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Pathway toward environmental
sustainability: mediating role of
corporate social responsibility in
green human resource
management practices in small and
medium enterprises
Jun Wen, Hadi Hussain, Junaid Waheed and Waheed Ali
School of Economics and Finance, Xi’an Jiaotong University, Xi’an, China, and
Ihsan Jamil
Xi’an Jiaotong University, Xi’an, China
Abstract
Purpose – Recent research validates an increasing knowledge of environmental concerns in manufacturing
small and medium enterprises (SMEs). However, only a few studies maintain that green human resource
management (HRM) practices and corporate social responsibility (CSR) play an important role, especially in
the case of developing economies. Thus, this study aims to examine the direct and indirect relationship
between green HRM practices and environmental sustainability (ES) through the mediation of CSR in SMEs
in Pakistan.
Design/methodology/approach – The cross-sectional design of this study considers the mechanism by
which green HRM practices affect ES through CSR in the context of Pakistani SMEs. The authors collected data
from 320 manufacturing SMEs and used the partial least squares structural equation modelling (PLS-SEM)
technique to examine the relationship between variables.
Findings – The empirical findings of this study suggest green HRM practices have a positive and significant
impact on ES. Further, the second hypothesis is not supported. In addition to the direct impact, the indirect
effect of green HRM practices on CSR is positive and significant. Finally, the authors determine that green HRM
practices affect ES through the partial mediation of CSR.
Originality/value – To date, this study is the first to use CSR as a mediator between green HRM practices and
ES in the context of Pakistani SMEs. The study has important implications for HRM and government policy
makers, suggesting they should improve strategies in favour of the green economy. Furthermore, developing
countries could design similar studies with different future sustainability factors.
Keywords Green HRM practices, Environmental sustainability, CSR, Pakistan, SMEs
Paper type Research paper
1. Introduction
Of late, environment-related issues have been gaining interest and organisations are facing the
challenge of reducing their environmental impact (Gilal et al., 2019). Researchers have stated
that strong environmental performance depends on support for human resource management
(HRM) policies regarding the environment (Mishra, 2017). Environmental performance is
defined as an organisation’s commitment to enriching the environment. Designing an
organisation’s operations to align with HRM standards (Roscoe et al., 2019) is termed as green
Green HRM
practices and
CSR
701
Hadi Hussain acknowledges the support for this research work provided by Professor Jun Wen, School
of Economics and Finance, Xi’an Jiaotong University, China. Jun Wen is grateful to the National Science
Foundation of People’s Republic of China (Grant number 72074176).
Jun Wen and Hadi Hussain have equal for the research strategies of this paper.
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/0143-7720.htm
Received 11 January 2020
Revised 4 June 2020
2 October 2020
13 January 2021
4 February 2021
5 April 2021
3 June 2021
Accepted 7 August 2021
International Journal of Manpower
Vol. 43 No. 3, 2022
pp. 701-718
© Emerald Publishing Limited
0143-7720
DOI 10.1108/IJM-01-2020-0013
HRM (Gilal et al., 2019). Green HRM practices can be categorised into three main activities:
allocating employees with the ability, motivation, and opportunity to induce change (Renwick
et al., 2013). Green HRM utilises waste management and worker efficiency to boost green
performance (Pham et al., 2019). Therefore, organisations should consider implementing HRM
to effectively achieve environmentally friendly policies (Jabbour et al., 2008).
While the promising role of HRM in enhancing environmental performance is understood,
limited focus has been placed on the influence of HRM on the environmental sustainability (ES)
of an organisation (Kim et al., 2019). Green HRM practices develop green employees, teaching
personnel to appreciate green initiatives and ensure environmental safety standards to the
benefit of the natural environment, society, and individuals (Saeed et al., 2018). These employees
play a key role in achieving organisational green goals and maintaining green practices (Saeed
et al., 2018). Green HRM practice implementation consists of green selection, recruitment,
training, appraisal, and reward systems (Mishra, 2017).Within a company, an employee’s green
development includes promoting environmentally friendly behaviour through human resource
activities (Pellegrini et al., 2018). Green employees are more aware to mitigate environmentrelated issues easily (Fawehinmi et al., 2020) perform better within their own responsibilities,
and thus, improve overall environmental performance (Pinzone et al., 2019).
In addition, a firm may work to improve its environmental and social impact by conforming
to international standards, which are encouraged by developed economies (Cooke et al., 2020).
The aim of this study is to give a reference for researchers to better understand the differing
social and economic characteristics of developed and developing countries (Cooke et al., 2020).
