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Study Protocol

The Mediating Role of Employee Perceived Value in the ESG–Sustainability Link: Evidence from Taiwan’s Green Hotel Industry

by
Chang-Yan Lee
1,*,
Wei-Shang Fan
1 and
Ming-Chun Tsai
2
1
Department of Business Administration, Nanhua University, Chiayi County 622301, Taiwan
2
Department of Business Administration, Ling Tung University of Science and Technology, Taichung City 408, Taiwan
*
Author to whom correspondence should be addressed.
Tour. Hosp. 2025, 6(3), 153; https://doi.org/10.3390/tourhosp6030153
Submission received: 24 June 2025 / Revised: 21 July 2025 / Accepted: 6 August 2025 / Published: 13 August 2025
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Abstract

Prior studies have generally confirmed that Environmental, Social, and Governance (ESG) practices have a positive impact on perceived value and sustainability performance. However, empirical research examining the mediating role of employee-perceived value in the relationship between ESG and sustainability performance from the perspective of internal stakeholders remains limited. To address this gap, this study aims to understand the relationship among ESG, employee-perceived value, and sustainable management in green hotels in southern Taiwan. Using a convenience sampling method, 277 valid questionnaires were collected and analyzed through Structural Equation Modeling (SEM). The results show that ESG practices have significant positive effects on both employee-perceived value and sustainability performance, with perceived value partially mediating the relationship between the two, highlighting the critical role employees play in promoting sustainable management. Based on the empirical findings, it is recommended that companies strengthen internal ESG communication and education to ensure that employees understand ESG goals and outcomes and integrate them into daily work. Employee-centered participation programs, such as green innovation contests and community carbon reduction activities, should be designed to enhance emotional value and organizational identification. Companies should internalize ESG principles into corporate culture and management processes, reinforcing sustainable behaviors through performance appraisals, leadership modeling, and continuous dialogue. Finally, ESG should be positioned as a core strategy aligned with long-term corporate objectives, enhancing employee commitment and creating competitive advantages that attract support from customers and stakeholders.

1. Introduction

The concept of green hotels originated in the early 1990s with the establishment of the International Hotels Environment Initiative (IHEI), a collaboration among 12 global hotel chains in Germany aimed at promoting environmental practices in hospitality (Hart, 1993). Following this, countries such as Denmark, Canada, and the United States introduced green hotel certification systems, responding to rising consumer awareness of environmental issues (Sun et al., 2006). In Taiwan, the Environmental Protection Administration launched the Green Hotel Certification Program in 2008, encouraging hotels to implement measures such as energy conservation, hazardous substance management, water-saving initiatives, reduction in single-use products, and waste recycling to enhance international competitiveness (Chang & Liu, 2010).
The integration of sustainability into corporate strategies accelerated after the United Nations’ 1999 endorsement of Corporate Social Responsibility (CSR), which emphasized balancing profitability with social responsibility. The “Who Cares Wins” report in 2004 further expanded CSR into the Environmental, Social, and Governance (ESG) framework, introducing three measurable dimensions. By 2015, the United Nations Sustainable Development Goals (SDGs) reinforced this framework with 17 global objectives targeting economic, environmental, and social sustainability.
Despite the widespread adoption of ESG, its implementation presents several challenges. First, ESG performance measurement remains uncertain due to the lack of standardized and transparent evaluation criteria, complicating both assessment and disclosure. Second, organizations must balance diverse stakeholder expectations, which often creates conflicts between short-term financial returns and long-term sustainability. Third, the risk of greenwashing persists, where companies exaggerate ESG commitments without substantive action, undermining market trust and slowing ESG progress (Turban & Greening, 1997; Stubbs & Rogers, 2013; Zampone et al., 2023).
In the hospitality sector, these challenges are particularly evident. Green hotels often face higher operational costs and longer return on investment periods, raising concerns about long-term viability (Bradley, 2020; Merli et al., 2019). Nevertheless, growing consumer awareness has shifted market preferences toward sustainable hotels. Research indicates that when consumers actively seek green products or services, their perceived value increases, leading to greater support for sustainable brands (Oriade et al., 2020; Roberts, 1996). ESG practices have also been linked to improved financial performance and competitive advantage (Barber et al., 2021; Graci & Dodds, 2008; Jeong et al., 2018; King & Lenox, 2001; Korstanje, 2020).
Recent reports emphasize this trend. CBRE (2023) highlights increasing investor and consumer pressure on hotels to reduce their carbon footprints, while KPMG (2024) underscores the expectation for hospitality businesses to offer sustainable options. Qing and Jin (2023) further confirm that ESG activities are crucial for advancing corporate sustainability. Although prior studies have extensively examined ESG’s relationship with corporate sustainability and financial performance, the internal stakeholder perspective—especially employees—has received limited attention (N. H. Lin & Wu, 2019; H. C. Lin & Su, 2024). Employees are not merely executors of ESG policies but also co-creators of customer experience and organizational culture that reflect ESG values (Vargo & Lusch, 2004).
Empirical evidence has confirmed positive relationships between ESG and sustainability performance, as well as between ESG and perceived value. For example, Chen et al. (2024) found that employees of A-share listed companies in Shanghai and Shenzhen perceive ESG implementation as a driver of both innovation and sustainability development. Similarly, Barbosa et al. (2025) reported that employees in Brazil’s electricity sector perceive corporate sustainability performance to improve following ESG adoption. Regarding perceived value, Panyagometh and Bian (2023) found that consumers link ESG engagement to higher perceived value, which mediates the relationship between ESG practices and purchase intention. Seok et al. (2024) also demonstrated that ESG enhances corporate value and sustainability, with perceived value playing a key mediating role.
However, few studies have explicitly examined how ESG influences employee-perceived value and how this perception affects sustainability performance. To address this gap, this study investigates the relationships among ESG practices, employee-perceived value, and sustainability performance in Taiwan’s green hotel industry. Specifically, this research explores whether ESG practices enhance perceived value, whether ESG directly affects sustainability performance, whether perceived value contributes to sustainability outcomes, and whether perceived value mediates the ESG–sustainability relationship.

