This research aims to investigate how workforce-wide diversity, defined as the proportion of employees from underrepresented communities (URCs) across all organizational levels, influences consumer perceptions of environmental stewardship. The authors propose that consumers may interpret higher workforce-wide diversity as a signal of stronger environmental commitment. The authors further examine whether perceived social responsibility explains this relationship and whether it is stronger for smaller firms than for larger firms.
The research comprises three large-scale experiments conducted in the USA and Europe. Together, these studies test the proposed hypotheses across different contexts.
Firms with a higher percentage of employees from URCs are perceived as more committed to environmental stewardship. This relationship is explained by perceived social responsibility and is stronger for smaller firms than for larger firms.
This research extends the application of signaling theory to workforce diversity by showing that consumers may use workforce-wide diversity as a signal when judging a firm’s environmental values. It also improves understanding of how internal organizational characteristics influence consumer perceptions and identifies firm size as an important boundary condition.
The findings provide practical guidance for managers seeking to align diversity and sustainability communications. Smaller firms may benefit from communicating workforce diversity as part of their corporate responsibility efforts, whereas larger firms may need additional evidence of environmental commitment to strengthen consumer perceptions.
This study contributes to the workforce diversity literature by examining how workforce-wide diversity influences consumers’ perceptions of environmental stewardship through perceived social responsibility and under different firm-size conditions. It broadens understanding of how workforce diversity disclosures can shape sustainability-related consumer perceptions.
