Perceived Corporate Sustainability and Its Impact on Employees’ Pro-Environmental Behavior and Sustainable Innovation: The Mediating Role of Employee Engagement

Abstract

This study examined the impact of perceived corporate sustainability on employees’ pro-environmental behavior and sustainable innovation, with employee engagement serving as a mediating variable. A quantitative cross-sectional design was employed, and data were collected from 350 full-time employees across manufacturing and service organizations. Structural Equation Modeling (PLS-SEM) was used to test the hypothesized relationships. The results indicated that perceived corporate sustainability significantly influenced employee engagement (β = 0.62, p < 0.001), pro-environmental behavior (β = 0.29, p < 0.001), and sustainable innovation (β = 0.33, p < 0.001). Employee engagement significantly predicted proenvironmental behavior (β = 0.41, p < 0.001) and sustainable innovation (β = 0.46, p < 0.001). Mediation analysis confirmed partial mediation, with significant indirect effects for pro-environmental behavior (β = 0.25, p < 0.001) and sustainable innovation (β = 0.29, p < 0.001). The findings suggested that sustainability perceptions enhanced employee engagement, which in turn strengthened environmentally responsible and innovative behaviors. The study contributed to the sustainability and organizational behavior literature by demonstrating the psychological mechanism linking corporate sustainability to behavioral and innovation outcomes. Practical implications highlighted the importance of embedding sustainability into organizational strategy to foster employee commitment and long-term innovation performance.