Different studies analyse green HRM practices to involve organisational commitment (Kim
et al., 2019), corporate green performance (Jawad Abbas, 2020) and employee behaviour
(Pellegrini et al., 2018), act as mediators to explain both employee green performance and proenvironmental behaviour. Taken together, previous research provides the groundwork for
considering corporate social responsibility (CSR) as a mediator for small and medium
enterprises (SMEs). Therefore, by combining research on ES (Shafaei et al., 2020; Kim et al.,
2019), green HRM practices (Fawehinmi et al., 2020; Gilal et al., 2019; Kim et al., 2019; Renwick
et al., 2013; Roscoe et al., 2019), and CSR (Abbas, 2020; Pellegrini et al., 2018), we develop a
unique framework by establishing CSR as a mediating variable between green HRM practices
and ES. Moreover, the ability-motivation-opportunity (AMO) theory, which suggests that green
HRM boosts employees’ capabilities to attain ES (Fawehinmi et al., 2020).
Currently, Pakistan faces significant environmental pollution issues (Hameed et al., 2020).
SMEs are considered the main contributors to environmental pollution (Ndubisi et al., 2020;
Jabbour et al., 2008). Pakistan’s 2020 environmental performance index (EPI) score is 33.1,
ranking 142 out of 180 countries (Yale Center for Environmental Law and Policy, 2021).
Therefore, this study adds significantly to the domain of green HRM and CSR. Moreover, this
study promotes better understanding by helping to explain the possible association between
green HRM and a firm’s environmental outcome through the addition of CSR as a mediating
variable. Further, we contribute to and build upon existing studies (Shafaei et al., 2020;
Fawehinmi et al., 2020; Yong et al., 2020) by arguing that the indirect effect of green HRM
through CSR is stronger than its direct impact. Theoretically, this study integrates the AMO
theory into the environmental context and analyses the conceptual framework by improving
our knowledge about mediation, and the relationship between independent variables. Thus,
this research examines how green HRM practices and CSR together impact an organisation’s
environmental performance.
2. Theoretical background and hypotheses
2.1 Theoretical foundation
In this study, we employ the AMO theory developed by Appelbaum et al. (2000) to evaluate
current research surrounding this topic. The AMO theory posits that to comprehend
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employee performance, appropriate skills, time motivation, and distinct opportunities must
be evaluated during green HRM decision-making processes (Fawehinmi et al., 2020). The
theory further claims that green HRM practices contributes to organisational performance by
improving employee green behaviour by providing competent workers with green values,
which is linked with the organisation’s green goals (Renwick et al., 2013). By enhancing
employee green behaviour at the workplace, green HRM practices also facilitate knowledgesharing and problem-solving (Saeed et al., 2018). To achieve organisational goals, green HRM
practices develop employee environmental knowledge, which ultimately leads to increased
environmentally friendly behaviour (Dumont et al., 2015). Thus, AMO encourages employees
to participate in environmentally friendly behaviour at the workplace (Fawehinmi et al., 2020;
Hameed et al., 2020). Further, when an organisation recruits a green employee, both entities
become more knowledgeable and passionate about protecting the environment and achieving
green organisational goals (Ren et al., 2018). Through knowledge-sharing, green employee
involvement enhances commitment to environmental protection activities, for which
employees are assessed and rewarded based on their green performance (Saeed et al.,
2018). For these reasons, the AMO theory was selected to evaluate the role of green HRM
practices on ES via employee green environment knowledge and to assess how CSR improves
the bond between ES and green HRM.
2.2 SMEs and green HRM
SMEs are defined by the number of working employees, available assets, output volume and
sales (Jun et al., 2019). The European Commission considers an enterprise with 10–50 working
employees as small, and one with 50–250 employees as medium. In Pakistan, any enterprise
with 0–250 working employees is considered an SME (Jun et al., 2019). The motivation to
adopt green practices in SMEs is driven by the potential for improved environmental and
economic performance, enhanced market image, and commercial and financial benefits
(Abbas, 2020). Further, environmental regulatory agencies assert certain financial pressures
to adopt green practices to enhance profitability and cost efficiency (Saeed et al., 2018). In
Pakistan, several studies address the influence of green practice adoption by SMEs (Jun et al.,
2019), green HRM practices and environmental passion (Gilal et al., 2019), and green HRM
practices and pro-environmental behaviour (Saeed et al., 2018).
Existing literature supports green HRM as the optimal strategy to achieve ES as its
practices allow employees to attain company green goals efficiently (Shafaei et al., 2020).
Further, Kim et al. (2019) highlighted the importance of increasing employee awareness and
education of the positive ramifications of sustainably developing their organisation.
Moreover, industries should provide a friendly work environment for their employees, which
may lead to greater commitment to their companies (Kim et al., 2019). As a result, SMEs
should be motivated to adopt innovative activities to improve their economic, financial, and
environmental performance.
2.3 Green HRM practice adoption and implementation
In an environmental context, the term “green” refers to the active support of earth-friendly
practices that help protect the environment and sustain natural resources. According to
Doran and Ryan (2012), there are three main drivers behind environmental innovation:
regulatory drivers, demand drivers, and supply drivers. These drivers can influence each
other. For example, the supply of green products is increased by regulatory demand pressure,
while customer demand and regulatory pressure can improve an organisation’s intention to
adopt green practices (Foster and Green, 2000). Further, profitability and ES are enhanced by
adoption of green practices, which is also influenced by environmental regulatory pressure
(Doran and Ryan, 2012). In addition, investment in research and development and in the
Green HRM
practices and
CSR
703
evolution of a company’s environmental management system fosters green practice adoption
in SMEs (Rennings et al., 2006).