2. Literature Review

2.1. The Impact of ESG Practices on Employee Perceived Value

Environmental, Social, and Governance (ESG) practices have evolved from the foundations of Corporate Social Responsibility (CSR), shifting the focus from voluntary philanthropy to measurable accountability in Environmental, Social, and Governance performance (Eccles et al., 2018; Gerard, 2019). As sustainability becomes an integral part of corporate strategy, stakeholder expectations have broadened, placing greater emphasis on ethical conduct and social impact (Liang et al., 2022; Lichtenstein et al., 2004).
While much of the existing ESG literature has centered on consumer perspectives, prior studies suggest that customers’ emotional value perceptions vary significantly based on the level of a company’s ESG engagement, particularly in relation to social initiatives (Currás-Pérez et al., 2018). Koh et al. (2002) further highlight that consumers’ perceived value is directly shaped by corporate investments in social and governance dimensions. In a similar vein, Damais and Weaver (2023) advocate for integrating ESG principles into customer experience management, suggesting that exceeding customer expectations through sustainable practices can strengthen brand commitment and enhance perceived value.
Recent research also indicates that ESG practices influence not only external stakeholders but also internal stakeholders, particularly when such initiatives align with organizational values (Becker-Olsen et al., 2006; Chong & Verma, 2013). In the hospitality industry, employees are not passive implementers of corporate policies; rather, they are active co-creators of service value and customer experience (Vargo & Lusch, 2004).
Despite these insights, prior studies have predominantly focused on ESG’s impact at the organizational level—such as investment value, earnings per share, and financial performance—or on the individual level from the consumer’s perspective. There remains a notable gap in understanding how internal employees perceive and respond to ESG initiatives, particularly in terms of how these practices reshape employees’ perceived value.
The existing literature suggests that companies committed to ESG and CSR not only gain external customer loyalty and investor trust but also foster greater support from employees and local communities, thereby promoting long-term sustainable development (H. C. Lin & Su, 2024). Against this backdrop, the present study aims to address this gap by investigating how ESG practices—specifically in the domains of environmental protection, social responsibility, and corporate governance—influence employees’ perceived value in the hospitality sector. This research focuses on understanding how internal employees cognitively and emotionally process ESG activities and how these perceptions ultimately relate to organizational sustainability outcomes.
H1. 
ESG has a significant positive effect on perceived value.

2.2. The Impact of ESG Factors on Corporate Sustainability in the Hospitality Sector

The hospitality industry, while economically significant, has long faced criticism for its environmental impact due to excessive resource consumption and waste generation (Bao et al., 2019). In response, integrating Environmental, Social, and Governance (ESG) factors into corporate strategy has become a critical approach to mitigating environmental burdens, fostering social inclusion, and promoting transparent governance, thereby advancing sustainable business operations. Many hotels have adopted ESG-driven practices such as renewable energy adoption, green procurement, and the development of sustainable facilities to align with global sustainability targets (Marco, 2024; Velaoras et al., 2025).
To support this transition, frameworks like the Triple Bottom Line (Elkington, 1997) and the Sustainable Balanced Scorecard (Figge et al., 2002; Epstein & Wisner, 2001) have been developed to integrate financial and non-financial performance indicators, enabling holistic evaluation of sustainability outcomes (Möller & Schaltegger, 2005; Bieker & Waxenberger, 2002). Schmidt-Bleek et al. (2009) further proposed that organizations adopting a balanced focus on economic, environmental, and social objectives tend to utilize resources more responsibly to meet both ecological and societal demands. This strategic shift often leads to greater consumer support, as customers are more inclined to endorse companies that transition toward sustainable business models (Chan, 2015; Namkung & Jang, 2007).
The emergence of the Sustainable Balanced Scorecard has advanced this approach by embedding environmental concerns within market strategies and corporate development metrics. This model incorporates five key dimensions—sustainability, financial performance, customer orientation, internal process optimization, and organizational learning and growth—offering a comprehensive tool for assessing sustainable management (Figge et al., 2002; Nikolaou et al., 2013).
In Taiwan, however, ESG promotion in the hospitality sector remains uneven due to regulatory immaturity and gaps in industry awareness and professional capacity (Liu et al., 2023). Nevertheless, with the global rise of green tourism, Taiwan’s hospitality industry can enhance customer trust, brand equity, and international competitiveness by actively adopting ESG measures such as energy efficiency, carbon reduction, ethical sourcing, community engagement, and transparent governance practices (Nikolaou et al., 2013). Moreover, the participation of internal employees is crucial for ESG implementation success. When employees identify with the organization’s sustainability vision, it not only strengthens internal cohesion but also improves service quality and ultimately enhances customer value and sustainability performance (H. C. Lin & Su, 2024).
H2. 
ESG has a significant positive effect on sustainability performance.

