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Article

Social and Environmental Sustainability, Workers’ Well-Being, and Affective Organizational Commitment in Palm Oil Industries

by
Sahar E-Vahdati
1,*,
Nor Azila Mohd Noor
2,
Pei Yew Mah
1,3,
Francis Chuah
2 and
Filzah Md Isa
4
1
Othman Yeop Abdullah Graduate School of Business, Universiti Utara Malaysia, Kuala Lumpur 50300, Malaysia
2
School of Business Management, Universiti Utara Malaysia, Kedah 06010, Malaysia
3
Faculty of Business and Finance, Universiti Tunku Abdul Rahman, Perak 31900, Malaysia
4
Faculty of Business and Law, Taylor’s University, Selangor 47500, Malaysia
*
Author to whom correspondence should be addressed.
Sustainability 2023, 15(12), 9514; https://doi.org/10.3390/su15129514
Submission received: 4 April 2023 / Revised: 25 April 2023 / Accepted: 3 May 2023 / Published: 13 June 2023
(This article belongs to the Section Health, Well-Being and Sustainability)
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Review Reports Versions Notes

Abstract

:
This paper examines the relationship between social and environmental sustainability and workers’ well-being as well as the mediation role of affective organizational commitment for those relationships through social exchange and stakeholder theories. A questionnaire was used to collect data from 112 workers employed in palm oil plantations in Malaysia. Structural equation modeling was then applied to examine the hypotheses. Findings show that social and environmental sustainability positively relates to workers’ well-being. We also found that affective commitment positively mediates social and environmental sustainability relationships with workers’ well-being. Our research findings have practical implications for various stakeholders, such as investors, policymakers, and managers in the palm oil industry. Our results highlight the importance of addressing the well-being of workers and the sustainability factors in palm oil plantations. This study suggests a widened perspective on sustainability factors and well-being which allows professionals to evaluate and enhance sustainability across their operations in a more comprehensive manner.

1. Introduction

In recent years, the concept of well-being has gained considerable attention globally [1], with an emphasis on satisfying human requirements such as enhanced health, work–life balance, commitment, and gender equality in the workplace [2,3]. The palm oil industry is pivotal to several nations’ economic growth and development, notably in Southeast Asia [4]. The expansion of the palm oil industry in Malaysia and Indonesia, particularly on a large scale, has been viewed as diversifying away from rubber production, promoting rural development, and alleviating poverty [5,6]. For the industry to maintain its sustainability and success, employee well-being is essential, as satisfied employees in a healthy work environment tend to be more engaged, productive, and committed to their work [7]. Focusing on employee well-being benefits individual employees and positively impacts the organization’s performance and bottom line. The labor-intensive nature of the palm oil industry has led to contentious issues such as labor shortages, forced labor, and inadequate working conditions [8,9]. To prepare for its future, Malaysia requires a sustainable approach to well-being. Unfortunately, over 60% of the forest in the Malay Peninsula and 80% of the rainforest in Sarawak have already been cleared due to various agricultural practices, mining, logging, and urbanization.
These activities have resulted in significant environmental degradation, including tree cover loss, climate change, erosion and sedimentation, floods, water cycle imbalances, and biodiversity loss [10]. Thus, improving workers’ well-being can enhance the indutry’s reputation, reduce turnover rates and increase productivity [11,12].
Given the current challenge faced by the palm oil industry to improve the well-being of its workers, the adoption of sustainable development practices can prove beneficial in fulfilling the needs of stakeholders in both the present and the future [13]. The stakeholder theory states that organizations ought to prioritize the interests of all stakeholders and establish trust with them [14]. Regarding this matter, employees and workers are considered critical stakeholder groups and their reactions to an organization’s sustainability efforts are crucial to understanding the social good generated by such initiatives [15]. Sustainability and employee well-being are interconnected in the palm oil industry. Thus, the industry must prioritize its workers’ physical and mental health and their job satisfaction to achieve long-term sustainability. These sustainable practices can help create a safer, healthier, and happier workplace for laborers, which can improve their well-being. In this vein, during the 39th Palm Oil Familiarization Programme (POFP) in 2019, the Minister of Primary Industries, Teresa Kok, stated that the Malaysian government had implemented policies to promote sustainable oil palm cultivation. One such measure is to set a limit on the total area of land that can be used for oil palm cultivation to 6.5 million hectares. It is aimed at preventing further deforestation and destruction of natural habitats and means that any additional expansion beyond this limit would not be permitted.
While economic sustainability remains essential, the palm oil industry has recognized that neglecting environmental and social factors can have significant long-term economic consequences [15,16]. For instance, environmental degradation can harm the productivity and resilience of ecosystems that are essential for the industry’s long-term viability [17,18]. Similarly, social conflicts and human rights abuses can undermine the industry’s social license to operate, potentially leading to decreased demand and economic losses [19]. Thus, stakeholders, including consumers, civil society organizations, and governments, demand a more sustainable approach to the industry, with more significant consideration for environmental and social factors. Although many companies and scholars have been implementing employee well-being and CSR initiatives to address the social and environmental factors of sustainable development in the palm oil industry (e.g., [20,21,22]), the industry has encountered more significant challenges than anticipated in resolving these underlying issues (e.g., [22,23]).
Additionally, limited attention has been devoted to the effects of sustainability in the palm oil industry from workers’ perspectives. Their job satisfaction can play a vital role in boosting corporate identity and reputation [24,25]. This study utilizes stakeholder theory to fulfil stakeholders’ requirements [24]. It expands upon the social exchange theory [26] for employees’ attitudes and behaviors in an organization by introducing additional variables that contribute to a greater understanding of employee well-being, particularly in the context of social and environmental sustainably factors in the palm oil sector. Therefore, the first objective of this study is to find whether social and environmental factors affect workers’ well-being in the Malaysian palm oil industry.
Moreover, employers face a significant challenge in fostering workers’ organizational commitment [27]. Based on the social exchange theory (SET), when an organization engages in supportive actions with its employees, it cultivates a sense of organizational commitment [28]. However, prioritizing sustainability by organizations can create a culture that values social and environmental responsibility, leading to higher levels of employee commitment. Committed workers are more engaged, productive, and satisfied with their work, ultimately promoting their well-being [29]. Therefore, the second objective of this study is to investigate the potential mediating role of organizational commitment in the association between social and environmental sustainability factors and workers’ well-being in the palm oil industry.
This study makes several contributions to the existing literature. Firstly, it addresses the call made by some previous studies, such as refs. [30,31], to expand the empirical evidence on the effects of social and environmental sustainability factors on the well-being of employees, which is crucial for their health, safety, and productivity. This is why organizations must adopt a proactive approach towards environmental issues by utilizing socially acceptable technologies and involving stakeholders in environmental management. Such actions are essential for the industry’s sustainable development and for meeting stakeholders’ expectations. Secondly, it informs the development of sustainable practices and policies that promote workers’ well-being and the industry’s sustainability. Thirdly, this is the first study to examine the mediating effect of organizational commitment on the sustainability factors and workers’ well-being in the palm oil industry. Finally, it helps build a more robust understanding of the linkages between sustainability and employee well-being, which can benefit other industries facing similar challenges. Studying the relationship between sustainable development and workers’ well-being can lead to better outcomes for workers, stakeholders, and the palm oil industry.
The remainder of this study is structured as follows: The subsequent section reviews the relevant literature and outlines the hypotheses. The study’s design is then explained, including details on the sample selection and descriptive statistics, after which the main results are presented. Finally, the discussion and conclusion are provided in the last sections.