Jabbour et al. (2008) stated that green HRM practices are significant contributors to
organisational environmental outcome. Researchers believe that employees with green
values are more active in adopting and enacting ES principles, thereby leading to better
organisational environmental performance (Shafaei et al., 2020). The basic principles of green
HRM practices are developed using diverse dimensions available in the literature (Yong et al.,
2020). We summarise the first hypothesis (H1) as follows:
H1. Green HRM adoption and implementation has a positive impact on ES among SMEs
in Pakistan.
2.4 CSR
CSR is recognised as a green organisational strategy that ultimately targets the social,
economic, and cultural aspects of the company’s environment (Raimi, 2017). Regarding
environmental uncertainty, CSR is used as a comprehensive term to explain several issues
that contribute to a company’s responsibilities. Note that CSR initiatives are often linked to
HRM and organisational performance. For example, organisations with better green HRM
policies tend to have stricter CSR policies (Abbas, 2020). CSR is a way to improve a company’s
performance by maintaining a positive corporate image, given it is based on the knowledge,
feelings, and beliefs regarding the organisation, which change over time from person to
person, as well as from one organisation to another (Raimi, 2017). CSR is a key component of a
company’s green operations for achieving customer loyalty, sustainable growth objectives,
company reputation, and employee satisfaction (Asrar-ul-Haq et al., 2017).
The European Commission (2003) states that implementing CSR is a display of outward
environmental and social awareness of daily operations. Moreover, CSR’s main roles are to
monetise organisational capabilities, offer competitive advantages and enhance
sustainability and employee satisfaction levels (Raimi, 2017). Nevertheless, the CSR
concept is not very popular and is still in the initial stages of adoption in the developing
world (Abbas, 2020). In Pakistan, most businesses consider CSR to be a philanthropic rather
than an environmental activity (Abbas, 2020). Thus, the next hypothesis is:
H2. CSR has a positive impact on ES through green HRM practices.
2.5 Mediating role of CSR
Currently, CSR is on the agenda of multiple social agents and various studies consider CSR to
be a multidimensional construct that incorporates a diverse range of initiatives and practices,
including reducing negative environmental impacts, improving health and safety, and
ensuring an organisation’s economic sustainability (Carroll, 2016). It links employees’ green
job performance, organisational identification and green input with overall green
organisational performance (Brammer et al., 2015). CSR activities eventually contribute to
the development of a sustainable environment by preserving and protecting natural
resources (Shahzad et al., 2020). CSR activities facilitate a company’s sustainable growth and
environmental protection efforts (Raimi, 2017). Currently, SMEs are dynamically
emphasizing the importance of preserving the natural environment and embracing green
HRM practices to reduce their impact on the environment (Babiak and Trendafilova, 2011).
According to Memon et al. (2018), a mediator always clarifies the relationship between two
variables. Previously, CSR has been identified in different studies as a mediating variable.
Like, Abbas (2020) investigated a partial mediating effect of CSR on corporate green
performance in Pakistan and revealed a positive relationship between CSR, financial
performance, and corporate sustainable performance. Rashidin et al. (2018) use CSR as a
mediator to evaluate the influence of market orientation on performance of Pakistani
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enterprises, and find that market orientation initiatives only affect financial performance
through CSR (see Figure 1).
However, the mediating effect of CSR on the relationship between green HRM and
environmental sustainability has been ignored to date. Because of the rising relevance of CSR
practices and compliance with ISO and WTO international standards in Pakistan (Rashidin
et al., 2018), the manufacturing sector is a suitable context to evaluate the mediating role of
CSR. Thus, the following hypothesis is derived from the above reasoning:
H3. CSR mediates the relationship between green HRM practices and ES.
3. Method
3.1 Survey and data collection
The current study is empirically interpretative because SMEs in different sectors face serious
competition and strong governmental and social pressures related to environmental protection.
Therefore, a cross-sectional study design suitable for studies regarding certain phenomena at
distinct time is constructed (Anderson et al., 2011) to verify the impact of green HRM practices
on ES. To test this conceptual design, a survey instrument and measurement scale from the
literature were developed and the data were collected in two phases. First, a pre-test was
considered to check the validity of the scale, and improvements were made by three academics
and six industry experts. Second, a revised questionnaire was used to collect data to analyse the
hypotheses developed. The conceptual framework items represented ES, CSR, and green HRM
practices. The study population was comprised of seven different sectors within SMEs.