2.3. Linking Perceived Value to Sustainable Business Performance

Perceived value plays a pivotal role in the service industry by influencing stakeholder loyalty and driving long-term business performance. As organizations transition toward ESG-aligned operational models, perceived value becomes a strategic mechanism for communicating corporate purpose and authentic commitment to sustainability (Challagalla & Daisace, 2022; Laukkanen & Tura, 2022).
According to KPMG (2024), achieving sustainable business value requires companies to deliver exceptional experiences for both internal and external stakeholders while simultaneously creating strong perceived value. In this context, perceived value is not merely an outcome but a strategic differentiator, essential for fostering stakeholder loyalty and sustaining long-term business growth.
When employees perceive emotional, ethical, or functional value in their organization’s sustainability efforts, they are more likely to support strategic objectives and contribute to improved operational performance (Sairanen et al., 2024). This is particularly relevant in the hospitality sector, where employee engagement directly influences service quality, customer satisfaction, and overall sustainability outcomes.
Although prior research has primarily emphasized consumers’ value perceptions, the internal perspective is equally critical. Employees who perceive ESG initiatives as meaningful are more inclined to align their behaviors with corporate sustainability goals, thereby reinforcing organizational efforts toward long-term sustainable performance (N. H. Lin & Wu, 2019; H. C. Lin & Su, 2024).
H3. 
Perceived value has a significant positive effect on sustainability performance.

2.4. The Mediating Role of Perceived Value

Prior research has established that ESG practices positively influence both perceived value and sustainability performance (Currás-Pérez et al., 2018; Koh et al., 2002). However, limited empirical work has explored the role of perceived value as a mediating mechanism through which ESG efforts translate into tangible sustainability outcomes.
According to the Global Sustainable Tourism Council (2024), the Taiwan Tourism Administration is actively promoting the “Guidelines for Subsidies to Enhance the Quality of Accommodation Services,” emphasizing green, sustainable, energy-saving, and carbon reduction goals. This initiative encourages hotels to pursue GSTC certification, directly aligning with ESG practices and representing a concrete demonstration of the hospitality industry’s commitment to sustainability.
Achieving organizational sustainability requires more than managerial intention; it depends on how stakeholders—particularly employees—interpret and internalize ESG values (Zheng et al., 2022). When employees perceive significant emotional, social, or functional value from ESG initiatives, they are more likely to actively contribute to sustainability practices (Laukkanen & Tura, 2022).
ESG implementation—such as energy conservation, carbon reduction, employee well-being, and ethical governance—enhances both internal and external stakeholders’ emotional, functional, and ethical value perceptions. Employees, in particular, are more likely to view the organization as prioritizing environmental and social responsibilities alongside profitability, which fosters more positive evaluations and strengthens organizational commitment.
This study proposes that ESG practices can improve sustainability performance by enhancing employees’ perceived value, thereby creating a relational pathway between ESG efforts and sustainable outcomes. While prior research has seldom examined this triadic relationship in the green hotel context, the present study extends the existing literature by empirically testing the mediating role of perceived value in the ESG–sustainability performance link within Taiwan’s green hospitality sector.
H4. 
Perceived value mediates the relationship between ESG and sustainability performance.

3. Research Methods

3.1. Conceptual Framework

This study investigates the influence of Environmental, Social, and Governance (ESG) factors on perceived value and corporate sustainability from the perspective of internal employees in green hotels. Specifically, it examines whether the three ESG dimensions—environmental protection, social responsibility, and corporate governance—individually affect six dimensions of perceived value: functional value (quality), functional value (price), social value, emotional value, conditional value, and epistemic value. In turn, these perceived value components are hypothesized to influence five dimensions of sustainability performance: environmental sustainability, financial performance, customer orientation, internal process optimization, and organizational learning and growth.
Furthermore, this study explores whether perceived value serves as a mediating mechanism in the relationship between ESG practices and sustainable business performance. By focusing on internal employees—who are both strategic executors and value co-creators—this study aims to provide a more nuanced understanding of how ESG strategies translate into sustainability outcomes within the hospitality sector. The conceptual framework is illustrated in Figure 1.
While this study proposes and tests structural hypotheses (H1–H4) based on the overall constructs of ESG, perceived value, and sustainability performance, each construct is further operationalized through multiple subdimensions to enhance measurement precision. Specifically, perceived value comprises six subdimensions (e.g., emotional, functional, social), and sustainability performance comprises five (e.g., customer orientation, learning, growth). These subdimensions are not individually hypothesized but serve to reflect the latent variables more comprehensively in the structural equation model.