2. Literature Review

2.1. Social Sustainability Factor and Workers’ Well-Being

Sustainable development is based on stakeholder theory and emphasizes the importance of employees, investors, customers, and other stakeholders for an organization’s long-term success [32,33,34]. Social sustainability refers to an organization prioritizing employee well-being and the broader community’s needs [35]. Balancing the needs of internal and external stakeholders is a crucial aspect of social sustainability and comprehensive sustainability programs can help fulfil the diverse needs of these stakeholders [36,37]. Such programs can contribute to the needs of local communities in palm oil areas, such as education, healthcare, and disaster relief [37,38].
The labor-intensive nature of the palm oil industry makes it a significant source of employment opportunities, particularly for the rural population. One worker is typically responsible for cultivating eight hectares of land for field and harvesting operations in oil palm estates. The palm oil industry in Malaysia heavily relies on migrant workers, mainly from Indonesia and Bangladesh, due to a shortage of local workers [38]. Interestingly, refs. [39,40] states that social impact efforts can create real value in the palm oil sector. Therefore, by investing in worker development, training, and education as part of social sustainability, this industry can increase worker satisfaction, engagement, and feelings of value, which can positively impact job performance.
Mavroulidis et al. from ref. [41] highlight the crucial role of employees in evaluating an organization’s social sustainability and states that social sustainability practices can improve workplace health and safety. Organizations that prioritize employee well-being are more likely to implement policies and programs that promote healthy behaviors, such as regular breaks, ergonomic workstations, and mental health support services [42]. This act, in turn, can reduce workplace stress, burnout, and absenteeism and decrease workplace accidents and injuries. Additionally, organizations prioritizing social sustainability are more likely to invest in employee development, training, and education. This action can make employees feel valued, engaged, and satisfied in their jobs, as they have the necessary skills and knowledge to perform their tasks effectively. As a result, job satisfaction levels are likely to increase.
The social exchange theory (SET) explains that comprehending workers’ behaviors and actions depends on their motivation to achieve a good performance outcome [26,43]. Overall, the positive relationship between social sustainability and workers’ well-being can be explained by organizations prioritizing employee well-being and investing in social sustainability practices to create a more supportive and fulfilling work environment. Thus, this may result in increased job satisfaction, improved physical and mental health outcomes, and a greater sense of dedication and allegiance to the organization. Therefore, we hypothesize as below:
H1. 
Social sustainability positively affects workers’ well-being.

