Working to benefit a good cause could increase corporate productivity by 30%, according to findings published in Management Science.
“A lot of studies show how bonuses and stock options can improve performance,” Mirco Tonin, PhD, economist at the University of Southampton and lead author of the study, stated in a press release. “But our results provide empirical support that some workers are also motivated by advancing social causes through their efforts.”
Students at the University of Southampton in Southampton, England were asked to complete four 1-hour online data entry sessions over the course of a week. Productivity was measured by the accuracy and number of entries in each session.
All participants received the UK equivalent of about $30 for completing the sessions, but were divided into four groups with varying levels of added financial and social incentive. Some were given performance related pay, and others were given the opportunity to donate to a charity.
Findings showed that when workers were given the chance to donate, performance increased by 13%, and increased to 30% among those who were initially the least productive.
Productivity was further improved when workers could decide how much of their pay would be donated. On average, the workers gave 20%, with women being more generous than men.
“We found that offering subjects some discretion in choosing their own payment scheme leads to a substantial improvement in performance,” Tonin said. “This suggests that firms willing to introduce corporate giving programs may want to consider giving employees the opportunity to opt in.”
Tonin M. Management Science; 2014;doi:10.1287/mnsc.2014.1985