3.2. Research Participants and Sampling Design

Due to limitations in manpower, resources, and time, this study adopted a convenience sampling method, targeting employees of green hotels located in three counties in southern Taiwan. The selection of green hotel samples was based on the listings from the Environmental Protection Administration’s “Net Zero Green Life Information Platform,” which includes hotels that have received the “Eco-Hotel” designation, the “Green Mark” certification, or have participated in the government-promoted “Six Major Environmental Hotel Initiatives.” The sampled hotels also include three-star to five-star tourist hotels that have been awarded gold, silver, or bronze levels in these environmental programs. Data were collected through an online survey distributed via a Google Forms link embedded in a QR code. Participants were invited to complete the questionnaire through various channels, including email, Facebook, Line, telephone outreach, and in-person visits.
The data collection period for this study was from 1 March to 30 April 2024. A total of 300 questionnaires were collected. After excluding responses with uniform answers or those where the respondents were unsure whether their company implemented ESG practices, 277 valid responses remained, resulting in an effective response rate of 92.3%.

3.3. Questionnaire Design

The measurement instruments used in this study were adapted from validated scales developed by prior scholars and aligned with established sustainability and ESG guidelines.
The ESG scale was based on the ESG Evaluation Indicators for the Hotel Industry developed by Lue (2023), which integrates standards from Taiwan’s Financial Supervisory Commission (FSC), the United Nations Sustainable Development Goals (SDGs), the Global Reporting Initiative (GRI), and the Sustainability Accounting Standards Board (SASB), as well as indicators from international hotel chains and leading hotel groups in Taiwan. The scale comprises three major dimensions: environmental protection (e.g., use of products compliant with carbon footprint labeling standards), social responsibility (e.g., hiring of local residents with increasing ratios over time), and corporate governance (e.g., offering diversified products that contribute to local economic development), with a total of 62 items.
The perceived value scale used in this study was adapted from P. C. Lin and Huang (2012), categorizing value into six dimensions: functional value–quality (e.g., green products and services are consistently high in quality), functional value–price (e.g., the price of green products and services is reasonable), social value (e.g., the company’s green products and services make me feel satisfied), emotional value (e.g., using the company’s green products and services makes me feel morally right), conditional value (e.g., I choose green products and services when the environment worsens), and epistemic value (e.g., I seek a lot of information before using the company’s green products and services), for a total of 23 items.
The corporate sustainability scale used in this study was adapted from the Sustainable Balanced Scorecard developed by Tseng (2017), covering five dimensions: environmental sustainability, financial performance, customer orientation, internal processes, and organizational learning and growth, for a total of 18 items.
All questionnaire items were measured using a five-point Likert scale ranging from one (strongly disagree) to five (strongly agree). While the original instruments have demonstrated content validity in previous studies, item wording was slightly modified to suit the context of this study. To ensure expert validity, the revised items were reviewed and refined by academic experts in the fields of ESG, hospitality management, and sustainability assessment.

3.4. Statistical Analysis Method

This study employed Structural Equation Modeling (SEM) to test the proposed hypotheses and assess overall model fit. SEM allows simultaneous analysis of latent constructs and their interrelationships, integrating measurement and structural components in a unified framework. A two-step approach was used: (1) confirmatory factor analysis (CFA) to evaluate the reliability and validity of the measurement model and (2) structural model estimation to test the hypothesized paths.
To enhance model parsimony and estimation stability, an item parceling method was applied. Items within each first-order construct were grouped into parcels using the average-score method, based on conceptual coherence and psychometric consistency. In total, 13 parcels were formed: six for ESG (two per subdimension), three for Perceived Value, and four for Sustainability Performance. This approach reduced model complexity, improved estimation efficiency, and enhanced the interpretability of the structural paths (Little et al., 2013).
CFA results confirmed high internal reliability and unidimensionality, supporting the use of parceling. Convergent validity was demonstrated by standardized factor loadings exceeding 0.50 and AVE values above 0.50. Discriminant validity was established as the square root of AVE for each construct exceeded the corresponding inter-construct correlations.
Model fit was assessed using absolute (χ2/df, GFI, AGFI, RMR, RMSEA), incremental (NFI, NNFI/TLI, IFI, CFI), and parsimony (PGFI, PNFI) fit indices. Based on standard benchmarks (e.g., CFI and TLI > 0.90; RMSEA < 0.08), both the measurement and structural models showed acceptable fit, supporting the robustness of the proposed framework.
The final SEM model included three second-order latent constructs: ESG (Environmental Protection, Social Responsibility, Corporate Governance), Perceived Value (Functional Value–Quality, Functional Value–Price, Emotional Value, Social Value, Conditional Value, Epistemic Value), and Sustainability Performance (Environmental Sustainability, Financial Performance, Customer Orientation, Internal Processes, Learning and Growth). This analytical strategy provided a clear and efficient examination of the structural relationships in the green hospitality context.