3.2 Sample size and data demographics
In this study, the main emphasis is to employ a survey method to gather data from
manufacturing SMEs that practice green HRM. The data were collected through selfadministered questionnaires from four industrial zones in Multan and three major industrial
zones in Faisalabad, from December 2018 to April 2019. In addition, our data were from seven
sectors of manufacturing SMEs, including chemicals, power generation, fibre plants, textiles,
pharmaceuticals, embroidery, and cotton. A list of SMEs was adapted from the Multan and
Faisalabad Chambers of Commerce and Industry. From the list of 1,437 manufacturing
SMEs, only 723 companies were chosen as they were registered with the Securities and
Exchange Commission Pakistan (SECP, 2021) and the World-Wide Fund for Nature-Pakistan
(WWF-Pakistan, 2021). A random sampling technique was practiced to gather data from
manufacturing SMEs via electronic correspondence and personal visits. Based on the

Corporate
Social
Responsibility
Figure 1.
Conceptual framework
Green HRM
practices and
CSR
705
selected list of SMEs, 723 self-administered questionnaires were distributed. After discarding
missing data and outliers, a total of 320 valid questionnaires were retained, resulting in a
44.23% response rate. Responses were predominantly from CEOs, HR managers/directors,
and personnel of environmental safety and procurement departments. We targeted these
functions and departments given their direct knowledge and consideration of green HRM
practices and ES.
3.3 Measures
In our model, the dependent variable was ES and the independent variable was divided into
two parts: green HRM practices and CSR adoption. All the constructs were measured by
adapting previous validated scales from available literature (see Appendix Table A1). The
respondents were interviewed on five-point Likert scale. Further, SmartPLS diagram of
measurement items is provided in the Appendix (see Figure A1).
Measures for ES used 7 items adapted from Saeed et al. (2018) for a developing country
context. In this study, ES referred to the actual environmental practices in manufacturing
SMEs. The items are further validated by the study of Pinzone et al. (2019). The sample item
was “whether a company emphasises airborne emissions reduction”.
Green HRM practices were measured using 6 different domains: green job description,
green selection, green employee recruitment, green training, green employee assessment, and
green employee rewards, with 14 items adapted from the study of Yong et al. (2020), whose
research study is specifically focused on developing country. The sample item was “whether
your company requires employees to have environmental management (EM) knowledge”.
CSR was measured using 5 items adapted from Raimi (2017), which focused on social and
economic aspects of the work environment in the organisational context. The sample item
was “whether a company pursues partnership dedicated to social causes”.
A complete list of measures with demonstrated desirable reliability and validity is
presented in Table 1.
3.4 Common method bias
In the case of cross-sectional nature of this study, the common method bias (CMB) impact can be
minimised at different stages. First, we consider several approaches to minimise the threat of
bias at data collection stage. As outlined by Shafaei et al. (2020), at the time of data collection, we
minimised ambiguity and made certain that the constructs used were not affected by external
factors. Second, we ratified the items on ES, green HRM practices, and CSR by obtaining
reviews of experts. Further, to minimize the effect of CMB, this study employs different
statistical measures as recommended by Schwarz et al. (2017). For statistical measures, this
study adopted the confirmatory factor analysis (CFA) marker technique, Harman’s singlefactor test, and unmeasured latent marker construct (ULMC). Both confirmatory factor analysis
(CFA) and Harman’s single-factor test with no threat of CMB were captured for the data used in
the present study (Schwarz et al., 2017). In addition, after data collection, we implemented the
ULMC to detect andmanageCMB. Note that we did not find CMB to be an obstacle in our study.
Schwarz et al. (2017) and Richardson et al. (2009) suggest utilising the ULMC to create a method
effect construct for all variables employed in the study and checking the CMB of the baseline to
the ULMC model. Bias due to CMB is not possible when the baseline model fit compare to
ULMC model is better (Chin et al., 2012; Schwarz et al., 2017). Therefore, we conclude that no
threat of CMB was found in our study.
4. Data analysis
This study aims to present new insights of ES through green HRM practices at SMEs level.
Additionally, we investigate whether the association between ES and green HRM practices is
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mediated by CSR. This indicates the exploratory nature of the present study and justifies the
use of partial least squares structural equation modelling (PLS–SEM). Recently, various
social science and business management researchers use SEM in their research (Kline, 2011)
as it enables us to comprehensively analyse a complex model composed of several
independent variables. PLS-SEM is the most comprehensive, reliable, and powerful secondgeneration statistical technique across various disciplines (Cheah et al., 2018). Most
researchers refer to this tool as the “Silver Bullet” (Hair et al., 2014) because it is the most
adopted technique in management and business disciplines due to edge of suitability in
addressing non-normal data (Cheah et al., 2018). As our survey data are non-normal in nature,
we consider SEM best suited for our analysis. Further, we prefer SEM to SPSS because the
SEM technique removes the bias effect resulting from measurement errors and can build
latent constructs (Abbas, 2020; Cheah et al., 2018; Hair et al., 2014). According to guidelines in
the literature, we tested the measurement model first, then examined the structural model
(Yong et al., 2020).