2.2. Environmental Sustainability Factor and Workers’ Well-Being

Sustainability concerns, including biodiversity loss, waste, and deforestation, are rising [44]. To address these issues, refs. [45,46] emphasizes the importance of preserving the environment and improving environmental performance to promote sustainability. Environmental well-being can be categorized into nature and environment, natural resources, and climate and energy indicators [47,48]. Environmental sustainability entails the responsible management of natural resources to fulfil the current generation’s needs without jeopardizing the capacity of future generations to meet their own needs [49]. Organizations across various industries have recognized the importance of environmental sustainability due to its impact on workers’ well-being, including job satisfaction and workplace health [50].
Adopting sustainable practices in the workplace can lead to a sense of purpose and pride among employees, ultimately promoting greater job satisfaction and motivation. Sustainable practices can also directly impact workplace health by reducing sick days and improving employees’ physical health. In addition, sustainable practices can reduce stress and anxiety among employees by creating a more relaxed work environment that incorporates natural elements such as plants and natural light [51].
Several past studies have focused mainly on the environmental dimensions of the TBL as an approach to sustainability, with less focus on the organizational business aspect (e.g., [52,53]). Consequently, there has been a proliferation of the concept of sustainability in organizational research that has yet to fully capture its comprehensive nature [51]. The elements of sustainability, such as social, environmental, and economic factors, may act as motivators that impact an employee’s discretionary actions and, in turn, their well-being.
Employees who feel that their organization supports their environmental goals experience higher job satisfaction and are less likely to leave their jobs. This is because they perceive a sense of purpose, competence, and effectiveness in their work. Employees who perceive support from their organizations towards their efforts to protect the environment are more likely to experience a sense of psychological empowerment, leading to greater job satisfaction, identification with the organization, environmental commitment, and reduced intention to leave their jobs. Therefore, the palm oil industry has been scrutinized for its environmental impact and contribution to climate change ref. [54]. Incorporating sustainable practices in the palm oil industry can have a positive impact not only on the environment but also on workers’ well-being. Thus, in this paper, we test the following hypothesis:
H2. 
Environmental sustainability positively affects workers’ well-being.

2.3. Social and Environmental Sustainability, Workers’ Well-Being, and Affective Organizational Commitment as a Mediator

Organizational commitment is a crucial factor that influences various outcomes for employees and their organizations, including job satisfaction, performance, and retention [27,55,56]. Organizational commitment refers to an employee’s emotional attachment and sense of obligation to their organization [55,57,58]. Affective organizational commitment, in particular, refers to an employee’s emotional attachment and identification with their organization and has been shown to have a strong relationship with these outcomes [59,60]. Moreover, affective organizational commitment is influenced by various workplace factors such as the work environment, management, leadership style, and organizational support [29,55,58]. Organizations that can identify and address factors that could diminish affective organizational commitment can benefit from increased employee loyalty and the emergence of high-performing employees [59,60]. Affective commitment can also motivate employees to engage in behaviors that benefit the organization, such as fulfilling their job responsibilities, expanding their work scope, and improving job performance [61].
Studies have demonstrated that incorporating environmental sustainability practices in organizations can positively influence employee well-being [57,59,61]. Similarly, social sustainability, which involves creating and maintaining social systems that are equitable, resilient, and adaptable to change [62], can also have a favorable impact on employee well-being [60,61]. However, understanding the mechanisms through which these sustainability practices affect workers’ well-being is crucial.
In this regard, affective organizational commitment can mediate the relationship between environmental and social sustainability and workers’ well-being. Sustainable practices can increase workers’ commitment by fostering a sense of purpose and pride among workers [62]. Firms that adopting sustainable practices will lead employees to have a greater job satisfaction and motivation in doing their job and this will enhance their commitment on their organization [48]. Moreover, companies that prioritize environmental and social sustainability practices tend to have more positive relationships with their employees, which can lead to increased organizational commitment [58]. Sustainable practices can contribute to a healthier and safer workplace environment, reduce stress and anxiety, and promote work–life balance, ultimately enhancing workers’ well-being [63,64]. Therefore, we develop the hypotheses below and Figure 1 shows the theoretical framework of this study:
H3. 
Organizational commitment mediates the relationship between social sustainability and workers’ well-being.
H4. 
Organizational commitment mediates the relationship between environmental sustainability and workers’ well-being.

