a emen in making
CSR decisions.
5. Resea ch design
This s udy uses an expe imen al me hod wi h a 2 × 2 ac o ial design be ween subjec s. I ollows he
p e ious esea ch ha shows he alidi y o using uni e si y s uden s as subs i u es o manage s in a
decision-making con ex (A am & Kühne, 2008; Ma in & Mose , 2016; Mo ensen e al., 2012; Rokhaya i
e al., 2021). Acco dingly, pa icipan s in his s udy we e chosen om senio accoun ing s uden s a he
Facul y o Economics and Business o a s a e uni e si y in Indonesia who had aken a leas ou semes-
e s, including bo h managemen accoun ing and inancial accoun ing cou ses, o ensu e a signi ican
unde s anding o in es men decisions and business p ocesses.
Acco ding o Mon gome y (2013), o ob ain he mos accu a e es ima e o p ecision, i is ecom-
mended o ha e a minimum sample size o 10 o 12 pa icipan s pe cell. This s udy employed a
14 H. ROKHAYATI ETAL.
Au ho con ibu ions
Hij oh Rokhaya i: Concep ualiza ion, Fo mal analysis, In es iga ion, W i ing - o iginal d a
Mah ud Sholihin: Concep ualiza ion, Funding acquisi ion, W i ing - e iew & edi ing
Had ian G. Djajadike a: Concep ualiza ion, Supe ision, W i ing - e iew & edi ing.
Disclosu e s a emen
No po en ial con lic o in e es was epo ed by he au ho (s).
Abou he au ho s
Hij oh Rokhaya i is a lec u e a Depa men o Accoun ing, Facul y o Economics and Business, Uni e si as Jende al
Soedi man, Indonesia. He esea ch in e es s include managemen accoun ing, beha io al accoun ing, co po a e
social esponsibili y, and business e hics.
Mah ud Sholihin is a p o esso a Depa men o Accoun ing, Facul y o Economics and Business, Uni e si as Gadjah
Mada, Indonesia. His esea ch in e es s and subjec s include managemen accoun ing, islamic accoun ing, and busi-
ness and accoun ing p o ession e hics.
Had ian Ge i Djajadike a is a p o esso o Accoun ing Discipline in he School o Accoun ing, Economics and Finance
a Cu in Uni e si y. His esea ch a ea co e s essen ial aspec s o sus ainabili y, co po a e go e nance and manage-
men accoun ing, including he applica ion o sus ainabili y and sus ainable de elopmen p inciples o o ganisa ions
and hei epo ing. He also ca ies ou in e disciplina y esea ch in he ield o sus ainabili y and sus ainable de el-
opmen wi h he co e age a eas o managemen , inance, supply chain and logis ics, digi al echnology, and
educa ion.
E hics app o al
We decla e ha he p inciples o e hical and p o essional conduc ha e been ollowed and all pa icipan s ha e ead
and signed he in o med consen be o e pa icipa ing in his esea ch.
Funding
This s udy is unded by Pos -Doc o al Resea ch G an om Gadjah Mada Uni e si y, con ac numbe 13602/UN1.P.II/
Di -Li /PT.01.04/2022.
ORCID
Hij oh Rokhaya i h p://o cid.o g/0000-0003-1432-4084
Mah ud Sholihin h p://o cid.o g/0000-0003-0773-4501
Had ian Ge i Djajadike a h p://o cid.o g/0000-0003-1672-9579
Da a a ailabili y s a emen
The pa icipan s o his s udy did no gi e w i en consen o hei da a o be sha ed publicly, so due o he sen-
si i e na u e o he esea ch suppo ing da a is no a ailable.
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