4.1 Measurement model
At this stage, we assessed different methods for checking the reliability and validity of the
factors. Several rules of thumb are available in the literature, but we selected the techniques
Construct 1st order items 2nd order items Loadings CR AVE
Green analysis and job description GAJB1 0.771 0.903 0.756
GAJB2 0.797
GAJB3 0.909
Green assessment GA1 0.788 0.924 0.801
GA2 0.888
GA3 0.938
Green recruitment GR1 0.901 0.939 0.884
GR2 0.893
Green trainings GT1 0.899 0.961 0.926
GT2 0.944
Green rewards GTR1 0.922 0.966 0.935
GTR2 0.933
Green selection GS1 0.866 0.954 0.912
GS2 0.922
Green HRM practices GAJB 0.826 0.984 0.783
GA 0.871
GR 0.897
GT 0.921
GTR 0.928
GS 0.894
Corporate social responsibility CSR1 0.722 0.926 0.699
CSR2 0.85
CSR3 0.889
CSR4 0.914
CSR5 0.792
Environmental sustainability ES1 0.875 0.963 0.789
ES2 0.904
ES3 0.911
ES4 0.873
ES5 0.897
ES6 0.854
ES7 0.901
Table 1.
Measurement model
Green HRM
practices and
CSR
707
designed by Hair et al. (2010), which state that factor loading of 0.7 or greater is desirable
while 0.5 or greater is considered acceptable.
A second-order for green HRM practices was incorporated in the model. As a result, we
assessed first-order factor validity and reliability before moving on to the second-order factor
validity and reliability. All the first-order factors showed the factor loading of each item to be
greater than 0.7, which is desirable. Similarly, the composite reliability was greater than 0.7
for all constructs, signifying the internal reliability is within a desirable range and can be used
instead of Cronbach’s α, which is also greater than 0.7. To check convergent validity we use
the value of average variance extracted, Fornell and Larcker (1981) suggest that to satisfy
convergent validity, all constructs should be greater than 0.5. The second-order factors also
pass all the three criteria, indicating that both the first-order and second-order factors are
valid and reliable. Details are shown in the measurement model evaluation (Table 1).
To establish discriminant validity, we used the new Heterotrait-Monotrait ratio (HTMT)
test proposed by Henseler et al. (2015), who criticised Fornell Larcker’s criteria as non-reliable.
As of late, most studies have conformed to this new approach, which estimates the actual
correlation between constructs. Empirically, if the correlation value between the two
constructs is close to 1.0, the HTMT shows a lack of validity within the model. The proposed
rule of thumb for HTMT is that the value should be less than 0.90 (Henseler et al., 2015). The
HTMT results summarised in Table 2 confirm the discriminant validity of the model of
the study.
Similarly, the descriptive statistics for each variable are summarised in Table 3. The
empirical statistics reveal that ES (mean 5 3.57) is very prevalent in SMEs located in
Pakistan, followed by green HRM practices (3.52) and CSR (3.85).
4.2 Structural model
Before confirming the reliability and validity of the structural model, we assessed its
collinearity, which conformed with the thumb rule that the variance inflation factor value of
all the predictors should be less than 3.3 (Henseler et al., 2015). Next, to test the hypothesis,
we investigated the significance of the path models and performed bootstrapping at a 1,000
re-sampling rate (Hair et al., 2014). Table 4 lists the outcome of bootstrapping with 320
observations and 1,000 subsamples.
The hypothesis results show significance in terms of t-values, probability values, and also
confidence interval values. Only two of the three hypotheses developed were supported. In
Table 4, green HRM practices were found to be significantly positively related to ES
ES GHRMP CSR

Construct Mean (X) SD

GHRMP 3.52 1.2
Note(s): Interval 5 highest score – lowest score/number of scores interval l 5 (5–1)/5 5 0.8; criteria of the
average respondents’ answers: 1.00 < 3 < 1.79: strongly disagree; 1.80 < 3 < 2.59: disagree; 2.60 < 3 < 3.39:
neutral; 3.40 < 3 < 4.19: agree; 4.20 < 3 < 5.00: strongly agree
Table 2.
Heterotrait–Monotrait
ration (HTMT)
Table 3.
Descriptive statistics
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(β 5 0.946, LL 5 0.926, UL 5 0.968, p < 0.01). As a result, H1 was supported. Moreover, the
association of green HRM practices with CSR is significant and positive (β 5 0.158,
LL 5 0.142, UL 5 0.174, p < 0.01). Surprisingly, the findings of this study revealed that CSR
has a negative relationship with ES (β 5 –0.054, LL 5 –0.068, UL 5
0.044, p < 0.05).
Therefore, H2 was not supported. As can be seen in Table 5, the indirect effect shows that CSR
positively mediates the relationship between green HRM practices and ES (β 5 0.153,
LL 5 0.144, UL 5 0.174, p < 0.05). Hence, H3 was supported.