3. Research Methodology

This study examines how social and environmental sustainability factors impact workers’ well-being in Malaysia’s palm oil industry. Additionally, the study investigates the mediating role of affective organizational commitment in the relationship between these factors and workers’ well-being.
The research design for this study was quantitative and non-probability sampling, specifically convenience sampling, was used to select the participants. The selection of participants was based on accessibility and approachability. Data were collected through questionnaires distributed during personal visits to four different regions in Peninsular Malaysia, where palm oil plantations were located. A total of 300 questionnaires were distributed; 112 were returned and considered helpful for subsequent analysis, resulting in a response rate of 27 per cent, comprising 66 local employees and 46 foreigner employees. Despite a low response rate, a study conducted by ref. [65] explains that a survey with a small sample size, such as less than 500, and a response rate of 20–25% and a sample with at least 500 and a response rate of 5–10% is sufficient in providing a fairly confident estimate. The researchers explain that there is no evidence that a high response rate of 80% or higher is an optimum response rate for a survey [65]. The first possible factor of a low response rate in this study includes employees’ attitudes in answering the questions due to perception-based questions that truly represented their own thinking. The second possible factor might be due to the lack of incentives that were given to the employees; evidently, incentives boost the response rates. The survey was conducted between August 2022 and December 2022 and included palm oil plantation workers aged between 20 to 60 years old.
One set of coded structured questionnaires was created, comprising five (5) sections: profile of the participants, workers’ well-being, social and environmental sustainability, and affective organizational commitment. The questionnaire developed for the present study consisted of a total of 32 items, with 12 items measuring workers’ well-being, that is, job satisfaction adapted from ref. [64] and workplace health adapted from ref. [65]; 6 items to measure environmental sustainability adapted from ref. [64]; 6 items to measure social sustainability adapted from ref. [64]. It also enclosed six items that measured affective organizational commitment adapted from ref. [60]. The sample of items used to measure all the constructs, as mentioned above, is provided in Appendix A.
A five-point Likert-type scale ranging from “1 = strongly disagree” to “5 = strongly agree” was employed to measure workers’ well-being, affective organizational commitment, and social and environmental sustainability. The survey questionnaire was designed in both English and the national language of Malaysia (Malay). Research assistants aided in surveying the close supervision of the researchers.
Bu et al. from refs. [64,65] stated that a measure is considered reliable when it produces consistent outcomes. Therefore, reliability is widely accepted as a confirmation of the stability and consistency of the instrument [66,67]. In this study, the reliability of each instrument examined was assessed using Cronbach’s alpha value, the most commonly used method to test instrument reliability. Prior to distributing the questionnaire, a pilot test was conducted with thirty (30) local plantation workers in a small palm oil plantation in Changloon, Kedah in the northern region of Malaysia to examine the internal consistencies of the instruments using Cronbach’s alpha. Ref. [66] suggested that a reliability value between 0.70 and 0.90 is generally considered reliable. Typically, a Cronbach’s alpha coefficient is regarded as excellent if the value is more significant than 0.90, good if it is around 0.8, acceptable if the value is approximately 0.7, questionable if the value is about 0.6, and weak and intolerable if it is below 0.60 [66,67].
Referring to Table 1 below, the value of Cronbach’s alpha for organizational commitment is 0.917, demonstrating good consistency. For social and environmental sustainability, the values of Cronbach’s alpha are 0.919 and 0.912, respectively, indicating good consistency. Meanwhile, the reliability for job satisfaction and workplace health is 0.861 and 0.843, respectively. All four instruments used were regarded as reliable. In order to examine the content validity of the instruments, two experts from a public university and a manager of a palm oil plantation were involved in reviewing the questionnaire to confirm that all the items used in the instruments evaluate all aspects of the constructs that they are designed to measure. This section may be divided by subheadings. It should provide a concise and precise description of the experimental results, their interpretation, as well as the experimental conclusions that can be drawn.
To test the hypotheses, this study follows the partial least squares structural equation modeling (PLS–SEM) approach appropriate for exploratory study on total variance. The objective is to explain the relationships between exogenous and endogenous constructs. First and foremost, PLS has been confirmed effective by many researchers in exploring relationships between one or more dependent variables from a set of one or more independents [66,68]. Furthermore, PLS-SEM is a multivariate technique that permits the simultaneous evaluation of several equations. Finally, refs. [66,69] stated that PLS-SEM is able to run factor analysis and regression analysis in a single step [69,70].

4. Research Findings

4.1. Profile of Respondents

The demographic information of the 112 participants in this study is presented in Table 2. As expected, there are more male workers (84%) than female (16%) and a significant proportion of the employees fall within the age range of 31 to 40 years old, followed by 21 to 30 years old and 41 to 50 years old. Most participants are local employees (60%) and most have worked on the plantation site for 1 to 5 years. Regarding marital status, the composition of participants is quite balanced; nearly 51 per cent are married and 49 per cent are single. The majority of the participants (80%) stay in the accommodation provided by their employer and the remaining twenty per cent (20%) stay at their own accommodations.