4. Results and Analysis

4.1. Descriptive Statistical Analysis

The demographic profile of the respondents is summarized as follows: the majority were male, accounting for 57.0%, followed by females. In terms of age distribution, the largest group was 46 to 55 years old, comprising 44.4%, followed by those aged 56 and above, 26 to 35, 36 to 45, and 25 and below. Regarding education level, most respondents had completed college or university (61.0%), followed by high school or vocational school, and then postgraduate degrees. In terms of job positions, senior managers constituted the largest group at 31.8%, followed by general staff, first-line supervisors, and middle managers. Regarding marital status, married respondents accounted for 55.6%, followed by unmarried individuals (including divorced or widowed). For monthly income, the largest group earned NT50,001 or more, making up 51.3%, followed by those earning NT30,001–40,000, NT40,001–50,000, and NT30,000 or less.
As for the ESG construct, the average scores for all items ranged between M = 4.02 and 4.18. Among the three ESG dimensions, Social Responsibility had the highest mean (M = 4.18; SD = 0.571), while Corporate Governance showed the lowest (M = 4.02; SD = 0.582). Regarding Perceived Value, the overall item means ranged from M = 4.18 to 4.43. Emotional Value was the most highly rated dimension (M = 4.43; SD = 0.577), whereas Epistemic Value had the lowest mean (M = 4.18; SD = 0.558). For Sustainability Performance, the items’ means ranged from M = 4.12 to 4.36. The Customer dimension scored the highest (M = 4.36; SD = 0.539), while the Financial dimension scored the lowest (M = 4.12; SD = 0.643).
In summary, internal employees of green hotels located in three counties in southern Taiwan perceived Social Responsibility as the most prominent ESG initiative implemented by their organizations. Their perceptions also reflected a strong sense of Emotional Value, which may contribute to positive sustainability outcomes, particularly in terms of repeat customer visits and loyalty.

4.2. Reliability and Validity Analysis

This study conducted a confirmatory factor analysis (CFA) to evaluate the reliability and validity of the measurement models for the three primary latent constructs: Environmental, Social, and Governance (ESG), Perceived Value, and Sustainability Performance. Given the multidimensional nature of the constructs and the use of a parceling approach, measurement quality was assessed based on parcel-level indicators and construct-level statistics.
First, item parceling was implemented to enhance model parsimony and reduce estimation complexity. Parcels were created by aggregating items within conceptually coherent subdimensions using the average-score method. In total, 13 item parcels were generated: six for ESG (two per subdimension), three for Perceived Value, and four for Sustainability Performance. The complete parcel structure is detailed in Table 1.
The composite reliability (CR) and average variance extracted (AVE) were then used to assess internal consistency and convergent validity. According to Jöreskog and Sörbom (1993), CR values exceeding 0.60 and AVE values above 0.50 indicate acceptable measurement reliability. As shown in Table 1, CR values for all constructs ranged from 0.89 to 0.92, and AVE values ranged from 0.68 to 0.72, confirming strong internal consistency and convergent validity.
In addition, all parcel factor loadings were statistically significant (p < 0.01) and exceeded the minimum threshold of 0.40 (Hair et al., 2019), further supporting convergent validity. Parcel-level indicators thus adequately captured the variance of their respective latent constructs.
Discriminant validity was evaluated by examining the inter-construct correlation matrix (Table 2). According to Fornell and Larcker (1981), discriminant validity is confirmed when the square root of the AVE for each construct exceeds its correlations with other constructs. Although AVE values are not displayed within the matrix, all inter-parcel correlations were well below 1.00 and ranged from moderate to strong (e.g., 0.48–0.72 between ESG and Perceived Value parcels), indicating acceptable conceptual distinction. Moreover, no correlation exceeded the critical threshold for multicollinearity or construct redundancy.
Taken together, the CFA results provided robust evidence of the reliability and validity of the measurement model at the parcel level. The use of item parceling proved effective in supporting model stability and construct clarity in a complex multidimensional SEM framework.