The value of depends on the area of research (Hair et al., 2014). Here, the R2 of 0.88
(Gholami et al., 2016; O’brien, 2007; Jun et al., 2019) indicated that 88% of the variance in ES is
attributed to green HRM practices and CSR, while the of 0.194 showed that green HRM
practices explained 19.4% of the overall variance of CSR. Further, we used a blindfolding
procedure in PLS-SEM with a distance of 7 to calculate the relevance. The endogenous
variable ES has a Q2 value of 0.645, which was greater than the threshold proposed by Chin
(2010), and confirms the model’s high predictive relevance. Cohen (1992) classifies effect sizes
() of 0.35, 0.15 and 0.02 as large, medium and small, respectively. This study found that green
HRM practices had a large effect size on ES (0.584), while green HRM practices had a medium
effect size on CSR (0.171). However, CSR had a small effect size on ES (0.003).
5. Discussion of findings
Increasing awareness of and concern for ES can constrain industrialisation. In Pakistan, a
key distinction between environmental protection and green HRM activities is that the latter,
as only a limited number of manufacturing SMEs consider CSR. In EM literature, green HRM
practices are of great importance (Ren et al., 2018; Renwick et al., 2013). Therefore, the
objective of this study is to reveal the importance of green HRM practices within Pakistani
SMEs in sustaining the environment, examining CSR as a mediator of this relationship.
Consistent with Abbas (2020), the findings of our study revealed that green HRM practices
have a significant and positive relationship with ES in Pakistan. Results also show that better
green practices can strengthen employee environmental knowledge. For example, better
selection, recruitment and green training improve employee pro-environmental knowledge,
while other practices, such as performance appraisal and reward systems, can motivate
employees to achieve strategic organisational goals (Fawehinmi et al., 2020; Renwick
et al., 2013).
Most of organisations have practiced CSR activities with broad goal of contributing to the
well-being of communities and societies, which diverts CSR’s attention away from its primary
Constructs Std β SE t-value p-values LL UL Decision

Note(s): N 5 320; *p < 0.05, **p < 0.01, ***p < 0.001; GHRMP 5 green HRM practices; ES 5 environmental
sustainability; CSR 5 corporate social responsibility
Constructs Std β SE t-value P-values LL UL Decision
GHRMP → CSR → ES 0.15 0.0003 2.962 0.043* 0.144 0.174 Mediated
Note(s): N 5 320; *p < 0.05 t 5 > 1.645; GHRMP 5 green HRM practices; ES 5 environmental sustainability;
CSR 5 corporate social responsibility
Table 4.
Hypothesis testing
result of direct effect:
structural model
Table 5.
Mediation hypothesis
testing
Green HRM
practices and
CSR
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goal: to align the company’s social and environmental activities with its business purpose and
values (Kasturi Rangan et al., 2015). The findings also indicated that the impact of CSR on ES
is negative but significant. Thus, our results are consistent with Wright and Ferris (1997).
Another reason for this negative impact was proposed by Chapple and Moon (2005), who
posited CSR is primarily deemed a western concept because of its strong institutions and
standards, attributes less common in developing countries such as Pakistan. CSR is
considered as a kind of financial burden because in Pakistan mostly businesses consider it as
a philanthropic activities (Abbas, 2020). Further, transparency issues, narrow perceptions of
CSR, unclear policies, complex tax systems, non-availability of clear CSR guidelines, and poor
infrastructure are also the reasons of its negative impact (Jun et al., 2019). Given we studied
SMEs, which indicate a low volume of CSR impact due to having less resources and poor
guidelines than larger companies, the impact was negative but significant.
Further, our study findings support the indirect relationship between green HRM
practices and ES with the partial mediation of CSR. To comprehensively test this mediation,
we followed the recommendation by Awang (2016) and the online Sobel test, which evaluate
the partial mediation of our hypothesised model. Gilal et al. (2019) explain that partial
mediation accounts for some of the relationship between green HRM practices and ES. Thus,
our findings contribute to existing literature by revealing that CSR may influence ES through
green practices. Note that no previous study has used CSR as a mediator between green HRM
practices and ES in the context of Pakistani SMEs.
5.1 Status of green HRM in Asia
To date, all Asian nations have limited resources and face major environmental challenges
as they aim for plausible development and environmental management (Jabbour and
Renwick, 2019; Ren et al., 2018). HRM research in Asia has grown rapidly in the last twentyfive years (Meyer, 2006). Journal databases indicate China published almost 3,000 Englishlanguage journal articles on HRM practices in 2019, while India published 1,000, Korea 700,
and Japan over 600, each relating to different aspects of HRM (Cooke et al., 2020). Green
HRM practices are a primary component of CSR and EM as they uniquely create a resourceefficient, environmentally sensitive and green workplace for employees, stimulating green
behaviour within the organisation (Cooke et al., 2020; Jabbour and Renwick, 2019). As
previously mentioned, countries have diverse responses to sustainability and their impact
on the environment. Factors driving these responses are cultural, social, and regulatory and
industrial (Cooke et al., 2020). Thus, to foster behaviour consistent with green HRM
practices in Asia, different policies for implementing green HRM exist. These policies
involve selection, training, performance appraisal, and reward systems (Jabbour and
Renwick, 2019).