4.2. Preliminary Analysis

We assessed the multivariate normality of our model using the WebPower tool available from www.webpower.psychstat.org/models/kurtosis, accessed on 18 March 2023. Table 3 below assesses our model’s univariate and multivariate normality. All the constructs (affective commitment, environment, job satisfaction, social, and workplace health) demonstrate univariate normality with each construct’s skewness and kurtosis value within the suggested threshold [71]. We then assessed the normality of our model using Mardia’s multivariate skewness and kurtosis [71]. The assessment yields a significant p-value on skewness and kurtosis, implying that the multivariate normality assumption of the model has not been met [71]. Partial least squares structural equation modeling is selected to analyze the data, as this technique accommodates non-normal data [71].

4.3. Assessment of First Order Reflective Measurement Model

Assessment of Reliability and Validity

Table 4 shows that all constructs demonstrate a high internal consistency, as the composite reliability (CR) values are higher than the threshold value of 0.7, ranging between 0.873 and 0.935 [66]. The average variance extracted (AVE) scores are greater than 0.50, indicating that 50% of the indicators are explained by its construct. Meanwhile, the indicator reliability shows an acceptable value of the outer loadings of its construct; however, four indicators (AC3, AC4, ENV5, ENV6) fail to meet the threshold value of 0.708 [66,70]. These indicators with lower loadings are retained because, on average, convergent validity and internal consistency have been achieved. In assessing discriminant validity, heterotrait–monotrait (HTMT) is used and presented in Table 5. The HTMT inference values (as shown in Table 5) are within the range of −1 to 1, indicating that discriminant validity is established to indicate that the constructs differ from one another [66,69]. Appendix A depicts the descriptions of the construct items.

4.4. Assessment of First Order Formative (Composite) Measurement Model

On the other hand, three stages are required to assess the composite measurement model: the collinearity issue and the significance and relevance of composite indicators. In the context of this study, there are two constructs with composite indicators, namely job satisfaction and social sustainability. The variance inflation factor (VIF) for these indicators is within the acceptable range of 1.336 to 2.95, below 3.3, according to ref. [66]. This represents that these indicators have no collinearity problem. Next, the significance and relevance weights for the composite indicators are assessed. The outer weights of the indicators are insignificant, that is, less than 0.5; however, the deletion of the composite indicators is omitted due to the relative contributions of the indicators based on the significance of the t-values above 1.645 and the significance level of less than 0.01. Thus, the criterion of assessing the collinearity issues and the significance and relevance of the outer weights, as shown in Table 6, are met.

4.5. Assessment of Second Order Measurement Model

Assessment of Formative (Composite Model) Measurement Model

Prior to assessing the structural model, the model of this study requires an assessment of the second-order construct for the composite measurement model. The construct of workers’ well-being has two dimensions, namely job satisfaction and workplace health, that better explain the construct, as illustrated in Table 7. There are two stages to pass in assessing the second-order composite construct. First, the VIF of job satisfaction and workplace health indicates no collinearity issue in which the value of VIF is lower than 5 [66]. Second, the outer weight of workplace health is significant, while job satisfaction is insignificant because the value is less than 0.5 [66]. The insignificant dimension of job satisfaction does not require deletion because the relative contribution of the t-value is significant.

4.6. Hypotheses Testing

The structural equation model will be assessed to evaluate the proposed hypotheses. The initial step is to check for any collinearity problems among the constructs. The result of VIF, depicted in Table 5, indicates that there are no issues with collinearity. The next step is to assess the path coefficient to evaluate the relationship between independent and dependent variables. All hypothesized hypotheses are significant at a 95% confidence interval (p-value < 0.05), with a t-value ranging from 2.11 to 3.107. The results indicate that all four hypotheses (H1 to H4) are supported, as shown in Table 8.
Table 9 depicts the quality of the model, specifically in assessing the R2 and f2 of the independent and dependent variables. The assessment of R2 is based on refs. [72,73,74] threshold values of the effect size. The R2 value of 0.727 represents 72.7% of the variance in the organizational commitment that can be explained by environmental and social sustainability. Following this, employee well-being accounts for 80.7% of the variance, which can be explained by environmental sustainability, social sustainability, and organizational commitment. On the other hand, the results indicate that all path relationships carry small-to-medium and medium-to-large effect sizes. In particular, organizational commitment and workers’ well-being, as well as environment sustainability and well-being, have a small-to-medium effect size of 0.141 and 0.08, respectively. In contrast, the rest have medium-to-large effect sizes, such as environmental sustainability and organizational commitment (0.233), social sustainability and organizational commitment (0.272), and social sustainability and workers’ well-being (0.231).