4.3. Model Fit Assessment

This study employed Structural Equation Modeling (SEM) with Maximum Likelihood Estimation (MLE) to assess the overall model fit and test the proposed structural relationships among the latent variables. Given the multidimensionality of the constructs and the large number of observed items, a full second-order model would have introduced excessive complexity, increased sample size requirements, and potentially reduced estimation stability and model fit (Little et al., 2013). Therefore, this study adopted an item parceling approach to streamline the model while maintaining theoretical rigor and statistical robustness.
The overall model fit was evaluated using three categories of fit indices:
Absolute Fit Indices: The chi-square to degrees of freedom ratio (χ2/df) was 1.594, well below the threshold of 5. The Goodness-of-Fit Index (GFI = 0.945) and Adjusted GFI (AGFI = 0.919) exceeded the recommended cutoff of 0.80. Additionally, the Root Mean Square Residual (RMR = 0.027) was below 0.08, and the Root Mean Square Error of Approximation (RMSEA = 0.046) was below the stringent standard of 0.06, indicating excellent absolute model fit.
Incremental Fit Indices: The Normed Fit Index (NFI = 0.931), Non-Normed Fit Index or Tucker-Lewis Index (NNFI = 0.912), Incremental Fit Index (IFI = 0.973), and Comparative Fit Index (CFI = 0.973) all exceeded the recommended threshold of 0.90, reflecting strong incremental model fit.
Parsimony Fit Indices: The Parsimony Goodness-of-Fit Index (PGFI = 0.727) and Parsimony Normed Fit Index (PNFI = 0.759) both exceeded the 0.50 threshold, indicating an acceptable balance between model complexity and explanatory power.
Collectively, these results confirm that the parcel-based SEM model exhibited a good overall fit to the data, supporting the adequacy and stability of the theoretical framework.

4.4. Hypothesis Testing

The results of the Structural Equation Modeling (SEM) confirmed all of the proposed hypotheses. As shown in Figure 2 and Table 3, ESG had a significant positive direct effect on Perceived Value (β = 0.725, p < 0.01), with an R2 value of 0.53, indicating that 53% of the variance in Perceived Value can be explained by ESG, thus supporting H1. ESG also had a significant direct effect on Sustainability Performance (β = 0.404, p < 0.01), with an R2 value of 0.56, supporting H2. Similarly, Perceived Value exerted a significant effect on Sustainability Performance (β = 0.402, p < 0.01), supporting H3.
To test for mediation, the indirect effect of ESG on Sustainability Performance through Perceived Value was examined. The results demonstrated a significant indirect effect (β = 0.291, 95% CI = [0.122, 0.488], p < 0.01), indicating that Perceived Value partially mediates the relationship between ESG and Sustainability Performance. The total effect of ESG on Sustainability Performance (β = 0.695, p < 0.01) was also significant, providing further support for H4.
Although ESG had a significant direct effect on Sustainability Performance, the strength of this path was moderated when Perceived Value served as a mediator, confirming a partial mediation model. This finding highlights the critical role of perceived value in translating ESG initiatives into sustainable business outcomes in the hospitality sector.

4.5. Discussion

The results of this study confirm and extend prior ESG research by highlighting both consistencies and divergences with the existing literature.
Consistent with previous studies, this research found that ESG practices significantly enhance employee-perceived value. This aligns with findings from Currás-Pérez et al. (2018) and Damais and Weaver (2023), who emphasized that stakeholders perceive higher emotional and ethical value when corporate actions reflect environmental and social responsibility. In the context of Taiwan’s green hotel industry, the social responsibility dimension of ESG was most salient to employees, similar to findings in service sectors where social initiatives have the greatest perceptual impact (Koh et al., 2002). However, while much prior research focused on external consumers, this study specifically validates the importance of internal employee perception, addressing a gap noted by Becker-Olsen et al. (2006) and Laukkanen and Tura (2022).
The positive relationship between ESG and sustainability performance also aligns with the Sustainable Balanced Scorecard framework (Figge et al., 2002; Nikolaou et al., 2013). Similar to prior research in hospitality (Bao et al., 2019; Liu et al., 2023), this study demonstrates that ESG initiatives improve not only environmental outcomes but also customer satisfaction and operational efficiency. However, unlike previous studies that focused primarily on external metrics or financial indicators, this research integrates employees’ perceptions as a critical component of sustainability outcomes.
A key contribution of this study is the confirmation that perceived value partially mediates the ESG–sustainability relationship. While prior studies have acknowledged ESG’s direct impact on performance (Marco, 2024; Velaoras et al., 2025), few have empirically tested perceived value as the mechanism that channels ESG into sustainable results. This finding expands on that by Zheng et al. (2022) by demonstrating that internal cognitive and emotional responses are pivotal to converting ESG strategies into practice, particularly in service industries like hospitality, where employee engagement shapes customer experience.
In summary, this study complements the existing ESG literature by confirming known relationships while advancing the discussion through the lens of internal stakeholder perceptions, particularly in Taiwan’s green hospitality sector.

