Newswise — AUSTIN, Texas — According to a recent study from The University of Texas at Austin's McCombs School of Business, individuals seeking employment with a philanthropic organization may experience hesitancy in negotiating for higher pay due to feelings of guilt.
"Social impact framing" is a term used by both for-profit and nonprofit organizations to highlight the societal benefits of their work, according to recent trends.
While companies may have pure motives when utilizing social impact framing, a recent research conducted by Insiya Hussain, an assistant professor of management at Texas McCombs, indicates that it could backfire on potential employees during salary negotiations. The study highlights that individuals who are exposed to such messaging may feel that requesting higher pay would go against the company's values.
Hussain stated, "This reflects a more extensive social trend of how we perceive money in the context of doing good. There's an unspoken assumption that money and altruism are incompatible, and that financial gain undermines attempts to do good. Even if job seekers do not necessarily endorse this viewpoint, they assume that recruiting managers do."
The study is currently available online in advance through the journal Organization Science.
The research team, consisting of Insiya Hussain, Marko Pitesa, and Michael Schaerer from Singapore Management University, and Stefan Thau from INSEAD, discovered that job applicants who were exposed to social impact framing were less likely to negotiate for higher salaries due to feeling uneasy about making such requests.
The study revealed that individuals who were exposed to social impact framing were concerned that requesting a higher financial reward when an organization emphasized altruistic goals would be viewed as inappropriate by those with hiring power, and could potentially result in negative perceptions of them.
The researchers refer to this attitude as a "self-censoring" effect, which is a new discovery in the field of research on social impact framing and wage demands. Prior studies have presumed that candidates forfeited pay for meaningful work, but Hussain and her colleagues demonstrate that this effect may be caused by job candidates feeling uneasy about negotiating in such situations.
It is unclear whether companies are deliberately employing social impact framing to suppress pay. However, the researchers suggest that managers should be mindful of its potential impact on human resources. They propose that if managers are educated on their motivation purity bias, they can better regulate their approach to prospective employees who inquire about financial rewards.
The researchers also suggest that managers create more transparency around company norms and values concerning compensation and offer job rewards based on objective criteria rather than salary negotiations.
Hussain commented, "Job candidates could contemplate whether companies that emphasize social impact are taking care of their own employees, financially or otherwise. Additionally, companies should not assume that extrinsically motivated workers are disinterested in the job and unwilling to work hard to achieve excellent performance."
Read the McCombs Big Ideas story.
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