5. Discussion and Conclusions

This paper aims to investigate the potential impact of environmental and social sustainability factors on the well-being of workers in the palm oil industry in Malaysia. Further, we examine how mediating roles of affective organizational commitment explain the positive relationship of environmental and social sustainability with workers’ well-being in the palm oil industry of Malaysia.
Previous research has examined the effects of CSR and sustainability on organizational outcomes and employee well-being. This study contributes to the literature by focusing specifically on the well-being of workers in the palm oil industry, which faces challenges in addressing social and environmental sustainability issues [23,75]. Given the demanding and labor-intensive nature of the industry, workers’ well-being is of great importance, as they are more likely to experience stressful situations [62].
Our findings demonstrate that social sustainability is positively associated with workers’ well-being. It encompasses the social aspects of the workplace, including fair treatment, respect, and inclusion, which can lead to higher levels of job satisfaction, stronger relationships with colleagues and supervisors, and a sense of belonging [41]. These social factors can contribute to workers’ well-being by reducing stress levels, improving mental health outcomes, and increasing motivation and engagement at work [45,50]. When workers feel that they are valued and supported by their organization, they are more likely to have positive attitudes towards their work, which can translate into better physical and mental health outcomes. This correlation can be clarified by the social exchange theory, which proposes that workers are incentivized to excel in their work when they believe their organization respects and appreciates them [28]. Our findings are consistent with previous research showing that investing in social sustainability practices and prioritizing employee well-being can create a supportive and fulfilling work environment (e.g., [43,44,45]).
In addition, our study reveals that the palm oil industry has been scrutinized for its impact on the environment and its contribution to climate change. We find that the environmental sustainability factor positively impacts workers’ well-being. When organizations focus on environmental sustainability, it can create a healthier and safer work environment for workers [53]. Additionally, an environmentally sustainable workplace can promote a sense of pride and purpose among workers, who may feel more connected to the organization’s values and mission. This positive impact on workers’ well-being is supported by previous research findings [50,52,56].
Our study also finds that affective organizational commitment mediates the relationships between social and environmental sustainability and workers’ well-being. These findings suggest that an organization’s involvement in social and environmental initiatives, such as sustainability practices, can improve workers’ well-being by strengthening their emotional connection to the organization. It helps to explain how the positive effects of sustainability practices can be translated into improved well-being for workers. By understanding the mediating role of affective organizational commitment, organizations can design interventions that not only promote sustainability but also enhance the well-being of their employees. This finding aligns with earlier research that has demonstrated a positive association between having a meaningful work purpose and employees’ commitment to the organization [76]. Specifically, employees who derive a sense of pride from working for a socially responsible organization are more likely to form a strong emotional bond with their employer, resulting in higher levels of well-being. This result is consistent with the previous literature that has identified affective commitment as a vital contributor to employee well-being [76,77]. By adopting sustainable practices, employees can feel they are contributing to a greater good and are part of a larger mission, resulting in greater job satisfaction and motivation to work hard. Affective commitment to an organization has been shown to increase the likelihood of workers continuing to work towards the organization’s goals [21], which can ultimately enhance well-being.
Previous studies have mainly focused on CSR reports and activities in the palm oil industry (e.g., [24,25]). This study breaks new ground by examining social and environmental sustainability approaches, workers’ well-being (including workplace health and job satisfaction), and organizational commitment variables within the social exchange theory in the Malaysian palm oil industry context. The findings of this study will significantly benefit academics by expanding our understanding of Malaysian palm oil plantation organizations’ perceptions of the role of sustainability (particularly in environmental and social dimensions) as a long-term strategy that can help develop intangible assets such as long-term performance and reputations. Moreover, this study sheds light on the indirect role of affective organizational commitment in promoting workers’ well-being by enhancing sustainability practices. As such, this pioneering study offers new perspectives and empirical evidence that can inform policymakers and practitioners about the potential benefits of sustainable practices for promoting workers’ well-being in the palm oil industry.
The findings of our study have significant implications, particularly for stakeholders such as consumer goods manufacturers and retailers interested in making investment decisions in the palm oil sector. Our research provides valuable information regarding the effects of sustainability practices on employee/worker well-being, which can inform these stakeholders’ decision-making processes. By considering the impact of sustainability practices on workers’ well-being, investors and analysts can make more informed and responsible investment decisions that align with their values and social responsibility objectives. Moreover, the finding can reduce shareholders’ uncertainty regarding the palm oil sector’s future sustainability practices. Due to their significance in the agricultural industry, palm oil plantation companies face labor shortage issues, while contributing significantly to Malaysia’s GDP [40,78,79]. Therefore, our research findings can provide valuable information to policymakers and the government, such as the ministry of primary industries, in both developed and developing countries to predict the future of employees’ well-being in Malaysia. This includes an explicit policy on employees’ workplace health, such as training in relation to organizational health, safety (i.e., necessary precautions while working in the plantation, working conditions, no discrimination policy, pay-related matters), and knowledge about their workplace. However, the palm oil industry encounters complex challenges such as deforestation, loss of biodiversity, human rights violations, and climate change, which require the transformation of the entire industry. This transformation necessitates the collaboration of all plantation companies and stakeholders committed to addressing these sustainability issues. By collaborating in this manner, employees’ commitment to their work in the plantation will be strengthened and their overall well-being will be improved. Thus, when employees take pride in their work at the plantation site, they experience a sense of comfort and willingness to contribute, leading to increased loyalty and a stronger desire to remain at the plantation site.
This study has some limitations that highlight areas for future research. Specifically, the study focuses solely on the sustainability of environmental and social dimensions, which are critical in the palm oil industry. However, future studies could benefit from a more comprehensive three-dimensional approach that covers all aspects of corporate operation sustainability. This would provide a more precise evaluation of progress towards sustainability and enable companies to develop more effective strategies for achieving sustainable outcomes. Extending the empirical models to other palm oil-producing countries, such as Indonesia, Thailand, Colombia, and Nigeria, would be valuable for future research. The study’s findings suggest that investors and regulators in Malaysia should consider the distinct impacts of social and environmental sustainability factors on the well-being of employees and workers when making investment decisions.