5. Conclusions and Managerial Implications

5.1. Conclusions

This study investigated the relationships among ESG practices, employee-perceived value, and sustainability performance in the context of Taiwan’s green hotel industry. Building on prior research emphasizing the role of stakeholder alignment in ESG strategy (Becker-Olsen et al., 2006; Vargo & Lusch, 2004; Laukkanen & Tura, 2022), this research extended the current literature by incorporating internal stakeholders—particularly employees—into the ESG-performance linkage.
The Structural Equation Modeling results provided empirical support for all four proposed hypotheses. First, ESG practices were found to significantly enhance perceived value (β = 0.564, p < 0.001), confirming that environmentally and socially responsible initiatives increase employees’ sense of organizational credibility, purpose, and ethical alignment. This supports prior findings suggesting that internal stakeholders respond positively when ESG actions align with organizational identity and values (Damais & Weaver, 2023; Brohi et al., 2024).
Second, ESG practices had a direct, positive effect on sustainability performance (β = 0.289, p < 0.01), consistent with the theoretical proposition of the Sustainable Balanced Scorecard and empirical evidence from prior ESG research (Nikolaou et al., 2013; Liu et al., 2023).
Third, perceived value exerted a strong, significant influence on sustainability performance (β = 0.402, p < 0.001), highlighting the critical role of employees as internal agents of sustainability. This finding reinforces the argument that employee engagement, when rooted in personal value recognition, enhances both operational and strategic sustainability outcomes (Sairanen et al., 2024; N. H. Lin & Wu, 2019).
Finally, perceived value was shown to partially mediate the relationship between ESG and sustainability performance, supporting the conceptual view that ESG initiatives indirectly affect performance through value-based cognitive and behavioral mechanisms.
Overall, these findings contribute to the growing part of the literature pertaining to ESG by empirically validating the importance of internal stakeholder perceptions and offering a nuanced understanding of how ESG implementation translates into sustainable organizational outcomes.

5.2. Managerial Implications

First, companies should strengthen internal ESG communication and education, ensuring that employees fully understand the content, goals, and actual outcomes of ESG initiatives. Regular sustainability workshops, internal briefings, and digital platforms that provide real-time updates on ESG progress can help employees perceive ESG as directly relevant to their daily work, rather than merely an external branding tool.
Second, companies are encouraged to design employee-centered ESG participation programs. This study confirms that perceived value is a key driver of sustainability performance; therefore, providing employees with opportunities to engage in ESG actions—such as green innovation proposal contests, sustainability action days, or involvement in carbon reduction and community projects—can enhance emotional value and organizational identification. These practices also ensure that ESG actions are implemented in a meaningful and sustainable way.
Third, organizations should internalize ESG principles into corporate culture and daily management processes. The findings suggest that when employees see ESG as part of their routine responsibilities rather than an additional task, it leads to better sustainability performance. Companies are advised to integrate ESG indicators into performance appraisal systems, promote value-sharing through leadership role modeling, and facilitate continuous dialogue about ESG values to embed sustainability into organizational behavior.
Finally, ESG should be positioned as a core strategic priority, not a supplementary task. This study finds that aligning ESG with strategic business objectives enhances employees’ perceived value and organizational commitment. Managers should incorporate ESG into long-term corporate plans and regularly assess sustainability goals during decision-making processes. This strategic shift will help build sustainable competitive advantages and attract broader support from customers and stakeholders in a market that increasingly values environmental and social responsibility.

5.3. Limitations and Directions for Future Research

Due to difficulties in accessing the full population, this study adopted a convenience sampling approach for data collection. Consequently, the findings primarily reflect the perspectives of green hotel employees in southern Taiwan and may not be generalizable to the entire green hospitality sector across the country. Future research is recommended to extend this theoretical model to other regions of Taiwan to enhance the model’s credibility and practical applicability.
Additionally, this study employed a quantitative methodology using online questionnaires to construct and test the proposed theoretical framework. However, this approach may not fully capture employees’ in-depth thoughts and perspectives regarding their company’s ESG implementation. Future research is encouraged to incorporate qualitative methods, such as in-depth interviews or focus group discussions, to collect case-specific data. This would provide richer insights into employees’ perceptions of ESG, perceived value, and sustainable management practices within green hotels. Alternatively, a mixed-methods approach—beginning with quantitative analysis followed by qualitative validation—could offer a more comprehensive understanding and yield more robust findings, improving both theoretical and practical relevance.
Moreover, the green hotel list used in this study was exclusively sourced from Taiwan’s “Net Zero Green Life Information Platform” maintained by the Ministry of Environment. The selection criteria may not fully align with international green hotel standards. Future studies are advised to incorporate internationally recognized green hotel certifications as part of the sampling criteria. Identifying Taiwan’s green hotels that meet global benchmarks and conducting further quantitative or qualitative research could generate findings that align with international trends. This would also provide actionable guidelines for hospitality operators aiming to transition into certified green hotels, enhancing both competitiveness and sustainability.

Author Contributions

Conceptualization, C.-Y.L., W.-S.F. and M.-C.T.; methodology, C.-Y.L. and W.-S.F.; writing—original draft preparation, C.-Y.L. and W.-S.F.; writing—review and editing, W.-S.F.; methodology, C.-Y.L. and M.-C.T.; validation, C.-Y.L., W.-S.F. and M.-C.T.; formal analysis, C.-Y.L. All authors have read and agreed to the published version of the manuscript.

Funding

This research received no external funding.

Institutional Review Board Statement

Ethical review and approval were waived for this study, due to it complied with the exemption criteria outlined in the 2012 official letter issued by Taiwan’s Department of Health. The research does not involve human subjects, biological specimens, or de-identified data. Instead, it merely investigates the relationship between ESG, employees’ perceived value, and sustainable management in Taiwan’s green hotel industry through surveys.

