The Impact of ESG Activity on Employees' Psychological Wellbeing and Intention to Participate: The Mediating Effect of Authenticity, Organizational Trust, and Identification

ABSTRACT This study examines how employees' recognition of environmental, social, and governance (ESG) activities affects their psychological well‐being and participation intention in ESG initiatives, focusing on the mediating roles of authenticity, organizational trust, and identification. Using survey data from 358 Korean employees in the financial industry, structural equation modeling was employed to test the hypotheses. The results revealed that ESG authenticity fully mediated the relationship between ESG recognition and organizational trust and identification, which subsequently enhanced employees' psychological well‐being and intention to engage in ESG programs. Organizational identification and trust were found to be key mechanisms through which authentic ESG initiatives contribute to positive employee outcomes. These findings underscore that employees' perceptions of the sincerity and integrity of ESG efforts are more influential than mere recognition of such activities. This study contributes to the literature on micro‐level ESG impacts by clarifying the psychological processes linking ESG perceptions to employee attitudes and behaviors.