Green HRM practices in Pakistan are nevertheless in the budding stage. Organisations
have only begun to identify and adopt green practices as part of their HRM policies (Jun et al.,
2019). To date, organisations and their employees are gradually becoming acquainted with
the concept of green HRM practices. Various studies are available addressing aspects of HRM
ranging from the adoption stage to complete implementation (Abbas, 2020; Gilal et al., 2019;
Saeed et al., 2018). The results of our study add insightful contributions for SMEs, considered
the primary economic drivers and main contributors to environmental pollution. This study
revealed that green HRM practices help SMEs achieve ES. Therefore, the government of
Pakistan should approve well-founded environmental policies that provide guidance to
manufacturing SMEs on how to “become green”.
5.2 Theoretical contribution
This study provides insights into the framework of AMO knowledge. First, we contribute to
AMO theory in a way that predicts environmental knowledge in the industrial arena. The
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findings reveal that when employees possess the required capabilities and have the
motivation and distinct opportunities to perform well, their improved environmental
knowledge enables them to alleviate environmental issues. This point is supported by
Fawehinmi et al. (2020) and Saeed et al. (2018), who proposed that the development of
employee environmental knowledge is necessary for the successful implementation of green
HRM practices needed to ensure ES. Second, this study builds on to the work of Riaz and
Siddiqui (2020), who proposed that both CSR and green HRM practices influence each other
and that AMO could be enhanced by the effective implementation of green HRM, which is
essential for CSR. This research shows that for organisational environmental benefits, CSR
strategies should be leveraged by green practices, including employees, the environment, and
society. It is further posited that organisational CSR strategy implementation should be
handled by HRM through green employee involvement and participation. These findings are
consistent with the studies by Abbas (2020) and Riaz and Siddiqui (2020), who suggest that
CSR impacts employee green behaviour when supported by green HRM practices.
Finally, this study contributes to green HRM literature in the context of AMO and ES by
focussing on SMEs in Pakistan and providing green HRM implementation information for
these SMEs. Previously, SMEs were considered major contributors to environmental
pollution. Recently, however, commercial benefits and green product innovation have
motivated SMEs to adopt and implement green practices in Pakistan (Jun et al., 2019).
5.3 Practical implications
For practitioners and organisations in Pakistan, this study has several practical implications.
In Pakistan, green HRM adoption and implementation have become essential given their
potential to foster competitive advantages through sustainable development. Pakistan’s
manufacturing SMEs cause environmental issues such as severe CO2 emissions, reduction of
natural resources, and inappropriate usage of water and electricity. To protect the
environment, green HRM implementation first encourages organisations to protect resources
through green work activities that safeguard and sustain the natural environment. Therefore,
both government and organisations at the firm level can support green practices. Likewise,
the Environmental Protection Agency (EPA) of the Ministry of Climate Change is supporting
environmental protection by providing SMEs with modern technical support to help reduce
environmental hazards at the industrial level. In addition to financial support, they should
encourage and promote green HRM practices in businesses by providing incentives in the
form of tax exemptions, subsidies, and depreciation allowances.
Second, to reduce negative environmental effects, HRM departments should understand
the importance of strategies to boost the green abilities of employees and to train them to
participate in environmentally friendly activities, given employees are the core element for
green change (Shafaei et al., 2020). Furthermore, to execute a successful environmental
strategy, a firm’s HR personnel should be aware of environmental regulations to ensure they
hire employees with sufficient environmental knowledge (Pham et al., 2019) while training
and motivating them by linking their performance with a reward system based on their green
contributions (Dumont et al., 2015).
Third, most businesses equate CSR with philanthropic activities rather than with
environmental and social development activities (Abbas, 2020). Therefore, government
policy makers should design policies to promote CSR benefits via transparent CSR policies,
awareness campaigns, and the removal of other factors that hinder perceptions of CSR.
Finally, if organisations attempt to reward the green behaviours of employees, they may
obtain a favourable reputation by advancing and implementing green HRM practices. This
study clearly demonstrates that investment in green strategies will ultimately improve
organisational environmental outcomes.
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5.4 Limitations and future research
The theoretical and methodological limitations of present study provide opportunities for
future research. First, gathering cross-sectional data at a distinct point in time may introduce
a CMB issue. However, in this study employee green behaviour was determined by the HRM
department, which may curb the CMB effect (Podsakoff et al., 2003). Furthermore, validating
research based on only closed-ended questions always yields limited information on a
respondent’s perceptions. Future studies should consider mixed-method approaches to
examine the association between green HRM and environmental outcomes for a more
comprehensive analysis.
