The circular path of social sustainability: An empirical analysis

Abstract

The sustainable human resource management literature provides arguments linking the social sustainability dimensions of business and society, suggesting a circular or two-way relationship between them. The norm of reciprocity builds social sustainability by increasing trust and cooperation in any group of people and explains this complex relationship. In this study, we test the connection between society––poverty and inequality––and business––human resource investment strategy––using a large longitudinal data set with six time points. Findings showed that past poverty negatively contributes to a later human resource investment strategy and vice versa. This mutual relationship configures a positive feedback loop where environmental social sustainability and organizational social sustainability enhance each other. Results also show that a human resource investment strategy negatively affects income inequality, revealing that corporate decisions on social sustainability can affect social sustainability in society.