Author Contributions

Conceptualization, S.E.-V. and N.A.M.N.; Methodology, S.E.-V. and P.Y.M.; Software, P.Y.M.; Validation, N.A.M.N.; Formal analysis, F.C.; Resources, F.C.; Data curation, P.Y.M.; Writing—original draft S.E.-V.; Writing—review & editing, F.M.I. All authors have read and agreed to the published version of the manuscript.

Funding

This paper was supported and funded by the Ministry of Higher Education (MOHE) Malaysia through Fundamental Research Grant Scheme (FRGS/1/2020/SS01/UUM/02/8) with project ID (18452), and SO Code:14841.

Data Availability Statement

Not applicable.

Acknowledgments

During our project, we acknowledge all support funded by the Ministry of Higher Education (MOHE) Malaysia through the Fundamental Research Grant Scheme.

Conflicts of Interest

The authors declare no conflict of interest.

Appendix A

Construct and SourcesItemsMeasurement Items
Job Satisfaction [63]JS1I am satisfied with my pay.
JS2I enjoy communicating with my friends at work.
JS3I have enough time for work and other things in my life.
JS4I feel appreciated working in the plantation site.
JS5People at my workplace respect me.
JS6I feel comfortable working in this plantation.
Workplace Health [63]WH1I understand about health and safety at this plantation.
WH2I have the knowledge about health and safety at this plantation.
WH3I know how to perform my job in a safe manner.
WH4If there is health or safety hazard at my workplace, I know who I would report it to.
WH5I know the necessary precautions that I should take while doing my job.
WH6I am free to give suggestions about workplace health and safety at this plantation.
Environmental Sustainability [63]ENV1This plantation provides good environmental condition.
ENV2This plantation protects from environmental degradation.
ENV3This plantation gives priority on environment.
ENV4This plantation constantly revisiting its environmental practices to suit current needs.
ENV5I am willing to sacrifice part of my salary to keep the environment at this plantation.
ENV6I am ready to contribute to the environmental protection activities that benefit the society.
Social Sustainability [63]SOC1The management minimizes the risk of accidents at this plantation.
SOC2This plantation provides training to its employees.
SOC3The management provides equal treatment to all employees.
SOC4The management respects human rights.
SOC5The management cares on local communities.
SOC6I am willing to sacrifice part of my salary to meet my social obligation.
Organizational Commitment [57]OC1I am happy spending my time working in this plantation.
OC2I am proud to work at this plantation.
OC3I feel that the plantation’s problems are my own problems.
OC4I will not work at other plantation.
OC5People who work at this plantation are like my family member.
OC6I feel sad to leave this plantation.