Informed Consent Statement

Informed consent was obtained from all subjects involved in the study.

Data Availability Statement

The data presented in this study are available on request from the corresponding author due to restrictions aimed at ensuring the data are used solely for legitimate research purposes and in an appropriate context.

Conflicts of Interest

The authors declare no conflicts of interest.

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Tourismhosp 06 00153 g001
Figure 1. Conceptual Framework.
Figure 1. Conceptual Framework.
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Figure 2. Structural equation model with item parceling. Note. This SEM diagram represents parcel-level constructs. ESG includes six parcels; Perceived Value includes three; Sustainability Performance includes three. Path coefficients are standardized. ** p < 0.01.
Figure 2. Structural equation model with item parceling. Note. This SEM diagram represents parcel-level constructs. ESG includes six parcels; Perceived Value includes three; Sustainability Performance includes three. Path coefficients are standardized. ** p < 0.01.
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Table 1. Parcel groupings for latent constructs in the structural equation model.
Table 1. Parcel groupings for latent constructs in the structural equation model.
ConstructParcel ExampleCRAVE
ESGESG1_P1, ESG1_P2
ESG2_P1, ESG2_P2
ESG3_P1, ESG3_P2		0.920.68
PVPV_P1, PV_P2, PV_P30.890.72
SDSD_P1, SD_P2, SD_P30.910.70
Note. CR = Composite Reliability; AVE = Average Variance Extracted. All parcels were averaged from the validated item indicator.
Table 2. Correlation matrix among latent construct parcels.
Table 2. Correlation matrix among latent construct parcels.
ESG1_P1ESG1_P2ESG2_P1ESG2_P2ESG3_P1ESG3_P2PV_P1PV_P2PV_P3SD_P1SD_P2SD_P3
ESG1_P11.00
ESG1_P20.801.00
ESG2_P10.570.771.00
ESG2_P20.480.360.711.00
ESG3_P10.630.410.880.771.00
ESG3_P20.530.460.800.510.471.00
PV_P10.300.790.720.740.760.341.00
PV_P20.490.500.740.680.830.580.371.00
PV_P30.610.560.320.360.320.680.490.611.00
SD_P10.440.350.470.400.860.780.680.820.781.00
SD_P20.780.840.490.370.440.560.790.820.300.611.00
SD_P30.370.500.870.490.610.720.520.880.880.450.601.00
Note. ESG1_P1–ESG3_P2 = ESG Parcels; PV_P1–PV_P3 = Perceived Value Parcels; SD_P1–SD_P3 = Sustainability Performance Parcels. All values are Pearson correlation coefficients. Diagonal values are equal to 1 by definition. p < 0.01.
Table 3. Standardized direct, indirect, and total effects with 95% confidence intervals.
Table 3. Standardized direct, indirect, and total effects with 95% confidence intervals.
Independent VariablePerceived Value
(Dependent Variable)		Sustainability Performance
(Dependent Variable)
ESG
Direct Effect		0.725 **
(0.606–0.830)		0.404 **
(0.166–0.642)
Indirect Effect-0.291 **
(0.122–0.488)
Total Effect0.725 **
(0.606–0.830)		0.695 **
(0.585–0.786)
Perceived Value
Direct Effect		-0.402 **
(0.156–0.637)
Indirect Effect--
Total Effect-0.402 **
(0.156–0.637)
Note. The table presents standardized path coefficients derived from SEM analysis. Bootstrap confidence intervals (95%) are reported in parentheses. ** p < 0.01. The mediation effect of Perceived Value between ESG and Sustainability Performance is statistically significant.
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Lee, C.-Y.; Fan, W.-S.; Tsai, M.-C. The Mediating Role of Employee Perceived Value in the ESG–Sustainability Link: Evidence from Taiwan’s Green Hotel Industry. Tour. Hosp. 2025, 6, 153. https://doi.org/10.3390/tourhosp6030153

AMA Style

Lee C-Y, Fan W-S, Tsai M-C. The Mediating Role of Employee Perceived Value in the ESG–Sustainability Link: Evidence from Taiwan’s Green Hotel Industry. Tourism and Hospitality. 2025; 6(3):153. https://doi.org/10.3390/tourhosp6030153

Chicago/Turabian Style

Lee, Chang-Yan, Wei-Shang Fan, and Ming-Chun Tsai. 2025. "The Mediating Role of Employee Perceived Value in the ESG–Sustainability Link: Evidence from Taiwan’s Green Hotel Industry" Tourism and Hospitality 6, no. 3: 153. https://doi.org/10.3390/tourhosp6030153

APA Style

Lee, C.-Y., Fan, W.-S., & Tsai, M.-C. (2025). The Mediating Role of Employee Perceived Value in the ESG–Sustainability Link: Evidence from Taiwan’s Green Hotel Industry. Tourism and Hospitality, 6(3), 153. https://doi.org/10.3390/tourhosp6030153

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