Second, this study used the AMO framework for environmental prospects and considered
mediation of CSR between green HRM practices and ES. Although we consider CSR only as a
mediating variable for evaluation in the framework of this study, future studies should
employ different psychological and social notions such as organisational background (Levy
and Marans, 2012) and management trust (Ramus, 2002). Furthermore, further research
should consider balance in green work-life (Muster and Schrader, 2011) as another aspect of
green HRM. Mediated-moderation or moderated-mediation models should also be examined
to test the relationship between green HRM and ES, potentially providing a new
understanding of this relationship. Finally, this study targeted CEOs, HR Managers, and
personnel in charge of environmental protection. However, to capture a more comprehensive
picture of green HRM at the firm level, future studies should consider lower-level workers,
including operational, technical, and administrative staff.
6. Conclusions
With the identification of the importance of environmental management, SMEs realise that
environmental incompetency is connected to poor green HRM practices in environmental
initiatives. Overall, our study attempted to join the nodes of green HRM literature with CSR and
ES. Further, this study identified a perceptible gap in the available literature on CSR mediation
in the given conceptual framework. Study findings are consistent with the AMO, providing
practical implications about the link between green HRM and the successful implementation of
green practices and under what phenomena this association is strong. Finally, the findings
provide a reference for policymakers, managers, and organisations to consider green HRM at
the firm level by presenting factors that incentivise companies to sustain such practices.
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Appendix
Constructs/Items descriptions References
Green human resource practices
 Green job description
GAJB1. Demand for employees with environmental management
(EM) Knowledge
GAJB2. Involvement in management activities
GAJB3. Provide knowledge acquisition regarding EM
Jabbour et al. (2008), Renwick et al.
(2013), Yong et al. (2020)
 Green job recruitment
GTR1. Prefer those who have EM knowledge
GTR2. Company’s performance regarding environmental attracts
new employees
 Green selection
GS1. Selection committee prefers those who have environmental
protection knowledge
GS2. Selection procedure undertakes all environment related
questions
 Green job training
GT1. Training is providing to promote green values, knowledge and
skills to improve understanding of environmental protection
GT2. Training is considered as valuable investment in our company
 Green job assessment
GA1. Company assessment records of employees regarding
environmental performance
GA2. Individual performance scores are recorded regarding
environmental performance
GA3. Company sets green goals for employees
 Green job rewards
GR1. Publicly recognized environmental performance
GR2. Rewards in cash are provided on the basis of environmental
performance to encourage
Corporate social responsibility
(continued)
Table A1.
Item used in the
research questionnaire
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Constructs/Items descriptions References
CSR1. Our company helps community through charitable dnations
and cultural contribution
Brammer et al.(2015), El-kassar et al.
(2017), Raimi (2017)
CSR2. Our company pursues partnerships with community
organizations, government agencies and other industry groups
dedicated to social cause
CSR3. Our company follows environmental protection emergency
plans
CSR4. Our company have well defined environment responsibilities
CSR5. Our company has responsible disposal of waste and recycling
system
Environmental sustainability
ES1. Our company emphasis on airborne omission reduction Pinzone et al. (2019), Jabbour et al.
ES2. Reduction in energy consumption (2008), Saeed et al. (2018)
ES3. Hazardous material consumption reduction
ES4. Material usage reduction (Horbach, 2008)
ES5. Compliance with environmental standards is improved
ES6. New practices and suggestion is appreciated and improved to
protect environment more effectively
ES7. Employees are allowed to make decisions and solve problems
related to environmental performance Table A1.
Figure A1.
Measurement model
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About the authors
Jun Wen is the assistant Dean of School of Economics and Finance, Xian Jiaotong University. Professor
Wen Jun has several years work experience in field of applied economics, corporate finance, industrial
organization and enterprise innovation. He has published many high quality papers. Professor has
completed a number of Chinese government projects successfully and due to great contribution in
research he has been awarded with many state level honors.
Hadi Hussain is PhD research Scholar at School of Finance and Economics, Xian Jiaotong University,
China. He has teaching experience of three years in field of applied economics and two year experience in
International Consultancy Firm. His main area of interests is environmental management, CSR, labour
economics, decision making, skills mismatch, human resource and innovation economics. Hadi Hussain
is the corresponding author and can be contacted at: [email protected]
Junaid Waheed, is a PhD research Scholar at School of Finance and Economics, Xian Jiaotong
University, China. He has teaching experience of three years in field of applied economics. His main area
of interests is behavior economics, decision making, corporate decisions, corporate finance and
innovation economics.
Waheed Ali is PhD research Scholar at School of Economics and Finance, Xi’an Jiaotong University,
China. His area of research is applied economics special focus on innovation management,
environmental economics and international trade.
Ihsan Jamil is a PhD research Scholar at School of Finance and Economics, Xian Jiaotong University,
China. His area of research is applied economics, marketing and innovation.
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