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Sustainability 15 09514 g001 550
Figure 1. Theoretical framework.
Figure 1. Theoretical framework.
Sustainability 15 09514 g001
Table
Table 1. Reliability Analysis Result.
Table 1. Reliability Analysis Result.
VariableCronbach’s Alpha (α)
Job Satisfaction (6 items)0.861
Workplace Health (6 items)0.843
Social Sustainability (6 items)0.919
Environmental Sustainability (6 items)0.912
Organizational Commitment (6 items)0.917
Table
Table 2. Demographic profile.
Table 2. Demographic profile.
Variable CountPercentage
GenderMale9416.1
Female1883.9
AgeLess than 20 years old32.7
21–30 years old2925.9
31–40 years old4641.1
41–50 years old2522.3
51 years old and above98.0
NationalitiesLocal6658.9
Foreigner4641.1
Years of working in siteLess than 1 year1332.1
1–5 years4540.2
6 -10 years3632.1
11 years and above1816.1
Table
Table 3. Output of Skewness and Kurtosis Calculation.
Table 3. Output of Skewness and Kurtosis Calculation.
Univariate Skewness and Kurtosis
SkewnessSE_skewZ_skewKurtosisSE_kurtZ_kurt
Case. ID0.0000.2280.000−1.2000.453−2.648
Organizational Commitment−0.3800.228−1.666−0.7550.453−1.666
Environmental Sustainability−0.5100.228−2.234−0.7300.453−1.612
Job Satisfaction−0.6640.228−2.908−0.6370.453−1.406
Social Sustainability−0.5920.228−0.592−0.6300.453−1.390
Workplace Health−0.7000.228−3.064−0.6250.453−1.379
Mardia’s Multivariate Skewness and Kurtosis
bzp-value
Skewness9.697368181.0184.33 × 10−15
Kurtosis58.125135.468204.55 × 10−8
Table
Table 4. Assessment of Reliability and Convergent Validity.
Table 4. Assessment of Reliability and Convergent Validity.
ConstructsItemsLoadingsCRAVE
Organizational CommitmentOC10.7130.8730.537
OC20.817
OC30.596
OC40.68
OC50.847
OC60.714
Environmental SustainabilityENV10.8120.8980.598
ENV20.841
ENV30.829
ENV40.864
ENV50.554
ENV60.695
Workplace HealthWH10.8220.9350.706
WH20.859
WH30.853
WH40.839
WH50.864
WH60.804
Table
Table 5. Assessment of HTMT.
Table 5. Assessment of HTMT.
OCENVWH
Organizational Commitment (OC)---
Environment Sustainability (ENV)0.945--
Workplace Health (WH)0.9080.871-
Criteria: HTMT inference (−1 < HTMT < 1).
Table
Table 6. Assessment of the Level of Collinearity Issue and Significance and Relevance of Outer Weights.
Table 6. Assessment of the Level of Collinearity Issue and Significance and Relevance of Outer Weights.
VIFOuter WeightsT-Value WeightsSignificance
JS11.8890.15311.22 *0.00
JS22.950.26214.19 *0.00
JS31.8920.0648.61 *0.00
JS42.5430.04511.27 *0.00
JS52.0790.38513.26 *0.00
JS62.8640.3114.78 *0.00
SOC11.990.28614.64 *0.00
SOC22.060.07913.82 *0.00
SOC32.4120.13715.47 *0.00
SOC41.9880.35613.68 *0.00
SOC52.3870.3412.56 *0.00
SOC61.3360.0744.72 *0.00
Note: * p < 0.01.
Table
Table 7. Assessment of the Level of Collinearity Issue and Significance and Relevance of Outer Weights.
Table 7. Assessment of the Level of Collinearity Issue and Significance and Relevance of Outer Weights.
ConstructDimensionVIFWeightsT-Value WeightsSignificance
Workers’ Well-BeingJob Satisfaction3.8690.4384.14 *0.00
Workplace Health3.8690.5975.91 *0.00
Note: * >1.645
Table
Table 8. Path Coefficient Assessment.
Table 8. Path Coefficient Assessment.
HypothesisStandard Beta (β)T-Valuep-ValueResult
H1Environment Sustainability -> Workers’ Well-Being0.2442.11 *0.035Supported
H2Social Sustainability -> Workers’ Well-Being0.3513.107 *0.002Supported
H3Environment Sustainability -> Organizational Commitment -> Workers’ Well-Being0.1543.048 *0.002Supported
H4Social Sustainability -> Organizational Commitment -> Workers’ Well-Being0.1623.065 *0.002Supported
Note: * p < 0.01.
Table
Table 9. The Determination of Coefficient (R2) and Effect Size (f2).
Table 9. The Determination of Coefficient (R2) and Effect Size (f2).
Coefficient of Determination (R2)Effect Size (f2)
R2Organizational CommitmentEffect SizeWorkers’ Well-BeingEffect Size
Organizational Commitment0.727 0.141Small to Medium
Workers’ Well-Being0.807
Environmental Sustainability 0.233Medium to Large0.08Small to Medium
Social Sustainability 0.272Medium to Large0.231Medium to Large
Note: for interpretation of effect size, Cohen (1988) [72] suggests the following: (0.02) small effect size, 0.15 medium effect size, 0.35 large effect size.
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E-Vahdati, S.; Noor, N.A.M.; Mah, P.Y.; Chuah, F.; Md Isa, F. Social and Environmental Sustainability, Workers’ Well-Being, and Affective Organizational Commitment in Palm Oil Industries. Sustainability 2023, 15, 9514. https://doi.org/10.3390/su15129514

AMA Style

E-Vahdati S, Noor NAM, Mah PY, Chuah F, Md Isa F. Social and Environmental Sustainability, Workers’ Well-Being, and Affective Organizational Commitment in Palm Oil Industries. Sustainability. 2023; 15(12):9514. https://doi.org/10.3390/su15129514

Chicago/Turabian Style

E-Vahdati, Sahar, Nor Azila Mohd Noor, Pei Yew Mah, Francis Chuah, and Filzah Md Isa. 2023. "Social and Environmental Sustainability, Workers’ Well-Being, and Affective Organizational Commitment in Palm Oil Industries" Sustainability 15, no. 12: 9514. https://doi.org/10.3390/su15129514

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